OFG Bancorp reported results for the fourth quarter and full-year 2019, reflecting the previously announced acquisition of Scotiabank’s Puerto Rico and U.S. Virgin Islands operations.
OFG reported a net loss to shareholders of $2.3 million, or ($0.04) per share, which included $21.5 million in acquisition related merger and restructuring charges and $6.6 million in additional provision for non-performing loans the company decided to sell in the third quarter of 2019.
The fourth quarter 2019 results compare to the prior quarter’s net income available to shareholders of $5.8 million, or $0.11 per share fully diluted, and the fourth quarter of 2018’s net income of $23.1 million, or $0.45 per share.
“We ended 2019 on a high note, closing the Scotiabank acquisition at year-end as originally anticipated,” said OFG President José Rafael Fernández.
“We welcome our new team members and clients in Puerto Rico and U.S. Virgin Islands. We’re committed to providing excellent career opportunities to our new employees and excellent service, products, and technology to our new clients. We’re excited about the prospects for future growth,” he said.
During the last quarter of last year, OFG obtained all regulatory approvals, developed an integration plan, and closed on the $560 million cash acquisition of Scotiabank’s assets, (excluding settlement amounts), adding $2.2 billion in net loans and $3.0 billion in low cost, core deposits, it reported.
“The fourth quarter of 2019 was a very busy quarter, closing on the acquisition while continuing to build our existing business. Operationally, we had a strong quarter,” he said.
“We effectively managed the transition to slightly lower yields in the commercial loan portfolio, reflecting Federal Reserve rate cuts, with our pro-active effort to reduce high cost wholesale funding. Going forward, our funding mix will improve even further with our larger core deposit base,” Fernández said.
“We’re well positioned for 2020. The acquisition enabled us to more effectively use our excess capital and end 2019 with a record $6.6 billion in loans and a record $7.7 billion in deposits, which increases our ability to generate future growth,” he said.
“We’re moving fast, starting the year focused on integration and loan production, and look forward to reporting our progress in the quarters ahead,” Fernández.
Regarding the earthquakes, the executive said Oriental teams helped organized shelters and relief centers.
“In coordination and collaboration with several of our clients, we provided more than 4,000 meals, bottled water, batteries, electric fans and other essentials. We also arranged access to teams of doctors and structural engineers,” Fernández said.