Oriental Bank achieves ‘historic’ quarter with record assets, loan growth
OFG Bancorp, the parent company of Oriental Bank, reported a historic second quarter for 2025, driven by record asset levels, robust loan originations and growing wealth and mortgage servicing portfolios.
José Rafael Fernández, the company’s CEO, emphasized the significance of the performance, calling it “a very strong quarter for Oriental.”
“We grew our assets and are now a bank with $12 billion in assets, a record for us, $8 billion in loans, also a record for us,” Fernández said. “We grew the portfolio of assets we manage in the wealth management business to almost $5 billion. And in mortgage loan servicing, we closed with $5.6 billion.”
For the quarter ended June 30, OFG Bancorp reported diluted earnings per share of $1.15, up from $1 in the previous quarter and $1.08 a year ago. Total core revenues reached $182.2 million, reflecting increases across mortgage banking, wealth management and lending.
Loan originations for the quarter totaled $784 million, nearly 30% of which were commercial loans in Puerto Rico. Fernández attributed this to a mix of delayed first-quarter closings, increased usage of lines of credit and heightened investment activity by businesses positioning for growth.
“All of this points to an equation that tells you… Puerto Rico’s economy is stable, solid,” he said.
Fernández noted that these were primarily new loans — “new clients or new loans from existing clients” — rather than refinancings.
“We’re the only bank that communicates this,” he added.
Total loans held for investment stood at $8.18 billion, a 4.2% increase over the first quarter and 7.08% year-over-year. Auto loan originations also saw a boost, reaching $250 million, driven by consumer response to news about tariffs and vehicle availability, he said.
Fernández projected this segment would normalize to the usual $200 million to $230 million range in the second half of the year.
On the funding side, customer deposits grew to $9.9 billion, up $138.7 million from the previous quarter. The bank also bolstered its liquidity with $200 million in new FHLB advances and $82.5 million in additional brokered deposits to support strategic lending growth.
Net interest margin stood at 5.31%, one of the strongest in U.S. banking. OFG also reported a return on average assets of 1.73% and return on average tangible common equity of 16.96%.
“From a financial perspective, we had a return on assets of 1.7%, a return on common equity of 17%, also among the best in U.S. banking,” Fernández noted. “And our equity is 14%, in other words, we still have a very strong capital base that helps us repurchase shares in the market.”
Operationally, the bank launched new digital tools, including the Oriental Marketplace and a DGI Money Market fund, to enhance customer experience and efficiency. OFG also repurchased 186,024 shares during the quarter.
In terms of credit quality, net charge-offs declined to $12.8 million, down from $20.4 million in the previous quarter. The bank’s early and total delinquency rates stood at 2.46% and 3.59%, respectively, while the nonperforming loan rate was 1.19%.
Fernández acknowledged that while Puerto Rico’s broader economic indicators point to modest growth, underlying trends reveal stronger momentum.
“Although the economic numbers show small growth, the reality is that we’re coming out of such a severe economic contraction… economic activity is being diluted by the crater we need to fill in the last 10 years, compared to the economy that contracted 20%,” he said.
