Oriental Bank, one of only several financial institutions doing business in Puerto Rico that weathered last year’s banking debacle, reported $13.1 million in net income for the first quarter of 2011, up 4.7 percent from the same period last year.
“Our core banking and wealth management operations continued to perform well during the quarter, and we experienced a strong rebound in net interest income,” said Oriental CEO José Rafael Fernández.
Wealth management revenues, one of the bank’s core business segments” increased 17.5 percent year over year, attributed to growth in brokerage and trust, and a successful Individual Retirement Account campaign earlier this year. Assets under management grew 35 percent year over year, to $4 billion.
“Core retail deposits continued to grow, and we continued to build a good pipeline of quality commercial banking prospects,” Fernández said. “At the same time, the cost of retail deposits, the total provision for loan and lease losses, and non-interest expenses, all declined, resulting in a 58 percent increase in net interest income after provision for loan and lease losses and a 120 percent increase in pre-tax operating income.”
Oriental’s favorable results also had to do with an increase in service revenues and total loans stemming from its acquisition last year of Eurobank’s assets, after the Federal Deposit Insurance Corp. closed it in April 2010.
While service revenues increased 136.4 percent as a result of the expanded branch network, total loans more than doubled at 53.1 percent to $1.7 billion as a result of the Eurobank acquisition. There was also an increase of 13.5 percent and 69 percent, respectively, in commercial and consumer loans, Oriental reported.
“Amid signs that the economy may be stabilizing, and that loan and deposit pricing are becoming more rational, Oriental remains on track to increase its market share this year in the commercial lending business in Puerto Rico,” Fernández said.
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