Oriental reports $20.2M in net income for 2Q20, capitalizes on tech during pandemic
OFG Bancorp, the parent company of Oriental bank, reported net income available to common shareholders totaled $20.2 million or $0.39 per share fully diluted, for the second quarter ended June 30.
As other banks did, Oriental “faced a number of Covid-19 pandemic related challenges during the second quarter, but acting promptly and with foresight, we generated excellent results,” said OFG Bancorp CEO José Rafael Fernández.
“Governments in Puerto Rico and the U.S. Virgin Islands shut down their respective economies in mid-March. Restrictions eased in late May, but recent spikes in contagions have forced Puerto Rico to scale down the flexibility,” he said.
“Results were also impacted by the Federal Reserve Bank 150 bps rate cut in March. All of this followed the Puerto Rico earthquakes in January and occurred while we are in the process of integrating the Scotiabank acquisition,” he added.
In a conference call to discuss the quarterly results, Fernández said once it gets past the COVID-19 emergency, “Puerto Rico stands to benefit significantly from COVID stimulus and still unspent, undistributed [Hurricane] María and earthquake related stimulus programs [funds].”
“At OFG, we believe our results and our history demonstrate our ability to quickly respond and adapt to changing economic environments. During the second quarter, we continued to build momentum in our core businesses and develop a good pipeline of new loans,” Fernández said.
Meanwhile, he said the bank has also capitalized on the use of technology from its retail and business customers since the onset of the emergency in mid-March.
“Online bill pay enrollment were up 12% as of March and 24% as of June. Mobile banking users jumped 17% by the end of the second quarter from the beginning of the first,” he said.
“The numbers of remote deposit capture users are up 68% from the end of March. In another area of success for us, during the second quarter, we scheduled more than 18,000 COVID safe appointments with our customers through our online and mobile tool,” Fernández added.
“Technology is a core part of our overall corporate strategy. We continue to look into new ways and innovative ways to use it to help our customers,” the executive said.
During the second quarter, Oriental generated a total of $286 million in U.S. Small Business Administration-backed loans through the Payroll Protection Program.
“This enabled us to help more than 4,000 small businesses save more than 50,000 jobs,” said Fernández, during the call. “It also enabled us to attract new accounts in this strategically important customer base. And we were able to distribute these funds electronically within five days of application approval.”
During the call, he provided an update of Oriental’s acquisition of the former ScotiaBank, which he said should be fully integrated by the end of the year.
“We must achieve the full benefits of the acquisition by the end of 2021,” he said.