Popular earns $211M, sees growth in auto leasing, loans
Popular Inc. reported net income of $211.3 million for the third quarter of 2025, compared with $210.4 million in the second quarter and $155.3 million a year earlier, as the financial institution continued to post steady growth across its lending and consumer segments.
Basic earnings per share were $3.15 and diluted $3.14, up 45% from $2.16 a year earlier and slightly higher than $3.09 in the prior quarter. The rise reflected stronger net interest income, margin expansion and expense management.
Chief Executive Javier Ferrer said the results reflected “continued expansion of core businesses, higher revenues and discipline in expense management.” He reaffirmed the company’s focus on strengthening customer relationships, improving efficiency and delivering sustainable returns.
Net interest income increased 12.9% year over year to $646.5 million, up from $572.5 million, while the bank’s net interest margin expanded to 3.51%, or 3.9% on a taxable-equivalent basis, compared with 3.24% and 3.47% last year. Popular attributed the improvement to a stronger asset mix and higher yields on loans and U.S. Treasury securities, partly offset by modest increases in deposit costs.
Noninterest income rose 4.3% to $171.2 million, driven by service fees and card-related revenues. Operating expenses climbed 6% to $495.3 million, reflecting higher technology investments, deposit-insurance costs and personnel expenses tied to modernization projects. Income before tax rose 25% to $247.3 million, while income-tax expense dropped to $36 million, lowering the effective tax rate to 14.5%.
Puerto Rico results
At Banco Popular de Puerto Rico, the company’s main subsidiary, net income rose 36% to $196.4 million from $144.7 million a year earlier, fueled by growth in commercial, mortgage and consumer lending. Total assets stood at $75.1 billion, a decrease of about $1 billion from the previous quarter, while loans held in portfolio increased to $38.7 billion, up $502 million from the second quarter.
Credit quality remained stable overall, though nonperforming loans increased to $502.2 million, or 1.3% of total loans, because of two isolated commercial exposures — a $158.3 million telecommunications credit in Puerto Rico and a $30.1 million hotel-related loan in Florida. Those cases contributed to a $75.1 million provision for credit losses, up 5% from $71.4 million a year earlier.
“These are very isolated situations that we’re not worried about having an impact,” said Chief Financial Officer Jorge A. García.
In the BPPR segment, net charge-offs increased $16.4 million, largely tied to a $13.5 million charge-off from the Florida loan. Consumer charge-offs rose $3.7 million, reflecting higher auto-loan losses, while credit-card charge-offs decreased $2 million.
García said the rise in consumer charge-offs coincides with growing demand for auto leasing, noting that the average new-car price in Puerto Rico now hovers around $45,000. “We’ve seen a noticeable increase in the use of the auto-leasing product,” he said.
Deposits totaled $66.5 billion, down $704 million from the prior quarter, mainly from lower Puerto Rico public deposits, though average quarterly deposits increased $793 million. The Common Equity Tier 1 (CET1) capital ratio stood at 15.79%, compared with 16.42% a year earlier.
Tangible book value per share rose 14.6% to $79.12. During the quarter, Popular repurchased 1 million shares for $119.4 million at an average price of $119.33 and raised its quarterly dividend to $0.75 per share, up from $0.70.
As the U.S. government shutdown continues, Popular said the bank is monitoring possible effects on customers, particularly the roughly 21,000 federal employees in Puerto Rico.
“We’re treating this like any other emergency — the same way we would respond to a hurricane or the pandemic,” Ferrer said. “If the shutdown extends, we’re prepared to support customers with payment plans and financial-relief measures.”
García said Popular has not observed major interruptions in federal mortgage programs such as FHA guarantees, though Small Business Administration lending has faced delays.
“It’s important to note that although we’ve seen interruptions, for example, in SBA programs, we’re not seeing interruptions in mortgage programs like FHA, guarantees of that type, so there’s no impact on the ability to support mortgage originations,” he said.
Popular closed the quarter with a return on average assets of 1.09%, up from 0.84% a year earlier, and a return on average common equity of 11.6%, compared with 8.8% in 2024.
“We remain focused on executing our strategic objectives and building long-term value for our shareholders and the communities we serve,” Ferrer said. “Our performance this quarter reflects the resilience of our franchise, the strength of our people, and our readiness to assist Puerto Rico’s economy in any circumstance.”
