Popular Inc. posts $210M Q2 profit, up 18.4% vs. Q2 2024
Popular Inc. reported net income of $210.4 million for the second quarter of 2025, an 18.4% increase from the $177.8 million during the same period in 2024 and a similar jump from the $177.5 million reported for the first quarter of 2025.
Earnings per share rose to $3.09 from $2.47 a year earlier, reflecting a stronger performance across core business segments, particularly Banco Popular de Puerto Rico (BPPR).
Total net interest income reached $631.5 million, up 11.1% from $568.3 million in the same quarter last year. On a taxable equivalent basis, net interest income climbed to $697.2 million, compared to $624.2 million the prior year.
The corporation’s net interest margin increased to 3.49%, compared with 3.33% in the year-ago period, driven by higher yields from U.S. Treasury securities and strong loan growth.
“We delivered strong performance in the second quarter, highlighted by higher net interest income, an expanding net interest margin, healthy loan and deposit growth and improved credit quality,” said CEO Javier D. Ferrer, during his first meeting with reporters in his new executive post.
“Our focus continues to be on executing our transformation, ensuring we are the No. 1 bank for our customers while simplifying our operations to improve efficiency,” he said.
At the segment level, BPPR contributed $538.5 million in net interest income, up from $488.7 million in the second quarter of 2024. Its net interest margin grew to 3.68%, bolstered by improved loan yields and declining deposit costs. The bank’s loan portfolio rose by $680.4 million quarter over quarter, with notable growth in commercial and mortgage lending.
Meanwhile, Popular Bank (PB), the institution’s U.S. mainland subsidiary, also posted gains. Net interest income rose to $102.2 million from $86.8 million a year earlier, while its net interest margin expanded to 2.93% from 2.38%.
Operating expenses increased 4.9 percent year over year to $492.8 million, driven by higher personnel costs and credit card-related promotions. The bank cited performance-based incentives, health insurance costs and a $13 million profit-sharing contribution as the main contributors to the rise.
During the call with reporters, Ferrer said the bank’s goal is to distribute $40 million to employees this year, which is the first time the bank will do so since 2022, when it paid out some $30 million in incentives to about 8,000 employees.
“But we’re telling employees, we’ve achieved great things this first half of the year but we can’t drop the ball now. We must continue putting in the work every day, which will allow us to pay out the most,” Ferrer said, confirming that the employee bonus is split between a cash payment and a contribution to retirement accounts.
Credit quality improved notably. Nonperforming loans (NPLs) dropped to $311.6 million from $341.8 million a year ago. Net charge-offs fell to $42.2 million from $53.6 million a year ago, while the annualized charge-off rate declined to 0.45% from 0.61%.
Nonperforming loans, credit losses down
At BPPR, the NPL ratio dropped to 0.82%. Net charge-offs were $40.2 million, down from $49.3 million in the same period last year. The allowance for credit losses stood at $769.5 million, representing 2.02% of loans held in portfolio, slightly lower than 2.05% last year, but with stronger coverage of NPLs (246.9% versus 213.6%).
Deposits grew to $67.2 billion, up $1.7 billion over the second quarter of 2024, led by growth in Puerto Rico public deposits, which totaled $20.9 billion at quarter-end. Loans held in portfolio rose 7.3% year over year to $38.2 billion, with consistent expansion across commercial, construction, mortgage and auto lending.
Total assets reached $76.1 billion as of June 30, 2025, an increase of $3.3 billion from a year ago. Investment securities increased to $28.3 billion from $26.7 billion, largely due to a higher allocation to U.S. Treasury holdings.
During the quarter, Popular Inc. repurchased 1.1 million shares for $112 million, bringing total repurchases under the current authorization to $451.5 million. A new $500 million share buyback program was announced, reflecting the company’s continued focus on shareholder returns. The quarterly dividend also increased from 70 cents to 75 cents per share.
Shout-out to Bad Bunny
Popular Inc. executives joined other members of the economy acknowledging the positive effects that the 30-show residency by Puerto Rican artist Benito Antonio Martínez-Ocasio — Bad Bunny — has had on the island’s main sectors.
Ferrer said the “true impact” to the bank — whose headquarters are adjacent to the Coliseo de Puerto Rico where the performances are taking place every weekend through Sept. 30 — will be seen after the residency is over in terms of credit card usage and other marketing campaigns underway.
Still, he acknowledged the artist’s role in boosting tourism and economic activity during the island’s traditionally slower season.
