Popular Inc. reports $218.1M in net income in 2Q21
Popular Inc., parent company of Banco Popular de Puerto Rico, reported $218.1 million in net income for the second quarter ended June 30, 2021, compared to the $127.6 million on record for the same period in 2020, representing $90.5M in year-over-year growth.
The most recent figure compares to $262.6 million in net income reported for the first quarter ended March 31, 2021.
“The second quarter was another strong quarter in which we achieved net income of $218 million. Our results reflect the continued rebound in economic activity and the unprecedented level of federal stimulus,” said Popular Inc. CEO Ignacio Álvarez on a call with investors to discuss the latest results. “They also reflect our diversified sources of revenue and prudent risk management.”
The second quarter’s results include a release of the allowance for credit losses of $17 million driven by improving credit quality and the improved macroeconomic outlook, bank officials said.
Net Interest income was $487.8 million, an increase of $36.9 million over the same year-ago second quarter and of $8.7 million compared to this year’s first quarter, mainly due to additional funds invested from the increase in deposits, the bank said.
“Deposit balances grew by $5.9 billion and excluding forgiveness of Paycheck Protection Program loans, we saw a small increase in our period end loans, led by strong auto loan originations in Puerto Rico,” Álvarez said.
During the second quarter of 2021, Popular Inc. also continued to return capital to shareholders. On May 3, 2021, the corporation announced it had entered into an accelerated share repurchase agreement to repurchase an aggregate of $350 million of Popular’s common stock.
Under the terms of the Agreement, on May 4, 2021, the corporation made an initial payment of $350 million and received an initial delivery of 3,785,831 shares of Popular’s Common Stock.
“While we’re extremely pleased with the results for the first half of the year, we remain attentive on how the evolving health situation may impact the economic recovery,” he said.
During a call with members of the local media, Álvarez confirmed that it will be calling most of its personnel back to work in-person, particularly managers and supervisors, on Aug. 16. The rest of the employees, with some exceptions, are being called back to their offices the day after Labor Day.
As for Banco Popular, it reported net interest income of $419.2 million for the second quarter ended June 30, 2021, compared to $387.2 million for the same quarter ended June 30, 2020, and $410.3 million in the first quarter in 2021.