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Press release from Business Wire

Popular, Inc. Reports Net Income of $83.9 million for the Fourth Quarter and $245.3 million for the Year Ended December 31, 2012

<ul> <li class='bwlistitemmargb'> <b>Significant progress in credit quality (excluding covered loans):</b> <ul> <li class='bwlistitemmargb'> <b>Non-performing loans held-in-portfolio declined by $125.4 million or 8% from Q3 2012, and down 39% from Q3 2010 peak; lowest level since Q2 2009; </b> </li> <li class='bwlistitemmargb'> <b>Inflows of commercial, construction and legacy non-performing loans held-in-portfolio for Q4 2012 down by $72.9 million, or 51%, from Q3 2012, and down $401.9 million, or 47%, year over year;</b> </li> <li class='bwlistitemmargb'> <b>Non-performing assets decreased by $384.4 million, or 18%, year over year;</b> </li> <li class='bwlistitemmargb'> <b>Net charge-offs of $100.9 million for Q4 2012, vs. $95.8 million for Q3 2012, and $126.0 million for Q4 2011;</b> </li> <li class='bwlistitemmargb'> <b>Net charge-offs declined $131.3 million, or 25%, year over year.</b> </li> </ul> </li> <li class='bwlistitemmargb'> <b>Net interest margin increased to 4.41% in Q4 2012 </b> </li> <li class='bwlistitemmargb'> <b>Average balance of non-covered loans grew by $361.1 million in Q4 2012, reflecting strong mortgage and commercial originations in Puerto Rico and purchases of high-quality U.S. mortgages </b> </li> <li class='bwlistitemmargb'> <b>Common Equity Tier 1 ratio of 13.18% and Tangible Book Value per Share of $32.55 at December 31, 2012; capital exceeds well-capitalized threshold by $1.9 billion </b> </li> </ul>

Thursday, January 24, 2013

Popular, Inc. Reports Net Income of $83.9 million for the Fourth Quarter and $245.3 million for the Year Ended December 31, 201208:00 EST Thursday, January 24, 2013 SAN JUAN, Puerto Rico (Business Wire) -- Popular, Inc. (“the Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $83.9 million for the quarter ended December 31, 2012, compared with net income of $47.2 million for the quarter ended September 30, 2012. Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: “Our fourth quarter results reflect the strength of our core businesses and market positions, significant further declines in non-performing loans and increases in our already strong capital ratios. In 2013, we remain focused on driving value through further progress on all these fronts and continuing to increase our strategic and financial flexibility.” Significant events for the quarter ended December 31, 2012 During the month of December 2012, the Corporation received a $24.2 million cash dividend from its investment in EVERTEC's parent company. Also, the Corporation recorded pre-tax income of approximately $31.6 million related to its proportionate share of a tax benefit from a tax grant received by EVERTEC from the Puerto Rico Government. The Corporation's equity investment balance in the entity stands at $73.9 million as of year-end. The Corporation's participation interest in the entity was 48.5% as of December 31, 2012. Earnings Highlights                   Quarters ended Years ended (Dollars in thousands, except per share information)   31-Dec-12   30-Sep-12   31-Dec-11 31-Dec-12   31-Dec-11 Net interest income $ 350,411 $ 343,426 $ 344,780 $ 1,372,619 $ 1,431,992 Provision for loan losses – non-covered loans 86,256 83,589 123,908 334,102 430,085 Provision for loan losses – covered loans [1]   (3,445)   22,619   55,900 74,839   145,635 Net interest income after provision for loan losses 267,600 237,218 164,972 963,678 856,272 FDIC loss share (expense) income (36,824) (6,707) 17,447 (56,211) 66,791 Other non-interest income 169,825 122,416 131,912 522,553 493,486 Operating expenses   296,747   290,355   311,093 1,211,148   1,150,297 Income before income tax 103,854 62,572 3,238 218,872 266,252 Income tax expense (benefit)   19,914   15,384   263 (26,403)   114,927 Net income   $ 83,940   $ 47,188   $ 2,975 $ 245,275   $ 151,325 Net income applicable to common stock   $ 83,009   $ 46,257   $ 2,044 $ 241,552   $ 147,602 Net income per common share - basic and diluted [2]   $ 0.81   $ 0.45   $ 0.02 $ 2.35   $ 1.44   [1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements.   [2] Per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. Financial Impact of FDIC-Assisted Transaction         Quarters ended   Years ended (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11 31-Dec-12   31-Dec-11           Income Statement Interest income on covered loans $ 76,998 $ 70,584 $ 88,424 $ 301,441 $ 412,678 Total FDIC loss share (expense) income (36,824) (6,707) 17,447 (56,211) 66,791 Other non-interest income 281 310 1,092 1,211 12,810 Provision for loan losses   (3,445)   22,619   55,900 74,839   145,635 Total revenues less provision for loan losses   $ 43,900   $ 41,568   $ 51,063 $ 171,602   $ 346,644   Balance Sheet Loans covered under loss-sharing agreements with FDIC $ 3,755,972 $ 3,903,867 $ 4,348,703 FDIC loss share asset 1,399,098 1,559,057 1,915,128 FDIC true-up payment obligation   111,519   103,189   98,340 See additional details on accounting for FDIC-Assisted transaction in Table O. Net interest income Net interest margin for the fourth quarter of 2012 increased 4 basis points to 4.41% when compared with the third quarter of 2012. Net interest income reached $350.4 million, an increase of $7.0 million from the third quarter. The main drivers of the improvement in net interest margin are: Increase of $6.4 million in interest income on the covered loan portfolio. The higher yield of the covered loan portfolio was mainly the result of a substantial reduction in expected losses and the resolution of certain commercial loans in excess of their book value. Decrease of approximately $2.1 million, or 3 basis points, in interest expense on deposits, reflecting continuing progress in repricing the deposit base and a decrease in the average balance of deposits, mainly in brokered and non-brokered certificates of deposit. Decrease of approximately $1.8 million, or 24 basis points in interest expense on notes payable, driven by replacing long-term FHLB advances with brokered certificates of deposit and repurchase agreements at a lower cost. Banco Popular de Puerto Rico's (BPPR) net interest margin increased 7 basis points from 5.11% in the third quarter to 5.18% in the fourth quarter. Net interest income amounted to $309.1 million for the quarter ended December 31, 2012, compared with $300.9 million for the previous quarter. The improvement was mainly the result of higher interest income from covered loans and a lower cost of borrowings as mentioned above. Banco Popular North America (BPNA) earned $68.5 million in net interest income for the quarter ended December 31, 2012 compared with $69.6 million in the previous quarter. The decrease in the net interest margin of 6 basis points to 3.51% was mainly caused by a decrease in the yield of commercial and mortgage loans and of investment securities due to prepayments, partially offset by a 12 basis point reduction in the cost of interest-bearing deposits. Provision for Loan Losses               Quarters ended Years ended (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11 31-Dec-12   31-Dec-11 Provision for loan losses - non-covered loans BPPR $ 78,092 $ 69,738 $ 88,128 $ 282,061 $ 341,596 BPNA     8,164       13,851     35,780   52,041     88,489 Total provision for loan losses- non-covered loans     86,256       83,589     123,908   334,102     430,085 Provision (reversal) for loan losses - covered loans     (3,445 )     22,619     55,900   74,839     145,635 Total provision for loan losses   $ 82,811     $ 106,208   $ 179,808 $ 408,941   $ 575,720 The provision for loan losses for the fourth quarter of 2012 amounted to $82.8 million, a decrease of $23.4 million versus the previous quarter, mainly driven by lower provision for the covered loan portfolio. The provision for loan losses for the non-covered loan portfolio increased by $2.7 million from third quarter 2012. The provision for loan losses for non-covered loans at BPPR increased by $8.4 million from the third quarter of 2012, primarily reflecting higher net charge-offs in the commercial loan portfolio mainly related to one particular relationship. The provision for loan losses at BPNA operations decreased by $5.7 million from the third quarter of 2012, primarily due to continued improvements in credit trends. The provision for loan losses on the covered loan portfolio decreased by $26.1 million from the third quarter 2012, driven primarily by loans accounted for pursuant to ASC 310-30. The provision for loan losses for loans accounted under ASC 310-30 was $1.6 million for the fourth quarter of 2012, compared with $17.9 million for the previous quarter. The $16.3 million decrease was mostly due to certain commercial and construction loan pools, which reflected lower expected loss estimates for the fourth quarter of 2012. Overall expected losses on the covered portfolio continue to be lower than originally estimated. The provision for loan losses on covered loans accounted under ASC 310-20 declined by $9.8 million from the previous quarter, primarily driven by a reduction in the specific reserve of a particular commercial loan relationship. Non-interest income Non-interest income increased by $17.3 million versus the third quarter, driven primarily by the following items: A $37.9 million increase in other operating income principally due to $31.6 million of income recorded from the Corporation's interest in EVERTEC during the fourth quarter related to its proportionate share of a tax benefit from a tax grant received by EVERTEC from the Puerto Rico Government. An $11.7 million increase in net gain on sale of loans as a result of higher gains on securitization transactions at BPPR and sales of U.S. commercial loans held-for-sale. Reduction of $5.5 million in adjustments to the indemnity reserves on loans sold, mainly as a result of improvements in delinquency trends of mortgage loans serviced subject to credit recourse as well as a declining portfolio and lower provision in the representations and warranties reserve in the U.S. mainland. The Corporation stopped selling loans subject to credit recourse in 2009. These increases were partially offset by: An increase of $3.7 million in trading account losses mainly driven by lower gain on sale of trading securities. During the third quarter the Corporation sold approximately $140.7 million in trading mortgage-backed securities which resulted in a gain on sale of approximately $3.4 million, net of hedging costs. Also, during the fourth quarter there were higher unrealized losses on trading mortgage-backed securities due to higher prepayment rates and higher realized and unrealized losses of local municipal bonds due to rating downgrades of municipal agencies in Puerto Rico. An increase of $30.1 million in FDIC loss-share expense, principally caused by higher amortization of the loss-share asset due to lower expected losses, a release of allowance for loan and lease losses during the fourth quarter and higher unfavorable fair value adjustments of $5.3 million in the true-up payment obligation. See additional details about covered portfolio and FDIC indemnity asset in Table O. Refer to table B for further details.Operating expenses Operating expenses increased by $6.4 million versus the third quarter, driven primarily by the following items: An increase of $4.8 million in personnel costs, driven mainly by sales incentives, retail commissions, training expenses and other compensation costs. An increase of $2.5 million in net occupancy expenses related to higher expenses at BPNA for property maintenance and repair and rent and higher real property taxes in the Puerto Rico and U.S. operations. An increase of $4.8 million in professional fees mainly due to appraisal and programming costs, processing fees, and other technology costs related to services from EVERTEC. An increase of $1.9 million in business promotion expenses tied to year-end institutional campaigns in Puerto Rico and higher expenses in customer affinity programs. An increase of $9.0 million in other operating expenses due mainly to higher costs associated with the Westernbank covered loan portfolio, of which 80% are reimbursable by the FDIC, and higher provision for operational losses in the Puerto Rico and US operations. These costs were partially offset by a lower provision for unused commitments at BPPR. These increases were partially offset by: Lower FDIC deposit insurance expenses of $10.5 million, driven mainly by revisions in the deposit insurance premium calculation and efficiencies achieved from the internal reorganization of Popular Mortgage into BPPR. A $4.8 million decrease in other real estate owned (OREO) expenses, driven mainly by higher gains on sales of commercial properties at both BPPR and BPNA. This decrease was partially offset by an increase in fair value adjustments for commercial properties in BPPR. Non-personnel credit-related costs, which include collections, appraisals, credit related fees, and OREO expenses, amounted to $14.1 million for the fourth quarter of 2012, compared with $18.1 million for the third quarter of 2012. The decrease was principally due to higher gains on sales of commercial OREOs at both BPPR and BPNA, partially offset by an increase in unfavorable fair value adjustments for commercial properties at BPPR. Full-time equivalent employees (“FTEs”) were 8,072 as of December 31, 2012, compared with 8,074 as of September 30, 2012 and 8,329 as of December 31, 2011. The decline in FTEs is largely due to the retirement window for qualifying employees that was announced in October 2011 and implemented during the first quarter of 2012. When compared with the fourth quarter of 2011, salary expenses are down $2.2 million, or approximately $8.8 million on an annualized basis. For a breakdown of operating expenses by category refer to table B.Income taxes Income tax expense amounted to $19.9 million for the quarter ended December 31, 2012, compared with an income tax expense of $15.4 million for the third quarter of 2012. Credit Quality:Non-Performing Assets               (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11 Total non-performing loans held-in-portfolio, excluding covered loans   $ 1,425,133   $ 1,550,500   $ 1,737,850 Non-performing loans held-for-sale 96,320 108,886 262,302 Other real estate owned (“OREO”), excluding covered OREO     266,844       252,024       172,497   Total non-performing assets, excluding covered assets 1,788,297 1,911,410 2,172,649 Covered loans and OREO     213,469       208,235       192,771   Total non-performing assets   $ 2,001,766     $ 2,119,645     $ 2,365,420   Net charge-offs for the quarter (excluding covered loans)   $ 100,854     $ 95,791     $ 126,045     Ratios (excluding covered loans):             Non-performing loans held-in-portfolio to loans held-in-portfolio 6.79 % 7.47 % 8.44 % Allowance for loan losses to loans held-in-portfolio 2.96 3.07 3.35 Allowance for loan losses to non-performing loans, excluding loans held-for-sale     43.62       41.04       39.73   Credit quality continues to improve as the Company addresses its non-performing loan balances and manages asset exposures. Non-performing loans (NPL) held-in-portfolio declined by $125.4 million, or 8%, from the third quarter of 2012 and were 39% lower than peak levels in the third quarter of 2010. The reduction in NPLs was principally attributed to a decrease of $90.0 million in Puerto Rico commercial NPLs. Inflows of commercial, construction and legacy non-performing loans held-in-portfolio decreased by $72.9 million, or 51%, from the third quarter as underlying credit performance continues to improve due to successful efforts in managing early delinquency and greater economic stability. OREO, excluding covered OREO, increased by $14.8 million from the third quarter, as a result of continuing efforts to aggressively resolve non-performing loans. Net charge-offs for the fourth quarter were $100.9 million, compared with $95.8 million for the previous quarter. The increase was principally driven by higher commercial and mortgage net charge-offs of $4.5 million and $4.9 million at BPPR, respectively, offset in part by lower losses in BPNA loan portfolios. Refer to Table J for further information on net charge-offs and related ratios. The ratio of allowance for loan losses to loans held-in-portfolio, excluding covered loans, stood at 2.96% as of December 31, 2012, compared with 3.07% as of September 30, 2012. The general and specific reserves related to non-covered loans totaled $510.6 million and $111.1 million at quarter-end, compared with $528.9 million and $107.4 million, respectively, as of September 30, 2012. The decrease in the allowance for loan losses is driven by the improvement in credit quality and stability in net charge-offs. Credit Quality by Segment   (In thousands) Quarters ended BPPR   31-Dec-12   30-Sep-12   31-Dec-11 Provision for loan losses   $ 78,092   $ 69,738   $ 88,128 Net charge-offs 78,050 71,041 78,309 Total non-performing loans held-in-portfolio, excluding covered loans 1,191,982 1,284,026 1,371,242 Allowance/ non-covered loans held-in-portfolio     2.92 %     2.96 %     3.06 %   Quarters ended BPNA   31-Dec-12   30-Sep-12   31-Dec-11 Provision for loan losses   $ 8,164   $ 13,851   $ 35,780 Net charge-offs 22,804 24,750 47,736 Total non-performing loans held-in-portfolio, excluding covered loans 233,151 266,474 366,608 Allowance/ non-covered loans held-in-portfolio     3.07 %     3.35 %     4.11 % BPPR Segment The provision for loan losses for the non-covered loan portfolio increased by $8.4 million from the third quarter 2012, mainly due to higher net charge-offs in the commercial loan portfolio. Net charge-offs, excluding covered loans, increased by $7.0 million from the third quarter 2012, principally due to increases in commercial loans net charge-offs of $4.5 million, mainly due to one particular relationship, and $4.9 million increase in mortgage loans net charge-offs. Total non-performing loans held in portfolio, excluding covered loans, decreased by $92.0 million from the third quarter 2012. This decrease was mainly driven by a decline in commercial NPLs of $90.0 million. Continued aggressive collection and loss-mitigation efforts have led to lower inflows of non-performing loans and higher volume of loans returning to accrual status after assessing borrower's willingness and capacity of debt repayment. Inflows of commercial non-performing loans held-in-portfolio decreased by $55.3 million, or 58%, from the third quarter reflecting stronger underlying credit performance. The allowance for loan losses for non-covered loans held-in-portfolio remained unchanged at $445.3 million from the third quarter of 2012. The allowance for loan losses as a percentage of non-covered loans held in portfolio decreased to 2.92% from 2.96% in third quarter 2012. BPNA Segment The provision for loan losses in the third quarter of 2012 decreased by $5.7 million. The allowance for loan losses as a percentage of loans held in portfolio decreased to 3.07% from 3.35% in the third quarter 2012. Sustained improvements in credit quality trends drove the reduction in both the provision and the allowance. Net charge-offs decreased by $1.9 million from the third quarter of 2012, mainly driven by reductions from the commercial loan portfolio. The annualized net charge-offs to average loans held-in-portfolio was 1.60% in the fourth quarter of 2012, down from 1.74% in the previous quarter. Total non-performing loans held in portfolio decreased by $33.3 million from the third quarter of 2012, mainly related to overall improvements in credit performance across most loan portfolios. Inflows of commercial, construction, and legacy non-performing loans held-in-portfolio decreased by $16.0 million, or 38%, from the third quarter of 2012. Financial Condition Highlights     (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11 Total assets   $ 36,507,535   $ 36,503,366   $ 37,348,432 Total loans held-in-portfolio (net) 24,008,557 23,896,548 24,135,991 Deposits 27,000,613 26,319,499 27,942,127 Borrowings 4,430,673 5,017,141 4,293,669 Stockholders' equity     4,110,000     4,068,984     3,918,753 Total assets increased by approximately $4.2 million from September 30, 2012 driven by: A $121.9 million increase in cash and money market accounts due mainly to excess balances held with the Federal Reserve Bank. An $87.6 million increase in trading securities, mainly due to mortgage-backed securities. A $229.3 million increase in non-covered loans held in portfolio mostly due to: mortgage loan growth of $56.1 million during the fourth quarter of 2012, with the BPPR segment originating approximately $446.0 million in residential mortgage loans, the highest levels since 2005; and growth in commercial loans of $229.6 million, partially offset by a decrease in legacy loans of $81.6 million. Other real estate owned (covered and non-covered) increased by approximately $28.4 million, due mainly to the continuing efforts to aggressively resolve non-performing loans. These increases were partially offset by: Decrease in other assets of $155.4 million driven by receivables from securities sold, not yet delivered. During the third quarter of 2012, a sale of approximately $140.7 million in trading securities was executed but not settled at the end of the quarter. Federal Home Loan Bank stock decreased by $28.1 million driven by lower balances of advances with the FHLB of NY. The Loss-Sharing-Agreement (LSA) indemnification asset was reduced by $160.0 million during the quarter, driven by collections from the FDIC, while reduced estimated losses on the covered portfolio drove higher amortization of the indemnification asset. The covered loan portfolio balance decreased by approximately $147.9 million. Total liabilities decreased by $36.8 million from September 2012, driven by: Decreases in notes payable and other borrowings of $586.5 million, resulting from decreases in FHLB of NY advances. These advances were replaced with brokered CDs and repurchase agreements. Other liabilities decreased by $131.5 million, mainly due to a decrease of $66 million in liabilities for unsettled purchases of trading securities and a decrease of approximately $20.5 million in the pension plan liability, reflecting a contribution of $58.0 million, net of an actuarial valuation adjustment. The decrease was partially offset by: A $681.1 million increase in deposits, particularly brokered CDs and retail deposits. Table G presents a breakdown of deposits by major categories. Stockholders' equity increased by $41.0 million from September 30, 2012, mainly as a result of the net income for the quarter, partially offset by a decrease in unrealized gains on securities available-for-sale and an increase in the underfunding of the pension plan liability. Refer to Table A for capital ratios and Table N for Non-GAAP reconciliations. Refer to Table C for the Statements of Condition. Forward-Looking Statements The information included in this news release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in forward-looking statements. Factors that might cause such a difference include, but are not limited to (i) the rate of growth in the economy and employment levels, as well as general business and economic conditions; (ii) changes in interest rates, as well as the magnitude of such changes; (iii) the fiscal and monetary policies of the federal government and its agencies; (iv) changes in federal bank regulatory and supervisory policies, including required levels of capital; (v) the relative strength or weakness of the consumer and commercial credit sectors and of the real estate markets in Puerto Rico and the other markets in which borrowers are located; (vi) the performance of the stock and bond markets; (vii) competition in the financial services industry; (viii) possible legislative, tax or regulatory changes; (ix) the impact of the Dodd-Frank Act on our businesses, business practice and cost of operations; and (x) additional Federal Deposit Insurance Corporation assessments. For a discussion of such factors and certain risks and uncertainties to which the Corporation is subject, see the Corporation's Annual Report on Form 10-K for the year ended December 31, 2011, as well as its filings with the U.S. Securities and Exchange Commission. Other than to the extent required by applicable law, including the requirements of applicable securities laws, the Corporation assumes no obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements. Founded in 1893, Popular, Inc. is the leading banking institution by both assets and deposits in Puerto Rico and ranks 36th by assets among U.S. banks. In the United States, Popular has established a community-banking franchise, doing business as Popular Community Bank, providing a broad range of financial services and products with branches in New York, New Jersey, Illinois, Florida and California. An electronic version of this press release can be found at the Corporation's website, www.popular.com. Popular will hold a conference call to discuss the financial results today Thursday, January 24, 2013 at 10:30 a.m. Eastern time. The call will be broadcast live over the Internet and can be accessed through the investor relations section of the Corporation's website: www.popular.com. Listeners are recommended to go to the website at least 15 minutes prior to the call to download and install any necessary audio software. The call may also be accessed through a dial-in telephone number 866-700-6293 or 617-213-8835. The conference code is 31838169. A replay of the webcast will be archived in Popular's website during the respective period. A telephone replay will be available from 12:30 p.m. on Thursday, January 24, 2013 to 11:59 p.m. on Thursday, January 31, 2013, at 888-286-8010 or 617-801-6888. The replay passcode is 79338243. Popular will hold an Investor Day on Friday, March 1 at Popular Center in San Juan, Puerto Rico. You can find the link to the webcast in the investor-relations section of our website. For further information, please contact us via email at investor-relations@bppr.com. Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings Release   Table A - Selected Ratios and Other Information   Table B - Consolidated Statement of Operations   Table C - Consolidated Statement of Financial Condition   Table D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER   Table E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE   Table F - Other Service Fees   Table G - Loans and Deposits   Table H - Non-Performing Assets   Table I - Activity in Non-Performing Loans   Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios   Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED   Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS   Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS   Table N - Reconciliation to GAAP Financial Measures   Table O - Financial Information - Westernbank Covered Loans POPULAR, INC.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable A - Selected Ratios and Other Information(Unaudited)               Quarters ended   Years ended   31-Dec-12   30-Sep-12   31-Dec-11   31-Dec-12   31-Dec-11 Net income per common share:       Basic and diluted [1] $ 0.81 $ 0.45 $ 0.02 $ 2.35 $ 1.44   Average common shares outstanding [1] 102,628,274 102,451,410 102,274,180 102,429,755 102,179,393   Average common shares outstanding - assuming dilution [1] 102,801,581 102,484,960 102,274,180 102,653,610 102,289,496   Common shares outstanding at end of period [1] 103,169,806 103,097,143 102,590,457 103,169,806 102,590,457   Market value per common share [1] $ 20.79 $ 17.45 $ 13.90 $ 20.79 $ 13.90   Market Capitalization --- (In millions) $ 2,145 $ 1,799 $ 1,426 $ 2,145 $ 1,426   Return on average assets 0.92 % 0.52 % 0.03 % 0.68 % 0.40 %   Return on average common equity 8.50 % 4.81 % 0.21 % 6.37 % 4.01 %   Net interest margin [2] 4.41 % 4.37 % 4.30 % 4.35 % 4.34 %   Common equity per share [1] $ 39.35 $ 38.98 $ 37.71 $ 39.35 $ 37.71   Tangible common book value per common share (non-GAAP) [1] $ 32.55 $ 32.15 $ 30.77 $ 32.55 $ 30.77   Tangible common equity to tangible assets (non-GAAP) 9.38 % 9.26 % 8.62 % 9.38 % 8.62 %   Tier 1 risk-based capital [3] 17.35 % 16.81 % 15.97 % 17.35 % 15.97 %   Total risk-based capital [3] 18.63 % 18.09 % 17.25 % 18.63 % 17.25 %   Tier 1 leverage [3] 11.52 % 11.40 % 10.90 % 11.52 % 10.90 %   Tier 1 common equity to risk-weighted assets (non-GAAP) [3]   13.18 %     12.72 %     12.10 %     13.18 %     12.10 % [1] All share and per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012.   [2] Not on a taxable equivalent basis.   [3] Capital ratios for the current quarter are estimated. POPULAR, INC.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable B - Consolidated Statement of Operations(Unaudited)       Variance   Quarter   Variance     Quarters ended Q4 2012 ended Q4 2012 Years ended (In thousands, except per share information)   31-Dec-12   30-Sep-12   vs.Q3 2012   31-Dec-11   vs.Q4 2011   31-Dec-12   31-Dec-11 Interest income:       Loans $ 393,732 $ 387,381 $ 6,351 $ 399,523 $ (5,791 ) $ 1,558,397 $ 1,694,357 Money market investments 929 862 67 837 92 3,703 3,596 Investment securities 37,953 39,945 (1,992 ) 46,758 (8,805 ) 166,781 203,941   Trading account securities     5,155       5,815       (660 )     6,275       (1,120 )     22,824       35,607     Total interest income     437,769       434,003       3,766       453,393       (15,624 )     1,751,705       1,937,501   Interest expense: Deposits 40,896 43,000 (2,104 ) 56,068 (15,172 ) 184,089 269,487 Short-term borrowings 10,302 9,876 426 13,780 (3,478 ) 46,805 55,258   Long-term debt     36,160       37,701       (1,541 )     38,765       (2,605 )     148,192       180,764     Total interest expense     87,358       90,577       (3,219 )     108,613       (21,255 )     379,086       505,509   Net interest income 350,411 343,426 6,985 344,780 5,631 1,372,619 1,431,992 Provision for loan losses - non-covered loans 86,256 83,589 2,667 123,908 (37,652 ) 334,102 430,085 Provision for loan losses - covered loans     (3,445 )     22,619       (26,064 )     55,900       (59,345 )     74,839       145,635   Net interest income after provision for loan losses     267,600       237,218       30,382       164,972       102,628       963,678       856,272   Service charges on deposit accounts 44,449 45,858 (1,409 ) 46,162 (1,713 ) 183,026 184,940 Other service fees 63,695 64,784 (1,089 ) 60,097 3,598 256,545 239,720 Net (loss) gain on sale and valuation adjustments of investment securities (1,422 ) 64 (1,486 ) 2,800 (4,222 ) (1,707 ) 10,844 Trading account (loss) profit (5,990 ) (2,266 ) (3,724 ) 2,610 (8,600 ) (17,682 ) 5,897 Net gain on sale of loans, including valuation adjustments on loans held-for-sale 30,196 18,495 11,701 16,135 14,061 48,765 30,891 Adjustments (expense) to indemnity reserves on loans sold (3,208 ) (8,717 ) 5,509 (3,481 ) 273 (21,198 ) (33,068 ) FDIC loss share (expense) income (36,824 ) (6,707 ) (30,117 ) 17,447 (54,271 ) (56,211 ) 66,791 Fair value change in equity appreciation instrument - - - - - - 8,323 Other operating income     42,105       4,198       37,907       7,589       34,516       74,804       45,939     Total non-interest income     133,001       115,709       17,292       149,359       (16,358 )     466,342       560,277   Operating expenses: Personnel costs Salaries 74,846 74,339 507 77,074 (2,228 ) 301,965 305,018 Commissions, incentives and other bonuses 14,817 12,800 2,017 10,873 3,944 54,702 44,421 Pension, postretirement and medical insurance 16,453 15,984 469 26,039 (9,586 ) 66,976 62,219   Other personnel costs, including payroll taxes     10,209       8,427       1,782       10,561       (352 )     42,059       41,712   Total personnel costs 116,325 111,550 4,775 124,547 (8,222 ) 465,702 453,370 Net occupancy expenses 26,918 24,409 2,509 25,891 1,027 100,452 102,319 Equipment expenses 11,602 11,447 155 10,526 1,076 45,290 43,840 Other taxes 11,942 12,666 (724 ) 12,899 (957 ) 50,120 51,885 Professional fees 58,246 53,412 4,834 50,019 8,227 211,890 194,942 Communications 6,558 6,500 58 5,917 641 26,834 27,115 Business promotion 16,822 14,924 1,898 19,225 (2,403 ) 61,576 55,067 FDIC deposit insurance 13,691 24,173 (10,482 ) 25,088 (11,397 ) 85,697 93,728 Loss on early extinguishment of debt 12 43 (31 ) 56 (44 ) 25,196 8,693 Other real estate owned (OREO) expenses 1,079 5,896 (4,817 ) 9,893 (8,814 ) 23,520 21,778 Credit and debit card processing, volume, interchange and other 4,646 5,442 (796 ) 3,974 672 19,729 17,539 Other operating expenses 26,439 17,412 9,027 20,377 6,062 85,070 70,367 Amortization of intangibles     2,467       2,481       (14 )     2,681       (214 )     10,072       9,654     Total operating expenses     296,747       290,355       6,392       311,093       (14,346 )     1,211,148       1,150,297   Income before income tax 103,854 62,572 41,282 3,238 100,616 218,872 266,252 Income tax expense (benefit)     19,914       15,384       4,530       263       19,651       (26,403 )     114,927   Net income   $ 83,940     $ 47,188     $ 36,752     $ 2,975     $ 80,965     $ 245,275     $ 151,325   Net income applicable to common stock   $ 83,009     $ 46,257     $ 36,752     $ 2,044     $ 80,965     $ 241,552     $ 147,602   Net income per common share - basic [1]   $ 0.81     $ 0.45     $ 0.36     $ 0.02     $ 0.79     $ 2.35     $ 1.44   Net income per common share - diluted [1]   $ 0.81     $ 0.45     $ 0.36     $ 0.02     $ 0.79     $ 2.35     $ 1.44   [1] Per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable C - Consolidated Statement of Financial Condition(Unaudited)         Variance Q4 2012 vs. (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11   Q3 2012 Assets: Cash and due from banks $ 530,363 $ 477,342 $ 535,282 $ 53,021 Money market investments 994,580 925,663 1,376,174 68,917 Trading account securities, at fair value 314,525 226,918 436,331 87,607 Investment securities available-for-sale, at fair value 5,084,201 5,120,301 5,009,823 (36,100 ) Investment securities held-to-maturity, at amortized cost 142,817 122,072 125,383 20,745 Other investment securities, at lower of cost or realizable value 185,443 213,389 179,880 (27,946 ) Loans held-for-sale, at lower of cost or fair value 354,468 337,049 363,093 17,419 Loans held-in-portfolio:     Loans not covered under loss sharing agreements with the FDIC 21,080,005 20,851,108 20,703,192 228,897 Loans covered under loss sharing agreements with the FDIC 3,755,972 3,903,867 4,348,703 (147,895 ) Less: Unearned income 96,813 97,255 100,596 (442 )     Allowance for loan losses     730,607       761,172       815,308       (30,565 )     Total loans held-in-portfolio, net     24,008,557       23,896,548       24,135,991       112,009   FDIC loss share asset 1,399,098 1,559,057 1,915,128 (159,959 ) Premises and equipment, net 535,793 525,733 538,486 10,060 Other real estate not covered under loss sharing agreements with the FDIC 266,844 252,024 172,497 14,820 Other real estate covered under loss sharing agreements with the FDIC 139,058 125,514 109,135 13,544 Accrued income receivable 125,728 133,943 125,209 (8,215 ) Mortgage servicing assets, at fair value 154,430 158,367 151,323 (3,937 ) Other assets 1,569,578 1,724,927 1,462,393 (155,349 ) Goodwill 647,757 647,757 648,350 - Other intangible assets     54,295       56,762       63,954       (2,467 ) Total assets   $ 36,507,535     $ 36,503,366     $ 37,348,432     $ 4,169   Liabilities and Stockholders' Equity: Liabilities: Deposits: Non-interest bearing $ 5,794,629 $ 5,404,470 $ 5,655,474 $ 390,159     Interest bearing     21,205,984       20,915,029       22,286,653       290,955       Total deposits     27,000,613       26,319,499       27,942,127       681,114   Assets sold under agreements to repurchase 2,016,752 1,944,564 2,141,097 72,188 Other short-term borrowings 636,200 1,206,200 296,200 (570,000 ) Notes payable 1,777,721 1,866,377 1,856,372 (88,656 ) Other liabilities     966,249       1,097,742       1,193,883       (131,493 ) Total liabilities     32,397,535       32,434,382       33,429,679       (36,847 ) Stockholders' equity: Preferred stock 50,160 50,160 50,160 - Common stock 1,032 1,031 1,026 1 Surplus 4,150,294 4,131,681 4,123,898 18,613 Retained earnings (accumulated deficit) 11,826 (54,183 ) (212,726 ) 66,009 Treasury stock (444 ) (270 ) (1,057 ) (174 ) Accumulated other comprehensive loss     (102,868 )     (59,435 )     (42,548 )     (43,433 )     Total stockholders' equity     4,110,000       4,068,984       3,918,753       41,016   Total liabilities and stockholders' equity   $ 36,507,535     $ 36,503,366     $ 37,348,432     $ 4,169   Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER(Unaudited)         Quarter ended   Quarter ended   Quarter ended   Variance   Variance 31-Dec-12 30-Sep-12 31-Dec-11 Q4 2012 vs. Q3 2012 Q4 2012 vs. Q4 2011 ($ amounts in millions; yields not on a taxable equivalent basis)   Average balance   Income/ Expense   Yield/ Rate Average balance   Income/ Expense   Yield/ Rate Average balance   Income/ Expense   Yield/ Rate Average balance   Income/ Expense   Yield/ Rate Average balance   Income/ Expense   Yield/ Rate Assets:                     Interest earning assets: Money market, trading and investment securities $6,693     $44.1   2.63 % $6,625     $46.6   2.81 % $6,635     $53.9   3.24 % $68     ($2.5 )   (0.18 ) % $58     ($9.8 )   (0.61 ) % Loans not covered under loss sharing agreements with the FDIC: Commercial 10,200 123.5 4.82 10,024 123.2 4.89 10,596 131.4 4.92 176 0.3 (0.07 ) (396 ) (7.9 ) (0.10 ) Construction 386 3.3 3.44 435 3.3 3.02 564 2.3 1.59 (49 ) - 0.42 (178 ) 1.0 1.85 Mortgage 6,169 81.0 5.25 5,915 80.7 5.46 5,402 70.5 5.22 254 0.3 (0.21 ) 767 10.5 0.03 Consumer 3,835 97.5 10.11 3,855 97.9 10.10 3,680 95.0 10.25 (20 ) (0.4 ) 0.01 155 2.5 (0.14 ) Lease financing 540     11.4   8.48 540     11.7   8.67 562     11.9   8.44 -     (0.3 )   (0.19 ) (22 )   (0.5 )   0.04     Total loans not covered under loss sharing agreements with the FDIC 21,130 316.7 5.97 20,769 316.8 6.08 20,804 311.1 5.95 361 (0.1 ) (0.11 ) 326 5.6 0.02 Loans covered under loss sharing agreements with the FDIC 3,832     77.0   8.01 3,952     70.6   7.12 4,401     88.4   7.99 (120 )   6.4     0.89   (569 )   (11.4 )   0.02   Total loans 24,962     393.7   6.28 24,721     387.4   6.24 25,205     399.5   6.30 241     6.3     0.04   (243 )   (5.8 )   (0.02 ) Total interest earning assets 31,655     $437.8   5.51 % 31,346     $434.0   5.52 % 31,840     $453.4   5.66 % 309     $3.8     (0.01 ) % (185 )   ($15.6 )   (0.15 ) % Allowance for loan losses (754 ) (757 ) (751 ) 3 (3 ) Other non-interest earning assets 5,400   5,396   5,655   4   (255 ) Total average assets $36,301   $35,985   $36,744   $316   ($443 )   Liabilities and Stockholders' Equity: Interest bearing deposits: NOW and money market $5,707 $6.1 0.43 % $5,709 $6.2 0.43 % $5,199 $6.4 0.49 % ($2 ) ($0.1 ) - % $508 ($0.3 ) (0.06 ) % Savings 6,654 4.8 0.29 6,561 4.5 0.27 6,475 6.4 0.39 93 0.3 0.02 179 (1.6 ) (0.10 ) Time deposits 8,650     30.0   1.38 9,003     32.3   1.43 10,685     43.3   1.61 (353 )   (2.3 )   (0.05 ) (2,035 )   (13.3 )   (0.23 ) Total interest bearing deposits 21,011 40.9 0.77 21,273 43.0 0.80 22,359 56.1 0.99 (262 ) (2.1 ) (0.03 ) (1,348 ) (15.2 ) (0.22 ) Borrowings 4,704     46.5   3.94 4,426     47.6   4.29 4,507     52.5   4.65 278     (1.1 )   (0.35 ) 197     (6.0 )   (0.71 ) Total interest bearing liabilities 25,715     87.4   1.35 25,699     90.6   1.40 26,866     108.6   1.61 16     (3.2 )   (0.05 ) (1,151 )   (21.2 )   (0.26 ) Net interest spread 4.16 % 4.12 % 4.05 % 0.04   % 0.11   % Non-interest bearing deposits 5,583 5,319 5,165 264 418 Other liabilities 1,067 1,090 895 (23 ) 172 Stockholders' equity 3,936   3,877   3,818   59   118   Total average liabilities and stockholders' equity $36,301   $35,985   $36,744   $316   ($443 )   Net interest income / margin non-taxable equivalent basis $350.4   4.41 % $343.4   4.37 % $344.8   4.30 % $7.0     0.04   % $5.6     0.11   % Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE(Unaudited)         Year ended Year ended     31-Dec-12 31-Dec-11 Variance Average   Income /   Yield/ Average   Income/   Yield/ Average Income/ Yield/ ($ amounts in millions; yields not on a taxable equivalent basis)   balance   Expense   Rate balance   Expense   Rate balance   Expense   Rate Assets: Interest earning assets: Money market, trading and investment securities $ 6,724     $ 193.3   2.87 % $ 7,314     $ 243.1   3.32 %   ($590 )   ($49.8 )   (0.45 ) % Loans not covered under loss sharing agreements with the FDIC: Commercial 10,226 499.4 4.88 10,889 541.9 4.98 (663 ) (42.5 ) (0.10 ) Construction 459 16.6 3.61 731 10.8 1.48 (272 ) 5.8 2.13 Mortgage 5,817 314.9 5.41 5,153 302.0 5.86 664 12.9 (0.45 ) Consumer 3,748 379.1 10.11 3,654 376.2 10.30 94 2.9 (0.19 ) Lease financing   545       47.0   8.62   577       50.8   8.81   (32 )   (3.8 )   (0.19 ) Total loans not covered under loss sharing agreements with the FDIC 20,795 1,257.0 6.04 21,004 1,281.7 6.10 (209 ) (24.7 ) (0.06 ) Loans covered under loss sharing agreements with the FDIC   4,051       301.4   7.44   4,613       412.7   8.95   (562 )   (111.3 )   (1.51 ) Total loans   24,846       1,558.4   6.27   25,617       1,694.4   6.61   (771 )   (136.0 )   (0.34 ) Total interest earning assets   31,570   $ 1,751.7 5.55 %   32,931   $ 1,937.5 5.88 %   (1,361 ) ($185.8 ) (0.33 ) % Allowance for loan losses (772 ) (746 ) (26 ) Other non-interest earning assets   5,466     5,881     (415 ) Total average assets $ 36,264   $ 38,066     ($1,802 )   Liabilities and Stockholders' Equity: Interest bearing deposits: NOW and money market $ 5,555 $ 24.6 0.44 % $ 5,204 $ 31.0 0.60 % $ 351 ($6.4 ) (0.16 ) % Savings 6,571 21.7 0.33 6,321 37.5 0.59 250 (15.8 ) (0.26 ) Time deposits   9,421       137.8   1.46   10,920       201.0   1.84   (1,499 )   (63.2 )   (0.38 ) Total interest bearing deposits 21,547 184.1 0.85 22,445 269.5 1.20 (898 ) (85.4 ) (0.35 ) Borrowings   4,416       195.0   4.42   5,847       236.0   4.04   (1,431 )   (41.0 )   0.38   Total interest bearing liabilities   25,963       379.1   1.46   28,292       505.5   1.79   (2,329 )   (126.4 )   (0.33 ) Net interest spread 4.09 % 4.09 % -   % Non-interest bearing deposits 5,357 5,058 299 Other liabilities 1,100 983 117 Stockholders' equity   3,844     3,733     111   Total average liabilities and stockholders' equity $ 36,264   $ 38,066     ($1,802 )   Net interest income / margin non-taxable equivalent basis $ 1,372.6 4.35 % $ 1,432.0 4.34 % ($59.4 ) 0.01   % Popular, Inc.           Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable F - Other Service Fees(Unaudited)   Variance Variance Quarters ended Q4 2012 vs. Q4 2012 vs. (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11   Q3 2012   Q4 2011 Other service fees:   Debit card fees $ 9,439 $ 8,772 $ 9,664 $ 667 $ (225 ) Insurance fees 17,050 12,322 16,471 4,728 579 Credit card fees 16,148 14,576 12,943 1,572 3,205 Sale and administration of investment products 9,721 9,511 9,686 210 35 Mortgage servicing fees, net of fair value adjustments 1,647 9,857 1,449 (8,210 ) 198 Trust fees 4,226 3,977 3,722 249 504 Processing fees 1,511 1,406 1,718 105 (207 )   Other fees     3,953     4,363     4,444       (410 )     (491 ) Total other service fees   $ 63,695   $ 64,784   $ 60,097     $ (1,089 )   $ 3,598         Variance Years ended 2012 vs. (In thousands)   31-Dec-12   31-Dec-11     2011   Other service fees: Debit card fees $ 36,787 $ 49,459 $ (12,672 ) Insurance fees 53,825 54,390 (565 ) Credit card fees 57,551 49,049 8,502 Sale and administration of investment products 37,766 34,388 3,378 Mortgage servicing fees, net of fair value adjustments 30,770 12,098 18,672 Trust fees 16,353 15,333 1,020 Processing fees 6,330 6,839 (509 )   Other fees     17,163     18,164     (1,001 ) Total other service fees   $ 256,545   $ 239,720   $ 16,825   Popular, Inc.           Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable G - Loans and Deposits(Unaudited)   Loans - Ending Balances Variance (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11   Q4 2012 vs. Q3 2012   Q4 2012 vs. Q4 2011 Loans not covered under FDIC loss sharing agreements: Commercial $ 9,858,202 $ 9,628,631 $ 9,973,327 $ 229,571 $ (115,125 ) Construction 252,857 258,453 239,939 (5,596 ) 12,918 Legacy [1] 384,217 465,848 648,409 (81,631 ) (264,192 ) Lease financing 540,523 538,014 548,706 2,509 (8,183 ) Mortgage 6,078,507 6,022,422 5,518,460 56,085 560,047 Consumer     3,868,886     3,840,485     3,673,755     28,401       195,131   Total non-covered loans held-in-portfolio $ 20,983,192 $ 20,753,853 $ 20,602,596 $ 229,339 $ 380,596 Loans covered under FDIC loss sharing agreements     3,755,972     3,903,867     4,348,703     (147,895 )     (592,731 ) Total loans held-in-portfolio   $ 24,739,164   $ 24,657,720   $ 24,951,299   $ 81,444     $ (212,135 ) Loans held-for-sale: Commercial $ 16,047 $ 17,696 $ 25,730 $ (1,649 ) $ (9,683 ) Construction 78,140 88,030 236,045 (9,890 ) (157,905 ) Legacy [1] 2,080 3,107 468 (1,027 ) 1,612 Mortgage     258,201     228,216     100,850     29,985       157,351   Total loans held-for-sale     354,468     337,049     363,093     17,419       (8,625 ) Total loans   $ 25,093,632   $ 24,994,769   $ 25,314,392   $ 98,863     $ (220,760 )   [1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment.   Deposits - Ending Balances Variance (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11   Q4 2012 vs. Q3 2012   Q4 2012 vs. Q4 2011 Demand deposits [1] $ 6,442,739 $ 6,091,400 $ 6,256,530 $ 351,339 $ 186,209 Savings, NOW and money market deposits (non-brokered) 11,190,335 11,046,595 10,762,869 143,740 427,466 Savings, NOW and money market deposits (brokered) 456,830 455,309 212,688 1,521 244,142 Time deposits (non-brokered) 6,541,660 6,614,153 7,552,434 (72,493 ) (1,010,774 ) Time deposits (brokered CDs)     2,369,049     2,112,042     3,157,606     257,007       (788,557 ) Total deposits   $ 27,000,613   $ 26,319,499   $ 27,942,127   $ 681,114     $ (941,514 ) [1] Includes interest and non-interest demand bearing deposits. Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable H - Non-Performing Assets(Unaudited)           Variance (Dollars in thousands)   31-Dec-12   As a percentage of loans HIP by category   30-Sep-12   As a percentage of loans HIP by category     31-Dec-11   As a percentage of loans HIP by category   Q4 2012 vs. Q3 2012   Q4 2012 vs. Q4 2011 Non-accrual loans:   Commercial $ 665,289 6.7 % $ 772,217 8.0 % $ 830,092 8.3 % $ (106,928 ) $ (164,803 ) Construction 43,350 17.1 49,933 19.3 96,286 40.1 (6,583 ) (52,936 ) Legacy [1] 40,741 10.6 48,735 10.5 75,660 11.7 (7,994 ) (34,919 ) Lease financing 4,865 0.9 4,837 0.9 5,642 1.0 28 (777 ) Mortgage 630,130 10.4 632,052 10.5 686,502 12.4 (1,922 ) (56,372 ) Consumer     40,758   1.1     42,726   1.1       43,668   1.2     (1,968 )     (2,910 ) Total non-performing loans held-in- portfolio, excluding covered loans 1,425,133 6.8 % 1,550,500 7.5 % 1,737,850 8.4 % (125,367 ) (312,717 ) Non-performing loans held-for-sale [2] 96,320 108,886 262,302 (12,566 ) (165,982 ) Other real estate owned (“OREO”), excluding covered OREO     266,844         252,024           172,497         14,820       94,347   Total non-performing assets, excluding covered assets 1,788,297 1,911,410 2,172,649 (123,113 ) (384,352 ) Covered loans and OREO     213,469         208,235           192,771         5,234       20,698   Total non-performing assets   $ 2,001,766       $ 2,119,645         $ 2,365,420       $ (117,879 )   $ (363,654 ) Accruing loans past due 90 days or more [3]   $ 388,712       $ 379,051         $ 316,614       $ 9,661     $ 72,098   Ratios excluding covered loans: Non-performing loans held-in-portfolio to loans held-in-portfolio 6.79 % 7.47 % 8.44 % Allowance for loan losses to loans held-in-portfolio 2.96 3.07 3.35 Allowance for loan losses to non-performing loans, excluding held-for-sale     43.62         41.04           39.73             Ratios including covered loans: Non-performing loans held-in-portfolio to loans held-in-portfolio 6.06 % 6.63 % 7.30 % Allowance for loan losses to loans held-in-portfolio 2.95 3.09 3.27 Allowance for loan losses to non-performing loans, excluding held-for-sale     48.72         46.61           44.76             [1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment.   [2] Non-performing loans held-for-sale as of December 31, 2012 consisted of $78 million in construction loans, $16 million in commercial loans, $2 million in legacy loans and $53 thousand in mortgage loans (September 30, 2012 - $88 million in construction loans, $18 million in commercial loans, $3 million in legacy loans and $53 thousand in mortgage loans; December 31, 2011 - $236 million in construction loans, $26 million in commercial loans, $468 thousand in legacy loans and $59 thousand in mortgage loans).   [3] It is the Corporation's policy to report delinquent residential mortgage loans insured by FHA or guaranteed by the VA as accruing loans past due 90 days or more as opposed to nonperforming since the principal repayment is insured. These balances include $86 million of residential mortgage loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of December 31, 2012. Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable I - Activity in Non-Performing Loans(Unaudited)   Commercial loans held-in-portfolio:     Quarter ended   Quarter ended 31-Dec-12   30-Sep-12 (In thousands)   BPPR   BPNA   Popular, Inc.   BPPR   BPNA   Popular, Inc. Beginning balance NPLs $ 612,781   $ 159,436   $ 772,217 $ 591,792   $ 176,148   $ 767,940 Plus: New non-performing loans 40,585 16,601 57,186 95,836 32,395 128,231 Advances on existing non-performing loans - 163 163 - 525 525 Other - - - 1,139 - 1,139 Less: Non-performing loans transferred to OREO (14,694 ) (6,580 ) (21,274 ) (4,217 ) (10,558 ) (14,775 ) Non-performing loans charged-off (45,682 ) (11,745 ) (57,427 ) (43,711 ) (9,261 ) (52,972 ) Loans returned to accrual status / loan collections (66,957 ) (13,645 ) (80,602 ) (28,058 ) (25,561 ) (53,619 ) Loans transferred to held-for-sale - (1,674 ) (1,674 ) - (4,252 ) (4,252 )   Other     (3,300 )     -       (3,300 )     -       -       -   Ending balance NPLs   $ 522,733     $ 142,556     $ 665,289     $ 612,781     $ 159,436     $ 772,217       Construction loans held-in-portfolio: Quarter ended Quarter ended 31-Dec-12   30-Sep-12 (In thousands)   BPPR   BPNA   Popular, Inc.   BPPR   BPNA   Popular, Inc. Beginning balance NPLs $ 37,793 $ 12,140 $ 49,933 $ 55,534 $ 12,004 $ 67,538 Plus: New non-performing loans 2,255 - 2,255 3,917 - 3,917 Advances on existing non-performing loans - - - - 136 136 Other 3,300 - 3,300 - - - Less: Non-performing loans transferred to OREO - (3,605 ) (3,605 ) (280 ) - (280 ) Non-performing loans charged-off (839 ) (264 ) (1,103 ) (1,366 ) - (1,366 ) Loans returned to accrual status / loan collections (5,119 ) (2,311 ) (7,430 ) (18,873 ) - (18,873 )   Other     -       -       -       (1,139 )     -       (1,139 ) Ending balance NPLs   $ 37,390     $ 5,960     $ 43,350     $ 37,793     $ 12,140     $ 49,933                 Mortgage loans held-in-portfolio: Quarter ended Quarter ended 31-Dec-12   30-Sep-12 (In thousands)   BPPR   BPNA   Popular, Inc.   BPPR   BPNA   Popular, Inc. Beginning balance NPLs $ 598,523 $ 33,529 $ 632,052 $ 600,082 $ 32,817 $ 632,899 Plus: New non-performing loans 166,768 8,104 174,872 157,114 9,457 166,571 Less: Non-performing loans transferred to OREO (21,693 ) (989 ) (22,682 ) (19,522 ) (1,858 ) (21,380 ) Non-performing loans charged-off (15,523 ) (2,936 ) (18,459 ) (12,811 ) (2,541 ) (15,352 )   Loans returned to accrual status / loan collections     (131,969 )     (3,684 )     (135,653 )     (126,340 )     (4,346 )     (130,686 ) Ending balance NPLs   $ 596,106     $ 34,024     $ 630,130     $ 598,523     $ 33,529     $ 632,052       Legacy loans held-in-portfolio: Quarter ended Quarter ended 31-Dec-12   30-Sep-12 (In thousands)   BPPR   BPNA   Popular, Inc.   BPPR   BPNA   Popular, Inc. Beginning balance NPLs $ - $ 48,735 $ 48,735 $ - $ 54,730 $ 54,730 Plus: New non-performing loans - 9,337 9,337 - 9,011 9,011 Less: Non-performing loans transferred to OREO - (50 ) (50 ) - - - Non-performing loans charged-off - (7,313 ) (7,313 ) - (7,900 ) (7,900 ) Loans returned to accrual status / loan collections - (7,099 ) (7,099 ) - (4,405 ) (4,405 )   Loans transferred to held-for-sale     -       (2,869 )     (2,869 )     -       (2,701 )     (2,701 ) Ending balance NPLs   $ -     $ 40,741     $ 40,741     $ -     $ 48,735     $ 48,735   Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable J - Allowance for Credit Losses, Net Charge-offs and Related Ratios(Unaudited)       Quarter ended Quarter ended Quarter ended (Dollars in thousands)   31-Dec-12   30-Sep-12   31-Dec-11       Non-covered loans   Covered loans   Total   Non-covered loans   Covered loans   Total   Non-covered loans   Covered loans   Total   Balance at beginning of period $ 636,299 $ 124,873   $ 761,172 $ 648,535 $ 117,495   $ 766,030 $ 692,500 $ 80,421   $ 772,921 Provision for loan losses     86,256       (3,445 )     82,811     83,589       22,619     106,208       123,908     55,900     179,808         722,555       121,428       843,983     732,124       140,114     872,238       816,408     136,321     952,729   Net loans charged-off (recovered): BPPR Commercial 41,540 492 42,032 37,019 7,013 44,032 48,428 10,526 58,954 Construction (2,371 ) 7,561 5,190 (527 ) 7,483 6,956 3,820 8 3,828 Lease financing 516 - 516 265 - 265 1,233 - 1,233 Mortgage 17,310 885 18,195 12,431 736 13,167 5,236 746 5,982 Consumer     21,055       3,584       24,639     21,853       9     21,862       19,592     96     19,688 Total BPPR     78,050       12,522       90,572     71,041       15,241     86,282       78,309     11,376     89,685   BPNA Commercial 7,044 - 7,044 9,611 - 9,611 23,104 - 23,104 Construction 239 - 239 - - - 1,102 - 1,102 Legacy [1] 3,369 - 3,369 3,952 - 3,952 5,821 - 5,821 Mortgage 3,023 - 3,023 3,541 - 3,541 3,501 - 3,501 Consumer     9,129       -       9,129     7,646       -     7,646       14,208     -     14,208   Total BPNA     22,804       -       22,804     24,750       -     24,750       47,736     -     47,736   Total loans charged-off (recovered) - Popular, Inc.     100,854       12,522       113,376     95,791       15,241     111,032       126,045     11,376     137,421   Net (write-downs) recoveries related to loans transferred to loans held-for-sale     -       -       -     (34 )     -     (34 )     -     -     -   Balance at end of period   $ 621,701     $ 108,906     $ 730,607   $ 636,299     $ 124,873   $ 761,172     $ 690,363   $ 124,945   $ 815,308     POPULAR, INC. Annualized net charge-offs to average loans held-in-portfolio 1.94 % 1.84 % 1.87 % 1.82 % 2.46 % 2.21 % Provision for loan losses to net charge-offs 0.86 x 0.73 x 0.87 x 0.96 x 0.98 x 1.31 x   BPPR Annualized net charge-offs to average loans held-in-portfolio 2.07 % 1.91 % 1.92 % 1.84 % 2.14 % 1.88 % Provision for loan losses to net charge-offs 1.00 x 0.82 x 0.98 x 1.07 x 1.13 x 1.61 x   BPNA Annualized net charge-offs to average loans held-in-portfolio 1.60 % 1.74 % 3.27 % Provision for loan losses to net charge-offs             0.36 x           0.56   x           0.75 x [1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment.     Year ended Year ended (Dollars in thousands) 31-Dec-12   31-Dec-11     Non-covered loans   Covered loans   Total   Non-covered loans   Covered loans   Total   Balance at beginning of period $ 690,363 $ 124,945 $ 815,308 $ 793,225 $ - $ 793,225 Provision for loan losses 334,102   74,839   408,941   430,085   145,635   575,720     1,024,465   199,784   1,224,249   1,223,310   145,635   1,368,945   BPPR Commercial 144,640 46,259 190,899 195,388 13,774 209,162 Construction (2,283) 30,495 28,212 5,816 2,853 8,669 Lease financing 943 - 943 3,444 - 3,444 Mortgage 56,777 5,909 62,686 27,624 811 28,435 Consumer 90,095   8,215   98,310   98,647   3,252   101,899   Total BPPR 290,172   90,878   381,050   330,919   20,690   351,609     BPNA Commercial 44,653 - 44,653 76,557 - 76,557 Construction 400 - 400 2,943 - 2,943 Legacy [1] 16,338 - 16,338 52,324 - 52,324 Mortgage 15,163 - 15,163 14,187 - 14,187 Consumer 36,004   -   36,004   57,118   -   57,118   Total BPNA 112,558   -   112,558   203,129   -   203,129   Total loans charged-off (recovered) - Popular, Inc. 402,730   90,878   493,608   534,048   20,690   554,738   Net (write-downs) recoveries related to loans transferred to loans held-for-sale (34)   -   (34)   1,101   -   1,101   Balance at end of period $ 621,701   $ 108,906   $ 730,607   $ 690,363   $ 124,945   $ 815,308     POPULAR, INC. Annualized net charge-offs to average loans held-in-portfolio 1.97 % 2.01 % 2.61 % 2.21 % Provision for loan losses to net charge-offs 0.83 x 0.83 x 0.81 x 1.04 x   BPPR Annualized net charge-offs to average loans held-in-portfolio 1.96 % 2.02 % 2.31 % 1.86 % Provision for loan losses to net charge-offs 0.97 x 0.94 x 1.03 x 1.39 x   BPNA Annualized net charge-offs to average loans held-in-portfolio 1.98 % 3.28 % Provision for loan losses to net charge-offs         0.46 x         0.44 x [1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED(Unaudited)   31-Dec-12 (Dollars in thousands)   Commercial   Construction   Legacy [3]   Mortgage   Lease financing   Consumer   Total [2] Specific ALLL $ 17,348 $ 120 $ - $ 74,667 $ 1,066 $ 17,886 $ 111,087 Impaired loans [1] $ 527,664 $ 41,809 $ 18,744 $ 611,230 $ 4,881 $ 133,377 $ 1,337,705 Specific ALLL to impaired loans [1] 3.29 % 0.29 % - % 12.22 % 21.84 % 13.41 % 8.30 % General ALLL $ 280,334 $ 7,309 $ 33,102 $ 74,708 $ 1,828 $ 113,333 $ 510,614 Loans held-in-portfolio, excluding impaired loans [1] $ 9,330,538 $ 211,048 $ 365,473 $ 5,467,277 $ 535,642 $ 3,735,509 $ 19,645,487 General ALLL to loans held-in-portfolio, excluding impaired loans [1] 3.00 % 3.46 % 9.06 % 1.37 % 0.34 % 3.03 % 2.60 % Total ALLL $ 297,682 $ 7,429 $ 33,102 $ 149,375 $ 2,894 $ 131,219 $ 621,701 Total non-covered loans held-in-portfolio [1] $ 9,858,202 $ 252,857 $ 384,217 $ 6,078,507 $ 540,523 $ 3,868,886 $ 20,983,192 ALLL to loans held-in-portfolio [1] 3.02 % 2.94 % 8.62 % 2.46 % 0.54 % 3.39 % 2.96 % [1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction.   [2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of December 31, 2012, the general allowance on the covered loans amounted to $100 million, while the specific reserve amounted to $9 million.   [3] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment.                                 30-Sep-12 (Dollars in thousands)   Commercial   Construction   Legacy [3]   Mortgage   Lease financing   Consumer   Total [2] Specific ALLL $ 22,239 $ 191 $ - $ 62,823 $ 978 $ 21,193 $ 107,424 Impaired loans [1] $ 497,224 $ 47,897 $ 24,276 $ 560,441 $ 4,933 $ 135,204 $ 1,269,975 Specific ALLL to impaired loans [1] 4.47 % 0.40 % - % 11.21 % 19.83 % 15.67 % 8.46 % General ALLL $ 263,769 $ 8,945 $ 39,871 $ 92,009 $ 1,603 $ 122,678 $ 528,875 Loans held-in-portfolio, excluding impaired loans [1] $ 9,131,407 $ 210,556 $ 441,572 $ 5,461,981 $ 533,081 $ 3,705,281 $ 19,483,878 General ALLL to loans held-in-portfolio, excluding impaired loans [1] 2.89 % 4.25 % 9.03 % 1.68 % 0.30 % 3.31 % 2.71 % Total ALLL $ 286,008 $ 9,136 $ 39,871 $ 154,832 $ 2,581 $ 143,871 $ 636,299 Total non-covered loans held-in-portfolio [1] $ 9,628,631 $ 258,453 $ 465,848 $ 6,022,422 $ 538,014 $ 3,840,485 $ 20,753,853 ALLL to loans held-in-portfolio [1] 2.97 % 3.53 % 8.56 % 2.57 % 0.48 % 3.75 % 3.07 % [1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction.   [2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of September 30, 2012, the general allowance on the covered loans amounted to $110 million, while the specific reserve amounted to $15 million.   [3] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment.                                 Variance (Dollars in thousands)   Commercial   Construction   Legacy   Mortgage   Lease financing   Consumer   Total   Specific ALLL $ (4,891) $ (71) $ - $ 11,844 $ 88 $ (3,307) $ 3,663 Impaired loans   $ 30,440   $ (6,088)   $ (5,532)   $ 50,789   $ (52)   $ (1,827)   $ 67,730   General ALLL $ 16,565 $ (1,636) $ (6,769) $ (17,301) $ 225 $ (9,345) $ (18,261) Loans held-in-portfolio, excluding impaired loans   $ 199,131   $ 492   $ (76,099)   $ 5,296   $ 2,561   $ 30,228   $ 161,609   Total ALLL $ 11,674 $ (1,707) $ (6,769) $ (5,457) $ 313 $ (12,652) $ (14,598) Total non-covered loans held-in-portfolio   $ 229,571   $ (5,596)   $ (81,631)   $ 56,085   $ 2,509   $ 28,401   $ 229,339   Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS(Unaudited)   31-Dec-12 Puerto Rico (In thousands)   Commercial   Construction   Mortgage   Lease financing   Consumer   Total Allowance for credit losses:               Specific ALLL non-covered loans $ 17,323 $ 120 $ 58,572 $ 1,066 $ 17,779 $ 94,860   General ALLL non-covered loans     200,292     5,742     60,455     1,828     82,120     350,437 ALLL - non-covered loans     217,615     5,862     119,027     2,894     99,899     445,297 Specific ALLL covered loans 8,505 - - - - 8,505   General ALLL covered loans     63,555     9,946     20,914     -     5,986     100,401 ALLL - covered loans     72,060     9,946     20,914     -     5,986     108,906 Total ALLL   $ 289,675   $ 15,808   $ 139,941   $ 2,894   $ 105,885   $ 554,203 Loans held-in-portfolio: Impaired non-covered loans $ 447,779 $ 35,849 $ 557,137 $ 4,881 $ 130,663 $ 1,176,309   Non-covered loans held-in-portfolio, excluding impaired loans     5,848,505     176,418     4,391,787     535,642     3,103,666     14,056,018 Non-covered loans held-in-portfolio     6,296,284     212,267     4,948,924     540,523     3,234,329     15,232,327 Impaired covered loans 109,241 - - - - 109,241   Covered loans held-in-portfolio, excluding impaired loans     2,135,406     361,396     1,076,730     -     73,199     3,646,731 Covered loans held-in-portfolio     2,244,647     361,396     1,076,730     -     73,199     3,755,972 Total loans held-in-portfolio   $ 8,540,931   $ 573,663   $ 6,025,654   $ 540,523   $ 3,307,528   $ 18,988,299     30-Sep-12 Puerto Rico (In thousands)   Commercial   Construction   Mortgage   Lease financing   Consumer   Total Allowance for credit losses: Specific ALLL non-covered loans $ 21,246 $ 191 $ 47,523 $ 978 $ 21,070 $ 91,008   General ALLL non-covered loans     180,178     7,208     77,567     1,603     87,690     354,246 ALLL - non-covered loans     201,424     7,399     125,090     2,581     108,760     445,254 Specific ALLL covered loans 15,294 - - - - 15,294   General ALLL covered loans     64,326     27,223     12,886     -     5,144     109,579 ALLL - covered loans     79,620     27,223     12,886     -     5,144     124,873 Total ALLL   $ 281,044   $ 34,622   $ 137,976   $ 2,581   $ 113,904   $ 570,127 Loans held-in-portfolio: Impaired non-covered loans $ 404,375 $ 35,757 $ 506,723 $ 4,933 $ 132,472 $ 1,084,260   Non-covered loans held-in-portfolio, excluding impaired loans     5,779,440     174,999     4,412,162     533,081     3,059,817     13,959,499 Non-covered loans held-in-portfolio     6,183,815     210,756     4,918,885     538,014     3,192,289     15,043,759 Impaired covered loans 120,510 - - - - 120,510   Covered loans held-in-portfolio, excluding impaired loans     2,203,852     393,101     1,106,851     -     79,553     3,783,357 Covered loans held-in-portfolio     2,324,362     393,101     1,106,851     -     79,553     3,903,867 Total loans held-in-portfolio   $ 8,508,177   $ 603,857   $ 6,025,736   $ 538,014   $ 3,271,842   $ 18,947,626                             Variance (In thousands)   Commercial   Construction   Mortgage   Lease financing   Consumer   Total Allowance for credit losses:               Specific ALLL non-covered loans $ (3,923 ) $ (71 ) $ 11,049 $ 88 $ (3,291 ) $ 3,852   General ALLL non-covered loans     20,114       (1,466 )     (17,112 )     225       (5,570 )     (3,809 ) ALLL - non-covered loans     16,191       (1,537 )     (6,063 )     313       (8,861 )     43   Specific ALLL covered loans (6,789 ) - - - - (6,789 )   General ALLL covered loans     (771 )     (17,277 )     8,028       -       842       (9,178 ) ALLL - covered loans     (7,560 )     (17,277 )     8,028       -       842       (15,967 ) Total ALLL   $ 8,631     $ (18,814 )   $ 1,965     $ 313     $ (8,019 )   $ (15,924 ) Loans held-in-portfolio: Impaired non-covered loans $ 43,404 $ 92 $ 50,414 $ (52 ) $ (1,809 ) $ 92,049   Non-covered loans held-in-portfolio, excluding impaired loans     69,065       1,419       (20,375 )     2,561       43,849       96,519   Non-covered loans held-in-portfolio     112,469       1,511       30,039       2,509       42,040       188,568   Impaired covered loans (11,269 ) - - - - (11,269 )   Covered loans held-in-portfolio, excluding impaired loans     (68,446 )     (31,705 )     (30,121 )     -       (6,354 )     (136,626 ) Covered loans held-in-portfolio     (79,715 )     (31,705 )     (30,121 )     -       (6,354 )     (147,895 ) Total loans held-in-portfolio   $ 32,754     $ (30,194 )   $ (82 )   $ 2,509     $ 35,686     $ 40,673   Popular, Inc.Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS(Unaudited)   31-Dec-12 U.S. Mainland (In thousands)   Commercial   Construction   Legacy   Mortgage   Consumer   Total Allowance for credit losses:               Specific ALLL $ 25 $ - $ - $ 16,095 $ 107 $ 16,227   General ALLL   80,042   1,567   33,102   14,253   31,213   160,177 Total ALLL   $ 80,067   $ 1,567   $ 33,102   $ 30,348   $ 31,320   $ 176,404 Loans held-in-portfolio: Impaired loans $ 79,885 $ 5,960 $ 18,744 $ 54,093 $ 2,714 $ 161,396   Loans held-in-portfolio, excluding impaired loans   3,482,033   34,630   365,473   1,075,490   631,843   5,589,469 Total loans held-in-portfolio   $ 3,561,918   $ 40,590   $ 384,217   $ 1,129,583   $ 634,557   $ 5,750,865     30-Sep-12 U.S. Mainland (In thousands)   Commercial   Construction   Legacy   Mortgage   Consumer   Total Allowance for credit losses: Specific ALLL $ 993 $ - $ - $ 15,300 $ 123 $ 16,416   General ALLL   83,591   1,737   39,871   14,442   34,988   174,629 Total ALLL   $ 84,584   $ 1,737   $ 39,871   $ 29,742   $ 35,111   $ 191,045 Loans held-in-portfolio: Impaired loans $ 92,849 $ 12,140 $ 24,276 $ 53,718 $ 2,732 $ 185,715   Loans held-in-portfolio, excluding impaired loans   3,351,967   35,557   441,572   1,049,819   645,464   5,524,379 Total loans held-in-portfolio   $ 3,444,816   $ 47,697   $ 465,848   $ 1,103,537   $ 648,196   $ 5,710,094                               Variance (In thousands)   Commercial   Construction   Legacy   Mortgage   Consumer   Total Allowance for credit losses: Specific ALLL $ (968) $ - $ - $ 795 $ (16) $ (189)   General ALLL   (3,549)   (170)   (6,769)   (189)   (3,775)   (14,452) Total ALLL   $ (4,517)   $ (170)   $ (6,769)   $ 606   $ (3,791)   $ (14,641) Loans held-in-portfolio: Impaired loans $ (12,964) $ (6,180) $ (5,532) $ 375 $ (18) $ (24,319)   Loans held-in-portfolio, excluding impaired loans   130,066   (927)   (76,099)   25,671   (13,621)   65,090 Total loans held-in-portfolio   $ 117,102   $ (7,107)   $ (81,631)   $ 26,046   $ (13,639)   $ 40,771 Popular, Inc.   Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable N - Reconciliation to GAAP Financial Measures(Unaudited)     (In thousands, except share or per share information)   31-Dec-12   30-Sep-12   31-Dec-11   Total stockholders' equity $ 4,110,000 $ 4,068,984 $ 3,918,753 Less: Preferred stock (50,160 ) (50,160 ) (50,160 ) Less: Goodwill (647,757 ) (647,757 ) (648,350 ) Less: Other intangibles     (54,295 )     (56,762 )     (63,954 )   Total tangible common equity   $ 3,357,788     $ 3,314,305     $ 3,156,289     Total assets $ 36,507,535 $ 36,503,366 $ 37,348,432 Less: Goodwill (647,757 ) (647,757 ) (648,350 ) Less: Other intangibles     (54,295 )     (56,762 )     (63,954 )   Total tangible assets   $ 35,805,483     $ 35,798,847     $ 36,636,128     Tangible common equity to tangible assets 9.38 % 9.26 % 8.62 % Common shares outstanding at end of period [1] 103,169,806 103,097,143 102,590,457 Tangible book value per common share [1]   $ 32.55     $ 32.15     $ 30.77     [1] All share and per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012.     (In thousands)   31-Dec-12   30-Sep-12   31-Dec-11   Common stockholders' equity $ 4,059,840 $ 4,018,824 $ 3,868,593 Less: Unrealized gains on available-for-sale securities, net of tax[1] (154,568 ) (175,769 ) (203,078 ) Less: Disallowed deferred tax assets[2] (385,060 ) (365,954 ) (249,325 ) Less: Intangible assets: Goodwill (647,757 ) (647,757 ) (648,350 ) Other disallowed intangibles (14,444 ) (18,409 ) (29,655 ) Less: Aggregate adjusted carrying value of all non-financial equity investments (1,160 ) (1,154 ) (1,189 ) Add: Pension liability adjustment, net of tax and accumulated net gains (losses) on cash flow hedges[3]     226,159       205,309       216,798     Total Tier 1 common equity   $ 3,083,010     $ 3,015,090     $ 2,953,794     [1] In accordance with regulatory risk-based capital guidelines, Tier 1 capital excludes net unrealized gains (losses) on available-for-sale debt securities and net unrealized gains on available-for-sale equity securities with readily determinable fair values. In arriving at Tier 1 capital, institutions are required to deduct net unrealized losses on available-for-sale equity securities with readily determinable fair values, net of tax.   [2] Approximately $118 million of the Corporation's $541 million of net deferred tax assets at December 31, 2012 (September 30, 2012 - $153 million and $546 million, respectively; December 31, 2011 - $150 million and $430 million, respectively), were included without limitation in regulatory capital pursuant to the risk-based capital guidelines, while approximately $385million of such assets at December 31, 2012 (September 30, 2012 - $366 million; December 31, 2011 - $249 million) exceeded the limitation imposed by these guidelines and, as “disallowed deferred tax assets”, were deducted in arriving at Tier 1 capital. The remaining $38 million of the Corporation's other net deferred tax assets at December 31, 2012 (September 30, 2012 - $27 million; December 31, 2011 - $31 million) represented primarily the following items (a) the deferred tax effects of unrealized gains and losses on available-for-sale debt securities, which are permitted to be excluded prior to deriving the amount of net deferred tax assets subject to limitation under the guidelines; (b) the deferred tax asset corresponding to the pension liability adjustment recorded as part of accumulated other comprehensive income; and (c) the deferred tax liability associated with goodwill and other intangibles.   [3] The Federal Reserve Bank has granted interim capital relief for the impact of pension liability adjustment.   Popular, Inc.         Financial Supplement to Fourth Quarter 2012 Earnings ReleaseTable O - Financial Information - Westernbank Covered Loans(Unaudited)     Revenues Quarters ended (In thousands)   31-Dec-12   30-Sep-12   Variance Interest income on covered loans   $ 76,998     $ 70,584     $ 6,414   FDIC loss share expense: Amortization of indemnification asset (33,704 ) (29,184 ) (4,520 ) 80% mirror accounting on credit impairment losses [1] (2,756 ) 18,095 (20,851 ) 80% mirror accounting on discount accretion on unfunded commitments (225 ) (248 ) 23 80% mirror accounting on reimbursable expenses 10,152 7,577 2,575 Change in true-up payment obligation (8,329 ) (2,991 ) (5,338 ) Other     (1,962 )     44       (2,006 )   Total FDIC loss share expense     (36,824 )     (6,707 )     (30,117 ) Other non-interest income     281       310       (29 ) Total revenues     40,455       64,187       (23,732 ) Provision for loan losses     (3,445 )     22,619       (26,064 ) Total revenues less provision for loan losses   $ 43,900     $ 41,568     $ 2,332   [1] Reductions in expected cash flows for ASC 310-30 loans, which may impact the provision for loan losses, may consider reductions in both principal and interest cash flow expectations. The amount covered under the FDIC loss sharing agreements for interest not collected from borrowers is limited under the agreements (approximately 90 days); accordingly, these amounts are not subject fully to the 80% mirror accounting.   Quarterly average assets Quarters ended (In millions)   31-Dec-2012   30-Sep-2012   Variance Covered loans $ 3,832 $ 3,952 $ (120 ) FDIC loss share asset     1,540       1,578       (38 )     Activity in the carrying amount and accretable yield of covered loans accounted for under ASC 310-30   Quarters ended       31-Dec-2012   30-Sep-2012 (In thousands)   Accretable yield   Carrying amount of loans   Accretable yield   Carrying amount of loans Beginning balance $ 1,470,882 $ 3,627,209 $ 1,574,850 $ 3,729,489 Accretion (71,103 ) 71,103 (66,168 ) 66,168 Changes in expected cash flows 51,890 - (37,800 ) - Collections / charge-offs     -       (206,553 )     -       (168,448 ) Ending balance 1,451,669 3,491,759 1,470,882 3,627,209   Allowance for loan losses - ASC 310-30 covered loans     -       (95,407 )     -       (103,547 ) Ending balance, net of allowance for loan losses   $ 1,451,669     $ 3,396,352     $ 1,470,882     $ 3,523,662       Activity in the carrying amount of the FDIC indemnity asset   Quarters ended (In thousands)       31-Dec-2012       30-Sep-2012 Balance at beginning of period $ 1,559,057 $ 1,631,594 Amortization (33,704 ) (29,184 ) Credit impairment losses to be covered under loss sharing agreements (2,756 ) 18,095 Decrease due to reciprocal accounting on the discount accretion on unfunded commitments (225 ) (248 ) Reimbursable expenses to be covered under loss sharing agreements 10,152 7,577 Payments received from FDIC under loss sharing agreements (134,277 ) (64,932 ) Other adjustments attributable to FDIC loss sharing agreements         851           (3,845 ) Balance at end of period       $ 1,399,098         $ 1,559,057       Activity in the remaining FDIC loss share asset amortization   Quarters ended (In thousands)       31-Dec-2012       30-Sep-2012 Balance at beginning of period $ 96,424 $ 121,308 Amortization (33,704 ) (29,184 ) Impact of lower projected losses         79,080           4,300   Balance at end of period       $ 141,800         $ 96,424   Popular, Inc.Investor Relations:Jorge A. Junquera, 787-754-1685Chief Financial Officer, Senior Executive Vice PresidentorMedia Relations:Teruca Rullán, 787-281-5170 or 917-679-3596/mobileSenior Vice President, Corporate Communications