Popular, Inc. Shines in Q1 2025 with Strong Financial Performance and Leadership Transition
Popular, Inc., a leading financial institution, has reported impressive results for the first quarter of 2025. In a recent conference call, company executives outlined the key highlights of their performance during this period.
Ignacio Alvarez, CEO, began by apologizing for his hoarse voice and handed over to Javier Ferrer-Fernández, President and COO, who reviewed the business highlights of the quarter. According to Ferrer-Fernández, net interest income increased by $15 million, with the net interest margin expanding by 5 basis points to 3.4%, mainly driven by lower deposit costs.
Loan balances at Popular Bank grew significantly, primarily driven by the commercial and construction segments. Deposit balances also surged, increasing by $935 million, with both banks contributing to the growth. Credit quality improved during the quarter, led by lower net charge-offs and early delinquency.
In addition to these financial highlights, Ferrer-Fernández announced that Popular had repurchased $122 million in shares at an average price of roughly $96 per share. This brings the total share repurchase activity under their current $500 million authorization to $340 million.
Tangible book value per share increased by nearly $4 to approximately $72, driven by quarterly net income and lower unrealized losses in the investment portfolio, offset in part by share repurchase activity and dividends in the period. This demonstrates Popular's commitment to enhancing shareholder value.
The recent volatility caused by tariff uncertainty has had a significant impact on markets, raising recession concerns. However, Ferrer-Fernández emphasized that Popular's strong balance sheet, diversified business mix, and exceptional team have consistently enabled them to perform well in uncertain times.
As of the end of the first quarter, business activity in Puerto Rico continued to be solid, with favorable trends in total employment, consumer spending, and other key economic data. The current employment rate of 5.5% continues to hover around all-time lows, while consumer spending remains healthy.
Combined credit and debit card sales for Banco Popular customers increased by approximately 6% compared to the first quarter of 2024, demonstrating the bank's strong performance in this area. Mortgage loan balances at Banco Popular also grew significantly, increasing by $136 million in the first quarter, driven primarily by home purchase activity.
