Popular, Inc. Announces Earnings for the Quarter Ended March 31, 2001

Apr 10, 2001, 01:00 ET from Popular, Inc.

    SAN JUAN, Puerto Rico, April 10 /PRNewswire/ -- Popular, Inc.'s
 (the Corporation) net income for the first quarter of 2001 was $74.2 million
 as compared with $64.2 million reported for the same quarter of 2000, an
 increase of $10.0 million or 15.7%. Earnings per common share (EPS) for the
 quarter were $0.53, or 15.2% higher than $0.46 for the quarter ended March 31,
 2000. Net earnings for the last quarter of 2000 were $75.5 million, or $0.54
 per share.
     The Corporation's return on assets (ROA) and return on common equity (ROE)
 for the first quarter of 2001 were 1.09% and 15.25%, respectively, compared
 with 1.01% and 14.57% for the same period in 2000. For the last quarter of
 2000, these ratios were 1.09% and 15.72%.
     The Corporation's net income for the first quarter of 2001, when compared
 with the same period a year ago, reflected higher net interest income by $13.5
 million and lower operating expenses by $6.5 million. Non-interest income,
 excluding gain on sale of securities and trading account profits, rose $12.7
 million. These favorable variances were partially offset by decreases in the
 gain on sale of securities and trading account profits of $13.5 million and an
 increase in income tax of $8.4 million.
     The increase in net interest income of $13.5 million or 5.6% over the
 first quarter of 2000 was the effect of a favorable variance of $15.3 million
 due to a higher volume of average earning assets and a negative variance of
 $1.8 million due to a lower net interest margin. The increase in average
 earning assets of $2.4 billion was driven principally by a $1.2 billion
 increase in the average loan portfolio, mainly mortgage and commercial loans
 and a $1.1 billion increase in average investment securities, mostly from U.S.
 Government agencies. The increase in the volume of earning assets was funded
 mainly through higher average volume of short-term borrowings and interest-
 bearing deposits, which rose $1.4 billion and $760 million, respectively. The
 net interest yield for the quarter ended March 31, 2001, was 3.90% compared
 with 4.08% for the first quarter of 2000. The reduction in the net interest
 yield resulted from an increase of 11 basis points in the average cost of
 interest-bearing liabilities, mostly long-term debt and time deposits. Also,
 the average yield on loans declined 26 basis points. This decline was due to
 lower credit card income resulting from the sale of the U.S. credit card
 portfolio in 2000, a higher proportion of mortgages in the total loan
 portfolio, and the impact of the declining interest rate scenario at the
 beginning of 2001 in commercial loans with floating rates. The decline in the
 net interest yield was partially tempered by a rise of 42 basis points in the
 yield on investment securities, resulting from the maturity of investment
 securities during 2000 whose proceeds were reinvested at higher rates and
 additional arbitrage activities undertaken since the first quarter of 2000.
 For the last quarter of 2000 the net interest yield was 3.79%. The improvement
 in the net interest margin since the last quarter of 2000 stems from a
 reduction of 22 basis points in the cost of funding earning assets, as opposed
 to an 11 basis points reduction in their yield. The declining interest rate
 scenario in the first quarter of 2001 had a positive impact in the
 Corporation's net interest income due to its slightly negative gap and its net
 interest yield has begun to reflect an upward trend for the first time since
 the end of 1998.
     The provision for loan losses totaled $50.0 million for the first quarters
 of 2001 and 2000. Net charge-offs for the quarter ended March 31, 2001, were
 $36.1 million or 0.89% of average loans compared with $48.6 million or 1.29%
 for the first quarter of 2000.
     Total non-interest income, excluding securities and trading transactions,
 grew 12.5%, from $101.6 million for the first quarter of 2000 to $114.3
 million for the same period in 2001. This growth was fueled by increases of
 $10.8 million in other service fees and $4.4 million in service charges on
 deposit accounts, partially tempered by a $2.5 million decrease in other
 operating income. The increase in other service fees is mostly attributed to
 processing fees generated by GM Group and to debit card fees mainly as a
 result of the growing volume of point-of-sale terminals and transactions.
 Also, contributing to the growth were higher check cashing fees, basically
 driven by the expansion of the Corporation's retail financial subsidiary in
 the United States, and insurance commission income derived from Popular
 Insurance. The latter began operations in July 1, 2000. Service charges on
 deposit accounts increased mostly due to higher commercial account activity
 and the implementation during 2000 of new fees in deposit accounts, including
 charges for electronic transaction overdrafts, accounts without activity, and
 others. Also, the increase relates to some fees, including external payments,
 which were previously accounted for as other service fees and beginning in
 2001 are charged through account analysis for certain commercial accounts.
     The decrease in other income resulted mostly from lower revenues from the
 Corporation's leasing subsidiary and to income no longer derived as a result
 of the sale of Banco Fiduciario (BF) in the latter part of 2000. Also,
 included in other income was a pretax loss of $631 thousand on the fair market
 value of derivatives pursuant to SFAS No. 133 "Accounting for Derivative
 Instruments and Hedging Activities," which was adopted during the quarter.
     During the first three months of 2001, the Corporation realized gains on
 sale of securities and trading transactions of $0.6 million, compared with
 $14.1 million for the same period in 2000. During the first quarter of 2000,
 the Corporation exercised its conversion right and exchanged its investment in
 preferred stock of a financial corporation in Puerto Rico for common stock of
 the same entity, resulting in a $13.4 million pretax gain.
     Operating expenses amounted to $220.0 million for the first quarter of
 2001 compared with $226.5 million for the same period in 2000, for a decrease
 of $6.5 million or 2.9%. Personnel costs increased $1.7 million driven by a
 rise of $2.5 million in pension, profit sharing and other benefits. Partially
 offsetting the rise was a decrease of $0.8 million in salaries, impacted by
 lower headcount resulting from the sale of BF and the U.S. credit card
 operations, and to retired employees at Banco Popular. The latter was partly
 offset by annual merit increases and the impact of continued expansion in
 other business areas.
     All other operating expenses, excluding personnel costs, decreased
 $8.2 million or 6.7% when compared with the first quarter of 2000. This
 decline was mostly reflected in business promotion, other operating expenses,
 professional fees and amortization of intangibles. Business promotion declined
 mostly due to the fact that the Corporation is no longer incurring advertising
 efforts to market the U.S. credit cards, as these operations were sold in the
 second half of 2000. Other operating expenses declined mostly due to the sale
 of BF and lower sundry losses. Moreover, professional fees declined due to
 lower legal and consulting services, computer service fees, data processing
 and other professional services. The decrease in the amortization of
 intangibles relates to the core deposits intangible recorded on the merger
 with BanPonce Corporation in 1990, which was fully amortized at the end of
 2000.
     On January 1, 2001, the Corporation adopted SFAS No. 133 "Accounting for
 Derivative Instruments and Hedging Activities," which requires the recognition
 of derivatives as either assets or liabilities in the statement of condition
 measured at fair value. At the adoption, the Corporation recognized
 $686 thousand (net of tax) in income as a cumulative effect of accounting
 changes.
     The Corporation's total assets at March 31, 2001, amounted to $27.3
 billion, compared with $25.3 billion at March 31, 2000. Total assets at
 December 31, 2000, were $28.1 billion. At March 31, 2001, total loans amounted
 to $16.5 billion compared with $15.2 billion a year ago and $16.1 billion at
 December 31, 2000. Mortgage and commercial loans, which accounted for the
 largest increases in the portfolio, rose $1.1 billion and $238 million,
 respectively, from March 31, 2000. These same portfolios rose $394 million and
 $96 million, respectively, when compared with December 31, 2000. The decrease
 in assets from December 31, 2000 was mostly experienced in investment
 securities, which totaled $8.0 billion as of March 31, 2001, compared with
 $9.1 billion at the end of 2000. This decline is partly due to lower arbitrage
 activity as of the end of the quarter resulting from management's objective of
 reducing the reliance on borrowings. Investment securities were $7.3 billion
 as of March 31, 2000.
     The allowance for loan losses amounted to $305 million as of March 31,
 2001, or 1.85% of loans, compared with $293 million or 1.93% at the same date
 in 2000. At December 31, 2000, the allowance for loan losses totaled $291
 million or 1.81% of loans. Non-performing assets were $368 million or 2.23% of
 ending loans at March 31, 2001, compared with $361 million or 2.38% at the end
 of the first quarter of 2000 and $347 million or 2.16% at December 31, 2000.
 The increase of $21 million from December 31, 2000 was mostly reflected in
 non-performing commercial loans, which increased by $19 million from the end
 of 2000. The increase resulted from the growth in the portfolio. The allowance
 as a percentage of non-performing assets was 83.01% at March 31, 2001,
 compared with 81.23% at the end of the first quarter of 2000 and 83.82% at
 December 31, 2000.
     The Corporation's policy is to place commercial loans on non-accrual
 status when payments of principal or interest are delinquent sixty days. The
 industry practice for most U.S. banks is to place commercial loans in non-
 accrual status when payments of principal or interests are delinquent 90 days.
 Financing leases, conventional mortgage and close-end consumer loans are
 placed on non-accrual status if payments are delinquent 90 days.
     Total deposits rose to $15.1 billion at March 31, 2001 compared with $14.3
 billion at March 31, 2000, and $14.8 billion at December 31, 2000.
     Borrowed funds increased to $9.6 billion at March 31, 2001, compared with
 $8.8 billion at the same date a year earlier. At December 31, 2000, borrowed
 funds totaled $10.8 billion.
     At March 31, 2001, stockholders' equity was $2.1 billion, compared with
 $1.7 billion at the same date last year. Stockholders' equity was $2.0 billion
 at December 31, 2000. The allowance for unrealized gains, net of taxes, on
 securities available-for-sale amounted to $82 million as of March 31, 2001,
 compared with unrealized losses of $161 million as of March 31, 2000 and
 unrealized gains of $4 million as of December 31, 2000.
     The market value of the Corporation's common stock at March 31, 2001, was
 $29.45 per share, compared with $22.19 at March 31, 2000, and $26.31 at
 December 31, 2000. The Corporation's market capitalization at March 31, 2001
 was $4.0 billion, compared with $3.0 billion at March 31, 2000, and $3.6
 billion at December 31, 2000. At March 31, 2001, the Corporation's common
 stock had a book value per share of $14.87.
     The Corporation's common and preferred stock are traded on the National
 Association of Securities Dealers Automated Quotation (NASDAQ) National Market
 System under the symbols BPOP and BPOPP, respectively.
 
                                 POPULAR, INC.
                               Financial Summary
                     (In thousands, except per share data)
 
                                       Quarter ended       First
                                          March 31        Quarter
                                                         2001-2000     Fourth
                                                          Percent     Quarter
                                      2001        2000  Variance        2000
     Summary of Operations
 
     Interest income                $550,451     $505,801   8.83%     $558,408
     Interest expense                294,734      263,561   11.83      312,659
 
     Net interest income             255,717      242,240    5.56      245,749
     Provision for loan losses        50,034       50,013    0.04       46,242
 
     Net interest income after
      provision
       for loan losses               205,683      192,227    7.00      199,507
 
     Other operating income          114,368      101,645   12.52      121,130
     Gain on sale of securities          290       13,264               (2,539)
     Trading account profit              309          817     ---          770
 
     Total other income              114,967      115,726   (0.66)     119,361
 
     Salaries and benefits            99,797       99,092    0.71       88,346
     Profit sharing                    5,097        4,132   23.35        4,016
     Amortization of intangibles       6,876        8,592  (19.97)       8,600
     Other operating expenses        108,199      114,688   (5.66)     109,729
 
     Total operating expenses        219,969      226,504   (2.89)     210,691
 
     Income before income tax,
      minority interest and
      cumulative effect of
      acccounting changes            100,681       81,449   23.61      108,177
     Income tax                       27,151       18,756   44.76       32,695
     Net losses of minority
      interest                            16        1,496  (98.93)          17
 
     Income before cumulative
      effect of accounting
      changes                         73,546       64,189   14.58       75,499
     Cumulative effect of
      accounting changes, net of
      tax                                686            0     ---          ---
 
     Net income                      $74,232      $64,189   15.65      $75,499
 
     Net income applicable to
      common stock                   $72,145      $62,102   16.17      $73,410
 
     Earnings per common share:
      Net income                       $0.53        $0.46     ---        $0.54
 
     Average common shares
      outstanding                136,110,438  135,763,765     ---  136,013,633
     Common shares outstanding
      at end of period           136,101,195  135,747,610     ---  135,998,617
 
     Selected Average Balances
     Total assets                $27,707,352  $25,466,481    8.80  $27,598,700
     Loans                        16,204,326   15,027,521    7.83   16,222,867
     Earning assets               26,151,332   23,756,508   10.08   25,952,546
     Deposits                     14,831,644   14,147,519    4.84   14,706,237
     Interest-bearing
      liabilities                 22,227,630   20,099,522   10.59   22,107,939
     Stockholders' equity          2,018,788    1,815,021   11.23    1,957,918
 
     Selected Financial Data at
      Period-End
     Total assets                $27,312,724  $25,302,025    7.95  $28,057,051
     Loans                        16,509,477   15,200,931    8.61   16,057,085
     Earning assets               25,691,107   23,602,803    8.85   26,339,431
     Deposits                     15,093,740   14,337,861    5.27   14,804,907
     Interest-bearing
      liabilities                 21,721,087   20,173,181    7.67   22,480,261
     Stockholders' equity          2,122,974    1,682,293   26.20    1,993,644
 
     Performance Ratios
     Net interest yield *              3.90%        4.08%     ---        3.79%
     Return on assets                   1.09         1.01     ---        1.09
     Return on common equity           15.25        14.57     ---       15.72
 
     Credit Quality Data
     Non-performing assets          $367,761     $361,247    1.80     $346,747
     Net loans charged-off            36,130       48,581  (25.63)      50,884
     Allowance for loan losses       305,295      293,442    4.04      290,653
     Non-performing assets to
      total assets                     1.35%        1.43%     ---        1.24%
     Allowance for losses to
      loans                             1.85         1.93     ---        1.81
 
     * Not on a taxable equivalent basis
 
 

SOURCE Popular, Inc.
    SAN JUAN, Puerto Rico, April 10 /PRNewswire/ -- Popular, Inc.'s
 (the Corporation) net income for the first quarter of 2001 was $74.2 million
 as compared with $64.2 million reported for the same quarter of 2000, an
 increase of $10.0 million or 15.7%. Earnings per common share (EPS) for the
 quarter were $0.53, or 15.2% higher than $0.46 for the quarter ended March 31,
 2000. Net earnings for the last quarter of 2000 were $75.5 million, or $0.54
 per share.
     The Corporation's return on assets (ROA) and return on common equity (ROE)
 for the first quarter of 2001 were 1.09% and 15.25%, respectively, compared
 with 1.01% and 14.57% for the same period in 2000. For the last quarter of
 2000, these ratios were 1.09% and 15.72%.
     The Corporation's net income for the first quarter of 2001, when compared
 with the same period a year ago, reflected higher net interest income by $13.5
 million and lower operating expenses by $6.5 million. Non-interest income,
 excluding gain on sale of securities and trading account profits, rose $12.7
 million. These favorable variances were partially offset by decreases in the
 gain on sale of securities and trading account profits of $13.5 million and an
 increase in income tax of $8.4 million.
     The increase in net interest income of $13.5 million or 5.6% over the
 first quarter of 2000 was the effect of a favorable variance of $15.3 million
 due to a higher volume of average earning assets and a negative variance of
 $1.8 million due to a lower net interest margin. The increase in average
 earning assets of $2.4 billion was driven principally by a $1.2 billion
 increase in the average loan portfolio, mainly mortgage and commercial loans
 and a $1.1 billion increase in average investment securities, mostly from U.S.
 Government agencies. The increase in the volume of earning assets was funded
 mainly through higher average volume of short-term borrowings and interest-
 bearing deposits, which rose $1.4 billion and $760 million, respectively. The
 net interest yield for the quarter ended March 31, 2001, was 3.90% compared
 with 4.08% for the first quarter of 2000. The reduction in the net interest
 yield resulted from an increase of 11 basis points in the average cost of
 interest-bearing liabilities, mostly long-term debt and time deposits. Also,
 the average yield on loans declined 26 basis points. This decline was due to
 lower credit card income resulting from the sale of the U.S. credit card
 portfolio in 2000, a higher proportion of mortgages in the total loan
 portfolio, and the impact of the declining interest rate scenario at the
 beginning of 2001 in commercial loans with floating rates. The decline in the
 net interest yield was partially tempered by a rise of 42 basis points in the
 yield on investment securities, resulting from the maturity of investment
 securities during 2000 whose proceeds were reinvested at higher rates and
 additional arbitrage activities undertaken since the first quarter of 2000.
 For the last quarter of 2000 the net interest yield was 3.79%. The improvement
 in the net interest margin since the last quarter of 2000 stems from a
 reduction of 22 basis points in the cost of funding earning assets, as opposed
 to an 11 basis points reduction in their yield. The declining interest rate
 scenario in the first quarter of 2001 had a positive impact in the
 Corporation's net interest income due to its slightly negative gap and its net
 interest yield has begun to reflect an upward trend for the first time since
 the end of 1998.
     The provision for loan losses totaled $50.0 million for the first quarters
 of 2001 and 2000. Net charge-offs for the quarter ended March 31, 2001, were
 $36.1 million or 0.89% of average loans compared with $48.6 million or 1.29%
 for the first quarter of 2000.
     Total non-interest income, excluding securities and trading transactions,
 grew 12.5%, from $101.6 million for the first quarter of 2000 to $114.3
 million for the same period in 2001. This growth was fueled by increases of
 $10.8 million in other service fees and $4.4 million in service charges on
 deposit accounts, partially tempered by a $2.5 million decrease in other
 operating income. The increase in other service fees is mostly attributed to
 processing fees generated by GM Group and to debit card fees mainly as a
 result of the growing volume of point-of-sale terminals and transactions.
 Also, contributing to the growth were higher check cashing fees, basically
 driven by the expansion of the Corporation's retail financial subsidiary in
 the United States, and insurance commission income derived from Popular
 Insurance. The latter began operations in July 1, 2000. Service charges on
 deposit accounts increased mostly due to higher commercial account activity
 and the implementation during 2000 of new fees in deposit accounts, including
 charges for electronic transaction overdrafts, accounts without activity, and
 others. Also, the increase relates to some fees, including external payments,
 which were previously accounted for as other service fees and beginning in
 2001 are charged through account analysis for certain commercial accounts.
     The decrease in other income resulted mostly from lower revenues from the
 Corporation's leasing subsidiary and to income no longer derived as a result
 of the sale of Banco Fiduciario (BF) in the latter part of 2000. Also,
 included in other income was a pretax loss of $631 thousand on the fair market
 value of derivatives pursuant to SFAS No. 133 "Accounting for Derivative
 Instruments and Hedging Activities," which was adopted during the quarter.
     During the first three months of 2001, the Corporation realized gains on
 sale of securities and trading transactions of $0.6 million, compared with
 $14.1 million for the same period in 2000. During the first quarter of 2000,
 the Corporation exercised its conversion right and exchanged its investment in
 preferred stock of a financial corporation in Puerto Rico for common stock of
 the same entity, resulting in a $13.4 million pretax gain.
     Operating expenses amounted to $220.0 million for the first quarter of
 2001 compared with $226.5 million for the same period in 2000, for a decrease
 of $6.5 million or 2.9%. Personnel costs increased $1.7 million driven by a
 rise of $2.5 million in pension, profit sharing and other benefits. Partially
 offsetting the rise was a decrease of $0.8 million in salaries, impacted by
 lower headcount resulting from the sale of BF and the U.S. credit card
 operations, and to retired employees at Banco Popular. The latter was partly
 offset by annual merit increases and the impact of continued expansion in
 other business areas.
     All other operating expenses, excluding personnel costs, decreased
 $8.2 million or 6.7% when compared with the first quarter of 2000. This
 decline was mostly reflected in business promotion, other operating expenses,
 professional fees and amortization of intangibles. Business promotion declined
 mostly due to the fact that the Corporation is no longer incurring advertising
 efforts to market the U.S. credit cards, as these operations were sold in the
 second half of 2000. Other operating expenses declined mostly due to the sale
 of BF and lower sundry losses. Moreover, professional fees declined due to
 lower legal and consulting services, computer service fees, data processing
 and other professional services. The decrease in the amortization of
 intangibles relates to the core deposits intangible recorded on the merger
 with BanPonce Corporation in 1990, which was fully amortized at the end of
 2000.
     On January 1, 2001, the Corporation adopted SFAS No. 133 "Accounting for
 Derivative Instruments and Hedging Activities," which requires the recognition
 of derivatives as either assets or liabilities in the statement of condition
 measured at fair value. At the adoption, the Corporation recognized
 $686 thousand (net of tax) in income as a cumulative effect of accounting
 changes.
     The Corporation's total assets at March 31, 2001, amounted to $27.3
 billion, compared with $25.3 billion at March 31, 2000. Total assets at
 December 31, 2000, were $28.1 billion. At March 31, 2001, total loans amounted
 to $16.5 billion compared with $15.2 billion a year ago and $16.1 billion at
 December 31, 2000. Mortgage and commercial loans, which accounted for the
 largest increases in the portfolio, rose $1.1 billion and $238 million,
 respectively, from March 31, 2000. These same portfolios rose $394 million and
 $96 million, respectively, when compared with December 31, 2000. The decrease
 in assets from December 31, 2000 was mostly experienced in investment
 securities, which totaled $8.0 billion as of March 31, 2001, compared with
 $9.1 billion at the end of 2000. This decline is partly due to lower arbitrage
 activity as of the end of the quarter resulting from management's objective of
 reducing the reliance on borrowings. Investment securities were $7.3 billion
 as of March 31, 2000.
     The allowance for loan losses amounted to $305 million as of March 31,
 2001, or 1.85% of loans, compared with $293 million or 1.93% at the same date
 in 2000. At December 31, 2000, the allowance for loan losses totaled $291
 million or 1.81% of loans. Non-performing assets were $368 million or 2.23% of
 ending loans at March 31, 2001, compared with $361 million or 2.38% at the end
 of the first quarter of 2000 and $347 million or 2.16% at December 31, 2000.
 The increase of $21 million from December 31, 2000 was mostly reflected in
 non-performing commercial loans, which increased by $19 million from the end
 of 2000. The increase resulted from the growth in the portfolio. The allowance
 as a percentage of non-performing assets was 83.01% at March 31, 2001,
 compared with 81.23% at the end of the first quarter of 2000 and 83.82% at
 December 31, 2000.
     The Corporation's policy is to place commercial loans on non-accrual
 status when payments of principal or interest are delinquent sixty days. The
 industry practice for most U.S. banks is to place commercial loans in non-
 accrual status when payments of principal or interests are delinquent 90 days.
 Financing leases, conventional mortgage and close-end consumer loans are
 placed on non-accrual status if payments are delinquent 90 days.
     Total deposits rose to $15.1 billion at March 31, 2001 compared with $14.3
 billion at March 31, 2000, and $14.8 billion at December 31, 2000.
     Borrowed funds increased to $9.6 billion at March 31, 2001, compared with
 $8.8 billion at the same date a year earlier. At December 31, 2000, borrowed
 funds totaled $10.8 billion.
     At March 31, 2001, stockholders' equity was $2.1 billion, compared with
 $1.7 billion at the same date last year. Stockholders' equity was $2.0 billion
 at December 31, 2000. The allowance for unrealized gains, net of taxes, on
 securities available-for-sale amounted to $82 million as of March 31, 2001,
 compared with unrealized losses of $161 million as of March 31, 2000 and
 unrealized gains of $4 million as of December 31, 2000.
     The market value of the Corporation's common stock at March 31, 2001, was
 $29.45 per share, compared with $22.19 at March 31, 2000, and $26.31 at
 December 31, 2000. The Corporation's market capitalization at March 31, 2001
 was $4.0 billion, compared with $3.0 billion at March 31, 2000, and $3.6
 billion at December 31, 2000. At March 31, 2001, the Corporation's common
 stock had a book value per share of $14.87.
     The Corporation's common and preferred stock are traded on the National
 Association of Securities Dealers Automated Quotation (NASDAQ) National Market
 System under the symbols BPOP and BPOPP, respectively.
 
                                 POPULAR, INC.
                               Financial Summary
                     (In thousands, except per share data)
 
                                       Quarter ended       First
                                          March 31        Quarter
                                                         2001-2000     Fourth
                                                          Percent     Quarter
                                      2001        2000  Variance        2000
     Summary of Operations
 
     Interest income                $550,451     $505,801   8.83%     $558,408
     Interest expense                294,734      263,561   11.83      312,659
 
     Net interest income             255,717      242,240    5.56      245,749
     Provision for loan losses        50,034       50,013    0.04       46,242
 
     Net interest income after
      provision
       for loan losses               205,683      192,227    7.00      199,507
 
     Other operating income          114,368      101,645   12.52      121,130
     Gain on sale of securities          290       13,264               (2,539)
     Trading account profit              309          817     ---          770
 
     Total other income              114,967      115,726   (0.66)     119,361
 
     Salaries and benefits            99,797       99,092    0.71       88,346
     Profit sharing                    5,097        4,132   23.35        4,016
     Amortization of intangibles       6,876        8,592  (19.97)       8,600
     Other operating expenses        108,199      114,688   (5.66)     109,729
 
     Total operating expenses        219,969      226,504   (2.89)     210,691
 
     Income before income tax,
      minority interest and
      cumulative effect of
      acccounting changes            100,681       81,449   23.61      108,177
     Income tax                       27,151       18,756   44.76       32,695
     Net losses of minority
      interest                            16        1,496  (98.93)          17
 
     Income before cumulative
      effect of accounting
      changes                         73,546       64,189   14.58       75,499
     Cumulative effect of
      accounting changes, net of
      tax                                686            0     ---          ---
 
     Net income                      $74,232      $64,189   15.65      $75,499
 
     Net income applicable to
      common stock                   $72,145      $62,102   16.17      $73,410
 
     Earnings per common share:
      Net income                       $0.53        $0.46     ---        $0.54
 
     Average common shares
      outstanding                136,110,438  135,763,765     ---  136,013,633
     Common shares outstanding
      at end of period           136,101,195  135,747,610     ---  135,998,617
 
     Selected Average Balances
     Total assets                $27,707,352  $25,466,481    8.80  $27,598,700
     Loans                        16,204,326   15,027,521    7.83   16,222,867
     Earning assets               26,151,332   23,756,508   10.08   25,952,546
     Deposits                     14,831,644   14,147,519    4.84   14,706,237
     Interest-bearing
      liabilities                 22,227,630   20,099,522   10.59   22,107,939
     Stockholders' equity          2,018,788    1,815,021   11.23    1,957,918
 
     Selected Financial Data at
      Period-End
     Total assets                $27,312,724  $25,302,025    7.95  $28,057,051
     Loans                        16,509,477   15,200,931    8.61   16,057,085
     Earning assets               25,691,107   23,602,803    8.85   26,339,431
     Deposits                     15,093,740   14,337,861    5.27   14,804,907
     Interest-bearing
      liabilities                 21,721,087   20,173,181    7.67   22,480,261
     Stockholders' equity          2,122,974    1,682,293   26.20    1,993,644
 
     Performance Ratios
     Net interest yield *              3.90%        4.08%     ---        3.79%
     Return on assets                   1.09         1.01     ---        1.09
     Return on common equity           15.25        14.57     ---       15.72
 
     Credit Quality Data
     Non-performing assets          $367,761     $361,247    1.80     $346,747
     Net loans charged-off            36,130       48,581  (25.63)      50,884
     Allowance for loan losses       305,295      293,442    4.04      290,653
     Non-performing assets to
      total assets                     1.35%        1.43%     ---        1.24%
     Allowance for losses to
      loans                             1.85         1.93     ---        1.81
 
     * Not on a taxable equivalent basis
 
 SOURCE  Popular, Inc.