First BanCorp. (the "Corporation" or "First BanCorp.") (NYSE:FBP), the bank holding company for FirstBank Puerto Rico ("FirstBank" or "the Bank"), today reported a net income of $75.7 million, or $0.46 per diluted share, for the fourth quarter of 2024, compared to $73.7 million, or $0.45 per diluted share, for the third quarter of 2024, and $79.5 million, or $0.46 per diluted share, for the fourth quarter of 2023. For the year ended December 31, 2024, the Corporation reported a net income of $298.7 million, or $1.81 per diluted share, compared to $302.9 million, or $1.71 per diluted share, for the year ended December 31, 2023.

*Aurelio Alemán, President and Chief Executive Officer of First BanCorp, commented:* "We are very pleased to conclude the year with strong fourth quarter results underscored by solid loan growth across all business segments, encouraging core customer deposit trends, and solid profitability metrics. We earned $76 million in net income and grew pre-tax pre-provision income by 5% on a linked quarter basis driven by net interest income expansion and disciplined expense management. Consistent with our strategy, steady core deposit inflows during the quarter enabled us to reinvest a portion of our investment portfolio cash flows into higher yielding securities at a very attractive spread to our run-off yield, while growing the loan book by $303 million and paying down higher-cost funding sources, including the redemption of $50 million in junior subordinated debentures. Our solid performance this quarter caps a year of record results for the franchise. We registered record revenues and posted a return on average assets above 1.5% for the third consecutive year. The loan portfolio expanded by 4.7% or $569 million, we added $267 million in core customer deposits and distributed over 100% of earnings in the form of capital deployment actions for the fourth consecutive year. These results were complemented by ongoing community outreach initiatives aligned with our commitment to support reconstruction efforts and facilitate the development of affordable housing projects and the modernization of critical infrastructure in our main market. We are achieving the targets we set to measure our strategy's success and are seeing the benefit of the investments we have made in technology to accelerate our growth and improve how we serve our communities. As we look to 2025, the operating environment seems conducive to another year of positive performance and organic capital generation. Given this backdrop, and our strong capital levels and improved earnings profile, we are pleased to announce that our Board approved a 13% increase in our common stock dividend. We remain focused on deploying our capital in a thoughtful manner by prioritizing responsible organic growth, executing reasonable share repurchase opportunities, and maintaining a sustainable dividend payout policy."		Q4			Q3			Q4			Year
		2024			2024			2023			2024			2023
		Financial Highlights (1)
	Net interest income	$	209,267		$	202,064		$	196,682		$	807,479		$	797,110
	Provision for credit losses		20,904			15,245			18,812			59,921			60,940
	Non-interest income		32,199			32,502			33,609			130,722			132,694
	Non-interest expenses		124,533			122,935			126,605			487,073			471,428
	Income before income taxes		96,029			96,386			84,874			391,207			397,436
	Income tax expense		20,328			22,659			5,385			92,483			94,572
	Net income	$	75,701		$	73,727		$	79,489		$	298,724		$	302,864

		Q4			Q3			Q4			Year
		2024			2024			2023			2024			2023
		Selected Financial Data (1)
	Net interest margin		4.33	%		4.25	%		4.14	%		4.25	%		4.22	%
	Efficiency ratio		51.57	%		52.41	%		54.98	%		51.92	%		50.70	%
	Earnings per share - diluted	$	0.46		$	0.45		$	0.46		$	1.81		$	1.71
	Book value per share	$	10.19		$	10.38		$	8.85		$	10.19		$	8.85
	Tangible book value per share⁽²⁾	$	9.91		$	10.09		$	8.54		$	9.91		$	8.54
	Return on average equity		17.77	%		18.31	%		23.69	%		19.09	%		21.86	%
	Return on average assets		1.56	%		1.55	%		1.70	%		1.58	%		1.62	%

Results for the Fourth Quarter of 2024 compared to the Third Quarter of 2024
Profitability		Net income – $75.7 million, or $0.46 per diluted share compared to $73.7 million, or $0.45 per diluted share. Income before income taxes – $96.0 million compared to $96.4 million. Adjusted pre-tax, pre-provision income (Non-GAAP)⁽²⁾ – $116.9 million compared to $111.6 million. Net interest income – $209.3 million compared to $202.1 million. Net interest margin increased to 4.33%, compared to 4.25%. Provision for credit losses – $20.9 million compared to $15.2 million. The increase in provision reflects loan growth, mainly in the commercial loan portfolio. The economic outlook continues to reflect a positive outlook which impacted the provision levels but to a lesser extent than in the previous quarter. Non-interest income – $32.2 million compared to $32.5 million. Non-interest expenses – $124.5 million compared to $122.9 million. The efficiency ratio was 51.57%, compared to 52.41%. Income taxes – $20.3 million compared to $22.7 million. The decrease in income tax expense was due to a lower effective tax rate, in part due to a higher proportion of exempt income to taxable income.

Balance Sheet		Total loans – grew by $303.2 million to $12.8 billion, primarily reflecting growth in the commercial loan portfolio across all regions. Total loan originations, other than credit card utilization activity, of $1.5 billion, up $352.1 million, mainly in commercial and construction loans. Core deposits (other than brokered and government deposits) – increased by $197.9 million to $12.9 billion, which reflects growth of $106.7 million in the Puerto Rico region and $87.3 million in the Florida region. This increase includes a $296.8 million increase in non-interest-bearing deposits. Government deposits (fully collateralized) – increased by $367.9 million to $3.5 billion, mainly in the Puerto Rico region. Brokered certificates of deposits ("CDs") – decreased by $41.9 million to $478.1 million, reflecting a $129.9 million decrease in the Puerto Rico region, partially offset by an $88.0 million increase in the Florida region.

Asset Quality		Allowance for credit losses ("ACL") coverage ratio – amounted to 1.91%, compared to 1.98%. Annualized net charge-offs to average loans ratio remained flat at 0.78%, reflecting an increase in consumer loans and finance leases net charge-offs which was offset by a decrease in commercial and construction net charge-offs. Non-performing assets – decreased by $0.8 million to $118.3 million, compared to $119.1 million.

Liquidity and Capital		Liquidity – Cash and cash equivalents amounted to $1.2 billion, compared to $685.4 million. When adding $1.2 billion of free high-quality liquid securities that could be liquidated or pledged within one day and $912.4 million in available lending capacity at the Federal Home Loan Bank ("FHLB"), available liquidity amounted to 17.27% of total assets, compared to 18.43%. Capital – Repurchased $50.0 million of junior subordinated debentures and paid $26.1 million in common stock dividends. Capital ratios exceeded required regulatory levels. The Corporation's estimated total capital, common equity tier 1 ("CET1") capital, tier 1 capital, and leverage ratios were 18.02%, 16.32%, 16.32%, and 11.07%, respectively, as of December 31, 2024. On a non-GAAP basis, the tangible common equity ratio⁽²⁾ decreased to 8.44% when compared to 8.79%, in part due to a decrease in the fair value of available-for-sale debt securities due to changes in market interest rates which is recognized as part of accumulated other comprehensive loss.

		(1) In thousands, except per share information and financial ratios.
		(2) Represents non-GAAP financial measures. Refer to Non-GAAP Disclosures - Non-GAAP Financial Measures for the definition of and additional information about these non-GAAP financial measures.

NET INTEREST INCOME

The following table sets forth information concerning net interest income for the last five quarters:

	Quarter Ended
(Dollars in thousands)	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Net Interest Income
Interest income	$	279,728	$	274,675	$	272,245	$	268,505	$	265,481
Interest expense		70,461		72,611		72,617		71,985		68,799
Net interest income	$	209,267	$	202,064	$	199,628	$	196,520	$	196,682

Average Balances
Loans and leases	$	12,584,143	$	12,354,679	$	12,272,816	$	12,207,840	$	12,004,881
Total securities, other short-term investments and interest-bearing cash balances		6,592,411		6,509,789		6,698,609		6,720,395		6,835,407
Average interest-earning assets	$	19,176,554	$	18,864,468	$	18,971,425	$	18,928,235	$	18,840,288

Average interest-bearing liabilities	$	11,911,904	$	11,743,122	$	11,868,658	$	11,838,159	$	11,665,459

Average Yield/Rate
Average yield on interest-earning assets - GAAP		5.79%		5.78%		5.76%		5.69%		5.59%
Average rate on interest-bearing liabilities - GAAP		2.35%		2.45%		2.45%		2.44%		2.34%
Net interest spread - GAAP		3.44%		3.33%		3.31%		3.25%		3.25%
Net interest margin - GAAP		4.33%		4.25%		4.22%		4.16%		4.14%

Net interest income amounted to $209.3 million for the fourth quarter of 2024, an increase of $7.2 million, compared to $202.1 million for the third quarter of 2024. The increase in net interest income reflects the following:

A $3.2 million increase in interest income from interest-bearing cash balances, driven by a $349.3 million increase in the average cash balances, which consisted primarily of deposits maintained at the Federal Reserve Bank (the "FED") which more than compensated for the reduction in the federal funds rate.

A $1.2 million decrease in interest expense on junior subordinated debentures mainly due to the full quarter effect of the $50.0 million redemption of the then-outstanding trust-preferred securities ("TruPS") in September 2024.

A $1.0 million decrease on interest expense on interest-bearing deposits, consisting of:

- A $1.8 million decrease in interest expense on brokered CDs, driven by a $115.1 million decrease in the average balance.

- A $0.8 million decrease in interest expense on time deposits, excluding brokered CDs, mainly associated with new issuances and renewals at lower interest rates when compared to the third quarter of 2024. The average cost of non-brokered time deposits in the fourth quarter of 2024 decreased 9 basis points to 3.51% when compared to the previous quarter.

Partially offset by:

- A $1.6 million increase in interest expense on interest-bearing checking and savings accounts, driven by a $348.2 million increase in the average balance.

A $1.0 million increase in interest income on loans, mainly driven by:

- A $0.5 million increase in interest income on commercial and construction loans, driven by a $192.1 million increase in the average balance of this portfolio and higher collections from late charges and prepayment penalties, partially offset by the effect of lower market interest rates on the downward repricing of variable-rate loans.

As of December 31, 2024, the interest rate on approximately 53% of the Corporation's commercial and construction loans was tied to variable rates, with 33% based upon SOFR of 3 months or less, 12% based upon the Prime rate index, and 8% based on other indexes. For the quarter ended December 31, 2024, the average one-month SOFR decreased 62 basis points, the average three-month SOFR decreased 58 basis points, and the average Prime rate decreased 62 basis points, compared to the average rates for such indexes for the previous quarter.

- A $0.4 million increase in interest income on consumer loans and finance leases, in part due to a $21.3 million increase in the average balance, mainly in the auto loans and finance leases portfolios, partially offset by the downward repricing in the credit cards portfolio.

A $0.8 million increase in interest income on debt securities, driven by the effect during the fourth quarter of 2024 of $367.5 million in maturities of debt securities with an average yield of 0.65% being partially replenished with $222.1 million in purchases of U.S. agencies mortgage-backed securities ("MBS") with an average yield of 5.40%.

Net interest margin for the fourth quarter of 2024 was 4.33%, an 8 basis points increase when compared to the third quarter of 2024, mostly reflecting a change in asset mix resulting from an increase in interest-bearing cash balances deposited at the FED as a result of an increase in deposits, and the deployment of cash flows from lower-yielding investment securities to fund loan growth and purchases of higher-yielding investment securities, while simultaneously repaying higher-rate brokered CDs and redeeming the aforementioned junior subordinated debentures. These factors were partially offset by the downward repricing of variable-rate commercial loans and a lower federal funds rate on cash deposited at the FED.

NON-INTEREST INCOME

The following table sets forth information concerning non-interest income for the last five quarters:

	Quarter Ended
	December 31,2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31,2023
(In thousands)
Service charges and fees on deposit accounts	$	9,748	$	9,684	$	9,725	$	9,662	$	9,662
Mortgage banking activities		3,183		3,199		3,419		2,882		2,094
Insurance commission income		2,274		3,003		2,786		5,507		2,379
Card and processing income		12,155		11,768		11,523		11,312		11,015
Other non-interest income		4,839		4,848		4,585		4,620		8,459
Non-interest income	$	32,199	$	32,502	$	32,038	$	33,983	$	33,609

Non-interest income decreased by $0.3 million to $32.2 million for the fourth quarter of 2024, compared to $32.5 million for the third quarter of 2024, mainly due to:

A $0.7 million decrease in insurance commission income related to less production of insurance policies during the fourth quarter of 2024.

Partially offset by:

A $0.4 million increase in card and processing income, mainly due to credit card incentives recognized during the fourth quarter of 2024.

NON-INTEREST EXPENSES

The following table sets forth information concerning non-interest expenses for the last five quarters:

	Quarter Ended
	December 31,2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31,2023
(In thousands)
Employees' compensation and benefits	$	59,652		$	59,081		$	57,456		$	59,506		$	55,584
Occupancy and equipment		22,771			22,424			21,851			21,381			21,847
Business promotion		5,328			4,116			4,359			3,842			6,725
Professional service fees:
Collections, appraisals and other credit-related fees		956			688			1,149			1,366			952
Outsourcing technology services		7,499			7,771			7,698			7,469			7,003
Other professional fees		3,355			4,079			3,584			3,841			3,295
Taxes, other than income taxes		5,994			5,665			5,408			5,129			5,535
FDIC deposit insurance		2,236			2,164			2,316			3,102			8,454
Other insurance and supervisory fees		1,967			2,092			2,287			2,293			2,308
Net gain on OREO operations		(1,074	)		(1,339	)		(3,609	)		(1,452	)		(1,005	)
Credit and debit card processing expenses		7,147			7,095			7,607			5,751			7,360
Communications		2,251			2,170			2,261			2,097			2,134
Other non-interest expenses		6,451			6,929			6,315			6,598			6,413
Total non-interest expenses	$	124,533		$	122,935		$	118,682		$	120,923		$	126,605

Non-interest expenses amounted to $124.5 million in the fourth quarter of 2024, an increase of $1.6 million, from $122.9 million in the third quarter of 2024. The $1.6 million increase reflects the following significant variances:

A $1.2 million increase in business promotion expenses, mainly as a result of increases in events and sponsorships and public relations activities associated with seasonal campaign efforts.

A $0.6 million increase in employees' compensation and benefits expenses, in part due to increases in incentives and benefits.

A $0.3 million increase in occupancy and equipment expenses, mainly due to accelerated rent expense recognized due to the closure of a branch in the Puerto Rico region during the fourth quarter of 2024.

A $0.3 million decrease in net gain on other real estate owned ("OREO") operations, driven by a write-down of a commercial property in the Puerto Rico region and lower rental income.

Partially offset by:

A $0.7 million decrease in professional services fees, mainly due to a decrease in consulting fees driven by technology projects completed during the third quarter of 2024.

A $0.4 million decrease in other non-interest expenses, mainly due to lower charges for operational and fraud losses.

INCOME TAXES

The Corporation recorded an income tax expense of $20.3 million for the fourth quarter of 2024, compared to $22.7 million for the third quarter of 2024. The decrease in income tax expense was due to a lower effective tax rate, in part due to a higher proportion of exempt income to taxable income.

The Corporation's annual effective tax rate, excluding entities with pre-tax losses from which a tax benefit cannot be recognized and discrete items, was 23.0% for the fourth quarter of 2024, compared to an estimated annual effective tax rate of 23.7% for the third quarter of 2024. As of December 31, 2024, the Corporation had a deferred tax asset of $136.4 million, net of a valuation allowance of $119.1 million against the deferred tax assets.

CREDIT QUALITY

Non-Performing Assets

The following table sets forth information concerning non-performing assets for the last five quarters:

(Dollars in thousands)	December 31,2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31,2023
Nonaccrual loans held for investment:
Residential mortgage	$	31,949	$	31,729	$	31,396	$	32,685	$	32,239
Construction		1,365		4,651		4,742		1,498		1,569
Commercial mortgage		10,851		11,496		11,736		11,976		12,205
Commercial and industrial ("C&I")		20,514		18,362		27,661		25,067		15,250
Consumer and finance leases		22,788		23,106		20,638		21,739		22,444
Total nonaccrual loans held for investment	$	87,467	$	89,344	$	96,173	$	92,965	$	83,707
OREO		17,306		19,330		21,682		28,864

First BanCorp. Announces Earnings for the Quarter and Year Ended December 31, 2024