OFG Bancorp Reports 3Q23 Results

OFG Bancorp (NYSE: OFG), the financial holding company for Oriental Bank, reported results for the third quarter ended September 30, 2023. EPS diluted of $0.95 compared to $0.93 in 2Q23 and $0.87 in 3Q22. Total core revenues of $172.2 million compared to $170.5 million in 2Q23 and $156.8 million in 3Q22.

CEO Comment

José Rafael Fernández, Chief Executive Officer, said: “Third quarter results reflected year-over-year increases of 10% in core revenues and 9% in EPS. Highlights include continued loan growth, stable core deposits, low cumulative deposit beta of 19%, increased operating leverage, and strong performance metrics. We also benefited from overall higher interest rates and benign credit conditions as economic activity in Puerto Rico continues to do well.”

“Oriental’s self-service portal, launched earlier this year as part of our ‘Digital First’ strategy, has been expanded to include more features and is rapidly being adopted by our customers. This is resulting in a growing number of digital transactions, enabling us to better meet the needs of the customers and communities we serve.”

“Our results could not have been possible without the hard work and commitment of all our team members. We are thankful to them for executing our corporate vision.”

3Q23 Highlights

Performance Metrics: Net interest margin of 5.80%, return on average assets of 1.76%, return on average tangible common stockholders’ equity of 17.59%, and efficiency ratio of 52.36%.

Net Interest Income of $141.8 million compared to $139.6 million in 2Q23 and $126.5 million in 3Q22. 3Q23 reflected the full effect of 2Q23’s 25 basis point increase in the Federal Reserve Board’s funds rate and a partial effect of 3Q23’s 25 bps increase.

Total Interest Income of $165.7 million compared to $158.0 million in 2Q23 and $134.7 million in 3Q22. Compared to 2Q23, 3Q23 primarily reflected higher yields (7.84% vs. 7.76%) on increased average balances of loans and higher yields on variable rate loans.

Total Interest Expense of $23.9 million compared to $18.3 million in 2Q23 and $8.2 million in 3Q22. Compared to 2Q23, 3Q23 reflected higher cost of funds (1.07% vs. 0.84%) on increased average balances of deposits and borrowings.

Total Banking & Financial Service Revenues of $30.4 million compared to $30.9 million in 2Q23 and $30.3 million in 3Q22.

Pre-Provision Net Revenues of $82.3 million compared to $80.8 million in 2Q23 and $69.6 million in 3Q22.