Business Wire | Jul 23, 2020 08:01AM EDT

Popular, Inc. Announces Second Quarter 2020 Financial Results

Jul. 23, 2020

SAN JUAN, Puerto Rico--(BUSINESS WIRE)--Jul. 23, 2020--Popular, Inc. (the "Corporation," "Popular," "we," "us," "our") (NASDAQ:BPOP) reported net income of $127.6 million for the quarter ended June 30, 2020, compared to net income of $34.3 million for the quarter ended March 31, 2020.

Ignacio Alvarez, President and Chief Executive Officer, said: "We reported net income of $127.6 million for the quarter, notwithstanding the challenging economic environment resulting from the coronavirus pandemic and the historically low interest rate scenario. After 126 years in the banking business, we know success requires that we act quickly and decisively, putting people first. I want to express my gratitude to our employees for their commitment to serve our customers and their creativity and ability to adapt to a rapidly changing situation. We continue to support the communities we serve during these difficult times by providing payment deferrals to more than 120,000 customers and have also provided assistance to health care professionals and non-profit organizations as they battle the pandemic. I would also like to thank our customers for their continued trust and for adapting to this new reality. They have accelerated their adoption of digital channels, helping us reach an important milestone - more than one million active users in our digital banking platform.

We are aware that there remains much uncertainty as to the future of the economy. Economic performance will continue to be tied to developments on the health front, which are very difficult to predict. If the health situation deteriorates, leading to a new round of restrictions on businesses, this will obviously hamper the economic recovery. The strength of our balance sheet, levels of capital and liquidity place us in a strong position to continue to serve our clients and weather the challenges that may lie ahead."

Significant Events

Financial Highlights

For the second quarter of 2020 the Corporation recorded a net income of $127.6 million, compared to a net income of $34.3 million for the previous quarter. The results for both periods were significantly impacted by the COVID-19 pandemic, which has affected the markets in which we operate and our results of operations, as explained below.

The Corporation's total assets increased by $10.0 billion during the quarter to $62.8 billion, primarily due to an increase in deposits of $9.0 billion, of which $4.2 billion were from the public sector, driven by Federal and Puerto Rico Government assistance programs related to the pandemic. Most of this increased liquidity was deployed in overnight Fed Funds or in short-term U.S. Treasury securities and to originate $1.4 billion in Small Business Administration ("SBA") loans under the Payment Protection Program ("PPP"). These are all lower yielding assets. This change in the composition of our earning assets, coupled with the effect of the declines in market interest rates, resulted in a compression of the Corporation's net interest margin which declined 69 basis points during the quarter to 3.25%. Net interest income for the quarter ended June 30, 2020 was $450.9 million compared to $473.1 million in the previous quarter, a decrease of $22.2 million.

Coronavirus (COVID-19) Pandemic

The Corporation's results for the second quarter of 2020 reflect the impact of the continued business disruption caused by the pandemic, the relief measures implemented by the Corporation and by the federal, state and local governments in response thereto. Certain of the measures imposed by the governments of Puerto Rico, the United States mainland and United States Virgin Islands, including lockdowns, business closures, mandatory curfews and limits to public activities, were relaxed late in the second quarter of 2020 to allow for the gradual reopening of the economy. Nevertheless, economic activity was negatively impacted by the pandemic throughout the quarter, which in turn impacted our financial results. The recent regional resurgence in the spread of the virus has also led to the reinstitution of certain restrictive health and safety measures. For example, in July 16, 2020, as a result of the resurgence of COVID-19 cases on the Island, the Government of Puerto Rico scaled back measures to reopen the economy, including by further restricting non-essential business establishments and public activities.

As previously disclosed, the Corporation implemented several financial relief programs in response to the pandemic, including payment moratoriums, suspensions of foreclosures and other collection activity, as well as waivers of certain fees and service charges, such as late-payment charges and ATM transaction fees. In the case of Puerto Rico, the moratoriums for all consumer products are mandated by local law. As of June 30, 2020, the Corporation had granted a loan payment moratorium to 116,226 eligible retail customers with an aggregate book value of $3.9 billion, and to 5,003 eligible commercial clients with an aggregate book value of $4.1 billion as detailed below. Covid-related moratoriums began in March of 2020 and are set to expire between July 1, 2020 and September 30, 2020, depending on the loan product and deferral agreements with the borrowers. Other clients benefitted from moratoriums since mid-January 2020 as a result of various areas of Puerto Rico being declared disaster areas as a result of the January earthquakes.

Loan portfolio affected by Loan Book Value Percentage byCovid-related moratoriums count (In portfolio thousands)

Mortgage 16,595 $ 2,108,825 28.0 %

Auto loans 47,975 907,651 31.3 %

Lease financing 10,600 431,285 39.3 %

Credit cards 19,256 107,644 11.0 %

Other consumer loans 21,800 313,014 16.6 %

Commercial 5,003 4,116,697 28.0 %

Total 121,229 $ 7,985,116 27.5 %

The delinquency status of loans subject to the Corporation's payment moratorium programs remains unaltered during the payment deferral period and the Corporation continues to accrue interest income during such term.

As of June 30, 2020, the Corporation had secured funding approval for over 28,000 loans totaling approximately $1.4 billion under the Small Business Administration's ("SBA") Payroll Protection Program ("PPP"). Approximately $1.2 billion of such loans were granted in Puerto Rico, $215 million in the mainland United States and $29 million in the U.S. Virgin Islands. The average size of loans extended under the PPP was approximately $45,000 in Puerto Rico and the U.S. Virgin Islands and $152,000 in the mainland United States. The Corporation will continue to extend PPP loans while the program remains open and is now working on the second part of the process, loan forgiveness, which is expected to be completed predominantly through digital channels.

During the second quarter, the Corporation's revenue streams were also impacted by reduced consumer transaction activity, the waiver of certain late fees and service charges, including ATM transaction fees, as well as the temporary suspension of auto loans and leases as well as mortgage originations and related securitization and loan sale activities. Collectively, these revenue captions experienced a decrease of approximately $21.9 million when compared to the previous quarter and of approximately $27.2 million when compared to the same quarter of the previous year, reflecting the impact of the COVID-19 pandemic. As of July 2020, the corporation reinstated most of the fees waived as a result of the pandemic as well as its normal collection efforts. The speed at which earnings from those activities return to pre-pandemic levels remain highly uncertain and depend on client activity and the economic recovery.

Mortgage loan origination activity resumed during the month of May. Origination volumes and related mortgage loan securitization activity reflect the impact of the lockdown for a portion of the second quarter of 2020, although the origination volumes for the month of June reflect an increase to a level that is comparable to the same period of the previous year.

The extent to which the pandemic further impacts our business, results of operations and financial condition (including our regulatory capital, liquidity ratios and realizability of deferred tax assets), as well as the operations of our clients, customers, service providers and suppliers, will depend on future developments, which are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and actions taken by governmental authorities and other third parties in response thereto.

Common Stock Repurchase Plan

On May 27, 2020, the Corporation completed its previously announced $500 million accelerated share repurchase transaction ("ASR") for 2020 with respect to its common stock. On March 19, 2020 (the "early termination date"), the dealer counterparty to the ASR exercised its right under the ASR agreement to terminate the transaction because the trading price of the Corporation's common stock fell below a specified level due to the effects of the COVID-19 pandemic on the global markets. As a result of such early termination, the final settlement of the ASR, which was originally expected to occur during the fourth quarter of 2020, occurred during the second quarter of 2020.

Under the ASR, the Corporation prepaid $500 million and received from the dealer counterparty an initial delivery of 7,055,919 shares of common stock on February 3, 2020. As part of the final settlement of the ASR, the Corporation received an additional 4,763,216 shares of common stock after the early termination date. In total the Corporation repurchased 11,819,135 shares at an average price per share of $42.3043 under the ASR. The Corporation accounted for the ASR as a treasury stock transaction. This transaction increased by $2.20 the Corporation's tangible book value per share.

Goodwill Impairment Evaluation

As disclosed in the Form 10-Q for the quarter ended March 31, 2020, the Corporation deemed the effects of the current and projected interest rate environment and the continued effects of the pandemic on the valuation of the Corporation and its subsidiaries, as an interim triggering event for the evaluation of goodwill. During the second quarter, management has continued to monitor changes in circumstances to determine if these changes would more likely than not result in an impairment of goodwill. The Corporation expects to complete its evaluation prior to the filing of its Form 10-Q for the quarter ended June 30, 2020 with the Securities and Exchange Commission. An impairment of goodwill would result in a non-cash expense, net of tax impact. A charge to earnings related to a goodwill impairment would not impact regulatory capital calculations.

Earnings Highlights



(Unaudited) Quarters ended Six months ended

(Dollars inthousands, except per 30-Jun-20 31-Mar-20 30-Jun-19 30-Jun-20 30-Jun-19share information)

Net interest income $450,881 $473,095 $476,316 $923,976 $947,279

Provision for creditlosses - loan 63,104 188,995 40,191 252,099 82,016portfolios

Provision (reversal)for credit losses - (655) 736 - 81 -investment securities

Net interest incomeafter provision for 388,432 283,364 436,125 671,796 865,263credit losses

Other non-interest 112,055 126,643 138,326 238,698 274,756income

Operating expenses 348,231 372,608 363,015 720,839 710,435

Income before income 152,256 37,399 211,436 189,655 429,584tax

Income tax expense 24,628 3,097 40,330 27,725 90,553

Net income $127,628 $34,302 $171,106 $161,930 $339,031

Net income applicable $127,275 $33,602 $170,175 $160,877 $337,169to common stock

Net income per common $1.49 $0.37 $1.77 $1.83 $3.46share - basic

Net income per common $1.49 $0.37 $1.76 $1.83 $3.45share - diluted

Net interest income on a taxable equivalent basis - Non-GAAP financial measure

Net interest income, on a taxable equivalent basis, is presented with its different components in Table D for the quarter and six month period ended June 30, 2020 and comparable periods, segregated by major categories of interest earning assets and interest-bearing liabilities.

Interest earning assets include investment securities and loans that are exempt from income tax, principally in Puerto Rico. The main sources of tax-exempt interest income are certain investments in obligations of the U.S. Government, its agencies and sponsored entities, and certain obligations of the Commonwealth of Puerto Rico and/or its agencies and municipalities and assets held by the Corporation's international banking entities. To facilitate the comparison of all interest related to these assets, the interest income has been converted to a taxable equivalent basis, using the applicable statutory income tax rates for each period. Net interest income on a taxable equivalent basis is a non-GAAP financial measure. Management believes that this presentation provides meaningful information since it facilitates the comparison of revenues arising from taxable and tax-exempt sources.

Non-GAAP financial measures used by the Corporation may not be comparable to similarly named Non-GAAP financial measures used by other companies.

Net interest income

Net interest income for the quarter ended June 30, 2020 was $450.9 million compared to $473.1 million in the previous quarter, a decrease of $22.2 million. Net interest income, on a taxable equivalent basis, for the second quarter of 2020 was $493.0 million, a decrease of $28.4 million when compared to $521.4 million in the first quarter of 2020.

The net interest margin decreased by 69 basis points to 3.25% in the second quarter of 2020, compared to 3.94% in the previous quarter. The lower margin for the quarter is mainly as a result of three major factors: the decrease of 150 basis points in the Federal Funds Rate in mid-March, the increase in average deposits by $7.3 billion which were redeployed mostly at overnight Fed Funds, short-term U.S. Treasury securities and $1.4 billion ($913 million in average balance) in loans under the SBA PPP. These assets, although accretive to net interest income, are low yielding assets and compressed the net interest margin. The redeployment in relatively short tenured assets respond to the uncertainty of the tenure of the deposit growth. On a taxable equivalent basis, net interest margin was 3.56 % compared to 4.34% in the first quarter of 2020, a decrease of 78 basis points. The main variances in net interest income on a taxable equivalent basis were:

* Lower income from money market, trading and investment securities by $24.2 million of which $46.7 million came from lower yields by 99 basis points related to the above-mentioned decrease in the Federal funds rate, partially offset by an increase in interest income of $22.4 million caused by the increase in average volume of $6.6 billion; and

* lower interest income from loans by $23.8 million mainly driven by the decrease in yields of 55 basis points, partially offset by an increase in volume of $875 million. As mentioned above the loans issued under the SBA PPP carry a low yield of approximately 2.85%, including the amortization of fees received under the program. The decrease in yield is also impacted by the waived fees on past due loans associated to the moratoriums granted in order to mitigate the financial impact of the pandemic.

Partially offset by:

* Lower interest expense on deposits by $19.3 million due to lower interest cost by 29 basis points resulting from the decrease in market rates, mostly on Puerto Rico Government and U.S. deposits, partially offset by higher average balance of interest-bearing deposits of $5.3 billion. This increase is related to inflow of deposits from the relief and assistance programs provided by the P.R. and Federal governments in response to the pandemic. Payment moratoriums and the closure of economic activity may have also contributed to this outcome. Non-interest-bearing deposits increased $2.0 billion in average quarter over quarter.

The net interest income for the Banco Popular de Puerto Rico ("BPPR") segment amounted to $387.2 million for the quarter ended June 30, 2020, compared to $409.6 million in the previous quarter. The net interest margin for the second quarter of 2020 was 3.39%, a decrease of 83 basis points when compared to 4.22% for the previous quarter. The decrease in net interest margin was impacted by lower loan fees resulting from waivers granted due to the COVID-19 pandemic, the decrease in interest rates and a higher average balance of deposits by $6.8 billion which are mostly invested in overnight Fed Funds or in short-term U.S. Treasury securities. The issuance of PPP loans in BPPR amounted to $1.2 billion or $770 million in average loan balances during the second quarter. The cost of interest-bearing deposits was 0.28%, half of the cost reported in the first quarter of 0.56%, mostly driven by a lower cost of Puerto Rico Government deposits. Total cost of deposits for the quarter was 0.22%, compared to 0.44% reported in the first quarter of 2020, a decrease of 22 basis points.

Net interest income for Popular Bank ("Popular U.S." or "PB") was $73.7 million, for the quarter ended June 30, 2020, compared to $72.7 million during the previous quarter. The increase of $1.0 million in net interest income was primarily due to lower deposit costs by 26 basis points, partially offset by lower yields on debt securities, both driven by the decrease in market rates. Commercial and mortgage loan yields also decreased due to lower service fees related to waivers granted due to the pandemic, lower origination rates and the origination of PPP loans of approximately $207 million or $146 million in average loan balance during the second quarter. Net interest margin for the quarter was 3.07%, a decrease of 14 basis points when compared to 3.21% reported in the first quarter of 2020. Earning assets yielded 4.02%, compared to 4.37% in the previous quarter. The cost of interest-bearing deposits was 1.18%, compared to 1.44% in the previous quarter. Total cost of deposits for the quarter was 1.01%, compared to 1.25% reported in the first quarter.

Non-interest income

Non-interest income decreased by $14.6 million to $112.0 million for the quarter ended June 30, 2020, compared to $126.6 million for the quarter ended March 31, 2020. The decrease in non-interest income was primarily driven by:

* Lower service charges on deposit accounts by $11.5 million, mainly in the BPPR segment, due to lower transactions resulting from business disruptions and the waiver of fees related to the pandemic;

* lower other services by $12.7 million, mainly in the BPPR segment, due to lower debit and credit card fees by $8.6 million due to lower transactional volumes resulting from business disruptions related to the pandemic, which also resulted in the elimination of service charges and late fees, lower insurance fees by $1.7 million, and lower commission income by $1.4 million principally in the broker-dealer subsidiary; and

* lower income from mortgage banking activities by $2.6 million mainly due to lower mortgage servicing fees by $1.9 million and higher unfavorable fair value adjustments on mortgage servicing rights ("MSRs") by $2.4 million mainly due to a decrease in float earnings and a reduction in late fee revenues resulting from the moratoriums and fee waivers granted as a result of the pandemic relief efforts, partially offset by higher gains on securitization transactions and whole loan sales by $1.5 million;

Partially offset by:

* an increase in net unrealized gain on equity securities of $5.2 million mainly related to employee deferred compensation plans that have an offsetting expense on personnel related expenses;

* a favorable variance in adjustments to indemnity reserves on previously sold loans of $3.6 million mainly due to a lower provision related to loans previously sold with credit recourse; and

* higher other operating income by $2.6 million mostly due to a gain of $5.6 million recognized as a result of the sale and partial leaseback of the corporate office building that houses our auto lending subsidiary, partially offset by lower daily rental revenues by $1.2 million.

Refer to Table B for further details.

Operating expenses

Operating expenses for the second quarter of 2020 totaled $348.2 million, a decrease of $24.4 million from the first quarter of 2020. The decrease in operating expenses was driven primarily by:

* Lower personnel cost by $7.7 million due to lower commission, incentive and other bonuses by $9.2 million, mainly related to a special incentive to front-line employees during the COVID-19 pandemic amounting to $3.4 million which was granted during the first quarter of 2020, lower stock based compensation expense by $3.8 million due to awards granted in the first quarter and lower employment taxes by $2.4 million; partially offset by higher employee deferred compensation plans expense by $4.8 million, resulting from the unrealized gains in equity securities reflected by the Corporation, as administrator of these plan;

* lower professional fees by $8.5 million due to lower processing and technology services by $3.4 million, mainly as a result of lower number of transactions, lower advisory expenses by $2.3 million, lower legal fees by $1.1 million and lower audit and tax services by $0.7 million;

* lower business promotion by $1.9 million due to lower advertising expense;

* lower OREO expenses by $2.8 million due to the temporary suspension of foreclosure activity as part of the pandemic relief measures; and

* lower other operating expenses by $1.5 million mainly due to lower mortgage loans servicing operational losses and lower legal contingency reserves.

Full-time equivalent employees were 8,525 as of June 30, 2020, compared to 8,551 as of March 31, 2020.

For a breakdown of operating expenses by category refer to Table B.

Income taxes

For the quarter ended June 30, 2020, the Corporation recorded an income tax expense of $24.6 million, compared to $3.1 million for the previous quarter. The increase in income tax expense was mainly attributed to higher income before tax during the second quarter of 2020. The effective tax rate ("ETR") for the second quarter of 2020 was of 16%, compared to 8% in the previous quarter.

The ETR of the Corporation is impacted by the composition and source of its taxable income. For the remainder of 2020, the Corporation currently expects its consolidated ETR to be within the 14% to 17% range.

Credit Quality

The Corporation exhibited stable credit quality metrics in the second quarter of 2020 as Popular continued to provide financial relief to customers impacted by the pandemic. The effect of the pandemic and the full extent of its economic disruption remains uncertain. Management believes that the improvement over the last few years in the risk profile of the Corporation's loan portfolios better positions Popular to operate successfully under the ongoing challenging environment. Management will continue to carefully monitor the exposure of the portfolios to COVID-19 pandemic related risks, changes in the economic outlook of the regions in which we operate and how delinquencies and NCOs evolve after the period of payment deferrals lapses during the third quarter of 2020.

The following presents credit quality results for the second quarter of 2020:

* At June 30, 2020, total non-performing loans held-in-portfolio decreased by $8.5 million from March 31, 2020. BPPR's NPLs decreased by $9.1 million, driven by lower mortgage and consumer (mostly auto loans), by $7.2 million and $5.3 million, respectively. Popular Bank's NPLs remained flat quarter-over-quarter. During the first quarter of 2020, as a result of the implementation of CECL for purchased credit deteriorated ("PCD") loans, the NPLs increased by $278 million. At June 30, 2020, the ratio of NPLs to total loans held-in-portfolio was 2.6% compared to 2.8% in the first quarter of 2020.

* Inflows of NPLs held-in-portfolio, excluding consumer loans, increased by $21.0 million quarter-over-quarter. In Puerto Rico, commercial inflows increased by $9.2 million when compared to the first quarter of 2020, driven by a single $6.7 million loan relationship, while the mortgage inflows increased by $6.6 million. The PB inflows increased by $5.2 million from the previous quarter, mainly driven by higher mortgage inflows of $3.4 million during the period.

* NCOs increased by $2.4 million from the first quarter of 2020, primarily driven by higher BPPR mortgage NCOs by $2.0 million. The Corporation's ratio of annualized net charge-offs to average loans held-in-portfolio was 0.92%, compared to 0.91% in the first quarter of 2020. Refer to Table M for further information on net charge-offs and related ratios.

* For the first quarter of 2020's ACL computation, the Corporation utilized the March 27 Moody's Analytics' S3 Downside Scenario. That scenario assumed a double-dip recession. The U.S. stimulus plan enabled GDP growth in the third quarter of 2020, but the economy declined again in Q4 and it was not until Q2 2021 that a sustained recovery began. Under that scenario, unemployment peaked in the second quarter of 2020 with rates of 13.0% and 13.5% and economic activity declined by 25.3% and 18.3% in the U.S. and P.R., respectively. The recovery period began in the second quarter of 2021 and third quarter of 2021 for the U.S. and P.R., respectively. For the second quarter's ACL computation, the Corporation utilized Moody's Analytics' June Baseline scenario. This scenario assumes that a significant pickup in economic activity will occur in the third quarter of 2020 driven by federal assistance programs, followed by a period of tepid growth. Under this scenario, during the second quarter of 2020, the unemployment peaked with rates of 14.0% and 14.4% and economic activity declined by 33.4% and 24.6% in the U.S. and P.R., respectively. A sustained, albeit gradual, recovery begins in the fourth quarter of 2020 for the U.S. and P.R.

* At June 30, 2020, the allowance for credit losses remained essentially flat, decreasing slightly by $1.3 million from the first quarter of 2020 to $918.4 million. The ACL reflects the current economic outlook, as well as downgrades in the internal credit rating of parts of the commercial portfolio, related to the impact of the COVID-19 pandemic. Incremental reserves in the prior quarter related to the pandemic amounted to $134 million. The ratio of the allowance for credit losses to loans held-in-portfolio was 3.16% in the second quarter of 2020, compared to 3.32% in the previous quarter. The ratio of the allowance for credit losses to NPLs held-in-portfolio stood at 120.8%, compared to 119.7% in the previous quarter.

* The provision for credit losses for the second quarter of 2020 decreased by $125.9 million from the prior quarter. The provision for the BPPR and PB segments decreased by $52.6 million and $73.3 million, respectively, as the provision for the first quarter of 2020 included incremental reserves related to the COVID-19 pandemic impact. The provision to net charge-offs ratio was 97.2% in the second quarter of 2020, compared to 302.3% in the previous quarter.

Non-Performing Assets

(Unaudited)

(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19

Total non-performing loans $760,204 $768,675 $564,358held-in-portfolio

Non-performing loans held-for-sale 6,778 10,679 -

Other real estate owned ("OREO") 113,940 123,922 118,851

Total non-performing assets $880,922 $903,276 $683,209

Net charge-offs for the quarter $64,953 $62,523 $47,153





Ratios:

Loans held-in-portfolio $29,070,553 $27,662,272 $27,005,745

Non-performing loans held-in-portfolio 2.62% 2.78% 2.09%to loans held-in-portfolio

Allowance for credit losses to loans 3.16 3.32 2.01held-in-portfolio

Allowance for credit losses tonon-performing loans, excluding loans 120.81 119.65 96.33held-for-sale

Refer to Table K for additional information.

Provision for CreditLosses - Loan Portfolios



(Unaudited) Quarters ended Six months ended

(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19 30-Jun-20 30-Jun-19

Provision for credit losses:

BPPR $60,423 $113,004 $28,975 $173,427 $60,429

Popular U.S. 2,681 75,991 11,216 78,672 21,587

Total provision for $63,104 $188,995 $40,191 $252,099 $82,016credit losses

Credit Quality by Segment

(Unaudited)

(In thousands) Quarters ended

BPPR 30-Jun-20 31-Mar-20 30-Jun-19

Provision for credit losses - loan $60,423 $113,004 $28,975 portfolios

Net charge-offs 62,143 59,517 37,167

Total non-performing loans held-in-portfolio 726,603 735,683 522,525

Allowance / loans held-in-portfolio 3.53% 3.74% 2.38%

Quarters ended

Popular U.S. 30-Jun-20 31-Mar-20 30-Jun-19

Provision for credit losses - loan $2,681 $75,991 $11,216 portfolios

Net charge-offs 2,810 3,006 9,986

Total non-performing loans 33,601 32,992 41,833 held-in-portfolio

Allowance / loans held-in-portfolio 2.13% 2.19% 0.97%

Financial Condition Highlights



(Unaudited)

(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19

Cash and money market investments $10,060,358 $6,387,267 $3,563,819

Investment securities 21,058,918 16,114,167 17,038,098

Loans 29,070,553 27,662,272 27,005,745

Total assets 62,845,352 52,803,639 50,617,221

Deposits 53,844,300 44,797,176 42,059,837

Borrowings 1,339,339 1,336,897 1,604,670

Total liabilities 57,065,187 47,134,034 44,897,387

Stockholders' equity 5,780,165 5,669,605 5,719,834

Total assets increased by $10.0 billion from the first quarter of 2020, driven by:

* An increase of $3.7 billion in cash and money market investments, mainly due to an increase in deposits, partially offset by purchases of available-for-sale debt securities;

* An increase of $5.0 billion in debt securities available-for-sale mainly due to purchases of U.S. Treasury securities and mortgage-backed securities; and

* An increase of $1.4 billion in loans held-in-portfolio mainly due to growth of commercial loans due to originations of PPP loans at both BPPR and PB and an increase of $411 million in mortgage loans due to an increase in the rebooking of GNMA loans subject to the repurchase option due to an increase in delinquency resulting from the moratorium. Loans in our serviced GNMA portfolio benefit from payment forbearance programs but continue to reflect the contractual delinquency until the borrower repays deferred payments or completes a payment deferral modification or other borrower assistance alternative.

Total liabilities increased by $9.9 billion from the first quarter of 2020, mainly due to:

* An increase of $9.0 billion in deposits, mainly from an increase at BPPR of public sector deposits by $4.2 billion and retail and commercial demand and savings accounts by $5.0 billion; and

* An increase of $0.9 billion in other liabilities due to an increase in the liability for GNMA loans sold with a repurchase option of $0.4 billion, and $0.4 billion in unsettled purchases of debt securities.

Stockholders' equity increased by approximately $110.6 million from the first quarter of 2020, principally due to net income for the quarter of $127.6 million and higher unrealized gains on debt securities available-for-sale by $15.2 million, partially offset by declared dividends of $33.7 million on common stock (paid on July 1, 2020) and $0.3 million in dividends on preferred stock reflecting the reduction due to the redemption of the Series B Preferred Stock during the first quarter of 2020.

Common equity tier-1 ratio ("CET1"), common equity per share and tangible book value per share were 15.70%, $68.40 and $60.13, respectively, at June 30, 2020, compared to 15.79%, $64.08 and $56.17 at March 31, 2020. The regulatory capital ratios for the second quarter of 2020 reflect the impact of the new capital simplification rules, effective on April 1, 2020, which resulted in a reduction to CET1 of 48 bps. These rules alleviate the limitations to the amount of mortgage servicing assets and certain deferred tax assets allowed as CET1 and increased the risk weight for the portion of the deferred tax assets included as a component of CET1 from 100% to 250% among other provisions. Refer to Table A for capital ratios.

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including without limitation those about Popular's business, financial condition, results of operations, plans, objectives and future performance. These statements are not guarantees of future performance, are based on management's current expectations and, by their nature, involve risks, uncertainties, estimates and assumptions. Potential factors, some of which are beyond the Corporation's control, could cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. Risks and uncertainties include without limitation the effect of competitive and economic factors, and our reaction to those factors, the adequacy of the allowance for loan losses, delinquency trends, market risk and the impact of interest rate changes, capital market conditions, capital adequacy and liquidity, the effect of legal and regulatory proceedings (including as a result of any participation in and execution of government programs related to the COVID-19 pandemic), new accounting standards on the Corporation's financial condition and results of operations, the scope and duration of the COVID-19 pandemic, actions taken by governmental authorities in response thereto, and the direct and indirect impact of the pandemic on Popular, our customers, service providers and third parties. All statements contained herein that are not clearly historical in nature, are forward-looking, and the words "anticipate," "believe," "continues," "expect," "estimate," "intend," "project" and similar expressions, and future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or similar expressions, are generally intended to identify forward-looking statements.

More information on the risks and important factors that could affect the Corporation's future results and financial condition is included in our Annual Report on Form 10-K for the year ended December 31, 2019, our Form 10Q for the quarter ended March 31, 2020, and in our Form 10Q for the quarter ended June 30, 2020 to be filed with the Securities and Exchange Commission. Our filings are available on the Corporation's website (www.popular.com) and on the Securities and Exchange Commission website (www.sec.gov). The Corporation assumes no obligation to update or revise any forward-looking statements or information which speak as of their respective dates.

About Popular, Inc.

Popular, Inc. (NASDAQ: BPOP) is the leading financial institution in Puerto Rico, by both assets and deposits, and ranks among the top 50 U.S. bank holding companies by assets. Founded in 1893, Banco Popular de Puerto Rico, Popular's principal subsidiary, provides retail, mortgage and commercial banking services in Puerto Rico and the U.S. Virgin Islands. Popular also offers in Puerto Rico auto and equipment leasing and financing, investment banking, broker-dealer and insurance services through specialized subsidiaries. In the mainland United States, Popular provides retail, mortgage and commercial banking services through its New York-chartered banking subsidiary, Popular Bank, which has branches located in New York, New Jersey and Florida.

Conference Call

Popular will hold a conference call to discuss its financial results today Thursday, July 23, 2020 at 11:00 a.m. Eastern Time. The call will be open to the public and broadcasted 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 the dial-in telephone number 1-866-235-1201 or 1-412-902-4127. There is no charge to access the call.

A replay of the webcast will be archived in Popular's website. A telephone replay will be available one hour after the end of the conference call through Sunday, August 23, 2020. The replay dial-in is: 1-877-344-7529 or 1-412-317-0088. The replay passcode is 10145761.

An electronic version of this press release can be found at the Corporation's website: www.popular.com.

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release



Table A - Selected Ratios and Other Information



Table B - Consolidated Statement of Operations



Table C - Consolidated Statement of Financial Condition



Table D - Analysis of Levels and Yields on a Taxable Equivalent Basis(Non-GAAP) - QUARTER



Table E - Analysis of Levels and Yields on a Taxable Equivalent Basis(Non-GAAP) - YEAR-TO-DATE



Table F - Mortgage Banking Activities and Other Service Fees



Table G - Loans and Deposits



Table H - Loan Delinquency - PUERTO RICO OPERATIONS



Table I - Loan Delinquency - POPULAR U.S. OPERATIONS



Table J - Loan Delinquency - CONSOLIDATED



Table K - Non-Performing Assets



Table L - Activity in Non-Performing Loans



Table M - Allowance for Credit Losses, Net Charge-offs and Related Ratios



Table N - Allowance for Credit Losses - Loan Portfolios - CONSOLIDATED



Table O - Allowance for Credit Losses - Loan Portfolios - PUERTO RICOOPERATIONS



Table P - Allowance for Credit Losses - Loan Portfolios - POPULAR U.S.OPERATIONS



Table Q - Reconciliation to GAAP Financial Measures

POPULAR, INC.Financial Supplement to Second Quarter 2020 Earnings Release

Table A - Selected Ratios and Other Information

(Unaudited)



Quarters ended Six months ended

30-Jun-20 31-Mar-20 30-Jun-19 30-Jun-20 30-Jun-19

Basic EPS $1.49 $0.37 $1.77 $1.83 $3.46

Diluted EPS $1.49 $0.37 $1.76 $1.83 $3.45

Average common 85,135,522 90,788,557 96,305,118 87,962,040 97,437,141shares outstanding

Average commonshares outstanding - 85,161,661 90,892,961 96,457,448 88,039,712 97,591,989assuming dilution

Common sharesoutstanding at end 84,184,927 88,125,974 96,703,351 84,184,927 96,703,351of period

Market value per $37.17 $35.00 $54.24 $37.17 $54.24common share

Marketcapitalization - (In $3,129 $3,084 $5,245 $3,129 $5,245millions)

Return on average 0.87% 0.27% 1.38% 0.59% 1.39%assets

Return on average 9.74% 2.50% 12.31% 6.06% 12.24%common equity

Net interest margin(non-taxable 3.25% 3.94% 4.11% 3.58% 4.16%equivalent basis)

Net interest margin(taxable equivalent 3.56% 4.34% 4.50% 3.93% 4.53%basis) -non-GAAP

Common equity per $68.40 $64.08 $58.63 $68.40 $58.63share

Tangible common bookvalue per common $60.13 $56.17 $51.44 $60.13 $51.44share (non-GAAP) [1]

Tangible commonequity to tangible 8.15% 9.50% 9.96% 8.15% 9.96%assets (non-GAAP)[1]

Return on averagetangible common 11.23% 2.87% 14.07% 6.97% 14.00%equity [1]

Tier 1 capital 15.77% 15.79% 16.80% 15.77% 16.80%

Total capital 18.27% 18.36% 19.39% 18.27% 19.39%

Tier 1 leverage 8.13% 8.94% 9.75% 8.13% 9.75%

Common Equity Tier 1 15.70% 15.79% 16.80% 15.70% 16.80%capital

[1] Refer to Table Q for reconciliation to GAAP financial measures.

POPULAR, INC.Financial Supplement to Second Quarter 2020 Earnings Release

Table B - Consolidated Statement of Operations

(Unaudited)

Quarters ended Variance Quarter Variance Six months ended ended

Q2 2020 Q2 2020

(In thousands, vs. Q1 vs. Q2except per share 30-Jun-20 31-Mar-20 2020 30-Jun-19 2019 30-Jun-20 30-Jun-19information)

Interest income:

Loans $429,670 $450,446 $(20,776) $454,204 $ $880,116 $901,917 (24,534)

Money market 2,015 12,000 (9,985) 22,534 (20,519) 14,015 51,754 investments

Investment 76,884 87,912 (11,028) 94,241 (17,357) 164,796 175,277 securities

Total interest 508,569 550,358 (41,789) 570,979 (62,410) 1,058,927 1,128,948 income

Interest expense:

Deposits 42,780 62,101 (19,321) 78,449 (35,669) 104,881 149,275

Short-term 645 1,048 (403) 1,656 (1,011) 1,693 3,256 borrowings

Long-term debt 14,263 14,114 149 14,558 (295) 28,377 29,138

Total interest 57,688 77,263 (19,575) 94,663 (36,975) 134,951 181,669 expense

Net interest 450,881 473,095 (22,214) 476,316 (25,435) 923,976 947,279income

Provision forcredit losses - 63,104 188,995 (125,891) 40,191 22,913 252,099 82,016loan portfolios

Provision(reversal) forcredit losses - (655) 736 (1,391) - (655) 81 -investmentsecurities

Net interestincome after 388,432 283,364 105,068 436,125 (47,693) 671,796 865,263provision forcredit losses

Service chargeson deposit 30,163 41,659 (11,496) 39,617 (9,454) 71,822 78,308accounts

Other service 52,084 64,773 (12,689) 74,031 (21,947) 116,857 138,338fees

Mortgage banking 3,777 6,420 (2,643) (1,773) 5,550 10,197 8,153activities

Net gain (loss),includingimpairment, on 2,447 (2,728) 5,175 528 1,919 (281) 1,961equitysecurities

Net profit ontrading account 82 491 (409) 422 (340) 573 682debt securities

Net gain on saleof loans,includingvaluation 2,222 957 1,265 - 2,222 3,179 -adjustments onloansheld-for-sale

Adjustments(expense) toindemnity (1,160) (4,793) 3,633 1,840 (3,000) (5,953) 1,747reserves onloans sold

Other operating 22,440 19,864 2,576 23,661 (1,221) 42,304 45,567income

Total non-interest 112,055 126,643 (14,588) 138,326 (26,271) 238,698 274,756 income

Operating expenses:

Personnel costs

Salaries 93,969 92,256 1,713 86,161 7,808 186,225 170,611

Commissions, incentives and 16,076 25,258 (9,182) 22,636 (6,560) 41,334 48,397 other bonuses

Pension, postretirement 11,392 9,638 1,754 10,406 986 21,030 20,167 and medical insurance

Other personnel costs, 17,729 19,679 (1,950) 22,296 (4,567) 37,408 45,441 including payroll taxes

Total personnel 139,166 146,831 (7,665) 141,499 (2,333) 285,997 284,616 costs

Net occupancy 25,487 25,158 329 23,299 2,188 50,645 46,836expenses

Equipment 20,844 21,605 (761) 21,323 (479) 42,449 41,028expenses

Other taxes 13,323 13,681 (358) 12,577 746 27,004 24,239

Professional fees

Collections, appraisals and 2,897 3,881 (984) 4,741 (1,844) 6,778 8,465 other credit related fees

Programming, processing and other 59,387 62,819 (3,432) 61,033 (1,646) 122,206 121,211 technology services

Legal fees, excluding 2,184 2,986 (802) 4,446 (2,262) 5,170 7,935 collections

Other professional 28,079 31,385 (3,306) 25,028 3,051 59,464 45,103 fees

Total professional 92,547 101,071 (8,524) 95,248 (2,701) 193,618 182,714 fees

Communications 5,574 5,954 (380) 5,955 (381) 11,528 11,804

Business 12,281 14,197 (1,916) 19,119 (6,838) 26,478 33,793promotion

FDIC deposit 5,340 5,080 260 5,278 62 10,420 10,084insurance

Other realestate owned (344) 2,479 (2,823) 1,237 (1,581) 2,135 3,914(OREO)expense

Credit anddebit cardprocessing,volume, 9,873 10,282 (409) 9,900 (27) 20,155 18,123interchangeand otherexpenses

Otheroperating expenses

Operational 4,128 8,374 (4,246) 4,778 (650) 12,502 9,666 losses

All other 18,217 15,423 2,794 20,431 (2,214) 33,640 38,935

Total other operating 22,345 23,797 (1,452) 25,209 (2,864) 46,142 48,601 expenses

Amortizationof 1,795 2,473 (678) 2,371 (576) 4,268 4,683intangibles

Total operating 348,231 372,608 (24,377) 363,015 (14,784) 720,839 710,435 expenses

Income before 152,256 37,399 114,857 211,436 (59,180) 189,655 429,584income tax

Income tax 24,628 3,097 21,531 40,330 (15,702) 27,725 90,553expense

Net income $127,628 $34,302 $93,326 $171,106 $ $161,930 $339,031 (43,478)

Net income $applicable to $127,275 $33,602 $93,673 $170,175 (42,900) $160,877 $337,169common stock

Net incomeper common $1.49 $0.37 $1.12 $1.77 $(0.28) $1.83 $3.46share - basic

Net incomeper common $1.49 $0.37 $1.12 $1.76 $(0.27) $1.83 $3.45share -diluted

DividendsDeclared per $0.40 $0.40 $- $0.30 $0.10 $0.80 $0.60Common Share

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table C - Consolidated Statement of Financial Condition

(Unaudited)

Variance

Q2 2020 vs.

(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19 Q1 2020

Assets:

Cash and due from banks $435,080 $445,551 $391,703 $(10,471)

Money market investments 9,625,278 5,941,716 3,172,116 3,683,562

Trading account debt 33,560 42,545 35,623 (8,985)securities, at fair value

Debt securitiesavailable-for-sale, at fair 20,763,453 15,813,301 16,734,722 4,950,152value

Debt securitiesheld-to-maturity, at 95,429 95,263 99,599 166amortized cost

Less: Allowance for 12,735 13,390 - (655) credit losses

Total debt securities 82,694 81,873 99,599 821 held-to-maturity, net

Equity securities 166,476 163,058 168,154 3,418

Loans held-for-sale, at 68,725 87,855 54,028 (19,130)lower of cost or fair value

Loans held-in-portfolio 29,250,076 27,847,840 27,171,467 1,402,236

Less: Unearned income 179,523 185,568 165,722 (6,045)

Allowance for credit 918,434 919,716 543,666 (1,282) losses

Total loans 28,152,119 26,742,556 26,462,079 1,409,563 held-in-portfolio, net

Premises and equipment, net 513,680 552,007 554,614 (38,327)

Other real estate 113,940 123,922 118,851 (9,982)

Accrued income receivable 220,126 176,078 170,886 44,048

Mortgage servicing assets, 141,144 147,311 153,021 (6,167)at fair value

Other assets 1,833,444 1,788,437 1,806,825 45,007

Goodwill 671,122 671,122 671,122 -

Other intangible assets 24,511 26,307 23,878 (1,796)

Total assets $62,845,352 $52,803,639 $50,617,221 $10,041,713

Liabilities and Stockholders' Equity:

Liabilities:

Deposits:

Non-interest bearing $12,520,510 $9,396,449 $8,955,304 $3,124,061

Interest bearing 41,323,790 35,400,727 33,104,533 5,923,063

Total deposits 53,844,300 44,797,176 42,059,837 9,047,124

Assets sold under agreements 153,065 178,766 233,091 (25,701)to repurchase

Other short-term borrowings - 100,000 160,000 (100,000)

Notes payable 1,186,274 1,058,131 1,211,579 128,143

Other liabilities 1,881,548 999,961 1,232,880 881,587

Total liabilities 57,065,187 47,134,034 44,897,387 9,931,153

Stockholders' equity:

Preferred stock 22,143 22,143 50,160 -

Common stock 1,044 1,044 1,044 -

Surplus 4,520,333 4,366,300 4,316,225 154,033

Retained earnings 2,033,782 1,940,170 1,935,826 93,612

Treasury stock (1,016,486) (870,675) (392,208) (145,811)

Accumulated othercomprehensive income (loss), 219,349 210,623 (191,213) 8,726net of tax

Total stockholders' 5,780,165 5,669,605 5,719,834 110,560 equity

Total liabilities and $62,845,352 $52,803,639 $50,617,221 $10,041,713stockholders' equity

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table D - Analysis of Levels and Yields on a Taxable Equivalent Basis(Non-GAAP) - QUARTER

(Unaudited)



Quarters ended Variance

30-Jun-20 31-Mar-20 30-Jun-19 Q2 2020 vs. Q1 2020 Q2 2020 vs. Q2 2019

($ amounts in Income Yield Income Yield Income Yield Income Incomemillions; yields not Average / / Average / / Average / / Average / Yield Average / Yield on a taxable balance Expense Rate balance Expense Rate balance Expense Rate balance Expense / Rate balance Expense / Rateequivalent basis)

Assets:

Interest earning assets:

Money market, trading and $27,356 $111.5 1.64 % $20,744 $135.7 2.63 % $19,664 $153.7 3.13 % $6,612 ($24.2) (0.99) % $7,692 ($42.2) (1.49) % investment securities

Loans:

Commercial 13,350 168.8 5.09 12,342 183.2 5.97 12,156 186.0 6.14 1,008 (14.4) (0.88) 1,194 (17.2) (1.05)

Construction 935 13.2 5.69 861 13.2 6.16 806 13.5 6.74 74 - (0.47) 129 (0.3) (1.05)

Mortgage 7,038 92.2 5.24 7,028 93.2 5.30 7,113 95.2 5.36 10 (1.0) (0.06) (75) (3.0) (0.12)

Consumer 2,918 82.9 11.43 3,110 89.4 11.56 2,864 85.3 11.95 (192) (6.5) (0.13) 54 (2.4) (0.52)

Auto 2,957 66.0 8.98 2,992 67.7 9.10 2,822 67.7 9.62 (35) (1.7) (0.12) 135 (1.7) (0.65)

Lease financing 1,082 16.1 5.97 1,072 16.3 6.07 972 14.8 6.07 10 (0.2) (0.10) 110 1.3 (0.10)

Total loans 28,280 439.2 6.24 27,405 463.0 6.79 26,733 462.5 6.94 875 (23.8) (0.55) 1,547 (23.3) (0.70)

Total interest $55,636 $550.7 3.98 % $48,149 $598.7 4.99 % $46,397 $616.2 5.32 % $7,487 (48.0) (1.01) % $9,239 $(65.5) (1.34) % earning assets

Allowance for credit losses - (926) (808) (553) (118) (373) loan portfolio

Allowance for credit losses - (13) (13) - - (13) investment securities

Other non-interest 4,100 4,026 3,931 74 169 earning assets

Total average $58,797 $51,354 $49,775 $7,443 $9,022 assets

Liabilities and Stockholders' Equity:

Interest bearing deposits:

NOW and money $19,392 $11.6 0.24 % $16,229 $25.3 0.63 % $14,953 $39.3 1.05 % $3,163 $(13.7) (0.39) % $4,439 $(27.7) (0.81) % market

Savings 11,856 10.2 0.35 10,724 11.7 0.44 10,067 10.5 0.42 1,132 (1.5) (0.09) 1,789 (0.3) (0.07)

Time deposits 8,730 21.0 0.97 7,691 25.1 1.31 7,827 28.7 1.47 1,039 (4.1) (0.34) 903 (7.7) (0.50)

Total interest-bearing 39,978 42.8 0.43 34,644 62.1 0.72 32,847 78.5 0.96 5,334 (19.3) (0.29) 7,131 (35.7) (0.53) deposits

Borrowings 1,336 14.9 4.48 1,327 15.2 4.59 1,448 16.2 4.50 9 (0.3) (0.11) (112) (1.3) (0.02)

Total interest-bearing 41,314 57.7 0.56 35,971 77.3 0.86 34,295 94.7 1.11 5,343 (19.6) (0.30) 7,019 (37.0) (0.55) liabilities

Net interest 3.42 % 4.13 % 4.21 % (0.71) % (0.79) % spread

Non-interest 11,006 9,005 8,868 2,001 2,138 bearing deposits

Other liabilities 1,203 897 1,016 306 187

Stockholders' 5,274 5,481 5,596 (207) (322) equity

Total average liabilities and $58,797 $51,354 $49,775 $7,443 $9,022 stockholders' equity

Net interest income / marginon a taxable equivalent $493.0 3.56 % $521.4 4.34 % $521.5 4.50 % ($28.4) (0.78) % ($28.5) (0.94) %basis (Non-GAAP)

Taxable equivalent 42.1 48.3 45.2 (6.2) (3.1) adjustment



Net interest income / marginnon-taxable equivalent basis $450.9 3.25 % $473.1 3.94 % $476.3 4.11 % ($22.2) (0.69) % ($25.4) (0.86) %(GAAP)



Popular, Inc.Financial Supplement to Second Quarter 2020 Earnings Release

Table E - Analysis of Levels and Yields on a Taxable Equivalent Basis(Non-GAAP) - YEAR-TO-DATE

(Unaudited)

Six months ended

30-Jun-20 30-Jun-19 Variance

Average Income / Yield Average Income / Yield Average Income Yield / / / /

($ amounts inmillions; yields not balance Expense Rate balance Expense Rate balance Expense Rate on a taxableequivalent basis)

Assets:

Interest earning assets:

Money market, trading and $24,050 $247.2 2.06 % $19,221 $295.0 3.09 % $4,829 ($47.8) (1.03) % investment securities

Loans not covered under loss-sharing agreements with the FDIC:

Commercial 12,846 352.0 5.51 12,110 368.7 6.14 736 (16.7) (0.63)

Construction 898 26.4 5.91 806 27.2 6.79 92 (0.8) (0.88)

Mortgage 7,033 185.4 5.27 7,124 190.4 5.35 (91) (5.0) (0.08)

Consumer 3,014 172.2 11.49 2,839 168.1 11.94 175 4.1 (0.45)

Auto 2,975 133.8 9.04 2,776 135.3 9.83 199 (1.5) (0.79)

Lease financing 1,077 32.4 6.02 958 29.1 6.07 119 3.3 (0.05)

Total loans 27,843 902.2 6.51 26,613 918.8 6.95 1,230 (16.6) (0.44)

Total interest $51,893 $1,149.4 4.45 % $45,834 $1,213.8 5.33 % $6,059 ($64.4) (0.88) % earning assets

Allowance for credit losses - (867) (564) (303) loan portfolio

Allowance for credit losses - (13) - (13) investment securities

Other non-interest 4,064 3,934 130 earning assets

Total average $55,077 $49,204 $5,873 assets

Liabilities andStockholders' Equity:

Interest bearing deposits:

NOW and money $17,811 $36.8 0.42 % $14,504 $73.0 1.02 % $3,307 ($36.2) (0.60) % market

Savings 11,290 21.9 0.39 9,958 20.4 0.41 1,332 1.5 (0.02)

Time deposits 8,211 46.1 1.13 7,752 55.9 1.45 459 (9.8) (0.32)

Total interest-bearing 37,312 104.8 0.57 32,214 149.3 0.93 5,098 (44.5) (0.36) deposits

Borrowings 1,331 30.1 4.53 1,458 32.4 4.46 (127) (2.3) 0.07

Total interest-bearing 38,643 134.9 0.70 33,672 181.7 1.09 4,971 (46.8) (0.39) liabilities

Net interest 3.75 % 4.24 % (0.49) % spread

Non-interest 10,004 8,910 1,094 bearing deposits

Other liabilities 1,052 1,017 35

Stockholders' 5,378 5,605 (227) equity

Total average liabilities and $55,077 $49,204 $5,873 stockholders' equity

Net interest income / marginon a taxable equivalent basis $1,014.5 3.93 % $1,032.1 4.53 % ($17.6) (0.60) %(Non-GAAP)

Taxable equivalent adjustment 90.5 84.8 5.7



Net interest income / marginnon-taxable equivalent basis $924.0 3.58 % $947.3 4.16 % ($23.3) (0.58) %(GAAP)

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table F - Mortgage Banking Activities and Other Service Fees

(Unaudited)



MortgageBanking Activities

Quarters ended Variance Six months ended Variance

(In Q2 2020 Q2 2020 2020 vs.thousands) 30-Jun-20 31-Mar-20 30-Jun-19 vs.Q1 vs.Q2 30-Jun-20 30-Jun-19 2019 2020 2019

Mortgageservicingfees, net of fair valueadjustments:

Mortgage $ $ servicing $9,058 $10,968 $11,916 (1,910) (2,858) $20,026 $23,603 $(3,577) fees

Mortgage servicing rights fair (7,640) (5,229) (17,186) (2,411) 9,546 (12,869) (21,011) 8,142 value adjustments

Totalmortgageservicing 1,418 5,739 (5,270) (4,321) 6,688 7,157 2,592 4,565fees, net offair valueadjustments

Net gain onsale ofloans,including 5,487 3,986 5,215 1,501 272 9,473 9,232 241valuation onloansheld-for-sale

Trading account loss:

Unrealized gains (losses) on 1,695 (1,695) (227) 3,390 1,922 - (227) 227 outstanding derivative positions

Realized losses on closed (4,823) (1,610) (1,491) (3,213) (3,332) (6,433) (3,444) (2,989) derivative positions

Total trading (3,128) (3,305) (1,718) 177 (1,410) (6,433) (3,671) (2,762)account loss

Totalmortgage $3,777 $6,420 $(1,773) $ $5,550 $10,197 $8,153 $2,044banking (2,643)activities



Other Service Fees

Quarters ended Variance Six months ended Variance

Q2 2020 Q2 2020 2020 vs.(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19 vs.Q1 vs.Q2 30-Jun-20 30-Jun-19 2019 2020 2019

Other service fees:

Debit card $7,082 $10,237 $12,034 $(3,155) $(4,952) $17,319 $23,204 $(5,885) fees

Insurance fees 11,301 12,969 17,253 (1,668) (5,952) 24,270 30,044 (5,774)

Credit card 17,762 23,186 24,794 (5,424) (7,032) 40,948 47,080 (6,132) fees

Sale and administration 4,910 6,263 5,732 (1,353) (822) 11,173 10,991 182 of investment products

Trust fees 5,546 5,260 5,522 286 24 10,806 10,238 568

Other fees 5,483 6,858 8,696 (1,375) (3,213) 12,341 16,781 (4,440)

Total other $52,084 $64,773 $74,031 $ $ $116,857 $138,338 $service fees (12,689) (21,947) (21,481)

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table G - Loans and Deposits

(Unaudited)



Loans - Ending Balances

Variance

(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19 Q2 2020 Q2 2020 vs.Q1 2020 vs.Q2 2019

Loans held-in-portfolio:

Commercial $13,735,082 $12,498,969 $12,216,603 $1,236,113 $1,518,479

Construction 928,507 902,380 825,419 26,127 103,088

Legacy [1] 17,000 20,435 23,893 (3,435) (6,893)

Lease financing 1,098,188 1,088,542 991,546 9,646 106,642

Mortgage 7,521,795 7,094,757 7,198,959 427,038 322,836

Auto 2,904,324 2,954,150 2,796,403 (49,826) 107,921

Consumer 2,865,657 3,103,039 2,952,922 (237,382) (87,265)

Total loans $29,070,553 $27,662,272 $27,005,745 $1,408,281 $2,064,808held-in-portfolio

Loans held-for-sale:

Commercial $6,778 $10,679 $- $(3,901) $6,778

Mortgage 61,947 77,176 54,028 (15,229) 7,919

Total loans $68,725 $87,855 $54,028 $(19,130) $14,697held-for-sale

Total loans $29,139,278 $27,750,127 $27,059,773 $1,389,151 $2,079,505

[1] The legacy portfolio is comprised of commercial loans, construction loansand lease financings related to certain lending products exited by theCorporation as part of restructuring efforts carried out in prior years at thePopular U.S. segment.

Deposits - Ending Balances

Variance

Q2 2020 Q2 2020(In thousands) 30-Jun-20 31-Mar-20 30-Jun-19 vs. Q1 vs.Q2 2019 2020

Demand deposits [1] $22,731,726 $17,023,170 $17,750,676 $5,708,556 $4,981,050

Savings, NOW andmoney market 22,457,951 18,786,042 16,011,646 3,671,909 6,446,305deposits(non-brokered)

Savings, NOW andmoney market 522,929 460,140 384,251 62,789 138,678deposits (brokered)

Time deposits 7,919,265 8,404,525 7,816,939 (485,260) 102,326(non-brokered)

Time deposits 212,429 123,299 96,325 89,130 116,104(brokered CDs)

Total deposits $53,844,300 $44,797,176 $42,059,837 $9,047,124 $11,784,463

[1] Includes interest andnon-interest bearing demand deposits.

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table H - Loan Delinquency - Puerto Rico Operations

(Unaudited)

30-Jun-20

Puerto Rico

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ 1,641 $ 2,524 $ 1,368 $ 5,533 $ 142,630 $ 148,163 $ 1,368 $ -multi-family

Commercial real estate:

Non-owner 24,091 4,120 108,671 136,882 1,940,018 2,076,900 108,671 - occupied

Owner 19,439 5,471 101,112 126,022 1,554,153 1,680,175 101,112 - occupied

Commercialand 5,422 15,404 43,892 64,718 4,382,221 4,446,939 42,739 1,153industrial

Construction - - - - 176,612 176,612 - -

Mortgage 279,498 123,158 1,256,359 1,659,015 4,751,803 6,410,818 397,262 859,097

Leasing 11,386 10,355 4,751 26,492 1,071,696 1,098,188 4,751 -

Consumer:

Credit 9,128 15,424 17,849 42,401 934,981 977,382 - 17,849 cards

Home equity 14 262 6 282 4,284 4,566 - 6 lines of credit

Personal 20,485 13,730 34,834 69,049 1,300,646 1,369,695 34,834 -

Auto 64,977 29,813 22,111 116,901 2,787,423 2,904,324 22,111 -

Other 700 344 14,426 15,470 114,971 130,441 13,755 671

Total $ 436,781 $ 220,605 $ 1,605,379 $ 2,262,765 $ 19,161,438 $ 21,424,203 $ 726,603 $ 878,776



31-Mar-20

Puerto Rico

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ 8,382 $ 359 $ 1,379 $ 10,120 $ 137,145 $ 147,265 $ 1,379 $ -multi-family

Commercial real estate:

Non-owner 4,632 4,382 109,054 118,068 1,968,831 2,086,899 109,054 - occupied

Owner 11,649 4,276 101,887 117,812 1,460,599 1,578,411 101,887 - occupied

Commercialand 17,112 3,608 39,280 60,000 3,458,407 3,518,407 38,784 496industrial

Construction 4,411 - - 4,411 159,979 164,390 - -

Mortgage 339,648 141,841 854,105 1,335,594 4,680,414 6,016,008 404,465 449,640

Leasing 18,301 5,938 4,076 28,315 1,060,227 1,088,542 4,076 -

Consumer:

Credit 14,062 9,297 20,588 43,947 1,020,740 1,064,687 - 20,588 cards

Home equity 49 51 93 193 4,736 4,929 - 93 lines of credit

Personal 23,697 13,078 36,125 72,900 1,390,326 1,463,226 36,064 61

Auto 110,408 38,018 26,431 174,857 2,779,293 2,954,150 26,431 -

Other 622 293 13,966 14,881 122,086 136,967 13,543 423

Total $ 552,973 $ 221,141 $ 1,206,984 $ 1,981,098 $ 18,242,783 $ 20,223,881 $ 735,683 $ 471,301



Variance

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ (6,741) $ 2,165 $ (11) $ (4,587) $ 5,485 $ 898 $ (11) $ -multi-family

Commercial real estate:

Non-owner 19,459 (262) (383) 18,814 (28,813) (9,999) (383) - occupied

Owner 7,790 1,195 (775) 8,210 93,554 101,764 (775) - occupied

Commercialand (11,690) 11,796 4,612 4,718 923,814 928,532 3,955 657industrial

Construction (4,411) - - (4,411) 16,633 12,222 - -

Mortgage (60,150) (18,683) 402,254 323,421 71,389 394,810 (7,203) 409,457 ^[1]

Leasing (6,915) 4,417 675 (1,823) 11,469 9,646 675 -

Consumer:

Credit (4,934) 6,127 (2,739) (1,546) (85,759) (87,305) - (2,739) cards

Home equity (35) 211 (87) 89 (452) (363) - (87) lines of credit

Personal (3,212) 652 (1,291) (3,851) (89,680) (93,531) (1,230) (61)

Auto (45,431) (8,205) (4,320) (57,956) 8,130 (49,826) (4,320) -

Other 78 51 460 589 (7,115) (6,526) 212 248

Total $ (116,192) $ (536) $ 398,395 $ 281,667 $ 918,655 $ 1,200,322 $ (9,080) $ 407,475

Under the GNMA program, issuers such as BPPR have the option but not the obligation to repurchase loans that are 90 days or more past due. For accounting purposes, these loans subject to the repurchase option are required[1] to be reflected on the financial statements of BPPR with an offsetting liability. While the borrowers for our serviced GNMA portfolio benefited from the moratorium, the delinquency status of these loans continued to be reported to GNMA without considering the moratorium.

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table I - Loan Delinquency - Popular U.S. Operations

(Unaudited)

June 30, 2020

Popular U.S.

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ - $ 366 $ 2,097 $ 2,463 $ 1,637,996 $ 1,640,459 $ 2,097 $ -multi-family

Commercial real estate:

Non-owner 1,692 5,136 397 7,225 1,945,365 1,952,590 397 - occupied

Owner 1,010 - 352 1,362 345,412 346,774 352 - occupied

Commercialand 4,441 6,061 4,392 14,894 1,428,188 1,443,082 4,392 -industrial

Construction 23,209 9,600 - 32,809 719,086 751,895 - -

Mortgage 2,532 4,477 14,144 21,153 1,089,824 1,110,977 14,144 -

Legacy 29 83 2,001 2,113 14,887 17,000 2,001 -

Consumer:

Credit - - - - 26 26 - - cards

Home equity 1,715 655 8,242 10,612 100,095 110,707 8,242 - lines of credit

Personal 1,638 1,524 1,976 5,138 266,330 271,468 1,976 -

Other - - - - 1,372 1,372 - -

Total $ 36,266 $ 27,902 $ 33,601 $ 97,769 $ 7,548,581 $ 7,646,350 $ 33,601 $ -



March 31, 2020

Popular U.S.

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ 974 $ - $ 2,097 $ 3,071 $ 1,627,274 $ 1,630,345 $ 2,097 $ -multi-family

Commercial real estate:

Non-owner 25,944 - 269 26,213 1,950,611 1,976,824 269 - occupied

Owner 3,910 - 245 4,155 338,805 342,960 245 - occupied

Commercialand 1,067 3,546 4,793 9,406 1,208,452 1,217,858 4,793 -industrial

Construction - - - - 737,990 737,990 - -

Mortgage 25,639 391 12,176 38,206 1,040,543 1,078,749 12,176 -

Legacy 37 41 1,980 2,058 18,377 20,435 1,980 -

Consumer:

Credit - - - - 36 36 - - cards

Home equity 1,438 72 9,322 10,832 106,579 117,411 9,322 - lines of credit

Personal 2,687 1,632 2,110 6,429 308,559 314,988 2,110 -

Other 21 - - 21 774 795 - -

Total $ 61,717 $ 5,682 $ 32,992 $ 100,391 $ 7,338,000 $ 7,438,391 $ 32,992 $ -

Variance

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ (974) $ 366 $ - $ (608) $ 10,722 $ 10,114 $ - $ -multi-family

Commercial real estate:

Non-owner (24,252) 5,136 128 (18,988) (5,246) (24,234) 128 - occupied

Owner (2,900) - 107 (2,793) 6,607 3,814 107 - occupied

Commercialand 3,374 2,515 (401) 5,488 219,736 225,224 (401) -industrial

Construction 23,209 9,600 - 32,809 (18,904) 13,905 - -

Mortgage (23,107) 4,086 1,968 (17,053) 49,281 32,228 1,968 -

Legacy (8) 42 21 55 (3,490) (3,435) 21 -

Consumer:

Credit - - - - (10) (10) - - cards

Home equity 277 583 (1,080) (220) (6,484) (6,704) (1,080) - lines of credit

Personal (1,049) (108) (134) (1,291) (42,229) (43,520) (134) -

Auto - - - - - - - -

Other (21) - - (21) 598 577 - -

Total $ (25,451) $ 22,220 $ 609 $ (2,622) $ 210,581 $ 207,959 $ 609 $ -

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table J - Loan Delinquency - Consolidated

(Unaudited)



30-Jun-20

Popular, Inc.

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ 1,641 $ 2,890 $ 3,465 $ 7,996 $ 1,780,626 $ 1,788,622 $ 3,465 $ -multi-family

Commercial real estate:

Non-owner 25,783 9,256 109,068 144,107 3,885,383 4,029,490 109,068 - occupied

Owner 20,449 5,471 101,464 127,384 1,899,565 2,026,949 101,464 - occupied

Commercialand 9,863 21,465 48,284 79,612 5,810,409 5,890,021 47,131 1,153industrial

Construction 23,209 9,600 - 32,809 895,698 928,507 - -

Mortgage 282,030 127,635 1,270,503 1,680,168 5,841,627 7,521,795 411,406 859,097

Leasing 11,386 10,355 4,751 26,492 1,071,696 1,098,188 4,751 -

Legacy 29 83 2,001 2,113 14,887 17,000 2,001 -

Consumer:

Credit 9,128 15,424 17,849 42,401 935,007 977,408 - 17,849 cards

Home equity 1,729 917 8,248 10,894 104,379 115,273 8,242 6 lines of credit

Personal 22,123 15,254 36,810 74,187 1,566,976 1,641,163 36,810 -

Auto 64,977 29,813 22,111 116,901 2,787,423 2,904,324 22,111 -

Other 700 344 14,426 15,470 116,343 131,813 13,755 671

Total $ 473,047 $ 248,507 $ 1,638,980 $ 2,360,534 $ 26,710,019 $ 29,070,553 $ 760,204 $ 878,776



31-Mar-20

Popular, Inc.

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ 9,356 $ 359 $ 3,476 $ 13,191 $ 1,764,419 $ 1,777,610 $ 3,476 $ -multi-family

Commercial real estate:

Non-owner 30,576 4,382 109,323 144,281 3,919,442 4,063,723 109,323 - occupied

Owner 15,559 4,276 102,132 121,967 1,799,404 1,921,371 102,132 - occupied

Commercialand 18,179 7,154 44,073 69,406 4,666,859 4,736,265 43,577 496industrial

Construction 4,411 - - 4,411 897,969 902,380 - -

Mortgage 365,287 142,232 866,281 1,373,800 5,720,957 7,094,757 416,641 449,640

Leasing 18,301 5,938 4,076 28,315 1,060,227 1,088,542 4,076 -

Legacy 37 41 1,980 2,058 18,377 20,435 1,980 -

Consumer:

Credit 14,062 9,297 20,588 43,947 1,020,776 1,064,723 - 20,588 cards

Home equity 1,487 123 9,415 11,025 111,315 122,340 9,322 93 lines of credit

Personal 26,384 14,710 38,235 79,329 1,698,885 1,778,214 38,174 61

Auto 110,408 38,018 26,431 174,857 2,779,293 2,954,150 26,431 -

Other 643 293 13,966 14,902 122,860 137,762 13,543 423

Total $ 614,690 $ 226,823 $ 1,239,976 $ 2,081,489 $ 25,580,783 $ 27,662,272 $ 768,675 $ 471,301

Variance

Past due Past due 90 days or more

30-59 60-89 90 days Total Non-accrual Accruing

(In days days or more past due Current Loans HIP loans loansthousands)

Commercial $ (7,715) $ 2,531 $ (11) $ (5,195) $ 16,207 $ 11,012 $ (11) $ -multi-family

Commercial real estate:

Non-owner (4,793) 4,874 (255) (174) (34,059) (34,233) (255) - occupied

Owner 4,890 1,195 (668) 5,417 100,161 105,578 (668) - occupied

Commercialand (8,316) 14,311 4,211 10,206 1,143,550 1,153,756 3,554 657industrial

Construction 18,798 9,600 - 28,398 (2,271) 26,127 - -

Mortgage (83,257) (14,597) 404,222 306,368 120,670 427,038 (5,235) 409,457 ^[1]

Leasing (6,915) 4,417 675 (1,823) 11,469 9,646 675 -

Legacy (8) 42 21 55 (3,490) (3,435) 21 -

Consumer:

Credit (4,934) 6,127 (2,739) (1,546) (85,769) (87,315) - (2,739) cards

Home equity 242 794 (1,167) (131) (6,936) (7,067) (1,080) (87) lines of credit

Personal (4,261) 544 (1,425) (5,142) (131,909) (137,051) (1,364) (61)

Auto (45,431) (8,205) (4,320) (57,956) 8,130 (49,826) (4,320) -

Other 57 51 460 568 (6,517) (5,949) 212 248

Total $ (141,643) $ 21,684 $ 399,004 $ 279,045 $ 1,129,236 $ 1,408,281 $ (8,471) $ 407,475

Under the GNMA program, issuers such as BPPR have the option but not the obligation to repurchase loans that are 90 days or more past due. For accounting purposes, these loans subject to the repurchase option are required[1] to be reflected on the financial statements of BPPR with an offsetting liability. While the borrowers for our serviced GNMA portfolio benefited from the moratorium, the delinquency status of these loans continued to be reported to GNMA without considering the moratorium.

Popular, Inc.Financial Supplement to Second Quarter 2020 Earnings Release

Table K - Non-Performing Assets

(Unaudited)

Variance

As a % As a % As a % Q2 2020 Q2 2020(Dollars in 30-Jun-20 of loans 31-Mar-20 of loans 30-Jun-19 of loans vs. Q1 vs. Q2thousands) HIP by HIP by HIP by 2020 2019 category category category

Non-accrual loans:

Commercial [1] $261,128 1.9 % $258,508 2.1 % $155,348 1.3 % $2,620 $105,780

Construction - - - - 13,848 1.7 - (13,848)

Legacy [2] 2,001 11.8 1,980 9.7 2,469 10.3 21 (468)

Lease financing 4,751 0.4 4,076 0.4 2,830 0.3 675 1,921

Mortgage [1] 411,406 5.5 416,641 5.9 318,396 4.4 (5,235) 93,010

Auto 22,111 0.8 26,431 0.9 28,085 1.0 (4,320) (5,974)

Consumer [1] 58,807 2.1 61,039 2.0 43,382 1.5 (2,232) 15,425

Totalnon-performing 760,204 2.6 % 768,675 2.8 % 564,358 2.1 % (8,471) 195,846loansheld-in-portfolio

Non-performingloans 6,778 10,679 - (3,901) 6,778held-for-sale [3]

Other real estate 113,940 123,922 118,851 (9,982) (4,911)owned ("OREO")

Total $non-performing $880,922 $903,276 $683,209 (22,354) $197,713assets

Accruing loanspast due 90 days $878,776 $471,301 $494,488 $407,475 $384,288or more [4] [5]

Ratios:

Non-performingassets to total 1.40 % 1.71 % 1.35 % assets

Non-performingloansheld-in-portfolio 2.62 2.78 2.09 to loansheld-in-portfolio

Allowance forcredit losses to 3.16 3.32 2.01 loansheld-in-portfolio

Allowance forcredit losses tonon-performing 120.81 119.65 96.33 loans, excludingloansheld-for-sale

[1] The increase in non-accrual loans during the first quarter of 2020 includesthe initial impact of $278 million related to the adoption of CECL on theportfolio of previously purchased credit deteriorated loans. This includedmortgage loans for $133 million, commercial loans for $131 million and $14million in consumer loans.

[2] The legacy portfolio is comprised of commercial loans, construction loansand lease financings related to certain lending products exited by theCorporation as part of restructuring efforts carried out in prior years at thePopular U.S. segment.

[3] There were $7 million in non-performing commercial loans held-for-sale asof June 30, 2020, $11 million for the quarter ended March 31, 2020 and none forthe quarter ended June 30, 2019.

[4] It is the Corporation's policy to report delinquent residential mortgageloans insured by FHA or guaranteed by the VA as accruing loans past due 90 daysor more as opposed to non-performing since the principal repayment is insured.These include loans rebooked, which were previously pooled into GNMA securitiesamounting to $522 million (March 31, 2020 - $111 million; June 30, 2019 - $96million). Under the GNMA program, issuers such as BPPR have the option but notthe obligation to repurchase loans that are 90 days or more past due. Foraccounting purposes, these loans subject to the repurchase option are requiredto be reflected on the financial statements of BPPR with an offsettingliability. While the borrowers for our serviced GNMA portfolio benefited fromthe moratorium, the delinquency status of these loans continued to be reportedto GNMA without considering the moratorium. These balances include $234 millionof residential mortgage loans insured by FHA or guaranteed by the VA that areno longer accruing interest as of June 30, 2020 (March 31, 2020 - $222 million;June 30, 2019 - $262 million). Furthermore, the Corporation has approximately$62 million in reverse mortgage loans which are guaranteed by FHA, but whichare currently not accruing interest. Due to the guaranteed nature of the loans,it is the Corporation's policy to exclude these balances from non-performingassets (March 31, 2020 - $62 million; June 30, 2019 - $66 million).

[5] The carrying value of loans accounted for under ASC Subtopic 310-30 thatare contractually 90 days or more past due was $248 million at June 30, 2019.This amount is excluded from the above table as the loans' accretable yieldinterest recognition is independent from the underlying contractual loandelinquency status.

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table L - Activity in Non-Performing Loans

(Unaudited)



Commercial loans held-in-portfolio:

Quarter ended Quarter ended

30-Jun-20 31-Mar-20

(In thousands) BPPR Popular Popular, BPPR Popular Popular, U.S. Inc. U.S. Inc.

Beginning balance NPLs $251,104 $7,404 $258,508 $147,255 $3,505 $150,760

Transition of PCI to PCD - - - 112,517 18,547 131,064loans under CECL

Plus:

New non-performing 14,187 1,986 16,173 4,954 166 5,120 loans

Advances on existing - 100 100 - 95 95 non-performing loans

Less:

Non-performing loans - - - (2,202) - (2,202) transferred to OREO

Non-performing loans (1,402) (368) (1,770) (2,146) (554) (2,700) charged-off

Loans returned to accrual status / loan (9,999) (1,884) (11,883) (9,274) (3,676) (12,950) collections

Loans transferred to - - - - (10,679) (10,679) held-for-sale

Ending balance NPLs $253,890 $7,238 $261,128 $251,104 $7,404 $258,508



Construction loans held-in-portfolio:

Quarter ended Quarter ended

30-Jun-20 31-Mar-20

(In thousands) BPPR Popular Popular, BPPR Popular Popular, U.S. Inc. U.S. Inc.

Beginning balance NPLs $- $- $- $119 $26 $145

Less:

Loans returned to accrual status / loan - - - (119) (26) (145) collections

Ending balance NPLs $- $- $- $- $- $-



Mortgage loans held-in-portfolio:

Quarter ended Quarter ended

30-Jun-20 31-Mar-20

(In thousands) BPPR Popular Popular, BPPR Popular Popular, U.S. Inc. U.S. Inc.

Beginning balance NPLs $404,465 $12,176 $416,641 $283,708 $11,091 $294,799

Transition of PCI to PCD - - - 133,186 - 133,186loans under CECL

Plus:

New non-performing 82,560 7,440 90,000 75,966 4,007 79,973 loans

Advances on existing - 11 11 - 52 52 non-performing loans

Less:

Non-performing loans (48) - (48) (8,188) - (8,188) transferred to OREO

Non-performing loans (7,847) (7) (7,854) (4,747) - (4,747) charged-off

Loans returned to accrual status / loan (81,868) (5,476) (87,344) (75,460) (2,974) (78,434) collections

Ending balance NPLs $397,262 $14,144 $411,406 $404,465 $12,176 $416,641









Total non-performing loans held-in-portfolio (excluding consumer):

Quarter ended Quarter ended

30-Jun-20 31-Mar-20

(In thousands) BPPR Popular Popular, BPPR Popular Popular, U.S. Inc. U.S. Inc.

Beginning balance NPLs $655,569 $21,560 $677,129 $431,082 $16,621 $447,703

Transition of PCI to PCD - - - 245,703 18,547 264,250loans under CECL

Plus:

New non-performing 96,747 9,426 106,173 80,920 4,173 85,093 loans

Advances on existing - 137 137 - 171 171 non-performing loans

Less:

Non-performing loans (48) - (48) (10,390) - (10,390) transferred to OREO

Non-performing loans (9,249) (375) (9,624) (6,893) (554) (7,447) charged-off

Loans returned to accrual status / loan (91,867) (7,365) (99,232) (84,853) (6,719) (91,572) collections

Loans transferred to - - - - (10,679) (10,679) held-for-sale

Ending balance NPLs ^[1] $651,152 $23,383 $674,535 $655,569 $21,560 $677,129

[1] Includes $2.0 million of NPLs related to the legacy portfolio as of June30, 2020 (March 31, 2020 - $2.0 million).

Popular, Inc.Financial Supplement to Second Quarter 2020 Earnings Release

Table M - Allowance for Credit Losses, Net Charge-offs and Related Ratios

(Unaudited)





Quarter Quarter Quarter ended ended ended

30-Jun-20 31-Mar-20 30-Jun-19

(Dollars in thousands) Total Total Total

Balance at beginning of period $919,716 $477,708 $550,628

Impact of adopting CECL - 315,107 -

Provision for credit losses 63,104 188,995 40,191

Initial allowance for credit losses - PCD 567 429 - Loans

983,387 982,239 590,819

Net loans charged-off:

BPPR

Commercial 1,097 580 184

Construction (195) (19) (54)

Lease financing 3,390 3,307 1,630

Mortgage 7,554 5,538 8,713

Consumer 50,297 50,111 26,694

Total BPPR 62,143 59,517 37,167

Popular U.S.

Commercial (897) 100 5,791

Construction - (155) -

Legacy [1] 113 (101) (277)

Mortgage (19) (1) 230

Consumer 3,613 3,163 4,242

Total Popular U.S. 2,810 3,006 9,986

Total loans charged-off - Popular, Inc. 64,953 62,523 47,153

Balance at end of period $918,434 $919,716 $543,666



POPULAR, INC.

Annualized net charge-offs to average 0.92 % 0.91 % 0.71 %loans held-in-portfolio

Provision for credit losses to net 97.15 % 302.28 % 85.24 %charge-offs

BPPR

Annualized net charge-offs to average 1.20 % 1.18 % 0.75 %loans held-in-portfolio

Provision for credit losses to net 97.23 % 189.87 % 77.96 %charge-offs

Popular U.S.

Annualized net charge-offs to average 0.15 % 0.17 % 0.59 %loans held-in-portfolio

Provision for credit losses to net 95.41 % 2527.98 % 112.32 %charge-offs

[1] The legacy portfolio is comprised of commercial loans, construction loansand lease financings related to certain lending products exited by theCorporation as part of restructuring efforts carried out in prior years at thePopular U.S. segment.

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table N - Allowance for Credit Losses "ACL"- Loan Portfolios - CONSOLIDATED

(Unaudited)





30-Jun-20

(Dollars in Commercial Construction Legacy Mortgage Lease Consumer Total thousands) [1] financing

Total ACL $314,956 $6,417 $2,052 $222,237 $13,093 $359,679 $918,434

Total loans $13,735,082 $928,507 $17,000 $7,521,795 $1,098,188 $5,769,981 $29,070,553 held-in-portfolio

ACL to loans 2.29 % 0.69 % 12.07 % 2.95 % 1.19 % 6.23 % 3.16 %held-in-portfolio

[1] The legacy portfolio is comprised of commercial loans, construction loansand lease financings related to certain lending products exited by theCorporation as part of restructuring efforts carried out in prior years at thePopular U.S. reportable segment.





31-Mar-20

(Dollars in Commercial Construction Legacy Mortgage Lease Consumer Total thousands) [1] financing

Total ACL $305,048 $2,591 $2,026 $227,087 $12,589 $370,375 $919,716

Total loans $12,498,969 $902,380 $20,435 $7,094,757 $1,088,542 $6,057,189 $27,662,272 held-in-portfolio

ACL to loans 2.44 % 0.29 % 9.91 % 3.20 % 1.16 % 6.11 % 3.32 %held-in-portfolio

[1] The legacy portfolio is comprised of commercial loans, construction loansand lease financings related to certain lending products exited by theCorporation as part of restructuring efforts carried out in prior years at thePopular U.S. reportable segment.



Variance

(Dollars in Commercial Construction Legacy Mortgage Lease Consumer Total thousands) financing

Total ACL $9,908 $3,826 $26 $(4,850) $504 $(10,696) $(1,282)

Total loans $1,236,113 $26,127 $ $427,038 $9,646 $(287,208) $1,408,281 held-in-portfolio (3,435)

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table O - Allowance for Credit Losses - Loan Portfolios - PUERTO RICO OPERATIONS

(Unaudited)



30-Jun-20

Puerto Rico

(In thousands) Commercial Construction Mortgage Lease Consumer Total financing

Allowance for $214,927 $354 $199,250 $13,093 $328,158 $755,782 credit losses:

Loans 8,352,177 176,612 6,410,818 1,098,188 5,386,408 21,424,203 held-in-portfolio:

ACL to loans 2.57 % 0.20 % 3.11 % 1.19 % 6.09 % 3.53 %held-in-portfolio:





31-Mar-20

Puerto Rico

(In thousands) Commercial Construction Mortgage Lease Consumer Total financing

Allowance for $207,850 $419 $202,800 $12,589 $333,277 $756,935 credit losses:

Loans 7,330,982 164,390 6,016,008 1,088,542 5,623,959 20,223,881 held-in-portfolio:

ACL to loans 2.84 % 0.25 % 3.37 % 1.16 % 5.93 % 3.74 %held-in-portfolio:





Variance

(In thousands) Commercial Construction Mortgage Lease Consumer Total financing

Allowance for $7,077 $(65) $(3,550) $504 $(5,119) $(1,153) credit losses:

Loans 1,021,195 12,222 394,810 9,646 (237,551) 1,200,322 held-in-portfolio:

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table P - Allowance for Credit Losses - Loan Portfolios - POPULAR U.S. OPERATIONS

(Unaudited)



30-Jun-20

Popular U.S.

(In thousands) Commercial Construction Legacy Mortgage Consumer Total

Allowance for $100,029 $6,063 $2,052 $22,987 $31,521 $162,652 credit losses:

Loans 5,382,905 751,895 17,000 1,110,977 383,573 7,646,350 held-in-portfolio:

ACL to loans 1.86 % 0.81 % 12.07 % 2.07 % 8.22 % 2.13 %held-in-portfolio:





31-Mar-20

Popular U.S.

(In thousands) Commercial Construction Legacy Mortgage Consumer Total

Allowance for $97,198 $2,172 $2,026 $24,287 $37,098 $162,781 credit losses:

Loans 5,167,987 737,990 20,435 1,078,749 433,230 7,438,391 held-in-portfolio:

ACL to loans 1.88 % 0.29 % 9.91 % 2.25 % 8.56 % 2.19 %held-in-portfolio:





Variance

(In thousands) Commercial Construction Legacy Mortgage Consumer Total

Allowance for $2,831 $3,891 $26 $(1,300) $(5,577) $(129) credit losses:

Loans 214,918 13,905 (3,435) 32,228 (49,657) 207,959 held-in-portfolio:

Popular, Inc.

Financial Supplement to Second Quarter 2020 Earnings Release

Table Q - Reconciliation to GAAP Financial Measures

(Unaudited)





(In thousands, except share or per 30-Jun-20 31-Mar-20 30-Jun-19 share information)

Total stockholders' equity $5,780,165 $5,669,605 $5,719,834

Less: Preferred stock (22,143) (22,143) (50,160)

Less: Goodwill (671,122) (671,122) (671,122)

Less: Other intangibles (24,511) (26,307) (23,878)

Total tangible common equity $5,062,389 $4,950,033 $4,974,674

Total assets $62,845,352 $52,803,639 $50,617,221

Less: Goodwill (671,122) (671,122) (671,122)

Less: Other intangibles (24,511) (26,307) (23,878)

Total tangible assets $62,149,719 $52,106,210 $49,922,221

Tangible common equity to tangible 8.15 % 9.50 % 9.96 %assets

Common shares outstanding at end of 84,184,927 88,125,974 96,703,351 period

Tangible book value per common share $60.13 $56.17 $51.44



Quarterly average

Total stockholders' equity [1] $5,274,071 $5,481,179 $5,595,762

Less: Preferred Stock (22,143) (38,768) (50,160)

Less: Goodwill (671,121) (671,121) (671,121)

Less: Other intangibles (25,497) (27,826) (24,715)

Total tangible equity $4,555,310 $4,743,464 $4,849,766

Return on average tangible common 11.23 % 2.87 % 14.07 %equity

[1] Average balances exclude unrealized gains or losses on debt securitiesavailable-for-sale.

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CONTACT: Popular, Inc. Investor Relations: Paul Cardillo, 212-417-6721 Senior Vice President, Investor Relations Officer

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