OFG Bancorp (NYSE:OFG) Q2 2022 Earnings Conference Call July 21, 2022 10:00 AM ET

Company Participants

Jose Fernandez - CEO & Vice Chair

Maritza Arizmendi - CFO

Conference Call Participants

Brett Rabatin - Hovde Group

Timur Braziler - Wells Fargo

Alex Twerdahl - Piper Sandler

Kelly Motta - KBW

Operator

Good morning. Thank you for joining the OFG Bancorp's Conference Call. My name is Katie and I will be your conference operator today. Our speakers are Jose Rafael Fernandez, Chief Executive Officer, and Vice Chair of the Board of Directors; and Maritza Arizmendi, Chief Financial Officer. A presentation accompanies today's remarks. It can be found on the Investor Relations website on the homepage in the What's New box or on the quarterly results page.

This call may feature certain forward-looking statements about management's goals, plans and expectations. These statements are subject to risks and uncertainties outlined in the Risk Factors section of the OFG's SEC filings. Actual results may differ materially from those currently anticipated. We disclaim any obligation to update information disclosed in this call as a result of developments that occur afterwards. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session and instructions will be given at that time.

I would now like to turn the call over to Mr. Fernandez. Please go ahead.

Jose Fernandez

Good morning, and thank you for joining us. We are proud of this quarter's performance. It is a direct result of our focus on helping customers achieve progress and financial well-being. As always, thanks to our team members for their excellent work, commitment and dedication.

So let us turn to Page 3 of our conference call presentation. Looking at our second quarter income statement, earnings per share diluted was $0.84. Core revenues totaled $146 million that included a $4.7 million gain from the sale of a legacy branch building. Net interest margin was 4.8%, provision was $6.7 million, non-interest expenses were $85 million, and pre-provision net revenues totaled $66 million.

Looking at our balance sheet. When we compared to the prior quarter, total assets amounted to $10.2 billion. Customer deposits increased both from retail and commercial accounts and total approximately $9 billion. Our liquid balance sheet enabled us to continue to deploy cash into higher yielding loans and investment securities, which improved our asset mix.

Total loans held for investment increased 2.4%. We saw continued loan balance increases in all three of our key businesses, 4.7% increase in commercial loans, 9.7% increase in consumer loans, and 3.2% increase in auto loans. New loan origination remained high at $587 million. Investment securities increased to $1.7 billion. Cash balances declined to $1.3 billion.