OFG Bancorp (NYSE:OFG) Q3 2023 Results Conference Call October 20, 2023 10:00 AM ET

Company Participants

Jose Rafael Fernandez - CEO

Maritza Arizmendi - CFO

Conference Call Participants

Timur Braziler - Wells Fargo

Alex Twerdahl - Piper Sandler

Kelly Motta – KBW

Operator

Good morning. Thank you for joining OFG Bancorp's Conference Call. My name is James, I will be your 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 home page of the OFG website under the Third Quarter 2023 section.

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 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. [Operator Instructions].

I'd now like to turn the call over to Mr. Fernandez.

Jose Rafael Fernandez

Good morning, and thank you for joining us. We are very pleased to report our third quarter results. All our businesses performed well, and we continue to generate steady year-over-year revenue and earnings growth. Highlights include increased loan balances, stable core deposits with low cumulative beta, increased operating leverage and strong credit and performance metrics.

Our digital-first strategy continues to attract customers and speed the transition of routine transactions from in-branch to digital platforms. This makes it easier for customers to do their banking and for us to increase efficiency and engage in more business development activities. In Puerto Rico, consumer liquidity is sound and the economy is doing well. As always, thanks to our team for helping our customers and the communities we serve achieve their financial goals.

Please turn to Page 3 for a summary of our third quarter results. First, looking at the income statement. Earnings per share diluted was $0.95, an increase of 9% year-over-year. Total core revenues were $172.2 million, up 10% compared to last year. Net interest margin was 5.8%, provision was $16.4 million and noninterest expenses were $90.2 million. Pre-provision net revenues totaled $82.3 million, up 18% year-over-year.

Now turning to the balance sheet. Total assets increased to $10.3 billion from last quarter. Based on our growth and outlook for next year, we will remain above $10 billion. Customer deposits were stable at approximately $8.5 billion. Loans held for investment totaled $7.3 billion, up 2% from the second quarter. New loan production was approximately $563 million, in line with the last 5 quarters. Investments increased to $2.1 billion and cash declined to $533 million.