Evertec, Inc.

Hello and welcome to the Popular Incorporated fourth quarter earnings call. My name is Elliot and I'll be your coordinator today. If you would like to register a question during today's events, please press star one on your telephone keypad. I'd like to hand over to Paul Cardillo, investor relations officer. Please go ahead.

Good morning and thank you for joining us. With us on the call today is our CEO, Ignacio Alvarez, our president and COO, Javier Ferrer, our CFO, Jorge Garcia, and our CRO, Lidio Soriano. They will review our results for the full year and fourth quarter and then answer your questions. Other members of our management team will also be available during the Q&A session. Before we begin, I would like to remind you that on today's call, we may make forward-looking statements regarding POPULAR, such as projections of revenue, earnings, expenses, taxes, and capital structure, as well as statements regarding POPULAR's plans and objectives. These statements are based on management's current expectations and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these forward-looking statements are set forth within today's earnings release and our SEC filings. You may find today's press release and our SEC filings on our webpage at popular.com. I will now turn the call over to our CEO, Ignacio Alvarez.

Good morning, and thank you for joining the call. In 2024, we delivered results that reflect the strength of our franchise and the continued stability of the Puerto Rico economy. Our annual net income of $614 million compared to $541 million in 2023. On an adjusted basis, we achieved net income of $646 million, 10% higher than in 2023. The adjusted variance was mainly driven by higher net interest income offset in part by a higher provision for credit losses and higher operating expenses. Our strong fourth quarter loan growth helped bring our total loan growth for the year to $2 billion, an increase of 5.8%. BPPR generated loan growth across most business segments, led by commercial loans, reflecting the continued strength of the local economy and our diversified product offerings. Popular banks achieved growth in commercial and construction loans. Credit quality remained stable throughout 2024. Non-performing loans decreased slightly, while net charge offs remain below our historic normalized levels. Our capital levels are strong, ending the year with common equity tier one ratio of 16%. Our tangible value per share of $68.16 increased by 14% year over year, primarily driven by lower unrealized losses on investment securities and net income for the year, offset in part by dividends and our share repurchase activity. Our robust capital and liquidity position allowed us to continue returning capital to our shareholders. During the quarter, we announced the resumption of buybacks with a $500 million stock repurchase authorization. In total, during 2024, we repurchased 2.3 million of our shares for approximately $220 million. We continue to believe that our shares are attractive at current prices. Additionally, In the fourth quarter, we increased our quarterly common stock dividend by $0.08 to $0.70 per share. Please turn to slide four. We closed the last quarter of 2024 on a strong note, achieving net income of $178 million, an increase of $23 million from the third quarter. These results were primarily driven by higher net interest income and a lower provision for credit losses. Credit quality trends remain stable in the period. Our net interest income increased by 18 million in the quarter and net interest margin expanded by 11 basis points to 3.35%, mainly driven by lower deposit costs. As I mentioned before, loan growth was very strong in the quarter with balances increasing by 913 million or 2.5%. We were happy to see that both banks contribute equally to this growth. During the quarter, we purchased approximately 160 million shares at an average price of roughly $96. Tangible value per share decreased by $0.88 to $68.16, driven by higher unrealized losses in our investment portfolio and share repurchase activity in the period, offset by our quarterly net income. Please turn to slide five. Business activity in Puerto Rico remains solid as reflected in the favorable trends in total employment, consumer spending, and other economic data. The current unemployment rate of 5.4% is not something that I would have expected to see in my lifetime. Consumer spending remained healthy. Combined credit and debit card sales for BPR customers increased by approximately 5% compared to the fourth quarter of 2023. Mortgage loan balances at BPBR increased by $114 million in the fourth quarter, driven primarily by home purchase activity and our current strategy of retaining FHA loans in portfolio. Our auto loan and lease balances increased by $43 million compared to the third quarter as demand for new cars continues to be strong in Puerto Rico. The tourism and hospitality sector continues to be a source of strength for the local economy. Recently, several prominent luxury hotel brands have announced development plans for Puerto Rico. Passenger traffic at the San Juan International Airport increased by 10% in the fourth quarter compared to the fourth quarter of 2023, and hotel occupancy continues to be healthy. For the year, a record 13.2 million travelers visited Puerto Rico. We expect the ongoing disbursement of federal funds will continue to support activity for several years. We remain optimistic about the future of our primary market and are well positioned to support our clients during the coming years. On that note, I now turn the call over to Jorge for more details on our financial results.