First BanCorp. New

Good morning everyone and welcome to First Bancorp's fourth quarter and four year 2023 financial results. All lines have been placed on mute during the presentation portion of the call with an opportunity for question and answer at the end. If you would like to ask a question please press star followed by one on your telephone keypad. I would now like to turn this conference call over to our host Ramon Rodriguez, Senior Vice President of Corporate Strategy and Investment Relations. Please go ahead.

Thank you, Candice. Good morning, everyone. Thank you for joining FirstBank Corp's conference call and webcast to discuss the company's financial results for the fourth quarter and full year 2023. Joining you today from FirstBank Corp are Aurelio Aleman, President and Chief Executive Officer, and Orlando Verges, Executive Vice President and Chief Financial Officer. Before we begin today's call, it is my responsibility to inform you that this call may involve certain forward-looking statements such as projections of revenue, earnings, and capital structure, as well as statements on the plans and objectives of the company's business. The company's actual results could differ materially from the forward-looking statements made due to the important factors described in the company's latest SEC filings. The company assumes no obligation to update any forward-looking statements made during the call. If anyone does not already have a copy of the webcast presentation or press release, you can access them at our website at fbpinvestor.com. At this time, I'd like to turn the call over to our CEO, Aurelio Aleman.

Thanks, Ramon. Good morning to everyone, and thanks for joining our earnings call today. I will begin by briefly discussing our business performance for the first quarter first. Then we'll move on to provide some high-level highlights for the full year, and then share with you some of our priorities for 2024. Our four-quarter results were highlighted by strong profitability and non-growth. We earned 79.5 million, or 42 cents per share, and generated a 1.7 percent return on assets. Our expenses for the quarter were impacted by a 6.3 million FDIC special assessment expense. Excluding this special item, the adjusted efficiency ratio was 52.2% for the quarter. The quarter also reflected higher provision expense and some incremental operating expenses, which Orlando will cover in detail later. The loan portfolio expanded by $233 million, or 7.8% in quarter, annualized. driven by growth across all business segments, particularly the strong commercial and auto long-run nation, as we continue to deepen our share in those markets. Core deposits contracted slightly by 2% as we continue to see a gradual erosion of excess liquidity across our markets, and MPAs decreased again to just 67 basis points of total assets. We said for some time that credit metrics will gradually move closer to historical levels as the positive impact of excess liquidity related to the pandemic stimulus on the consumer decreases. We saw a little bit of that in the fourth quarter, actually also in the third quarter, with the charge of rate and early delinquency for the consumer book registering a slight increase when compared to previous quarters. That said, our MPA and classified asset levels remain at multi-year lows, and our research coverage ratio is also very solid, and we continue to sustain and enforce our proactive risk management culture. Definitely, you know, we're ready to withstand any additional deterioration as those rates move closer to the norm. It was a great quarter in terms of our capital position. Our tangible book value per share increased by 19%, and the TCE ratio improved to 7.7%, mostly driven by the favorable variance in the value of our bond book, given the reduction in market rates during the quarter. This was accomplished even while repurchasing 75 million in common shares, as we have indicated, and paying 24 million in dividends. Let's move to slide five to provide some highlights on the full year. Definitely, you know, the 23 performance showcase our attractive profitability and improved risk profile, even when, as we all know, operating in a challenging rate environment for our industry. Most importantly, it highlighted our capital management discipline and return flexibility. We generated 1.6 2% return on assets for the year and 41% return on equity adjusted for the impact of the AOCL. We added 628 million or 5.4% to the loan portfolio in the year while deposits or dam broker contracted by 1.7%. Our strong and diversified deposit franchise is evident by still healthy non-interest bearing ratio of 34% at the end of the year and a loan-to-deposit ratio of 77 percent. This achievement supports our goal of delivering close to 100 percent of our earnings to shareholders in the form of buybacks and dividends for the third consecutive year. As we mentioned before, this year marked – 2023 marked our 75th anniversary, and we are very pleased on how our franchise has supported businesses, households, and ultimately the Puerto Rico economy and our market during this period by how we continue investing in our people, upgrading our product offerings and services, investing in technology, operations and infrastructure, and improving our operating leverage in the long run. I want to thank all my colleagues for their valuable contributions and dedication during the years, and also our customers. that we serve on a daily basis, our communities and our shareholders for the support. As we look forward to 2024, we expect to continue our long-growth momentum, continue gaining market share and improving our long book on what we consider is a stable economy across our markets, including Miami, Puerto Rico, and the Virgin Islands. our goal is to again achieve mid-single-digit loan growth for the year organically. However, we do continue to expect that average deposit balance will gradually come down in line with recent trends in the market as excess liquidity in the system decreases during the year. Our top priorities for the year number one will be to leverage the short duration of the investment portfolio to redeploy low-yielding maturity securities cash flow, into higher yielding assets. Also, actively, proactively managing credit, particularly on the consumer lending businesses. Finally, we continue to be very well positioned to deploy our capital based on our healthy capital levels and our ability to consistently generate organic capital. We still have ample buyback capacity with 150 million in buybacks left on our current authorization. We will continue to monitor the general macro outlook and continue to execute the remaining buyback authorization during the year beginning in the first quarter of this year. Now I will turn the call over to Orlando to go over the financial resource in more detail and we'll come back for questions later.