First BanCorp. Announces Earnings for the Quarter Ended June 30, 2026

Aurelio Alemán, President and Chief Executive Officer of First BanCorp, commented: “We concluded the first half of the year with another quarter of strong financial and operating performance, delivering growth across our franchise while continuing to generate attractive returns for shareholders. Adjusted pre-tax, pre-provision income reached a record of $137.5 million, earnings per share increased 24% compared to the prior year, and return on average assets was 2.02%, marking our 18th consecutive quarter above 1.5%. By many measures, this represents the strongest and most consistent period of performance in our company’s history. This achievement reflects the trust our customers place in us, as well as the dedication, discipline, and execution demonstrated by our teams across the organization.

Loan growth accelerated during the quarter, driven primarily by commercial activity in Puerto Rico, with total loan originations reaching $1.7 billion, an increase of 21% year over year. These encouraging trends, combined with a healthy pipeline of opportunities, reinforce our path to achieve our full-year growth objectives. Credit quality remained sound, with lower net charge-offs and non-performing assets remaining near historic lows, while we continue to closely monitor seasonal delinquency trends and broader consumer market conditions.

We remain firmly committed to prudent capital management. During the quarter, we returned 84% of earnings to shareholders through dividends and share repurchases while maintaining a top-quartile CET1 ratio of 16.96%. Our strong capital position enables us to continue investing strategically in our franchise to enhance competitiveness, strengthen the customers’ experience, and support sustainable long-term growth.

While we remain mindful of an evolving economic environment, the strength of our franchise, combined with disciplined execution, positions us well to continue creating long-term value for our shareholders, customers, employees, and communities.”

(In thousands)

Q2 '26

Q1 '26

Q2 '25

YTD '26

YTD '25

Financial Highlights

Net interest income

$

229,131

$

220,956

$

215,859

$

450,087

$

428,256

Provision for credit losses

17,333

17,273

20,587

34,606

45,397

Non-interest income

35,732

37,685

30,950

73,417

66,684

Non-interest expenses

127,324

127,105

123,337

254,429

246,359

Income before income taxes

120,206

114,263

102,885

234,469

203,184

Income tax expense

24,052

25,485

22,705

49,537

45,945

Net income

$

96,154

$

88,778

$

80,180

$

184,932

$

157,239

Selected Financial Data

Net interest margin

4.87%

4.75%

4.56%

4.81%

4.54%

Efficiency ratio

48.07%

49.14%

49.97%

48.60%

49.78%

Diluted earnings per share

$

0.62

$

0.57

$

0.50

$

1.19

$

0.97

Book value per share

$

12.95

$

12.72

$

11.43

$

12.95

$

11.43

Tangible book value per share⁽¹⁾

$

12.68

$

12.45

$

11.16

$

12.68

$

11.16

Return on average equity

19.49%

17.92%

17.79%

18.70%

17.85%

Return on average assets

2.02%

1.89%

1.69%

1.95%

1.66%

Results for the Second Quarter of 2026 compared to the First Quarter of 2026

Profitability

Net income – $96.1 million, or $0.62 per diluted share compared to $88.8 million, or $0.57 per diluted share.

Income before income taxes – $120.2 million compared to $114.3 million.

Adjusted pre-tax, pre-provision income (Non-GAAP)⁽¹⁾ – $137.5 million compared to $131.4 million.

Net interest income – $229.1 million compared to $221.0 million. The increase was driven by approximately $1.6 million in net interest income attributable to an additional day in the second quarter of 2026, $3.4 million in interest income resulting from the acceleration of the unamortized purchase discount and net deferred fees associated with refinancings in the Puerto Rico region during the second quarter of 2026, which contributed approximately 7 basis points to the increase in net interest margin, as well as the continued deployment of cash flows from lower-yielding investment securities to higher-yielding assets. Net interest margin increased to 4.87% compared to 4.75%.

Provision for credit losses – remained flat at $17.3 million when compared to the previous quarter. The provision for credit losses for the second quarter of 2026 reflected a lower benefit from macroeconomic factors than in the previous quarter and higher loan growth, partially offset by a $5.0 million decrease in net charge-offs.

Non-interest income – $35.7 million compared to $37.7 million. The decrease was mainly due to $3.6 million in seasonal contingent insurance commissions recorded in the first quarter of 2026.

Non-interest expenses – remained relatively flat at $127.3 million compared to $127.1 million in the previous quarter.

Income tax expense – $24.1 million compared to $25.5 million, mainly due to a lower estimated annual effective tax rate, partially offset by higher pre-tax income.

Balance

Sheet

Total loans – increased by $168.8 million to $13.3 billion, driven by commercial and industrial (“C&I”) loan growth in the Puerto Rico region. Total loan originations of $1.7 billion, up $469.5 million, mainly in commercial and construction loans.

Government deposits (fully collateralized) – increased by $167.7 million to $3.0 billion, mainly in the Puerto Rico region.

Brokered certificates of deposits (“CDs”) – increased by $87.7 million to $594.8 million in the Florida region.

Core deposits (other than brokered and government deposits) – increased by $18.3 million to $13.2 billion.

Asset

Quality

Allowance for credit losses (“ACL”) coverage ratio – amounted to 1.85% compared to 1.87%.

Annualized net charge-offs to average loans ratio decreased to 0.49% compared to 0.65%, primarily reflecting a $4.7 million reduction in consumer loans and finance leases net charge-offs, mainly in the auto loan portfolio.

Non-performing loans – increased by $6.8 million to $94.6 million, driven by the migration of a $14.8 million C&I relationship in the Florida region to nonaccrual status during the second quarter of 2026.

Loans in early delinquency (30-89 days past due) – increased by $32.9 million to $143.4 million, driven by a $20.7 million increase in consumer loans and finance leases, primarily in the auto loan portfolio.

Liquidity

and

Capital

Liquidity – Cash and cash equivalents amounted to $561.3 million compared to $550.9 million. When adding $2.1 billion of free high-quality liquid securities that could be liquidated or pledged within one day and $1.1 billion in available lending capacity at the Federal Home Loan Bank (“FHLB”), available liquidity amounted to 19.60% of total assets compared to 20.14%.

Capital – Repurchased $50.0 million in common stock and declared $31.0 million in common stock dividends. Capital ratios exceeded required regulatory levels. The Corporation’s estimated total capital, common equity tier 1 (“CET1”) capital, tier 1 capital, and leverage ratios were 18.21%, 16.96%, 16.96%, and 11.72%, respectively, as of June 30, 2026. On a non-GAAP basis, the tangible common equity ratio⁽¹⁾ decreased to 10.08% compared to 10.11%, mainly due to an increase in tangible assets.

(1) Represents non-GAAP financial measures. Refer to Non-GAAP Disclosures - Non-GAAP Financial Measures for the definition of and additional information about these non-GAAP financial measures.

Quarter Ended

June 30, 2026

March 31, 2026

December 31, 2025

September 30, 2025

June 30, 2025

(Dollars in thousands)

Net Interest Income

Interest income

$

287,710

$

279,849

$

285,158

$

282,743

$

278,190

Interest expense

58,579

58,893

62,390

64,827

62,331

Net interest income

$

229,131

$

220,956

$

222,768

$

217,916

$

215,859

Average Balances

Loans and leases

$

13,077,087

$

13,068,874

$

13,032,081

$

12,876,239

$

12,742,809

Total securities, other short-term investments and interest-bearing cash balances

5,797,465

5,776,844

5,871,091

6,037,726

6,245,844

Average interest-earning assets

$

18,874,552

$

18,845,718

$

18,903,172

$

18,913,965

$

18,988,653

Average interest-bearing liabilities

$

11,371,881

$

11,409,037

$

11,531,091

$

11,669,135

$

11,670,411

Average Yield/Rate

Average yield on interest-earning assets

6.11

%

6.02

%

5.98

%

5.93

%

5.88

%

Average rate on interest-bearing liabilities

2.07

%

2.09

%

2.15

%

2.20

%

2.14

%

Net interest spread

4.04

%

3.93

%

3.83

%

3.73

%

3.74

%

Net interest margin

4.87

%

4.75

%

4.68

%

4.57

%

4.56

%

Quarter Ended

June 30, 2026

March 31, 2026

December 31, 2025

September 30, 2025

June 30, 2025

(In thousands)

Service charges and fees on deposit accounts

$

9,885

$

9,932

$

9,861

$

9,811

$

9,756

Mortgage banking activities

3,727

4,043

4,219

3,309

3,401

Insurance commission income

3,114

5,944

2,265

2,618

2,538

Card and processing income

12,512

11,758

12,353

11,682

11,880

Other non-interest income

6,494

6,008

5,702

3,374

3,375

Non-interest income

$

35,732

$

37,685

$

34,400

$

30,794

$

30,950

Quarter Ended

June 30, 2026

March 31, 2026

December 31, 2025

September 30, 2025

June 30, 2025

(In thousands)

Employees’ compensation and benefits

$

63,439

$

65,299

$

63,196

$

59,761

$

60,058

Occupancy and equipment

22,108

22,063

21,797

22,185

22,297

Business promotion

4,435

3,555

5,944

3,884

3,495

Professional service fees:

Collections, appraisals and other credit-related fees

1,229

734

1,007

856

634

Outsourcing technology services

8,352

8,585

8,433

8,107

8,324

Other professional fees

3,535

3,593

3,671

2,940

2,651

Taxes, other than income taxes

6,071

6,184

6,272

6,092

5,712

Federal Deposit Insurance Corporation (“FDIC”) deposit insurance

2,167

2,058

961

2,236

2,235

Other insurance and supervisory fees

1,182

1,206

1,327

1,344

1,566

Net (gain) loss on other real estate owned (“OREO”) operations

(842

)

(937

)

(838

)

1,033

(591

)

Credit and debit card processing expenses

8,514

7,327

7,728

7,889

7,747

Communications

2,234

2,288

2,284

2,294

2,208

Other non-interest expenses

4,900

5,150

5,088

6,273

7,001

Total non-interest expenses

$

127,324

$

127,105

$

126,870

$

124,894

$

123,337

(Dollars in thousands)

June 30, 2026

March 31, 2026

December 31, 2025

September 30, 2025

June 30, 2025

Nonaccrual loans held for investment:

Residential mortgage

$

23,410

$

28,071

$

29,169

$

28,866

$

30,790

Construction

5,463

5,414

5,536

5,591

5,718

Commercial mortgage

7,067

7,442

8,382

21,437

22,905

C&I

41,053

27,100

28,042

19,650

20,349

Consumer and finance leases

17,572

19,717

21,434

20,717

20,336

Total nonaccrual loans held for investment

$

94,565

$

87,744

$

92,563

$

96,261

$

100,098

OREO

6,939

6,344

7,522

9,343

14,449

Other repossessed property

10,803

13,124

12,389

12,234

11,868

Other assets ⁽¹⁾

1,610

1,609

1,620

1,579

1,576

Total non-performing assets ⁽²⁾

$

113,917

$

108,821

$

114,094

$

119,417

$

127,991

Past due loans 90 days and still accruing ⁽³⁾

$

24,736

$

28,949

$

31,913

$

28,891

$

29,535

Nonaccrual loans held for investment to total loans held for investment

0.71

%

0.67

%

0.71

%

0.74

%

0.78

%

Nonaccrual loans to total loans

0.71

%

0.67

%

0.70

%

0.74

%

0.78

%

Non-performing assets to total assets

0.59

%

0.57

%

0.60

%

0.62

%

0.68

%

(1)

Residential pass-through mortgage-backed securities (“MBS”) issued by the Puerto Rico Housing Finance Authority (“PRHFA”) held as part of the available-for-sale debt securities portfolio.

(2)

Excludes purchased-credit deteriorated (“PCD”) loans previously accounted for under Accounting Standards Codification (“ASC”) Subtopic 310-30 for which the Corporation made the accounting policy election of maintaining pools of loans as “units of account” both at the time of adoption of current expected credit losses (“CECL”) on January 1, 2020 and on an ongoing basis for credit loss measurement. These loans will continue to be excluded from nonaccrual loan statistics as long as the Corporation can reasonably estimate the timing and amount of cash flows expected to be collected on the loan pools. The portion of such loans contractually past due 90 days or more amounted to $3.6 million as of June 30, 2026 (March 31, 2026 - $4.2 million; December 31, 2025 - $4.8 million; September 30, 2025 - $5.0 million; June 30, 2025 - $4.9 million).

(3)

These include rebooked loans, which were previously pooled into Government National Mortgage Association (“GNMA”) securities, amounting to $4.6 million as of June 30, 2026 (March 31, 2026 - $6.7 million; December 31, 2025 - $6.7 million; September 30, 2025 - $3.8 million; June 30, 2025 - $5.5 million). Under the GNMA program, the Corporation has the option but not the obligation to repurchase loans that meet GNMA’s specified delinquency criteria. For accounting purposes, the loans subject to the repurchase option are required to be reflected on the financial statements with an offsetting liability.

Quarter Ended June 30, 2026

Loans and Finance Leases

Debt Securities

(Dollars in thousands)

Residential Mortgage Loans

Commercial and Construction Loans

Consumer Loans and Finance Leases

Total Loans and Finance Leases

Unfunded Loans Commitments

Held-to-Maturity

Available-for-Sale

Total ACL

Allowance for Credit Losses

Allowance for credit losses, beginning balance

$

41,534

$

69,118

$

134,408

$

245,060

$

3,120

$

641

$

839

$

249,660

Provision for credit losses - expense (benefit)

1,303

(233

)

14,888

15,958

1,479

(162

)

58

17,333

Net charge-offs

(79

)

(91

)

(15,809

)

(15,979

)

-

-

(12

)

(15,991

)

Allowance for credit losses, end of period

$

42,758

$

68,794

$

133,487

$

245,039

$

4,599

$

479

$

885

$

251,002

Amortized cost of loans and finance leases

$

2,927,167

$

6,668,570

$

3,661,486

$

13,257,223

Allowance for credit losses on loans to amortized cost

1.46

%

1.03

%

3.65

%

1.85

%

Quarter Ended March 31, 2026

Loans and Finance Leases

Debt Securities

(Dollars in thousands)

Residential Mortgage Loans

Commercial and Construction Loans

Consumer Loans and Finance Leases

Total Loans and Finance Leases

Unfunded Loans Commitments

Held-to-Maturity

Available-for-Sale

Total ACL

Allowance for Credit Losses

Allowance for credit losses, beginning balance

$

41,071

$

70,920

$

137,046

$

249,037

$

3,013

$

733

$

763

$

253,546

Provision for credit losses - expense (benefit)

239

(984

)

17,915

17,170

107

(92

)

88

17,273

Net recoveries (charge-offs)

224

(818

)

(20,553

)

(21,147

)

-

-

(12

)

(21,159

)

Allowance for credit losses, end of period

$

41,534

$

69,118

$

134,408

$

245,060

$

3,120

$

641

$

839

$

249,660

Amortized cost of loans and finance leases

$

2,914,898

$

6,517,223

$

3,658,956

$

13,091,077

Allowance for credit losses on loans to amortized cost

1.42

%

1.06

%

3.67

%

1.87

%