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First Bank (FRBA -2.84%)
Q3Â 2019 Earnings Call
Oct 22, 2019, 10:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good morning, and welcome to the First BanCorp Third Quarter 2019 Results and Acquisition of Banco Santander Puerto Rico discussion. [Operator Instructions]
I'd now like to turn the conference over to John Pelling, Investor Relations. Please go ahead.
John B. Pelling -- Investor Relations Officer
Thank you, Nick. Good morning, everyone, and thank you for joining First BanCorp's conference call and webcast to discuss the Company's financial results for the third quarter 2019, as well as the strategic transaction announced after the close yesterday.
Joining today from First BanCorp are Aurelio Aleman, President and Chief Executive Officer; and Orlando Berges, 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 presentation, transaction presentation or press release, you can access them at our website at 1firstbank.com.
At this time, I'd like to turn the call over to our CEO, Aurelio Aleman. Aurelio?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you, John, and good morning everyone, and thank you for joining us today. It's an important call. We will be discussing the third quarter results, and we will be disclosing the exciting transaction we announced yesterday. So it would be a different call. We're definitely very excited about the strategic transaction we reported last night, but we will be discussing that one in the second part of this call, then we will have a joined Q&A session for both results.
So please let's move to the third quarter highlights, Page 5 of the deck. We reported, this morning, what we consider another strong quarter of bottom line results with net income of $46.3 million, representing $0.21 per share. I think it is important to highlight that core franchise metrics continue positive, and will be in the right direction.
Pre-tax, pre-provision income at the $70 million level. Net interest income increased quarter-to-quarter by $1.9 million and $12 million when we compared to the same quarter in the prior year.
Our loan portfolio declined this quarter, approximately $137 million. I have to say that we view -- in this case, we view this result as a positive one, because it was driven by a large payoff of two loans that were actually criticized, and the repayment of another large non-performing loans. It really improved our risk profile on the portfolio.
In spite of this year-over-year, the loan portfolio has grown almost 3%, composed of 19% increase in the consumer, 3% increase in the commercial and construction, while we strategically continue to reduce the mortgage -- depreciation mortgage portfolio, which year-over-year has been reduced 6.5%.
Originations and renewal were strong for the quarter. The third quarter is not usually stronger one, but this one was a really good one with $1.1 billion in originations and renewals.
On the NPA side, we're very pleased to say that the path of organic improvement and reduction continued this quarter with a $52 million reduction or 14%. Now, NPA assets represent only 2.65% of the book, which is a lowest that we had in many, many years.
On the funding side, core deposits slightly decreased driven by government brokered CDs decrease, which is our intent to continue. And then capital, obviously, continues to grow, now with $2.2 million. The tangible book at $9.79 million [Phonetic], and obviously were giving you all, I think, excellent capital norms [Phonetic], which has been a question in all the private calls.
So with that summary, I'm going to turn the call over to Orlando, and we'll be back to cover the deal presentation later.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Good morning, everyone. As Aurelio mentioned, this third quarter was a very good quarter, to some extent, driven by improvements in some assets slightly related components that led to provision reductions and improvements in net interest income.
Net income, as he said, was $46.3 million or $0.21 a share, which compares to $41.3 million or $0.19 a share last quarter. Adjusted on a non-GAAP basis, net income was $44.7 million, which is about $0.20 a share, compared to $40.8 million last quarter. You can see the detail of the breakdown on the earnings release that was sent out this morning.
Pre-tax, pre-provision remains strong at $70.2 million, slightly lower than the $71 million achieved in the second quarter. The provision for the quarter was much better. Provision is down $5.1 million to $7.4 million in the quarter. It was mostly driven by $6.5 million reserve releases in commercial loans, combination of historical -- lower historical loss rates in the portfolios, the early payoff of $120 million in two large criticized loans as Aurelio mentioned, and some credit upgrades we have -- we had in the quarter.
In terms of net interest income, the net interest income grew $1.9 million. However, I would like to point out that we are starting to see the impact of the declining interest rate scenario on the variable-rate loans.
On one hand, we saw interest income grew -- growing $2.9 million, due to an increase of $96 million in the average balance of consumer loans. And we saw an additional $3 million growth from the accelerated discount accretion of an acquired loan that was paid off in the quarter.
On the other hand, we saw reduction of $900,000 from downward repricing of the variable rate commercial loans. And $700,000 was related to the reduction in the commercial portfolio associated with some of these large pay downs.
Net interest margin for the quarter was about 4.89%, very close with 4.90% from last quarter. But -- the accelerated discount accretion, I just mentioned, improved the margin by about 10 basis points in the quarter. The one thing important, with LIBOR and prime projected to decrease further, we believe margin will see some pressure, if it happens as the variable rate loans reprice. That could be partially compensated by the trends in growth that we've had in the consumer portfolios. But assuming no changes in deposits, we do expect a little bit of pressure on the margin, and might be close to the adjusted number for the quarter, after excluding the discount accretion or slightly lower than that amount in the next few quarters.
On non-interest income, it was fairly comparable to last quarter. We did see -- remember, the last quarter, we had a $600,000 gain from recovery on insurance proceeds related to insurance claims, and we did have this quarter $500,000 of OTTI charges on the private-label MBS we have on the books. Other than that, we saw some increases in service charges and fee-based income related to transactions.
The expenses for the quarter were $92.8 million, just under $92.9 million we had last quarter. The main items is, we did have a $2.5 million decrease in OREO expenses, mostly lower writedowns to the value of OREO properties. And we had $700,000 decrease in occupancy cost. If you recall last quarter, we had a writedown of some capitalized costs from a project that would change -- technology project that was changed and we eliminated some of the components.
We did see increases in professional service fees in the quarter, $600,000 were legal fees related to strategic projects, mostly associated with what the transaction we disclosed last night and $400,000 on assessment of some technology-related projects we had in the quarter. Also, our employee compensation was higher as we had salary increases took -- that took effect -- that merit increases took effect in July and we have one extra day in the quarter.
Regarding asset quality, I think it was Aurelio made reference to. We had a very good quarter. We were able to sell at $31.5 million non-accrual commercial mortgage loan in the Florida region or not sell [Phonetic], but it was repaid, which was the largest non-accrual in the portfolio. We had collections of $3.5 million of non-performing in the quarter, which was pretty good. And also we sold $10.8 million OREO property we had for some time. As a result, non-performing came down $52 million to $332 million compared to $384 million last quarter. The decrease we had in the quarter was partially offset by $1.2 million increase in non-accrual loans are primarily auto and the finance leases, and it's important to mention that obviously asset portfolios have continued to grow down, delinquency trends have continued to be good and charge-off trends have continued to be very good, but it's a much higher portfolio. So we're going to see a little bit of that happening, which -- and then with some additional inflows to non-accruals for the quarter.
But overall, pretty good results. In terms of movement in non-performing assets, charge-offs were -- net charge-offs were down in the quarter, were $13.8 million or which is 61 basis points which compares to $24 million last quarter. We did have a $12 million -- $11.5 million charge-off was taken in the second quarter on the loan -- non-performing loan that was paid off this quarter. The ratio of the allowance coverage is at 1.85% to loans held for investment, slightly down from 1.89% last quarter. But also you can see on the slide that the commercial NPL portfolios have come down significantly. They are now at $76 million, and they are carried at $0.41 in the dollar basically on the books.
Before we have called, as Aurelio mentioned, we're going to go to our presentation, and this was the transaction and then we'll address all the questions.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you, Orlando.
Yes, please move to Slide Number 3 on the second presentation titled Acquisition of Banco Santander Puerto Rico. Definitely as I said, we're really excited about this strategic announcement. It is transformational for the Company. It will give us scale, which is important to continue competing and expanding in this market. And I think, very clear, we want to get bigger. We want -- we see an opportunity to grow in the market with this acquisition. We'll like to see one plus one becomes three, no one plus one become 1.5. So we're going to work toward achieving that. Some of the assumptions on the presentation, which you could be conservative are driven by the fact that we would like to have more presence, retain more clients, grow more clients and expand our branch network to serve the communities and the clients better.
As you can see in the announcement -- the definitive agreement, we signed the agreement yesterday. Its going to go through a process of approval, which is customary to those -- these type of transactions. So the announcement is the signing of the agreement. We're going to go through the process of approval, the filing of the application, and we should move on, and we estimate somewhere in mid-2020, considering how things operating in this market, and regulatory views of the market that this is a process that we would work in hand to hand with the regulators over the next months in filing the application and submitting the required information. We -- as the agreement said, we paid $63 million premium for -- to core tangible equity.
And again, I'm going to try to walk you through the highlights, and Orlando will cover the details of the terms and the structure of the deal. We're very excited that -- we feel is a very, very efficient capital deployment, and we are acquiring a strong stable earnings stream. We're also very pleased to see how we expand the Italian bench, our gross retail commercial business banking, and risk management function. So definitely the Santander team that comes over and joins our team with an expanded talent bench for us to continue our combined strategy. Also, the transaction will give us additional revenues in -- as a larger company to continue expanding our investment in technology, which is a critical component in parallel that it's running with this strategy. Definitely, when you add all this together, we believe we're going to be a stronger competitor to further support the growth in Puerto Rico and the economic recovery and redevelopment of Puerto Rico.
Yeah, let's move to Slide 4 for a moment. This is just an overview what is -- what are the asset -- what is the composition of Santander today. As of June 30, 2019, $6.2 billion in assets, $3.1 billion in loans and $5 billion in deposits and approximately 1,000 employees. The 27 branch locations are complementary to our footprint and definitely will allow us to provide expanded and better services.
Moving to Page 5. On a pro forma basis, the -- using again June 30, 2019, the combined entity will have $17.6 billion in deposits and $12 billion in loans and $14.2 billion in deposits, becoming the Number 2 rank [Phonetic] in Puerto Rico as we are today in all -- in all areas. The pro forma loan-to-deposit ratio will be 84% as we achieve an improved mix of deposit. As you could note in the agreement, we will not be acquiring any non-performing assets. So by -- if we pro forma again as of June 30, the NPA and NPL loan ratios would both will reduce NPA to 2.2%.
I also want to highlight that, as we said, it's an all-cash transaction. Our projected pro forma capital ratios are still well in excess of the well-capitalized regulatory guidelines with the pro forma leverage ratio over 11%, CET1 at 15.3% and total risk-based capital ratio at close approximately of pro forma rate 18%.
Let's move to Slide 7, so you can see more granularity on the pro forma combined institution. We -- we will be growing market share in every segment that we participate today and the pro forma loan portfolio brings larger participation on the commercial activity in Puerto Rico, specifically in some of the segments that we are small, like the small business and business banking is an opportunity to grow in those segments. And then when you look at the pro forma deposit mix is definitely healthy in the four core products that we have in the core deposit. So it's a similar loan profile to ours in terms of pro composition. Obviously, within consumer, we have the auto lending, which is not one of the offers that they had at the Santander, but we [Technical Issues] with scale in the credit card business and in the personal loan business.
Definitely, the transaction, when you look at the deposit mix, will definitely enhance our funding profile, our cost of funds and our customer base.
Moving to Slide 8. When you look at the pro forma branch network, definitely on deposits you can see we reached 20% of deposit in the Island, which has been our goal for some time and 21 -- almost 22% of total assets. The branch -- as you can see the branch footprints complementary to ours, giving some additional presses in the -- in the Island in the West side and South part of the island which we definitely need. So definitely, the transaction, its both complementary and it helps grow the franchise.
So with that summary, I'm going to hand the call to Orlando so he can expand on the structure. We definitely look forward to welcoming the Santander team and the customers to the FirstBank family and we're very optimistic with the future growth that this potential transaction brings.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
So as Aurelio mentioned, I -- we're extremely excited about announcing this deal and having been able to reach this. But it -- so I'm going to walk you through some of the key components of the transaction, try to address later on any questions. The transaction, as Aurelio also mentioned, it's an all-cash transaction. There is a significant built-in liquidity in both our balance sheet and in terms of cash and securities as well as in Santander's balance sheet, which helps in achieving the structure. The premium, its $63 million, you may reference to, which is 17.5% over the $362 million of Santander's core tangible common equity as of June for total base price of $425 million.
In addition, Santander had $638 million in excess capital that will be paid at par. He also made reference to and it's important to highlight that we will not be acquiring any non-performing assets in this transaction. The purchase price represents approximately 7.2 times last 12-month adjusted earnings, given effect to every option of the excess capital. And obviously, it's subject to adjustments based on Santander's balance sheet at closing date, which as we said, we expect to be sometime mid-2020, pending the receivable regulatory approvals. Assuming a full-year earnings and cost savings for 2020, and we use 2020 because of the availability of consensus information, this transaction would be our 35% equity to consensus estimate of $0.81 a share, that would assume the transaction would have been completed beginning of 2020, and obviously includes earnings throughout the full 12 months of both institutions.
The tangible book value per share dilution on the transaction in -- at closing is estimated to be approximately 7% with an earnback of 2.6 year, using the crossover method.
Some of the assumptions that we have done in the transaction -- in modeling this transaction, we have estimated that we could achieve -- we can achieve approximately $48 million in cost savings, which is about 35% of the last 12 months non-interest expenses, excluding OREO. So no OREO is coming on the transaction. This is after an extensive due diligence process we have gone through different components, and trying to achieve some of the objectives that Aurelio just made reference to. Assuming to meet 2020 closing, we anticipate that those savings will be -- 25% will be achieved in 2020, and obviously a 100% of the savings will be by 2020.
Also with model reduction of approximately $4 million in pre-tax, non-interest income due to the limitations of Durbin amendment, which are applicable to us as an institution with more than $10 billion in assets, which was not applicable to Santander in Puerto Rico.
We did conduct an analysis of the commercial consumer and residential portfolios to estimate some fair value loan marks, we estimate those marks are approximately 5.9%. And looking at the other components, we've estimated that primarily the core deposit intangible, it's about 1.5% value, and the same thing on the credit card, the purchased relationships, which is about 3% of value, it's been assigned in the model. These intangibles are being amortized over seven years, using the some of the year digits.
I'd like to point out that the transaction also -- Santander has now a portfolio, which is tied to co-branded card with JetBlue. That portfolio has been transferred to another institution. So it's not part of the transaction, I see included from -- excluded from the analysis.
Lastly, we have estimated that transaction costs and restructuring charges will be approximately $76 million with 50% of that being incurred at close or closely thereafter and the other 50% in 2021 once we achieve all conversions and integrations.
I would also like to touch a bit -- CECL. As you all know, the adoption of CECL is effective at the beginning of 2020 for institutions with calendar years like us. CECL changes the way the accounting is going for acquired loans. On one part, we still have to follow the rules for accounting for business combination, where all assets are mark-to-market, which includes obviously marking loans at fair value.
However, in addition, CECL requires that -- for loans that are not considered what we call PCD loans, or Purchase Credit Deteriorated loans, an additional allowance will have to be established in accordance with the new standard, in essence duplicating some of the impact. The impact will be recovered or compensated in the future at the net fair value marks are accredited back to income over the estimated life of the loan portfolios of the specific loan portfolios.
So to estimate CECL, what we've done is, using the fair value assessment of the portfolios that we did, given the expected closing of mid-'20, so we anticipate they need to establish a CECL allowance for non-PCD loans at closing in the range of $45 million to $55 million pre-tax. And it would be approximately $28 million to $34 million after tax. This will increase dilution at closing in tangible book value per share by an additional 1.6% to 1.9% over the 7% dilution that I just mentioned. So that's been part of the analysis. Clearly as I mentioned, there will be some accretion of some of the impact coming back in the future year.
With that, I would like to open the call for questions on both presentations, the earnings and the transaction.
Questions and Answers:
Operator
Thank you. We'll now begin the question-and-answer session. [Operator Instructions] Your first question comes from Ebrahim Poonawala, Bank of America Merrill Lynch. Go ahead.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Good morning, guys.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Good morning, Ebrahim.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
So I guess, just first question, I think Aurelio, you mentioned that you made some conservative assumptions around how you've laid out either the expense savings or the earnings accretion tied to the deal. I think some of the feedback from investors over night has also been on similar lines, where there is expectation that we could see better than 35% earnings accretion. One, I would appreciate, if you could address in terms of the potential for that happening? And also tied to that, if you can talk about any loans, deposits that you will be running off following the deal, which may have made sense as part of Santander global, but don't as part of FBP?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Okay. Let me cover that. First -- I think first of all, obviously we still operating on the Puerto Rico economy. So we know that predicting the economy, it's not an easy task. So we took a conservative approach of both economic growth, but obviously we are assuming the -- yes, there is going to be certain growth, that is going to give us opportunity. So this works two ways. Our goal is to, after we combine the two institution, we can start seeing [Phonetic] some additional growth. So for that you need definitely to retain as much clients and as much front-end personal to continue the task of increasing the franchise. You also need to retain significant part of the branch network to continue servicing and deliver into larger -- a larger client base. So as we go through the approval process, integration planning, and all the things that will take us over the next six months, we will learn more. We will continue to view how the economy is moving. We have sectors of our strategy that, as you know, for example, strategically, we're increasing mortgage origination in the conforming, but we're decreasing the portfolio side. So we'd be adjusting all those estimates.
We think its a balancing -- its a balanced approach. Its being a balancing act. And I -- the way we presented transaction is a balanced approach. Yes, there could be an opportunity to go to higher number, as you guys in your original estimates [Indecipherable] around. But we first -- before we get into that we would like to see how we make sure that we maximize the resources and maximize the growth opportunities, as we're going to be a stronger competitor. There are certain segments that we are a small competitor to they, like small business and business banking, this gives us the opportunity to be a larger competitor in this sector. Some of the cash management service, the number of clients, there is an expansion there to credit cards, there's going to be scale in -- you know better scale in credit card and personal loans by having larger portfolios in both segments. So we think our approach is the right one. Yes, numbers could evolve and as we continue to progress in quarter-by-quarter we'll update you guys with that. But that's the main strategic goal of the transaction.
I'm sorry -- [Speech Overlap] and then the deposits, yeah. We are assuming a conservative -- we're assuming a conservative 20% in the model accretion on deposits, there are some intercompany deposits, some of them will stay, some of them will not -- would not stay, but -- and there is a government accumulation, a government deposit that is happening in Puerto Rico over time. So we believe that all institutions in Puerto Rico, not only us, but we'll see once these debt of Puerto Rico restructure and the agreement is approved, some of the government liquidity will be utilized. So we're also taking that into consideration to our 84% pro forma improve considers that already on a core deposit base, which, you know, it's really -- it's really -- it's really a very strong ratio from where we are today in terms of loan-to-deposit. So that is the -- I hope that answers your question.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Got it. And just in terms of -- Orlando, if you could remind us in terms of just the funding, there is about $900 million of cash on the balance sheet at the end of the quarter. If you could just talk to in terms of how much of the deal gets funded to this cash, where that cash balance should be coming out of the deal, that would be helpful.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Well, the modeling we did does assume that when you add up the $425 million and $638 million, so it's $1 billion of cash that it's coming out. And definitely the model assumes that a reduction in interest income associated with that cash that goes out. It's -- the way we see it, it's a combination of the liquidity we have in cash and the available securities that we have. Obviously, we have the flexibility of drawing lines or are using repos -- FHLB lines or using repos if needed. But as I mentioned, also, there are significant built-in liquidity in Santander's balance sheet. So a bunch of that liquidity, it's going to be complemented on both institutions once combined. So that's why the deal was structured. This way, we feel it's a very doable transaction, but clearly, as you well mentioned, our $1 billion comes out and does affect some of the investment income. At this point, a large chunk as you saw was sitting in the Fed account at $180 million [Phonetic], so it's a -- it's that kind of impact on the income statement, but it's been incorporated into the numbers that we're assuming for -- for the earnings accretions.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Got it. And just one last question on the deal. In terms of the 6% credit mark, seems a little high given what Puerto Rico has gone through over the last few years. And obviously, taking on the NPA, is there anything specific in that portfolio where -- where you assumed a higher credit mark or are you just being conservative there?
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
It's -- remember that fair value marks assume lifetime losses in there. The portfolio -- there is nothing -- they have a good portfolio as you had made reference to, we're not getting the non-performing. But what you still have a credit card portfolio in there, you have a mortgage portfolio which is longer term, cover $1 billion in mortgages. So it's that combination of the components with lifetime loss kind of scenarios that led to those marks. We will obviously update that. And the marks, it's been a combination of external parties we use for the assessment of the marks, as well as using the internal models that we use for DFAST and for CECL and all those components. So we've done a lot of work, we'll -- that has to be updated anyway as a transaction date, but it was most reasonable estimate based on all the information we have at this point.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Got it. Thank you. I'll dequeue.
Operator
Thank you. Our next question comes from Alex Twerdahl, Sandler O'Neill. Go ahead.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Hey, good morning guys.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Hey, Alex.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Good morning, Alex.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Congrats again as this thing [Phonetic] finally announced.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you.
Couple of clarification questions. In the cost saves number, the 35%, are there branch consolidations contemplated in that number?
There is -- there is -- primarily you're going to see overhead technology components, legal, marketing, a lot of [Indecipherable] expenses. There is a small assumption on that part, yes, but the final number hasn't been determined.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. So it seems like there is a little bit of potential 35% as things get assessed. Could potentially move a little bit higher as the deal gets closer to close and thereafter?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
I think it goes together with growth opportunity. That could obviously are the best part of the deal. If you want to grow, then you have to do less reduction on expenses.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Got it.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Remember, the key view as Aurelio mentioned is that, this is a very strategic transaction, we think it's going to position us extremely well for the future. So it's not a financial -- immediate financial transaction, but a long-term financial transaction, the way we see it. So we want to be able to maximize the capacities of the combined entities.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Got it. And then just to clarify, the 25% realized in 2020 that assumes $12 million of the $48 million assume -- is realized in 2020, right? Not 25% or 35%?
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
No, no, it's a $12 million.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Correct.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Yeah.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. And then I think there was a comment in the press release last night, that there is potential adjustment to pricing based on Santander's balance sheet at the time of closing. What would trigger an adjustment to the pricing of the transaction?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
The way the transaction is structured, it's -- and you will see the deal -- the documents of the deal published. But it's basically a calculation of a base tangible common equity, which is based on the size of the institution. So obviously, we do expect that the institution will continue to execute bases. And the base capital we're using it's 8%. So the transaction will continue to do business and grow. So if that happens, the price might go up a bit. If it comes down in size by any reason, it might come down a bit. So we're just trying to point out that the premium, it's based on a base capital which could change on size of the balance sheet as of the transaction date.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
And then the excess capital that remains at closing will be paid up par.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Right. And then -- and then just a quick question on -- I think this is something that you guys have obviously been preparing your balance sheet for quite some time. Can you maybe just shed a little light in sort of where you are in terms of preliminary conversations that you've had in the confidence in being able to get this thing closed and sort of, I know you said mid-2020 which gives obviously a lot of wiggle room, but just in terms of capital levels, in terms of balance sheet capacity, things you need to do. Are you -- I mean, do you feel like from a regulatory standpoint that you're in a pretty good spot to get this thing closed have too much delay?
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
I think the capital -- the committing capital, it's strong, when you look at deals in the market and if you compare to the asset quality profile, that is a pro forma. And if you can see there how much excess compared to normal. Even for Puerto Rico 11% leverage I think -- we think is a strong number.
But then obviously, being the -- the estimated pro forma at closing...
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Leverage.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Leverage...
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
So, as a matter of practice, the formal application process is the only forum through with the regulators will provide a definite view on a transaction proposal. However, formal disclosure are an important aspect of any bank's supervisory relationship with our regulators and the content of those discussions are definitely consider -- they're considering confidential supervisory, confidential information for banks that we're not -- we're not allowed to share. But what I can say that our discussion today have been very helpful in preparing us to address the key points that most likely rise in the formal application process. So we think this structure that we have put together is strong because all the metrics that make an institution more healthy are actually covered in the way the transaction was structured.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
And as -- with Santander keeping the non-performing and with us having achieved reductions we have achieved in non-performing and classified assets, I think that positions the institution in a much better way for any transaction.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Plus, an improved funding profile.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Thanks for taking my questions.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you, Alex.
Operator
Thank you. Our next question comes from Brett Rabatin, Piper Jaffray. Go ahead.
Brett Rabatin -- Piper Jaffray -- Analyst
Hey guys, good morning. Congrats on the deal.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you, Brett. Thanks.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Good morning, Brett.
Brett Rabatin -- Piper Jaffray -- Analyst
Wanted to, I guess, first just go back to just thinking about the deal and that you're having Durbin be lower. Can you give us -- I missed it, the numbers, if you gave it on the card portfolio, how big it was or how much the income that you're going to not be pulling over from that institution?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
We did some estimates based on the compensation of other fee base that approximately $4 million pre-tax, give or take $3 million after-tax of fee income. If there is a possibility, we won't be able to charge. So that, that for our modeling purposes, we are excluding that amount of income from the other fee base income that Santander has as an institution. Obviously, we need to go through a very much detail at the end, but based on the information, we feel it's a reasonable estimate of what could be the impact, based on similar -- so remember when this was adopted, we went through similar analysis for ourselves to see what was the impact. So we use the same kind of approach to estimate what could be the impact on their numbers.
Brett Rabatin -- Piper Jaffray -- Analyst
And the $4 million that's on the card portfolio or is that Durbin or is that both? I'm confused.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
It's Durbin, everything related to Durbin limitations...
Brett Rabatin -- Piper Jaffray -- Analyst
Okay.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
And right...
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
He asked about the card also.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
The card, you mean the JetBlue card, a portfolio...
Brett Rabatin -- Piper Jaffray -- Analyst
Right, the card portfolio.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
It's $75 million portfolio that's not coming over, interest income on that is about 14%.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yeah, that's also been taken out, but the fee base., the $4 million is mostly Durbin.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. And then how are your margin would have been down 10 basis points, if you exclude the discount accretion benefit in the quarter? Can you talk about both your margin going forward, I know you said a little bit of pressure if the Fed cuts or maybe give us some color on how much your margin comes down from here with that cuts and then how you're thinking about their balance sheet with lower rates?
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
I mean our margins, remember that there were few components. If rates coming down, we built in with some more liquidity on some of the repayments. We had a large -- large repayments on the commercial portfolio and we did have some repayments on the investment portfolio also. So looking forward, the way the market moves, we'll continue to accumulate a bit of -- catch more than we would like to see, so that affected margin. And as I mentioned, with rates coming down, there was $900,000 impact. It's a bit difficult to estimate, exactly. We think it's going to -- it's going to put a bit of pressure on margin to come down a little bit more.
Obviously, there are -- remember, there is a combination of -- the consumer portfolios are still moving well. So those are higher yielding. On the other hand, we have continued to reduce the size of our mortgage portfolio with originations of mortgage [Technical Issues] to be sold in the market rather than keep it in on the books. So those combined will put a little bit of pressure. So I am assuming that we're coming from down a bit from the $479 million. Normal pay downs and normal deposit behavior will help keep that reduction at not a large amount, but it's a bit difficult to say with the way rates have been moving. In their, -- their balance sheet would -- I would say, would have similar behavior, they have a good amount of liquidity and obviously with the transaction, $1 billion is going to go out. So there is some impact on interest income -- I'm sorry, on margin because obviously those -- that $1 billion would be low yielding kind of an investment. So we're looking at it mostly from the interest income perspective rather than the margin perspective in that sense. But I don't think it's different from what you were seeing in other places that there was a little bit of pressure on margin.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yeah. But the target portfolio has a lower amount of proportion of variable-rate loans than ours, having a fixed rate mortgage, having a fixed rate personal loans and credit card portfolio, which actually are mostly fixed. So that really -- and then the -- the loans tied to LIBOR [Technical Issues]. Yeah.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. And then on the CECL, the $45 million to $55 million, that's for the acquired portfolio, if I understand correctly. Do you have an estimate for your portfolio?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Well, we've -- I do -- I don't have it. I'm not disclosing it yet, because we're going to include that on the queue, Brett. We have gone through the full exercise, we have gone through a different iterations of the CECL. So those numbers, we're going to share what the estimated impact we're seeing on CECL for our portfolio. That number -- the number we're estimating on their portfolio or on non-PCD loans, obviously, we felt it was important to give some idea of where we see the range coming in on their portfolio for the impact on dilution on the book value per share that was important that you all understand. So -- but within a couple of weeks, once we publish the Q, you'll see a little bit of the disclosures on the estimated impact will have on our institution.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
At the end, it's we're going to have that no matter what, so wouldn't think would be the new impact, what would be on the acquired transaction.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. And then wanted to get -- just if I can one more on credit. Your net charge-offs were lower, NPAs were lower, but you had higher migration in the NPAs this quarter. Given what we're seeing with credit trends, it would seem like your provisioning level that decline in the third quarter could be sustainable. Can you just talk about provisioning from here? And absent that increase in inflow in 3Q are you expecting credit to continue to improve?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
I think -- yeah, I think we have to see how the balance sheet is also changing the loan portfolio changing. The mix of core mortgage portfolio is reducing even though originations are increasing and conforming is the one that we are -- that we're increasing. For the portfolio, it's going a little down. Consumer will continue to grow, that is our expectation, both auto, personal loans, credit cards, all the three, four [Phonetic] products. And commercial will also grow, but when you look at the proportion, provision component of the consumer is higher than commercial. So from that perspective, predicting the provision is going to be driven by how this portfolio makes us move. Definitely, we see very stable migration. On credit trends, we see very early -- good early indications on the delinquencies, which is really our leading -- primary leading indicator. So from that perspective, there's a lot of moving parts entitled formulas that you are very aware. But we continue to see a positive trend, when you add all the components within.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Keep in mind that obviously, this quarter, we did have some reserve releases on the large repayments. $120 million repayments were criticized loans, so they had some reserve releases in there, you don't have that every quarter. And you have to balance the fact that as we grow the consumer portfolio, you're going to have some more charge-offs, you have -- you don't have some provisions associated with it, but a much higher yielding asset at the same time on the income statement. So if you ask me, I mean, we had talked about not being more than $15 million, that stands. I think $7 million, it's on the low side of a quarter. We will never get to the $15 million I would say in this current scenario based on the behavior of the portfolio.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. I appreciate all the color.
Operator
Thank you. Our next question comes from Joe Gladue, Alden Securities. Go ahead.
Joe Gladue -- Alden Securities -- Analyst
Yeah. Hi, good morning, and congratulations.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Good morning, Joe.
Joe Gladue -- Alden Securities -- Analyst
Just let me follow up a little bit on one of Brett's questions on the margin. Just see that Santander's net interest margin is about, if I'm looking at this correctly, about 100 basis points lower than FirstBank's. And just wondering if there's any changes in mix or any structural changes that you'll be able to accomplish shortly after the acquisition that might, so [Indecipherable] that difference between the margin of what you're acquiring?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yes, there, keep in mind, you have to think a little bit about their compensation. Number one, proportionately, they have a large amount of investments and cash balance sheet -- on the balance sheet. Number two, their portfolio are -- higher components are commercial and mortgages. So those items would by themselves deal slow -- lower kind of interest rates. On the other hand, we should get a bridge by not having the non-performing that it's in their balance sheet, and that would help improve.
If you look at their consumer portfolio, it's mostly credit cards. So we do have other components of our consumer portfolios that improve the margin. So as we can develop more, some of those businesses through their branch network, would improve the margin. But you have to keep in mind, what's the composition of their -- fair enough of that mix [Phonetic].
Joe Gladue -- Alden Securities -- Analyst
Okay, thank you. That's all I had.
John B. Pelling -- Investor Relations Officer
Thanks, Joe.
Operator
Our next question comes from Glen Manna, KBW. Go ahead.
Glen Manna -- KBW -- Analyst
Hi, good morning, guys.
John B. Pelling -- Investor Relations Officer
Hey, Manna.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Good morning, Glen.
Glen Manna -- KBW -- Analyst
Congratulations on the deal. Just from a bigger perspective -- bigger picture perspective, we've seen a lot of consolidation on the Islands over the last year and a half whether it's portfolios or whole bank. And really I'd be interested to get from your perspective, you've all been long time bankers on the Island. How do you see the environment of banking changing on the Islands in banks roles, in the future of Puerto Rico?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Well, I think the one thing is definitely the local capital has been invested in growing in Puerto Rico for the last years. And we've seen how popular of the asset [Phonetic], we see how Oriental is doing it, and how we're going to be doing it. There is other players like CD and Banesco, which are also being growing in recent years. Puerto Rico, it's also through the digital channels, we have other competitors that are very active in the credit card market. They're very active in the personal loan market. They're very active in the deposits. So the landscape, it's not just the branch networks. We have to, as we are doing, we're also investing in the digital channels and technology component. And then you add the credit unions, which we divide a great yields in two sector. The co-ops, which are the lower grade unions, and then the federal trade unions, both of them have continued to grow. The largest of -- if you are on the Co-Ops, they are the largest lender or personal loans. They have the largest market share altogether. They also have 40% of the branches in Puerto Rico, when you add all the branches of the credit unions that are physically in the Island.
And then, you see some of the other federal credit unions continue expanding. They definitely -- they have a competitive advantage from the tax side. And there is no buyers of entry for federal unions to continue grow in Puerto Rico. Some of them continue to open branches. And they have been very active in the offering of the boxes. So, we think it continues to be competitive. We think the scale that we're going to have help us to be -- to be -- to improve competition in certain sectors that we haven't been able to successfully to do it like some of the small business and commercial banking sectors. So, by having an expanded branch network, we also compete to the larger banking island.
Glen Manna -- KBW -- Analyst
Okay, thank you. And when you look at loans on the Island, normalized for the pay downs and maybe they are at the run-off in the resi book, the planned run-off in the resi book, it looks like it's about 3% quarter-over-quarter annualized growth. Is that kind of where you see the Island growing at? And also, with respect to bringing on Santander's mortgage book, are your planning to continue to kind of run mortgages down or does this kind of alter some of those plans?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yes. I think the mortgage book would reach, next year, the point of stabilization. When you calculate our 3% year-over-year, remember that we have taken down significant NPLs. So, the risking, it's been part of our history for the last 10 years. And we don't see -- we see -- we finish in that -- in the coming quarters. So, from that perspective, we probably can achieve more than the 3%, once you consider all the aspects. And there is a component that we were not participating over this period, which is the construction sector, which we are starting to see some new projects coming into the pipeline. And even though, the funds as we are all aware, the recovery funds of Puerto Rico have been delayed and are moving slowly. They're coming, but at a pace that obviously will last more than we all wanted to last, which at the end is going to bring more loan volume on the construction sector as we see it. So, it's been certainly importantly how our $9 billion loan portfolio has moved over the last 10 years with NPL sales, migration of OREOs, originations, and then the sale of our participations which we also -- part of our derisking was also to reduce concentration in some borrowers and some of that was achieved also. But actually I'll tell you, this quarter, we achieved some of that also. So it is, I think the 3% is a low end of the number. We should be capable of doing better than that.
Glen Manna -- KBW -- Analyst
Okay. Thank you. And I was just looking at the CECL tip, can you disclose the percentage of non-PCD loans that you're acquiring in the breakout versus the whole number or not?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
We did not. Remember that PCD definitions are pretty ample on their CECL and it requires a lot more analysis. We did estimate how much were the non-PCD, obviously it's a higher percentage of non-PCD from PCD loans, because they are keeping the non-performing. But the rules for CECL are a bit more gray area kind of thing or more ample than the old PCI kind of definitions. So we did some estimates to get to those numbers that I showed on the $45 million to $55 million, which obviously will -- as we go through, the integration process will iron out to come up with the specific amounts. But there is some space that you can think of a typical institution and any kind of delinquency could -- all for a definition of PCD and things like that. So that's why it's a little bit difficult to say a specific number.
Glen Manna -- KBW -- Analyst
Okay. Thank you.
Operator
Up next is a follow-up question from Ebrahim Poonawala from Bank of America Merrill Lynch. Go ahead.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Hey guys. Just a quick question, just around capital. I'm assuming, if the TCE shakes out somewhere between 10% and 11% pro forma for the deal, sorry if I missed that, but wondering in terms of additional capital actions should we anticipate that the dividend that you initiated last year, we still see some movement on that I think you initiated in the fourth quarter of last year. And just in terms of the outlook of where the pro forma TCE would be in kind of your expectations beyond that, I know the deal is probably the big priority right now, but if you can just talk to how you think about capital levels pro forma for the deal and then your plans to use that.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yes. You are right. The deal is the priority. And -- but also there could be some room for moving on the dividend as you see where the earnings are and how much payout we have. Definitely other larger actions will have to wait until we have the final number. And we are ready to close the deal and we close the deal. But when you look at it on a pro forma basis, assuming the Puerto Rico economy continue at the pace it is moving and the asset quality trends continue on the pace we've been achieving, there should be opportunities for additional actions after we close the deal.
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Got it. Thank you.
Operator
Up next is a follow-up question from Brett Rabatin, Piper Jaffray. Go ahead.
Brett Rabatin -- Piper Jaffray -- Analyst
Hey, guys. Just wanted to go back to talking about the assumptions in the deal and I guess first everyone is super-focused on the 35% percent expense saves. Can you just go back to the branch assumption? And you said some are small I think, how much of the 27 locations you might look at and just talk about what percentage of facilities might be of the expense saving assumption that you have?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
We're not giving a specific number of branches, Brett. There is also other back office facilities that are embedded in this us, both institutions and very large facilities, and computer centers and technology components on our facilities [Phonetic], which definitely would be put together. So, that is a number that we're not -- we're not disclosing because we want to make sure we go to a more detailed view for link [Phonetic] with the growth strategies. And make sure that at the end, we can disclose that. But when you look at 35%, we feel very helpful with that number.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay.
And then wanted to make sure I understood, I mean, you've got a few things that are kind of net drag down in NII or fee income pro forma, but obviously there is going to be things that you'll do with the balance sheet that will be synergistic. Can you maybe just talk about, once you've gotten the deal closed what opportunities you see with the balance sheet in terms of your comment earlier about some things could be conservative.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
The opportunities that we see is number one, Aurelio made reference to the small business and middle market business, we think that that would help the combined institution further develop that business.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yes, but in the time frame of projections that we have for you that we shared, I think it's important to highlight, I'm glad you asked the question. We're assuming no growth of loan portfolio for the target in that period of time. Okay. So it is a no-growth scenario in the assumptions. As Orlando say, we have areas that we believe, but again we want to put that into the -- into our new projections once we go through a more detailed process and link that to the trends that we continue to see in the economy. But in the projected period that we're sharing with you in the presentations, that is the assumption is no growth on the loan portfolios.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. And does the increased size of the platform, does it change your ability to compete better in terms of larger credits on the island?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Yes. It change the ability to reach out to clients. I think it also -- if you have a larger corporate banking team, you can get to more clients too. So it changes the ability at our levels. We renamed personal loans and credit cards to the branches in addition to the digital channels, so that is expanded. In most of the products, mortgage are same. Auto, we're doing direct, but for the rest of the products they either use the branch network or the sales teams, which are going to be an expanded group.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. And then one other last one from me just on the mortgage portfolio, I'm just curious how much more you want to de-emphasize that piece of the book given the seasonal treatment?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Well, when we -- we don't -- we basically want to see the mix of conforming. It's really our focus and the non-interest income that comes with that. We see -- well, probably, you should expect next year similar decrease through the end of the year on the mortgage portfolio, which -- and then that should start leveling to the level that we see by the end of next year. Because the originations or repayments are going to be broadly close one to the other.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. I said last one, but I actually have one more if I could. Just thinking about the portfolio before the close of the deal, given that you're going to deploy all this capital with it, would it be fair to assume that the loan portfolio might be flattish in the next few quarters?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
You mean ours?
Brett Rabatin -- Piper Jaffray -- Analyst
Correct.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
I can tell you that we expect to grow in the consumer and we expect to continue leaders in the mortgage. And the commercial is very deal-driven. Small and medium, it's growing. Corporate, it depends on deals that get close in the quarter and prepayments that we receive to offset. Obviously, this quarter, if you'd -- it was a strong origination quarter, but is also there were $150 million in good prepayments, which, while we call good prepayments. So our goal is to grow the portfolio, obviously how the opportunities on the pipeline -- and the pipelines are positive. So, it's how fast we can close on these deals that will make the difference in having an appreciable net growth. Yes.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
We'll continue our normal business. We don't intend to hold back. Remember, after all, we continue to generate revenues and net income and that builds capital. So allows for the growth component on the balance sheet.
Brett Rabatin -- Piper Jaffray -- Analyst
Okay. Great. Appreciate all the additional color.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you.
Operator
Next is a follow-up question from Alex Twerdahl, Sandler O'Neill. Go ahead.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Hey guys. Just a couple of follow-ups from me. First off, do you have the cost of deposits on Santander's deposit book?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
It's slightly lower than our cost of interest-bearing deposits.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. And that -- is that for your total interest-bearing deposits or just the quarter...
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Total interest-bearing -- total interest-bearing including brokerage.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. And then the $120 million of large criticized commercial mortgages that paid down during the quarter, was it there in Puerto Rico? And if so, do they refi with another bank or were they pay it off or was there outside money they came into buying? What -- could you just maybe elaborate a little bit on what happened to them?
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Actually both of them refi with other bank in Puerto Rico, other type of funding sources.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay.
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Transactions related to acquisitions of those assets.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. And then is it fair to assume that since you didn't take the JetBlue credit card portfolio, I'm not sure if that was an option or not. But is it fair to assume that the loans that you took are all loans that you want and there will not be any divestitures of concentrations or anything like that following the close of this transaction?
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
It is fair. Yes.
Alex Twerdahl -- Sandler O'Neill -- Analyst
Okay. Great. That's all my follow-up. Thanks.
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Thank you, Alex. I just want to mention, I know that the Q&A session is over, just want to mention that we're definitely very pleased Santander has been an extremely good banking franchise in Puerto Rico and we're really excited about the combination. So we look forward to continue updating you as this process progress over the next months, and thank you all for your attention today.
John B. Pelling -- Investor Relations Officer
Just real quick on the investor front. We have a number of conferences upcoming, Bank of America Conference in New York, November 5 and 6, Sandler Conference in Naples on November 14. We also have Bank of America Investor Tour to Puerto Rico on December 12. So with that, we greatly appreciate your ongoing support, and we look forward to seeing many of you at these upcoming conferences. And with that, we will conclude the call. Thank you.
Operator
[Operator Closing Remarks].
Duration: 69 minutes
Call participants:
John B. Pelling -- Investor Relations Officer
Aurelio Aleman-Bermudez -- President and Chief Executive Officer
Orlando Berges-Gonzalez -- Executive Vice President & Chief Financial Officer
Ebrahim Poonawala -- Bank of America Merrill Lynch -- Analyst
Alex Twerdahl -- Sandler O'Neill -- Analyst
Brett Rabatin -- Piper Jaffray -- Analyst
Joe Gladue -- Alden Securities -- Analyst
Glen Manna -- KBW -- Analyst
