OFG Bancorp (OFG) 2014 Q3 法說會逐字稿

Good morning. My name is Paula and I will be your conference operator today. Thank you for joining us for this conference call for OFG Bancorp. Our speakers are Jose Rafael Fernandez, President, Chief Executive Officer, and Vice Chairman, and Ganesh Kumar, Executive Vice President and Chief Financial Officer.

There is a presentation that accompanies today's remarks. It can be found on the Investor Relations website under the webcast, presentations, and other files page.

Please note this call may feature certain forward-looking statements about management's goals, plans, and expectations which are subject to various risks and uncertainties outlined in the Risk Factors section of OFG's Securities and Exchange Commission 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 which occur afterwards.

All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answers session.

I would now like to turn the call over to Mr. Fernandez.

Thank you and good morning to all. I will cover the general overview and Ganesh will discuss key aspects of our financials.

Please turn to Slide 3. We continue to achieve notable success despite Puerto Rico's tough operating environment for the seventh consecutive quarter since the acquisition of BBVA Puerto Rico operations. Outperformance metrics were comparable to top-tier SMID cap banks that operate in a much more favorable market. All of these reflect our ability to be highly adaptive with sound capital management and operating capabilities.

Now let me review key highlights for the quarter. We earned $0.34 per share diluted, equal to the year-ago quarter. Compared to the second quarter, we earned about $0.04 less. That is primarily due to the absence of significant cost recoveries from the Eurobank portfolio. These don't necessarily flow into income statement on a straight-line basis as we have experienced throughout several quarters. Based on that, we have already -- based on what we have already seen, these recoveries should rebound in the fourth quarter.

Other operations perform well. Demand deposit and savings account balances grew while total deposit costs continued to decline. originated loan balances and yield expanded. Mortgage and commercial loan production increased. Noninterest expenses remained level.

We continue our strategic reduction of Puerto Rico government related exposure, which fell more than 4% during the quarter.

Furthermore, capital continued to grow with tangible book value up 0.7% to $14.82 per share and book value up 0.5% to $16.96 per share.

Additionally, we continue to build Oriental's brand and differentiate ourselves in the market by introducing new consumer oriented technology with enhanced products and services. Over the last year, we have introduced four such products. Our Cuenta Libre, Freedom Account in English, with no constraints on ATM access and advanced mobile features; FOTOdeposito, which is our version of FOTOdeposit, online account opening and People Pay.

We are happy to report that Cuenta Libre is attracting approximately 800 net new customers a month. Total mobile usage as a percentage of Internet users grew 5 times larger over the last 12 months.

Please turn to Slide 4. As a result, our performance metrics for the quarter were satisfactory in comparison to our target ranges. Net interest margin came in at a more normalized level, 5.84%. I say normalized because it didn't include cost recoveries, which benefited net interest margin in the second quarter as well as earlier this year.

Return on average assets was 1.02% versus our target of 1.25%. Return on average tangible common equity came in at 9.78% versus our 12% target. Our efficiency ratio came in at a solid 49.30%, better than our low 50s% target. It also has significantly improved over the more than 52% level of a year ago. I will have some of additional observations later, but for now, I will turn the call over to Ganesh.

Thank you, Jose. Good morning to everyone on the call.

Let me start with Slide Five and walk you through the third quarter of 2014. The key to understanding our results are the trends within our loan portfolio. Looking at the graph on this slide, you will notice the loan portfolio balance mix is changing. We have been increasing originated loans on a fairly steady basis. Our total loans this quarter end were $4.86 billion compared to $5.13 billion in the year-ago quarter. Adjusting for reductions in PR government loans, new loans generated have helped us to overcome runoff in the acquired portfolio.

The yield of originated loans has picked up slightly. This is due to our pricing discipline and a higher proportion of consumer loans. During the third quarter, the yield was 6.64% compared to 6.13% a year ago. This mix provides a good backdrop to understanding certain trends in our P&L and reported credit metrics.

Also, we still have $514 million of accretable yield and $602 million of non-accretable discounts on the two acquired books. Roughly 45% of our loan book is acquired and under purchase accounting.

Moving on to Slide 6, another key to our business is what is happening with our deposit balances and costs. Our strategy is twofold -- one, to reposition our brand and create the much-needed differentiation in the local market. Related to this are the product changes, as Jose mentioned earlier. Jose. And, two, to achieve a favorable funding mix at a better cost. To illustrate the second strategy, we are seeing a reduction in overall cost of funds and a much better mix of deposits.

In the third quarter, total deposits declined 8 basis points to 68 basis points. They are down 25 basis points year-over-year. Demand deposits and savings balances increased $30 million to $3.3 billion. They are also now equal 65% of the total deposit compared to 64% at the end of the last quarter and 56% a year ago. At the same time, higher costs and deposits, most of which were acquired, declined 4.6% due to maturities.

Now on to Page 7. Overall, our business has performed well with some aspects showing particular strength. Specific to loan generation, we were able to close more than $242 million in new loans, up 9.5% from second quarter.

Auto production of $69 million was down from $80 million to $90 million levels we saw in the past quarters. It should be noted that new car sales in the market overall have dropped 20% or so in the last few months. On the other hand, commercial production of $90 million was almost twice second-quarter levels. This reflects our earlier midmarket and small business C&I pipeline build.

Residential mortgage production of [$55] million increased 6% despite a tough regulatory environment. In addition, pricing improvement in the secondary market increasing fee revenues by 35%. We continue to focus on conforming loans with average balances of around $135,000 and on originate to sell model.

Consumer loan production at $29 million returned to its high water mark. The increase we had experienced in the second quarter was primarily due to some targeted marketing campaigns that we had run.

At close to $10 million, banking services revenues continue to maintain their level in part due to our institutional and commercial transaction services business. We also maintain wealth management revenues at more than $7 million. This was due to higher fee revenues from our trust businesses and less from our annuity sales at our broker-dealer. General market conditions continue to challenge our efforts to grow this business further.

Please turn to Slide 8 for an analysis of major items of our profit and loss statement. Non-covered loan income was virtually level at $88 million. Increased income from a higher balance of originated loans almost offset lower income from the reduction of the acquired loans. Covered loan income fell $4 million. There were no significant cost recoveries as this can vary quarter to quarter.

Investment securities declined $1.2 million, primarily due to the higher premium amortization in our portfolio. Total interest expense declined 7% due to factors we just discussed. Provision for loan losses, excluding acquired loans, increased $1.2 million. This was primarily due to an increase in charge-off levels on originated auto loans and higher portfolio balances as well. The provisions for acquired loans increased $1.3 million. Third quarter included our annual forecast refresh for the collared portfolio. Impairment and estimated cash flows on collar flows represents the entire increase in provisions for all of the acquired portfolio.

Since we already talked about the noninterest expenses, let me skip down to FDIC amortization. The amortization expense fell $1.5 million due to the absence of cost recoveries on the covered portfolio. Noninterest expenses remained approximately level at $59.6 million, in line with normalized prior quarters.

Now on to Slide 9, regarding the balance sheet. With respect to the balance sheet, we would like to review the following highlights. Our already strong liquidity continues to build up due to cash flows from our business operations.

We have already discussed loan balances so let's move down to the FDIC indemnification assets. As you can see, we continue to write this asset down. Most of it is expected to end in the second quarter of 2015 as the commercial loss share agreement with the FDIC expires then.

Stockholders equity increased to $930 million. The improvement was primarily due to increases in retained earnings, which more than offset the decline in AOCI as unrealized gains in our securities portfolio at the end of the quarter was lower than that of the end of the second quarter.

Please turn to Slide 10. Here is an update on our government related exposure. As we mentioned previously, we continue to reduce this exposure. Loan balances declined $31 million in the third quarter due to contractual maturity of some central government loans and some municipal loans.

With regard to PREPA, as part of the forbearance agreement, the bank syndicate agreed to extend the credit facility up to March 31, 2015. We had then classified this credit as a substandard asset and as a TDR as well. Along with the members of the syndicate, we had retained an outside expert to assist us with the cash flow forecast, which included a series of assumptions that produced to build our own model. Based on this analysis, the loan is being maintained in accrual status, requiring no impairment at this point in time.

To sum up, our Puerto Rico government exposure has declined almost a third from since a year ago.

On Slide 11, we review our credit quality metrics. These metrics relate to the originated loan portfolio, excluding the acquired loan portfolio. During the quarter, the nonperforming loan rate increased 26 basis points to 3.65%. This was probably due to incremental entries in the market in the form of repurchases from GSEs and as well as TDRs.

The net charge-offs increased 38 basis points to 1.34%. This was primarily due to increases in the consumer and auto portfolios up 64 basis points and 58 basis points respectively. In auto, we clearly see a trend in increasing charge-off rates. Eliminating the effect of seasoning, our increase is in line with the market experience that we see. But considering that our auto portfolio is a higher yielding portfolio with a different risk profile, we are comparatively better in terms of the loss experience that we see in our portfolio.

That concludes my part of the presentation. Let me turn it over to Jose for the wrap up.

Thank you, Ganesh. Please turn to Slide 12 for our current outlook.

With regards to Puerto Rico, the operating environment continues to be a challenging one. The GDP economic activity index has seen further declines, auto loan sales have dropped 20% for new cars, as Ganesh mentioned, and demand is softer for use cars. In general, it is a tough landscape. There continue to be signs of progress, however, as central government is taking steps in the right direction to tackle short-term liquidity challenges and also to fix the tax code. We are awaiting preference business and restructuring plans due on December 15, 2014 and March 15, 2015, respectively.

Tax reform and energy reform are two initiatives that the government needs to implement in the next few months for Puerto Rico to improve its fiscal situation and competitiveness.

We have also seen encouraging trends in the private sector employment as well as oil prices trending down, which will positively impact our economy.

In banking, loan demand continues to be soft. There has been a noticeable decline in consumer credit quality and there is a continued intense price competition for good quality commercial loans. On the other hand, deposit pricing, while higher than mainland averages, has become much more rational.

Within this challenging environment, we continue to adapt. This has enabled us to generate performance metrics that compare favorable to top tier mainland banks. We have proven this over the last seven quarters.

Near-term, our core businesses should continue to perform well. As we look into 2015 and beyond, Oriental will continue to benefit from our larger client base as we further deepen our customer relationships. The momentum we have with our advanced banking capabilities, market differentiation, and brand perception, along with the elimination of the FDIC amortization expense, should provide us with significant earnings growth going forward. All of this uniquely enables us to continue to pursue our capital deployment and management strategy. Our advantage is flexibility, and we will continue to do this to maximize returns.

That ends our formal presentation. Operator, please open the call to questions.

(Operator Instructions). Brian Klock, Keefe Bruyette Woods.

I have just two questions and then I will get back in the queue. First, thinking about how challenging it is in Puerto Rico, you guys continue to put up 2.25%, 2.3% pretax, pre-provision earnings. You have got a solid tangible common equity, tier 1 common, very strong. So, can you talk a little bit about your thoughts on the buyback and looking at where the shares are trading below tangible book and just remind us what you have got left in the buyback and what your thoughts are there?

At the end of the quarter, we -- let me start again. I think, from our perspective, we are looking to buy back shares every time we see an opportunity when the stock starts trading at or below tangible book value. So, we will take those opportunities and we will take advantage of those opportunities. Having said that, our original $70 million repurchase program had, at the end of the quarter, probably $18 million to $19 million left in -- $21 million left in availability. And we will be opportunistic as we have been in the past going forward.

Okay. That fair. And then, my second question is with all the competition in Puerto Rico for loans, I was impressed with the NIM being steady when you take out the accelerated accretable yield impact on the prior quarter and even the couple basis points of compression this quarter from excess liquidity buildup. And it looks like, on both fronts, on the loan side, you've actually had some nice expansion in your noncovered loan yields, but you also did some good work on the deposit side. So maybe talk about what you are thinking and maybe an outlook for I guess both loan yields, the deposit pricing, and then I guess expectations for the overall NIM in the next quarter or so.

So, on the loan side, Brian, when we look at the consumer side of the loan demand and loan portfolios, we see an opportunity for us to continue to show good yields. Again, the auto business has a high-yielding focus as well as the consumer, the personal loans and installment loans that we originate. So we continue to be encouraged with the yields on those two portfolios. As you know, the mortgage -- residential mortgage portfolio we originate to sell is mostly conforming.

And then, on the commercial side, that is where most of the strong price competition is happening, to some degree very irrational in terms of pricing and in terms of structures and terms. So it is a matter of making sure that we identify the best customers and try to attract them and/or retain them in a rational way. So that is what we see on the loan side from a pricing perspective.

On the deposit side, we have done a pretty good job of bringing down cost of funds on our core deposits, and while we have been doing that, our balances have remained or gone up depending on which category you want to look at. But, demand accounts and savings accounts have increased over the last year and a half since the acquisition, which reflects the larger and more recognized brand that we have here in Puerto Rico and also the acceptance of that from new potential customers coming in. As we mentioned on one of our accounts we're bringing in 800 new customers a month on average. And those are the differentiating factors that are helping us keep on bringing down the cost of funds since the market recognizes the value that we provide to those customers.

Brian, I would also like to add that the mix of the loan portfolio and the mix of the deposit balances contributes to this expansion in NIM, at least in maintaining the NIM at this level, primarily because two things happening. One, as the commercial loans come out of their acquired portfolio, the thing that is -- the components of the loan portfolio that is increasing are the consumer part, which is the auto and the retail loans. They have a higher pricing and yield. Therefore, there is a pick-up over there.

The second thing is, partly because the loans that were booked, even the auto loans and the consumer loans that were booked into our -- during the acquisition were pretty good with the premium and, therefore, they were lower yielding on book than the ones they're replacing, even though they are priced similar.

And then, obviously, the other side of the equation is the more deposits and savings accounts, and we have driven down the pricing on those ones, and so far the market has been inelastic and working in our favor in growing that portfolio and, at the same time, this has enabled us to concentrate on reducing the higher cost CDs that we acquired.

Great. Thanks for that. And I guess, so with that dynamic so much still in place, would you expect to see the margin sort of hold steady here? And, I think, Jose, did you mention earlier you think there may be some more accretable yield coming in against cost recoveries you referred to in your comments in the next few quarters?

That is correct. On the core portfolio, we are already seeing some additional cost recoveries into the fourth quarter. And, frankly, we need to continue to optimize our operation to maximize the cost recoveries on both portfolios, Eurobank and BBVA. So we are very focused on maximizing that accretable yield that is sitting out there for us to pass it to income.

Okay, great. Thanks for your time guys, appreciate it.

Brett Rabatin, Sterne, Agee.

I wanted to go back to the PREPA exposure and make sure I understand that you have gone through your analysis, you have done a cash flow analysis, and the determination was that was there was no provision needed even though it is now a TDR. Can you maybe give us a little more color on just -- on that particular credit and then just what happens from here in terms of that exposure? Do you guys think you will be able to do something with that position or do you kind of hold onto it and just wait and see kind of how it plays out?

Let me give you another view and I will let Ganesh get into more of the details. But, what we are seeing on PREPA is, as you well know, there is a forbearance that what timed an extension to March of next year, but we are looking very closely at this credit, as you might imagine. And what we are seeing, the trends that we are seeing on the information that we are getting, it is encouraging in terms of how they are working on the operation and trying to extract efficiencies. So, the cash flows are reflecting that and we are encouraged with that.

Having said that, there is a couple of more innings to go because there is a restructure officer engaged that needs to provide a business plan by December of this year and a restructure plan by March of next year. So we will be evaluating on an ongoing basis and on a quarterly basis this credit.

Brett, I would like to also add that compared to where we were last quarter when we were discussing the results to this quarter, the level of confidence on cash flows has increased a little bit because, as you would remember, last quarter, the forbearance agreement was not yet in and, therefore, we didn't know. So since that last quarter, we have had the forbearance agreement. We had retained the external experts to recast cash flows for PREPA, and identified the components of the assumption. And then we made the call primarily to categorize this as a TDR, primarily because the credit facility was changing in its form especially from a line build facility. So having said that, the cash flows do indicate at this point in time, even with our own analysis, and going through a fine tooth comb, the debt service coverage ratios are in fact good and until further information we get or any improvements that happen from the management plan or restructuring plan. So these factors have led us to kind of make the call that we do not need any specific impairment, specific provision towards the impairment. And, therefore, at this point in time, it is an accrual at TDR status at this point.

Okay. Appreciate the color there. And then I guess the other thing I wanted to just go back to was thinking about the loans and moving the consumer book higher, but you did have really strong commercial originations. And I guess I am just curious to hear -- I joined a minute or two late -- but a little more about the commercial pipeline and if you feel like the pricing there is good enough for you to maybe grow that portfolio as well.

I mentioned it earlier, Brett, and, basically, we see price pressure on the commercial portfolio, especially on the larger clients. So, we have an opportunity to attract some small and midsize type of commercial clients where we feel that they are not necessarily completely served and targeting them. But there is a lot of competition on the pricing side for the larger commercial clients. So, we are seeing some opportunities on the small business side, particularly there, as we continue to deepen our relationships with our current customers too.

Okay, great. Thanks for all the color.

Emlen Harmon, Jefferies.

You spoke a fair amount about how the economy there is changing your expectations on the consumer book in terms of credit. As we think about the commercial side of the loan book, can you give us some color just around how the economic environment is changing your expectations for losses on the commercial side of the book? And I guess any kind of data you can give us on potential problem loan increases the last couple of quarters or substandard loan increases would be helpful in understanding that as well.

On the commercial side, we are seeing clients have been operating in a very tough environment themselves, and they have done so successfully. So we feel very comfortable and confident with our commercial book. We are not seeing actually any increases in early delinquencies, and we are not seeing pressure in general terms on our commercial portfolio. On the contrary, what we are seeing is quite stable in terms of credit metrics, and we feel comfortable going forward. So, we don't expect that portfolio to (technical difficulty) pressure. Bear in mind, also, that there is an expectation also from the commercial side that the tax receipt that was imposed a year and a half ago will be eliminated some time at the beginning of 2015. So psychologically, commercial account businesses are starting to expect that, and I think that is also a positive. But from our perspective, our commercial portfolio is pretty solid and we feel comfortable.

Encouragingly, the C&I portfolio we acquired as part of the covered loan, that has done very well as well. So as Jose Rafael said, they have been subjected to the economy for quite some time right now so the seasoned portfolio continues to be steady in terms of not showing any further credit deterioration.

And as I said earlier, small clients, small commercial clients are an opportunity for us and we have a good focus there.

Got it. Okay. Thanks. And then in the earnings release, you guys called out a few acquired commercial credits as being the cause of the provision on the acquired book. Can you help me understand what the interplay between the marks you took on those credits as part of the acquisition and just the provision you put up for those credits in the quarter? What are the effectively marked assets and how much of that offset the provision you had to take?

Just to kind of explain the news release statement and which is what I think I went through the script earlier, primarily that the provisions increased about $1.4 million this quarter and the came from the covered loan portfolio. And the covered loan portfolio, as I said earlier, it is the annual quarter for us to re-forecast the entire portfolio. And the entire re-forecast always looks at all the loans, all the portfolios, all the pools, and we determined that we have to take an additional $1.4 million in provision towards the impairment of that portfolio compared to the last quarter. So, it is not necessarily we are changing the mark or anything like that because the mark really talks about the credit and the impairment might come in timing as we use the net present value to calculate the cash flows. So it is purely -- I won't ask you to take it as a credit deterioration, per se, it is just an impairment in the cash flows.

Got it. So your comments specifically address I guess the increase, but there were roughly $7 million in charge-offs in the acquired noncovered book as well?

Yes. There were some isolated cases where the appraisal came lower, so there were some one or two cases. And if you look at the table where we show the non-accretable discount, there has not been any movement from accretable to the non-accretable. So by looking at the table, you should be able to say that our initial marks are not suffering.

Okay, got it. Thank you.

(Operator Instructions). Taylor Brodarick, Guggenheim Securities.

Just talking -- one more follow-up on the weakness in the consumer and auto demand. Does that lend any opportunity to reduce expenses, either through plant, property, or people to kind of address the lower demand?

In terms of -- I am having a little trouble hearing you, Taylor, so if you could repeat it again just to make sure I understood your question.

Yes. I was just saying that with -- just talking about the weakness among consumer and auto demand, does that give you an opportunity to continue to improve operating expenses? Are there any sort of reductions that you can make given weaker demand?

There is always opportunities, but bear in mind we are running at a 49% efficiency ratio, so we are pretty efficient as it is. Certainly, there are opportunities. I think the opportunities not necessarily are from a cost reduction perspective, but more from a productivity and being more agile and efficient on our servicing efforts on the consumer side. I think we need to continue to improve there and our team is focused on that. So, that is how we see the -- how we approach the fact that the consumer demand is being affected a little bit.

All right. And then, one other question is just sort of on the landscape. Obviously, it seems like the industry will continue to consolidate, at what pace remains to be determined. But, just want to hear your thoughts on what you would be looking for if you reentered M&A and if there is any opportunities as far as any areas that you want to strengthen up in via a deal.

So, we are always open to opportunities and certainly, we have been all along seems to have some a key consolidator in the Puerto Rico banking industry. So the track record is there. Having said that, it is a difficult economic environment and so the players that exist here mostly our in a retrenching mode from the international side. So we will see how all those things play out.

In our mind, we are focused on our operation. We are focused on making sure that we optimize our retail banking operation, maximize our return to our shareholders. And if there is an opportunity, we will certainly evaluate it, but at this stage, we are very comfortable with the platform that we have here in Puerto Rico.

And, with the last acquisition, we closed our gap in our offerings. And at this point in time, anything we look at would be looked at as a financial transaction. And, therefore, our IRR expectations would commensurate with type of transaction. If something comes, as Jose Rafael said, we will definitely take a look at it.

Great. I appreciate the detail. Thanks.

Brian Klock, Keefe Bruyette Woods.

Thinking about, again, the capital question we talked about before in following up on the M&A discussion, I guess if there is not necessarily a franchise that could be for sale, it seems like the reduction and retrenching you mentioned with some of the international peers could be a market share take-away opportunities. So it's maybe a twofold follow-up question.

One, with that happening, I guess maybe what is the outlook for loan balances? I think -- should we expect there to be some slight decline, or do you think there are some market share opportunities to keep loan balances stable?

And then, secondly, if there is going to be a decline or maybe not a market share opportunity, would you think about re-upping the buyback once you get through this current authorization? Thanks.

I think loan demand is really slowing down, so there is really going to be a challenge for us to grow our loan book going forward. There are some opportunities for us to attract some additional clients, but I think our biggest opportunity, Brian, is within our own existing clientele expanding those relationships going into -- and trying to gain market share. If there is a challenge there, it is really pricing and we have got to be very rational on how to attract those clients in, especially on the credit side. So, I expect or we expect to have lower loan balances -- I will say neutral to lower for a year -- as we continue to have run-off from the covered portfolio, also some run-off from the acquired portfolio and booking new loans on our what we call originated portfolio. So that is how we are seeing it.

What was the second part of your question?

So I guess if it is going to be a little bit more challenging to kind of either keep that loan portfolio stable and maybe there is not an M&A opportunity, would you think of re-upping the buyback I guess once you get through this current authorization?

Yes. I mean, we always look at capital management and we go to the board on a yearly basis, and we are constantly looking at it, but we take a deeper dive later in the year in the fourth quarter in terms of our dividend as well as our repurchase program. So we will certainly take a look at those.

And I guess maybe with that, last year in the fourth quarter, you did increase the dividend. And is the typical -- I guess you are still making your way back towards your hold, what, 30% sort of payout target?

25%.

25%. Okay.

Yes. We look at it. As I said a little, the board will take a look at it and will evaluate both the repurchase plan as well as the comment dividend that we have. That is as much as I can share with you, Brian.

Okay, great. I appreciate your time. Thanks again guys.

Rick D'Auteuil, Columbia Management.

Just a couple. I guess the first one is more of a statement. But, it sounded like your response to M&A is there is likely to be a very high bar and you don't need to do anything and it has to just -- it will come down to a financial kind of metric that is how you are going to measure those. Did I read that correctly?

Yes. Yes, you did.

Okay. Go ahead.

The other thing is that it didn't look like you bought back any stock in the quarter. You have already established where you are willing to buy back. But it did trade below tangible subsequent to the end of the quarter. Was there a blackout period, or you able to buy in that period of time?

I am not allowed to talk a little bit about forward quarters. So I can just say to you that, as we have done in the past, we have been opportunistic every time we feel the stock is undervalued, and we have done it in the past and we continue to do it in the future.

Okay. So I guess just separate from that then, do you guys use a blackout period between the end of the quarter and when you report earnings, or that isn't something that --?

Not for the repurchases, Rick.

Rick D'Auteuil

Okay.

We don't have a blackout for repurchases. We have a blackout for management and the board.

Rick D'Auteuil

Okay. That's all I have. Thank you guys.

At this time, there are no further questions. I will now turn the call back over to Mr. Fernandez for closing remarks.

Thank you, operator, and thank you all, our stakeholders, who have listened in. Next week, on Thursday, October 30, we will be ringing the closing bell at the New York Stock Exchange in celebration of Oriental's 50th year in business and OFG Bancorp's 20th year being listed on the New York Stock Exchange. We will be issuing a news release with a video web link if you want to watch. And, of course, we look forward to talking to you next quarter when we hold our fourth-quarter and year-end call. Have a nice day to all.

Thank you. This concludes today's conference. Thank you. You may now disconnect.