Popular, Inc.: Form 10-Q for the period ended Jun 30, 2025

This report includes management’s discussion and analysis (“MD&A”) of the consolidated financial position and financial

performance of Popular, Inc. (the “Corporation” or “Popular”). All accompanying tables, financial statements and notes included

elsewhere in this report should be considered an integral part of this analysis.

The Corporation is a diversified, publicly owned financial holding company subject to the supervision and regulation of the Board of

Governors of the Federal Reserve System. The Corporation has operations in Puerto Rico, the United States (“U.S.”) mainland and

the U.S. and British Virgin Islands. In Puerto Rico, the Corporation provides retail, mortgage, commercial banking services and auto

and equipment leasing and financing through its principal banking subsidiary, Banco Popular de Puerto Rico (“BPPR”), as well as

broker-dealer and insurance services through specialized subsidiaries. In the U.S. mainland, the Corporation provides retail,

mortgage, and commercial banking services, as well as equipment leasing and financing, through its New York -chartered banking

subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches located in New York, New Jersey and Florida. Note 32 to the

Consolidated Financial Statements presents information about the Corporation’s business segments.

As a financial services company, the Corporation’s earnings are significantly affected by general business and economic conditions

in the markets which we serve. Lending and deposit activities and fee income generation are influenced by the level of business

spending and investment, consumer income, spending and savings, capital market activities, competition, customer preferences,

interest rate conditions and prevailing market rates on competing products.

The Corporation operates in a highly regulated environment and may be adversely affected by changes in federal and local laws

and regulations. Also, competition with other financial institutions, as well as with non-traditional financial service providers and

technology companies that provide electronic and internet-based financial solutions and services, could adversely affect its

profitability.

The Corporation continuously monitors general business and economic conditions, industry-related indicators and trends,

competition, interest rate volatility, credit quality indicators, loan, and deposit demand, operational and systems efficiencies, revenue

enhancements and changes in the regulation of financial services companies.

The description of the Corporation’s business contained in Item 1 of the 2024 Form 10-K, while not all inclusive, discusses additional

information about the business of the Corporation. Readers should also refer to “Part I - Item 1A” of the 2024 Form 10-K and “Part II

- Item 1A” of this Form 10-Q for a discussion of certain risks and uncertainties to which the Corporation is subject, many beyond the

Corporation’s control that, in addition to the other information in this Form 10-Q, readers should consider.

The Corporation’s common stock is traded on the NASDAQ Global Select Market under the symbol BPOP.

SIGNIFICANT EVENTS

Capital Actions

On July 16, 2025, the Corporation announced the following capital actions:

an increase in the Corporation’s quarterly common stock dividend from $0.70 to $0.75 per share, commencing with the

dividend payable in the fourth quarter of 2025, subject to the approval by the Corporation’s Board of Directors; and

a new common stock repurchase program of up to $500 million.

This new common stock repurchase program is in addition to the $500 million common stock repurchase program announced by the

Corporation on July 24, 2024 (the “2024 Repurchase Program”).

The Corporation’s planned common stock repurchases may be executed in open market transactions, privately negotiated

transactions, block trades or any other manner determined by the Corporation. The timing, quantity and price of such repurchases

will be subject to various factors, including market conditions, the Corporation’s capital position and financial performance, the

capital impact of strategic initiatives and regulatory and tax considerations. The common stock repurchase program does not require the Corporation to acquire a specific dollar amount or number of shares and may be modified, suspended or terminated at any time without prior notice.

During the quarter and six months ended June 30, 2025, the Corporation repurchased 1,136,390 shares of common stock for

$112.0 million at an average price of $98.54 per share and 2,406,959 shares of common stock for $234.2 million at an average price

of $97.32 per share, respectively. As of June 30, 2025, the Corporation had repurchased a total of approximately 4.7 million shares

of common stock for $451.5 million as part of the 2024 Repurchase Program.

OVERVIEW

Financial highlights for the quarter ended June 30, 2025

The Corporation’s net income for the quarter ended June 30, 2025 amounted to $210.4 million, an increase of $32.6 million when

compared to a net income of $177.8 million for the quarter ended June 30, 2024. Higher net income was mainly driven by higher net

interest income, offset in part by an increase in operating expense and income tax expense.

Financial highlights for the quarter ended June 30, 2025 include:

Net interest income amounted to $631.5 million, an increase of $63.2 million when compared to the quarter ended June

30, 2024, driven by loan growth and higher deposits, higher volume of U.S. Treasuries with higher yields, and lower cost

of deposits, mainly P.R. public deposits and re-pricing at PB, partially offset by lower income from money market

securities. Net interest margin expanded by 27 bps to 3.49%. On a taxable equivalent basis, net interest margin expanded

by 37 basis points to 3.85% driven by tax-exempt investment securities at higher yields.

The provision for credit losses amounted to $48.9 million for the quarter ended June 30, 2025, an increase of $2.1 million

when compared to the quarter ended June 30, 2024, driven by additional reserves in the commercial loans portfolio,

specifically in Commercial Real Estate portfolio in the PB segment due to higher qualitative reserves and changes in the

macroeconomic scenario, partially offset by a lower provision in the BPPR segment due to lower net charge-offs and

improvements of credit quality in the commercial portfolio.

Non-interest income amounted to $168.5 million, an increase of $2.2 million when compared to the quarter ended June

30, 2024, mainly driven by higher credit and debit card fee income, higher investment management fees, and a favorable

fair value adjustment of equity securities held for deferred benefit plans, partially offset by lower other operating income

mainly related to the daily rental car business sold during the fourth quarter of 2024.

Operating expenses amounted to $492.8 million for the quarter, reflecting an increase of $23.2 million when compared to

the quarter ended June 30, 2024. The increase was driven mainly by higher personnel costs due to higher incentives,

partially offset by lower professional fees.

Income tax expense of $47.9 million with an effective tax rate (“ETR”) of 18.5% during the quarter ended June 30, 2025,

compared to an income tax expense of $40.5 million with an ETR of 18.5% for the quarter ended June 30, 2024.

At June 30, 2025, the Corporation’s total assets amounted to $76.1 billion, compared to $73.0 billion at December 31,

2024. The increase of $3.1 billion is primarily due to higher balance in the available-for-sale (“AFS”) securities portfolio

and an increase across most loan portfolios, mainly in commercial, mortgage, and construction, partially offset by lower

balance in the held-to-maturity (“HTM”) investment securities, money market investments, and a decrease in other assets.

Deposits amounted to $67.2 billion at June 30, 2025, an increase of $2.3 billion from December 31, 2024, driven by P.R.

public deposits.

Stockholders’ equity amounted to $6.0 billion at June 30, 2025, compared to $5.6 billion at December 31, 2024. The

Corporation and its banking subsidiaries continue to be well capitalized. As of June 30, 2025, the Corporation’s tangible

book value per common share was $75.41, an increase of $7.25 from December 31, 2024. The Common Equity Tier 1

Capital ratio at June 30, 2025 was 15.91%, compared to 16.03% at December 31, 2024.

Refer to Table 1 for selected financial data for the quarters ended June 30, 2025 and June 30, 2024.

Table 1 - Financial Highlights

Financial Condition Highlights

Ending balances at

Average for the six months ended

(In thousands)

June 30, 2025

December 31,

2024

Variance

June 30,

2025

June 30,

2024

Variance

Money market investments

6,340,786

6,380,948

(40,162)

6,314,487

6,477,180

(162,693)

Investment securities

28,283,970

26,244,977

2,038,993

28,642,361

28,034,347

608,014

Loans

[1]

38,188,076

37,113,075

1,075,001

37,310,383

35,226,488

2,083,895

Earning assets

72,812,832

69,739,000

3,073,832

72,267,231

69,738,015

2,529,216

Total assets

76,065,090

73,045,383

3,019,707

75,391,749

72,800,664

2,591,085

Deposits

67,217,491

64,884,345

2,333,146

66,112,327

64,529,716

1,582,611

Borrowings

1,414,494

1,176,126

238,368

1,120,666

1,045,181

75,485

Total liabilities

70,111,072

67,432,317

2,678,755

68,224,476

66,549,458

1,675,018

Stockholders’ equity

5,954,018

5,613,066

340,952

7,167,273

6,251,206

916,067

Note: Average balances exclude unrealized gains or losses on debt securities available-for-sale and the unrealized loss related to certain securities transferred from available-for-

sale to held-to-maturity.

Operating Highlights

Quarters ended June 30,

Six months ended June 30,

(In thousands, except per share information)

2025

2024

Variance

2025

2024

Variance

Net interest income

631,549

568,312

63,237

1,237,146

1,119,056

118,090

Provision for credit losses

(benefit)

48,941

46,794

2,147

113,022

119,392

(6,370)

Non-interest income

168,477

166,306

2,171

320,538

330,124

(9,586)

Operating expenses

492,761

469,576

23,185

963,773

952,689

11,084

Income before income tax

258,324

218,248

40,076

480,889

377,099

103,790

Income tax expense

47,884

40,459

7,425

92,947

96,027

(3,080)

Net income

210,440

177,789

32,651

387,942

281,072

106,870

Net income applicable to common stock

210,087

177,436

32,651

387,236

280,366

106,870

Net income per common share – basic

3.09

2.47

0.62

5.64

3.90

1.74

Net income per common share – diluted

3.09

2.46

0.63

5.64

3.90

1.74

Dividends declared per common share

0.70

0.62

0.08

1.40

1.24

0.16

Quarters ended June 30,

Six months ended June 30,

Selected Statistical Information

2025

2024

2025

2024

Common Stock Data

End market price

110.21

88.43

110.21

88.43

Book value per common share at period end

87.31

73.94

87.31

73.94

Profitability Ratios

Return on assets

1.11

0.97

1.04

0.77

Return on common equity

11.77

10.38

10.93

8.24

Net interest spread (non-taxable equivalent basis)

2.85

2.44

2.79

2.41

Net interest spread (taxable equivalent) - Non-GAAP

3.21

2.70

3.14

2.65

Net interest margin (non-taxable equivalent basis)

3.49

3.22

3.45

3.20

Net interest margin (taxable equivalent) - Non-GAAP

3.85

3.48

3.80

3.44

Capitalization Ratios

Average equity to average assets

9.48

8.60

9.51

8.59

Common equity Tier 1 capital

15.91

16.48

15.91

16.48

Tangible common book value per common share (non-GAAP)

[2]

75.41

62.71

75.41

62.71

Return on average tangible common equity

[2]

13.26

11.77

12.32

9.35

Tier I capital

15.96

16.54

15.96

16.54

Total capital

17.70

18.30

17.70

18.30

Tier 1 leverage

8.51

8.53

8.51

8.53

[1]

Includes loans held-for-sale.

[2]

Refer to Table 10 for reconciliation to GAAP financial measures.

Non-GAAP Financial Measures

This Form 10-Q contains financial information prepared under accounting principles generally accepted in the United States (“U.S.

GAAP”) and non-GAAP financial measures. Management uses non-GAAP financial measures when it is determined that these

measures provide meaningful information about the underlying performance of the Corporation’s ongoing operations. Non-GAAP

financial measures used by the Corporation may not be comparable to similarly named non-GAAP financial measures used by other

companies.

Adjusted net income - Non-GAAP Financial Measure

In addition to analyzing the Corporation’s results on a reported basis, management monitors whether the impact of certain non-

recurring or infrequent transactions need to be excluded from the results of operations to present what is then considered to be

“adjusted net income” of the Corporation. Management believes that the “adjusted net income” provides meaningful information

about the underlying performance of the Corporation’s ongoing operations. The “adjusted net income” is a non-GAAP financial

measure.

The following table presents the adjusted net income for the six months ended June 30, 2024. There were no non-GAAP

adjustments for the six months ended June 30, 2025.

Table 2 - Adjusted Net Income for the Six Months Ended June 30, 2024 (Non-GAAP)

(In thousands)

Income before

income tax

Income tax

expense

(benefit)

Total

U.S. GAAP Net income

$377,099

$96,027

$281,072

Non-GAAP Adjustments:

FDIC Special Assessment [1]

14,287

(5,234)

9,053

Adjustments related to intercompany distributions [2]

6,400

16,483

22,883

Adjusted net income (Non-GAAP)

$397,786

$84,778

$313,008

[1] Expense recorded during the first quarter of 2024 to increase the estimate recognized during the fourth quarter of 2023 related to the November 16,

2023 FDIC Special Assessment to recover the losses to the deposit insurance fund used by the FDIC in connection with the receiverships of several

failed banks. The special assessment amount and collection period may change if the estimated loss is periodically adjusted or if the total amount

collected varies.

[2] Income tax expense and other related expenses from prior periods related to withholding taxes on certain distributions from U.S. subsidiaries.

Net interest income on a taxable equivalent basis – Non-GAAP Financial Measure

Net interest income, on a taxable equivalent basis, is presented with its different components in Table s 3 and 4 for the quarter and

six months ended June 30, 2025, as compared with the same period in 2024, segregated by major categories of interest earning

assets and interest-bearing liabilities.

The main sources of tax-exempt interest income are certain loans and investments in obligations of the U.S. Government, its

agencies and sponsored entities, and certain obligations of the Commonwealth of Puerto Rico and its agencies and assets held by

the Corporation’s international banking entities. On tables 3 and 4, the interest income has been converted to a taxable equivalent

basis, using the applicable statutory income tax rates for each period net of interest expense that the Puerto Rico tax law requires to

be disallowed, based on an equal proportion of tax-exempt assets to total assets, and by an allocation of general and administrative

expenses attributed to exempt income, reducing the benefit of the tax-exempt income. The effective yield, on a taxable equivalent

basis, will vary depending on the level of these expenses that are attributed to the available exempt income. Under Puerto Rico tax

law, the exempt interest can be deducted up to the amount of taxable income. Management believes that this presentation provides

meaningful information since it facilitates the comparison of revenues arising from taxable and exempt sources.

Tangible Common Equity and Tangible Assets

Tangible common equity, tangible common equity ratio, tangible assets and tangible book value per common share are non-GAAP

financial measures. Tangible common equity ratio and tangible book value per common share should be used in conjunction with

more traditional bank capital ratios commonly used by banks and analysts to compare the capital adequacy of banking

organizations with significant amounts of goodwill or other intangible assets, typically stemming from the use of the purchase

accounting method for mergers and acquisitions. Tangible common equity, tangible assets and other related measures should not

be used in isolation or as a substitute for stockholders' equity, total assets or any other measure calculated in accordance with

GAAP. Moreover, the way the Corporation calculates its tangible common equity, tangible assets and other related measures may

differ from that of other companies reporting measures with similar names.

Table 10 provides a reconciliation of total stockholders’ equity to tangible common equity and total assets to tangible assets as of

June 30, 2025 and December 31, 2024.

CRITICAL ACCOUNTING POLICIES / ESTIMATES

The accounting and reporting policies followed by the Corporation and its subsidiaries conform to U.S. GAAP and general practices

within the financial services industry. Various elements of the Corporation’s accounting policies, by their nature, are inherently

subject to estimation techniques, valuation assumptions and other subjective assessments.

Management has discussed the development and selection of the critical accounting estimates with the Corporation’s Audit

Committee. The Corporation has identified as critical accounting estimates those related to: (i) Fair Value Measurement of Financial

Instruments; (ii) Loans and Allowance for Credit Losses; (iii) Income Taxes; (iv) Goodwill and Other Intangible Assets; and (v)

Pension and Postretirement Benefit Obligations. For a summary of these critical accounting estimates, refer to the MD&A included

in the 2024 Form 10-K. Also, refer to Note 2 to the Consolidated Financial Statements included in the 2024 Form 10-K for a

summary of the Corporation’s significant accounting policies and to Note 3 to the Consolidated Financial Statements included in this

Form 10-Q for information on recently adopted accounting standard updates.

STATEMENT OF OPERATIONS ANALYSIS

NET INTEREST INCOME

The Corporation’s net interest income for the quarter ended June 30, 2025 was $631.5 million and increased $63.2 million,

compared to the same quarter in 2024. Higher net interest income was supported by an increase in average deposit balances and

loan growth. Net interest income on a taxable equivalent basis for the second quarter of 2025 was $697.2 million, an increase of

$82.4 million.

Net interest margin (“NIM”) for the quarter was 3.49%, an increase of 27 basis points when compared to the second quarter of 2024.

On a taxable equivalent basis, net interest margin for the second quarter of 2025 was 3.85% or 37 basis points higher than the

second quarter of 2024. NIM expansion was mainly attributed to lower deposit costs driven by the repricing of high-cost deposits

that are market-linked, such as P.R. public deposits, coupled with a higher volume of loans and higher yields of U.S. Treasuries.

Total cost of deposits decreased 32 basis points to 1.78%.

On a taxable equivalent basis, the main drivers of the increase for the second quarter of 2025 were:

higher income from U.S. Treasury securities by $21.5 million, due to investment activity at higher yields supported by

deposits growth. The U.S. Treasuries yield increased 30 basis points when compared to the second quarter of 2024 as

reinvestment of maturing debt securities along with incremental balances are being reinvested at higher current rates;

higher income from loans by $40.4 million resulting from higher average balances across most portfolios, led by

commercial, construction, mortgage, auto and lease portfolios, resulting from origination activity. Higher yields from the

auto, lease and mortgage portfolios mitigated the impact of lower yields from the commercial and construction portfolios,

due to the impact of short-term market rates decline on adjustable-rate loans. Overall, the loan portfolio yield decreased

by two basis points to 7.50%; and

lower interest expense on deposits by $44.9 million or 32 basis points lower when compared to the same period in 2024.

The cost of interest-bearing deposits decreased by 45 basis points, mainly due to the repricing of P.R. public deposits

which decreased by 93 basis points to 3.22% and a decrease in the cost of deposits in the PB segment;

partially offset by:

lower interest income from money market investments by $18.8 million or 103 basis points mainly due to lower yields

resulting from lower short-term market rates.

Table 3 - Analysis of Levels & Yields on a Taxable Equivalent Basis (Non-GAAP)

Quarter ended June 30,

Variance

Average Volume

Average Yields / Costs

Interest

Attributable to

2025

2024

Variance

2025

2024

Variance

2025

2024

Variance

Rate

Volume

(In millions)

(In thousands)

6,251

6,471

(220)

4.46

5.49

(1.03)

Money market

investments

69,532

88,316

(18,784)

(15,866)

(2,918)

28,809

28,943

(134)

3.29

3.01

0.28

Investment securities [1]

236,372

216,922

19,450

18,673

777

27

26

1

5.99

5.69

0.30

Trading securities

407

367

40

21

19

Total money market,

investment and

trading

35,087

35,440

(353)

3.50

3.47

0.03

securities

306,311

305,605

706

2,828

(2,122)

Loans:

18,676

17,707

969

6.73

6.86

(0.13)

Commercial

313,493

302,003

11,490

(4,831)

16,321

1,459

1,070

389

8.19

9.11

(0.92)

Construction

29,806

24,224

5,582

(2,558)

8,140

1,963

1,789

174

7.18

6.86

0.32

Leasing

35,249

30,697

4,552

1,467

3,085

8,339

7,817

522

5.89

5.66

0.23

Mortgage

122,873

110,673

12,200

4,632

7,568

3,211

3,192

19

14.00

13.97

0.03

Consumer

112,083

110,906

1,177

374

803

3,937

3,819

118

9.14

8.88

0.26

Auto

89,706

84,268

5,438

2,780

2,658

37,585

35,394

2,191

7.50

7.52

(0.02)

Total loans

703,210

662,771

40,439

1,864

38,575

72,672

70,834

1,838

5.57

5.49

0.08

Total earning assets

1,009,521

968,376

41,145

4,692

36,453

Interest bearing

deposits:

8,062

7,522

540

1.71

1.97

(0.26)

NOW and money

market

34,288

36,783

(2,495)

(4,611)

2,116

14,605

14,728

(123)

0.83

0.92

(0.09)

Savings

30,378

33,749

(3,371)

(2,862)

(509)

8,532

8,237

295

3.15

3.39

(0.24)

Time deposits

67,032

69,494

(2,462)

(4,857)

2,395

20,333

19,364

969

3.22

4.15

(0.93)

P.R. public deposits

163,360

199,913

(36,553)

(45,918)

9,365

51,532

49,851

1,681

2.29

2.74

(0.45)

Total interest bearing

deposits

295,058

339,939

(44,881)

(58,248)

13,367

14,825

15,176

(351)

Non-interest bearing

demand deposits

66,357

65,027

1,330

1.78

2.10

(0.32)

Total deposits

295,058

339,939

(44,881)

(58,248)

13,367

470

80

390

4.52

5.64

(1.12)

Short-term borrowings

5,300

1,126

4,174

(213)

4,387

Other medium and

832

978

(146)

5.79

5.16

0.63

long-term debt

11,965

12,530

(565)

181

(746)

Total interest bearing

52,834

50,909

1,925

2.36

2.79

(0.43)

liabilities (excluding

demand deposits)

312,323

353,595

(41,272)

(58,280)

17,008

Other sources of funds

5,013

4,749

264

72,672

70,834

1,838

1.72

2.01

(0.29)

Total source of funds

312,323

353,595

(41,272)

(58,280)

17,008

Net interest margin/

income on a taxable

equivalent basis (Non-

GAAP)

3.85

3.48

0.37

697,198

614,781

82,417

62,972

19,445

3.21

2.70

0.51

Net interest spread

Taxable equivalent

adjustment

65,649

46,469

19,180

Net interest margin/

income non-taxable

equivalent basis (GAAP)

3.49

3.22

0.27

631,549

568,312

63,237

Note: The changes that are not due solely to volume or rate are allocated to volume and rate based on the proportion of the change in each category.

[1] Average balances exclude unrealized gains or losses on debt securities available-for-sale and the unrealized loss related to certain securities transferred from

available-for-sale to held-to-maturity.

The Corporation’s net interest income for the six-month period ended June 30, 2025 was $1.2 billion, or $118.1 million higher than

the same period in 2024. Taxable equivalent net interest income was $1.4 billion, an increase of $156.7 million when compared to

the same period in 2024. NIM was 3.45%, an increase of 25 basis points when compared to 3.20% in 2024. NIM, on a taxable

equivalent basis, for the six months ended June 30, 2025, was 3.80%, an increase of 36 basis points compared to the same period

of 2024.

The main drivers of the variances in net interest income on a taxable equivalent basis for the six-month period ended June 20, 2025

were:

higher income from U.S. Treasury securities by $53.9 million mainly driven by higher yields, coupled with higher average

volume by $640.0 million;

higher income from loans by $71.6 million driven by higher average balances across most portfolios, mainly commercial,

construction and mortgage, and higher yields in the mortgage, auto and leasing portfolios due to originations at higher

rates, partially offset by lower yields in commercial and construction portfolios due to adjustable-rate loans which were

impacted by the decline in index rates; and

lower deposit cost by $76.5 million mainly due to the repricing of marked linked P.R. public deposits, which reflected a

lower cost by 90 basis points and deposit costs repricing in both banks;

partially offset by:

lower income from money markets investments by $37.1 million driven by the decline in short-term market rate and lower

average balances due to loan growth and investments, mainly in U.S. Treasuries; and

higher short-term borrowings expenses by $4.4 million mainly due to higher average balances of FHLB advances at

Popular Bank.

Table 4 – Analysis of Levels & Yields on a Taxable Equivalent Basis from Continuing Operations (Non-GAAP)

Period ended June 30,

Variance

Average Volume

Average Yields / Costs

Interest

Attributable to

2025

2024

Variance

2025

2024

Variance

2025

2024

Variance

Rate

Volume

(In millions)

(In thousands)

6,314

6,477

(163)

4.46

5.49

(1.03)

Money market

investments

139,698

176,832

(37,134)

(32,791)

(4,343)

28,613

28,626

(13)

3.22

2.86

0.36

Investment securities

[1]

456,807

408,024

48,783

45,804

2,979

29

30

(1)

5.90

4.60

1.30

Trading securities

847

678

169

186

(17)

Total money market,

investment and

trading

34,956

35,133

(177)

3.45

3.35

0.10

securities

597,352

585,534

11,818

13,199

(1,381)

Loans:

18,585

17,660

925

6.72

6.85

(0.13)

Commercial

619,461

601,507

17,954

(13,059)

31,013

1,385

1,031

354

8.15

9.04

(0.89)

Construction

55,995

46,324

9,671

(4,994)

14,665

1,951

1,766

185

7.14

6.80

0.34

Leasing

69,693

60,051

9,642

3,129

6,513

8,254

7,770

484

5.86

5.64

0.22

Mortgage

241,789

219,216

22,573

8,609

13,964

3,207

3,208

(1)

14.02

13.94

0.08

Consumer

222,989

222,396

593

230

363

3,929

3,791

138

9.11

8.82

0.29

Auto

177,511

166,322

11,189

5,010

6,179

37,311

35,226

2,085

7.49

7.50

(0.01)

Total loans

1,387,438

1,315,816

71,622

(1,075)

72,697

72,267

70,359

1,908

5.54

5.43

0.11

Total earning assets

1,984,790

1,901,350

83,440

12,124

71,316

Interest bearing

deposits:

8,022

7,643

379

1.72

1.99

(0.27)

NOW and money

market

68,290

75,548

(7,258)

(9,978)

2,720

14,556

14,711

(155)

0.85

0.93

(0.08)

Savings

61,658

67,873

(6,215)

(5,274)

(941)

8,466

8,029

437

3.18

3.29

(0.11)

Time deposits

133,713

131,511

2,202

(5,555)

7,757

20,310

19,017

1,293

3.27

4.17

(0.90)

P.R. public deposits

329,260

394,503

(65,243)

(90,446)

25,203

51,354

49,400

1,954

2.33

2.73

(0.40)

Total interest bearing

deposits

592,921

669,435

(76,514)

(111,253)

34,739

14,758

15,129

(371)

Non-interest bearing

demand deposits

66,112

64,529

1,583

1.81

2.09

(0.28)

Total deposits

592,921

669,435

(76,514)

(111,253)

34,739

297

82

215

4.57

5.67

(1.10)

Short-term

borrowings

6,726

2,318

4,408

(404)

4,812

Other medium and

847

988

(141)

5.72

5.13

0.59

long-term debt

24,077

25,239

(1,162)

250

(1,412)

Total interest bearing

52,498

50,470

2,028

2.40

2.78

(0.38)

liabilities (excluding

demand deposits)

623,724

696,992

(73,268)

(111,407)

38,139

5,011

4,760

251

Other sources of

funds

72,267

70,359

1,908

1.74

1.99

(0.25)

Total source of funds

623,724

696,992

(73,268)

(111,407)

38,139

3.80

3.44

0.36

Net interest margin/

income on a taxable

equivalent basis

(Non-GAAP)

1,361,066

1,204,358

156,708

123,531

33,177

3.14

2.65

0.49

Net interest spread

Taxable equivalent

adjustment

123,920

85,302

38,618

3.45

3.20

0.25

Net interest margin/

income non-taxable

equivalent basis

(GAAP)

1,237,146

1,119,056

118,090

Note: The changes that are not due solely to volume or rate are allocated to volume and rate based on the proportion of the change in each category.

[1] Average balances exclude unrealized gains or losses on debt securities available-for-sale and the unrealized loss related to certain securities transferred

from available-for-sale to held-to-maturity.

Provision for Credit Losses - Loans Held-in-Portfolio and Unfunded Commitments

For the quarter ended June 30, 2025, the Corporation recorded a provision for credit losses related to loans held-in-portfolio and

unfunded commitments of $48.4 million, an increase of $2.1 million when compared to the same quarter of the previous year. The

provision for the loan portfolio was $49.5 million, an increase of $5.4 million, and the provision release related to unfunded

commitments was $1.1 million, a favorable variance of $3.2 million, mainly driven by lower unfunded commitments reserves at the

BPPR segment.

As discussed in Note 8 to the Consolidated Financial Statements, the Corporation estimates the ACL by weighting the outputs of

optimistic, baseline, and pessimistic scenarios. During the first quarter of 2025, in response to the economic uncertainty, the

Corporation increased the probability assigned to the pessimistic scenario making it equal to the baseline scenario. Subsequently, in

the second quarter of 2025, the probability assigned to the pessimistic scenario was moderately reduced based on the changes in

the economic outlook and a reassessment of uncertainty compared to the previous quarter. The net impact of these two events on

the ACL levels for the six months ended June 30, 2025 was $13.7 million in additional reserves. The probability weight for the

pessimistic scenario remains above the levels observed in 2024, given the ongoing economic uncertainty.

The major drivers of the changes in the provision for loan losses during the quarter by business segment when compared to the

same quarter in 2024, were as follows:

In the BPPR segment, the provision for loans losses was $43.2 million, a decrease of $5.4 million when compared to the

same quarter in 2024, mainly driven by lower reserves for the commercial portfolio of $16.4 million due to improvements

in credit quality and lower net charge-offs, which offset the increase in the weight assigned to the pessimistic scenario for

the year 2025, as discussed above. The favorable variance was partially offset by higher reserves in the consumer

portfolio due to changes in credit quality mainly within the auto portfolio and changes in the macroeconomic scenarios.

In the Popular U.S. segment, the provision for loans losses was $6.4 million for the quarter ended June 30, 2025, an

increase of $10.8 million, mainly driven by higher qualitative reserves for the U.S. Commercial Real Estate portfolio and

changes in macroeconomic scenarios, when compared to the reserve release recorded for the same period in 2024 due

to improvement in credit ratings.

For the six months ended June 30, 2025, the provision for credit loss related to loans held-in-portfolio and unfunded commitments

amounted to $112.3 million, a decrease of $6.1 million, compared to the six months ended June 30, 2024. The provision for the loan

portfolio was $114.8 million, a decrease of $1.8 million, and the provision release related to unfunded commitments was $2.4

million, a decrease of $4.3 million, mainly driven by the reduction in unfunded commitment reserves within the U.S. construction

portfolio. The major drivers of the decrease in the provision for loan losses during the six months ended June 30, 2025 by business

segment when compared to the same period in 2024, were as follows:

In the BPPR segment, the provision for loan losses was $95.8 million, a decrease of $13.8 million, driven by lower net

charge-offs, mainly in commercial and consumer loans, and improvement in credit quality, mainly in the commercial

portfolio, partially offset by the increase in the probability weight assigned to the pessimistic scenario which generated an

additional reserve of $8.8 million.

In the Popular U.S. segment, the provision for loan losses was $18.9 million, an increase of $12.0 million, driven by an

increase of $7.1 million mainly due to credit quality changes and additional qualitative reserves established, mainly within

the commercial portfolio, and an increase of $4.9 million related to the increase in probability weight assigned to the

pessimistic scenario.

At June 30, 2025, the total allowance for credit losses for loans held-in-portfolio amounted to $769.5 million, compared to $746.0

million as of December 31, 2024. The ratio of the allowance for credit losses to loans held-in-portfolio was 2.02% at June 30, 2025,

compared to 2.01% at December 31, 2024. Refer to Note 8 to the Consolidated Financial Statements, for additional information on

the Corporation’s methodology to estimate its ACL. Refer to the Credit Risk section of this MD&A for a detailed analysis of net

charge-offs, non-performing assets, the allowance for credit losses and selected loan losses statistics.

Non-Interest Income

Non-interest income amounted to $168.5 million for the second quarter of 2025, an increase of $2.2 million when compared with the

same quarter for the previous year. The variance was primarily due to:

higher other service fees by $3.7 million mainly due to higher credit and debit card fee income by $2.5 million, due to

higher volume of costumer transactions, and higher investment management fees by $1.2 million, due to higher assets

under management; and

a favorable fair value adjustment of equity securities held for deferred compensation plans which have an offsetting effect

in personnel cost of $1.5 million;

partially offset by:

lower other operating income by $3.6 million mainly due to lower daily car rental revenue by $4.9 million and lower gains

from the sale of car rental units by $2.9 million, both due to the sale of the daily car rental business during the fourth

quarter of 2024, partially offset by $2.3 million of income related to the reimbursement of excess interest paid to the U.S.

Internal Revenue Service (“the IRS”) for late payment penalties related to tax withholdings on intercompany distributions

for the years 2014-2024 previously disclosed in 2024, and a $1.2 million cash distribution from the exit of a legacy equity

investment.

Non-interest income amounted to $320.5 million for the six months ended June 30, 2025, a decrease of $9.6 million when compared

to the same period of the previous year. The main factors that contributed to the variance were:

lower other operating income by $15.6 million mainly due to daily car rental revenue by $9.8 million and the gains from the

sale of car rental units by $6.3 million during the six months ended June 30, 2024 associated with the car rental business

sold in the fourth quarter of 2024, partially offset by $3.9 million income related to the reimbursement of interest paid from

the IRS, as discussed above;

partially offset by:

higher other service fees by $3.9 million due to higher credit and debit card fee income by $4.0 million, due to higher

volume of transactions, and higher investment management fees by $2.8 million, due to higher assets under

management, partially offset by lower insurance fees by $4.1 million; and

higher service charges on deposit accounts by $2.9 million mainly due to higher non-balance compensation fees in

commercial deposits.

Operating Expenses

Operating expenses amounted to $492.8 million for the quarter ended June 30, 2025, an increase of $23.2 million, when compared

with the same quarter of 2024. The variance in operating expenses was mainly driven by:

higher personnel costs by $31.9 million mainly due to higher incentives, including $13.0 million related to the profit-sharing plan

which is tied to the Corporation’s financial performance and $9.9 million in other performance-based incentives and stock-

based compensation, and higher salaries expense by $4.1 million due to a higher headcount and annual salary revisions;

higher technology and software expenses by $4.9 million mainly due to higher software amortization expense due to the

acquisition and renewal of multiple technology licenses reflective of the continuous investment in technology and

transformation initiatives and an increase in network management services expense; and

higher other taxes expense by $3.3 million mainly due to higher regulatory fees and an increase in municipal license tax;

partially offset by:

lower professional fees by $9.6 million mainly due to a decrease in advisory expenses related to corporate initiatives, a

decrease, due to expense-recognition timing differences, in the cost of restricted stock granted to directors, and lower legal

fees;

lower operational losses by $5.6 million due to a buildup of reserves for operational losses during the second quarter of 2024;

and

lower equipment expenses by $3.9 million, mainly due to the elimination of the car rental fleet depreciation expense, related to

the car rental business sold in 2024.

Operating expenses amounted to $963.8 million for the six months ended June 30, 2025, an increase of $11.1 million when

compared with the same period of 2024. Excluding the $6.4 million of interest accrued related to prior period tax withholdings and

the $14.3 million impact of the FDIC Special Assessment, total operating expenses for the six months ended June 30, 2025,

increased by $31.8 million, when compared with the same period of 2024. The main drivers of the increase were:

higher personnel costs by $29.3 million mainly due to higher incentives, including $13.0 million related to the profit-sharing plan

which is tied to the Corporation’s financial performance and $9.3 million in other performance-based incentives and stock-

based compensation, and higher salaries expenses by $5.7 million due to a higher headcount and annual salary revisions;

higher technology and software expenses by $9.2 million mainly due to higher software amortization expense due to the

acquisition and renewal of multiple technology licenses reflective of the continuous investment in technology and

transformation initiatives and an increase in network management services expense; and

higher other taxes expense by $7.6 million mainly due to higher regulatory fees and an increase in municipal license tax;

partially offset by:

lower professional fees by $11.7 million mainly due to a decrease in advisory expenses related to corporate initiatives focused

on compliance and cyber security efforts, a decrease in IT professional services, and lower legal fees;

lower equipment expenses by $8.1 million, mainly due to the depreciation of car rental units associated with the daily car rental

transaction; and

lower operational losses by $3.1 million due to a buildup of reserves for operational losses during the second quarter of 2024.

Table 5 - Operating Expenses

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

Variance

2025

2024

Variance

Personnel costs:

Salaries

132,752

128,634

4,118

263,702

258,018

5,684

Commissions, incentives, and other bonuses

40,551

30,626

9,925

78,537

69,237

9,300

Profit sharing

13,000

13,000

13,000

13,000

Pension, postretirement, and medical insurance

18,458

16,619

1,839

33,024

34,004

(980)

Other personnel costs, including payroll taxes

24,594

21,545

3,049

53,805

51,542

2,263

Total personnel costs

229,355

197,424

31,931

442,068

412,801

29,267

Net occupancy expenses

29,140

27,692

1,448

56,358

55,733

625

Equipment expenses

5,789

9,662

(3,873)

11,091

19,229

(8,138)

Other taxes

18,632

15,333

3,299

37,357

29,708

7,649

Professional fees

28,108

37,744

(9,636)

54,933

66,662

(11,729)

Technology and software expenses

84,696

79,752

4,944

168,364

159,214

9,150

Processing and transactional services:

Credit and debit cards

13,044

13,739

(695)

25,970

25,883

87

Other processing and transactional services

24,817

25,357

(540)

49,672

47,407

2,265

Total processing and transactional services

37,861

39,096

(1,235)

75,642

73,290

2,352

Communications

5,010

4,357

653

9,914

8,914

1,000

Business promotion:

Rewards and customer loyalty programs

18,047

16,406

1,641

34,412

30,462

3,950

Other business promotion

8,338

9,043

(705)

15,648

15,976

(328)

Total business promotion

26,385

25,449

936

50,060

46,438

3,622

Deposit insurance

9,407

10,581

(1,174)

19,442

34,468

(15,026)

Other real estate owned (OREO) income

(4,124)

(5,750)

1,626

(7,454)

(11,071)

3,617

Other operating expenses:

Operational losses

6,185

11,823

(5,638)

12,323

15,384

(3,061)

All other

15,932

15,679

253

32,693

40,390

(7,697)

Total other operating expenses

22,117

27,502

(5,385)

45,016

55,774

(10,758)

Amortization of intangibles

385

734

(349)

982

1,529

(547)

Total operating expenses

492,761

469,576

23,185

963,773

952,689

11,084

Income Taxes

For the quarter and six months ended June 30, 2025, the Corporation recorded an income tax expense of $47.9 million and $92.9

million with an effective tax rate (“ETR”) of 18.5% and 19.3%, respectively, compared to $40.5 million and $96.0 million with an ETR

of 18.5% and 25.5% for the respective periods of year 2024.

Higher income tax expense of $7.4 million for the second quarter, when compared to the same quarter of 2024, is mainly attributed

to higher income before tax, partially offset with higher net exempt income. For the six-month period ended June 30, 2025, the lower

income tax expense of $3.1 million reflects the impact of the tax withholding expense of $22.9 million recorded during the first

quarter of year 2024, in connection with intercompany distributions for years 2014-2024, as disclosed in Note 34 to the Consolidated

Financial Statements in the 2024 Form 10-K, and the benefit of $5.2 million related to the FDIC Special Assessment expense; this

was partially offset by the increase in income before tax. Excluding the impact of the withholding tax expense and the additional net

expense related to the FDIC Special Assessment in the first quarter of 2024, the ETR for the six-month period ended June 30, 2024,

would have been 21.3%.

At June 30, 2025, the Corporation had a net deferred tax asset amounting to $860.3 million, net of a valuation allowance of

$463.7million. The net deferred tax asset related to the U.S. operations was $242.2 million, net of a valuation allowance of $386.9

million.

Refer to Note 30 to the Consolidated Financial Statements for a reconciliation of the statutory income tax rate to the effective tax

rate and additional information on the income tax expense and deferred tax asset balances.

REPORTABLE SEGMENT RESULTS

The Corporation’s reportable segments for managerial reporting purposes consist of Banco Popular de Puerto Rico and Popular

U.S. A Corporate group has also been defined to support the reportable segments.

For a description of the Corporation’s reportable segments, including additional financial information and the underlying

management accounting process, refer to Note 32 to the Consolidated Financial Statements.

The corporate group reported a net income of $3.3 million for the quarter ended June 30, 2025, compared with a net income of $3.8

million for the same quarter of the previous year. For the six months ended June 30, 2025, the corporate group reported net loss of

$0.3 million, compared to a net loss of $21.6 million for the same period of the previous year. The higher loss in 2024 was mainly

attributed to the expense related to the $22.9 million adjustment recorded in the first quarter of 2024 to recognize the tax impact

associated with prior period intercompany distributions and the additional $6.5 million expense for the tax impact of intercompany

distributions paid during the first quarter of 2024. A positive adjustment of $3.9 million was recorded during the six months ended

June 30, 2025, resulting from reimbursements received from the U.S. Internal Revenue Service related to interest paid for these

intercompany distributions. There were no intercompany distributions between the U.S. subsidiaries and the bank holding

companies.

Highlights on the earnings results for the reportable segments are discussed below:

Banco Popular de Puerto Rico

The Banco Popular de Puerto Rico reportable segment’s net income amounted to $184.5 million for the quarter ended June 30,

2025, compared with a net income of $157.2 million for the same quarter of the previous year. The factors that contributed to the

variance in the financial results included the following:

Net interest income of $538.5 million was higher by $49.7 million primarily driven by lower interest expense on deposits,

mainly from the re-pricing of P.R. public funds, higher income from U.S. Treasury securities, mainly due to higher yields

and higher income from the loans portfolio driven by loan growth, partially offset by lower income from money market

investments reflecting the decline in rates. The net interest margin for the quarter ended June 30, 2025 was 3.68%, and

increase of 28 basis points, compared to 3.40% for the same quarter in the previous year. The increase in the margin was

mainly impacted by lower cost of deposits and higher yield from investment securities, as well as higher loan balances

which carry a higher yield, partially offset by lower rates on money market investments;

the provision for loan losses of $43.2 million was lower by $5.4 million mainly driven by lower reserves for commercial

loans, due to improvements in credit quality and lower net charge-offs partially offset by a higher provision for the

consumer loan portfolios due to changes in credit quality, mainly within the auto portfolio, and changes in macroeconomic

scenarios;

lower non-interest income by $6.7 million mainly due to lower income from the daily car rental business, which was sold in

the fourth quarter of 2024;

higher operating expenses by $21.9 million mostly due to higher personnel costs by $19.0 million, mainly due to the profit-

sharing expense accrual and other performance-related incentives, and higher technology expenses by $4.0 million, offset

by lower equipment expenses by $4.2 million mainly related to the daily car rental business sold in the fourth quarter of

2024; and

higher income tax expense by $1.7 million mainly due to higher income before tax; partially offset by higher exempt

income and other tax credits recorded during the first quarter of 2025.

For the six months ended June 30, 2025, the BPPR segment recorded a net income of $350.4 million compared to a net income of

$278.5 million for the same period of the previous year. The factors that contributed to the variance in the financial results included

the following:

Net interest income of $1.1 billion was higher by $98.8 million primarily driven by lower interest expense on deposits,

mainly from the re-pricing of P.R. public funds, higher income from investment securities and higher income from loans

due to portfolio growth, partially offset by lower income from money market investments reflecting the decline in rates and

lower balances. The net interest margin for the six months ended June 30, 2025 was 3.66% compared with the 3.36% for the same period of the previous year. The increase in the margin was mainly impacted by lower cost of deposits, higher yield from investment securities and loan growth, partially offset by lower rates from money market investments;

the provision for loan losses of $95.9 million was lower by $13.7 million mainly driven by the commercial and consumer

portfolios due to lower net charge-offs and improvements in credit quality, partially offset by the increase in the probability

weight assigned to the pessimistic economic scenario;

lower non-interest income by $14.8 million mainly due to lower income from the daily car rental business sold in 2024 and

lower insurance fees, partially offset by higher credit and debit card income, due to higher volume of transactions, higher

investment management fees and an increase in non-balance compensation fees in commercial deposits;

higher operating expenses by $19.2 million mostly due to higher personnel costs by $17.4 million, due to incentives as

discussed above, higher regulatory examination fees, municipal license tax and higher technology expenses, partially

offset by lower equipment expenses related to the daily rental business sold and lower FDIC expense due to the FDIC

Special Assessment recorded in 2024; and

Higher income tax expense by $8.0 million mainly due to higher income before tax.

Popular U.S.

For the quarter ended June 30, 2025, the reportable segment of Popular U.S. reported a net income of $22.6 million, compared with

a net income of $17.7 million for the same quarter of the previous year. The factors that contributed to the variance in the financial

results included the following:

Net interest income of $102.2 million, higher by $16.3 million due to higher income from loans, mainly from growth in the

commercial and construction portfolios, and lower cost of deposits due to the repricing of most interest-bearing deposit

products, partially offset by lower income from money market investments due to average balances and lower yields

reflecting the decrease in short-term rates. The net interest margin for the quarter ended June 30, 2025 was 2.93%

compared to 2.60% for the same quarter in the previous year driven by lower cost of deposits;

the provision for loan losses was $6.4 million, reflecting higher reserves due to changes in economic scenarios, compared

to a benefit of $4.4 million in 2024, which was mainly related to improvements in commercial credit ratings;

higher operating expenses by $1.5 million, reflecting higher personnel costs driven by incentives; and

higher income tax expense by $1.3 million due to higher net income before tax.

For the six months ended June 30, 2025, the reportable segment of Popular U.S. recorded a net income of $37.4 million, compared

with a net income of $24.8 million for the same period of the previous year. The factors that contributed to the variance in the

financial results included the following:

Higher net interest income by $24.4 million due to higher income from the loans portfolio mainly related to growth in the

commercial and construction portfolios and lower interest expense from deposits, due to product repricing as mentioned

above, partially offset by lower income from money market investments due to lower rates. The net interest margin for the

six months ended June 30, 2025 was 2.84% compared to 2.60% for the same period of the previous year driven by lower

cost of deposits;

the provision for loan losses of $18.9 million was higher by $12.0 million driven by higher reserves for the commercial

portfolio due to higher loan balances;

lower operating expenses by $1.6 million reflecting lower FDIC expense due to FDIC Special Assessment of $1.6 million

recorded in 2024 and lower professional fees, offset by higher allocation of Corporate expenses reflective of personnel

costs and consulting fees; and

higher income tax expense by $4.6 million due to higher net income before tax.

STATEMENT OF FINANCIAL CONDITION ANALYSIS

Assets

The Corporation’s total assets were $76.1 billion at June 30, 2025, compared to $73.0 billion at December 31, 2024. The variance in

total assets of $3.1 billion was driven by an increase in AFS securities and loan growth across most portfolios at both BPPR and PB

segments, partially offset by a decrease in HTM securities, other assets, and money market investments. Refer to the Consolidated

Statements of Financial Condition included in this report and to the following narrative for additional information.

Money market investments and investment securities

Money market investments decreased by $40.2 million as of June 30, 2025, when compared to December 31, 2024, driven by funds

deployed to support loan growth. AFS securities increased $2.2 billion, mainly due to investment in U.S. Treasury securities and the

decrease in the unrealized losses of AFS securities of $232.7 million, partially offset by maturities and principal paydowns. HTM

securities decreased by $216.4 million driven by maturities and principal paydowns, partially offset by the amortization of $91.6

million of the discount related to U.S. Treasury securities previously reclassified from the AFS to HTM. Refer to Note 5 and to Note 6

to the Consolidated Financial Statements for additional information with respect to the Corporation’s debt securities available-for-

sale and held-to-maturity.

Loans

Refer to Table 6 for a breakdown of the Corporation’s loan portfolio. Also, refer to Note 7 in the Consolidated Financial Statements

for detailed information about the Corporation’s loan portfolio composition and loan purchases and sales.

Loans held-in-portfolio increased by $1.1 billion to $38.2 billion at June 30, 2025, compared to December 31, 2024. Despite the

uncertainty about the economic outlook, demand for credit across all segments was strong during the second quarter of 2025. In the

BPPR segment loan balances increased by $626.0 million across all portfolios, mostly due to commercial and construction loans,

which include the origination of a $265.0 million commercial loan during the second quarter of 2025 which represents the

Corporation’s portion of a $425.0 million issuance in which BPPR acted as the lead bank and administrative agent, and higher

mortgage loans, driven primarily by home purchase activity. Auto loans and leases also increased, driven by a strong origination

activity. The PB segment also increased by $451.6 million, driven by commercial and construction lending. Nonetheless, the impact

of trade and tariff policies on economic activity may affect loan demand as uncertainty on the short-term economic outlook exists.

Table 6 - Loans Ending Balances

(In thousands)

June 30, 2025

December 31, 2024

Variance

Loans held-in-portfolio:

Commercial

Commercial multi-family

2,520,789

2,399,620

121,169

Commercial real estate non-owner occupied

5,521,374

5,363,235

158,139

Commercial real estate owner occupied

3,003,855

3,157,746

(153,891)

Commercial and industrial

8,043,752

7,741,562

302,190

Total Commercial

19,089,770

18,662,163

427,607

Construction

1,468,201

1,263,792

204,409

Leasing

1,983,068

1,925,405

57,663

Mortgage

8,444,427

8,114,183

330,244

Consumer

Credit cards

1,215,293

1,218,079

(2,786)

Home equity lines of credit

77,479

73,571

3,908

Personal

1,876,463

1,855,244

21,219

Auto

3,861,702

3,823,437

38,265

Other

168,775

171,778

(3,003)

Total Consumer

7,199,712

7,142,109

57,603

Total loans held-in -portfolio

38,185,178

37,107,652

1,077,526

Loans held-for-sale:

Mortgage

2,898

5,423

(2,525)

Total loans held-for-sale

2,898

5,423

(2,525)

Total loans

38,188,076

37,113,075

1,075,001

Other assets

Other assets amounted to $1.7 billion at June 30, 2025, a decrease of $52.7 million when compared to $1.8 billion at December 31,

2024. The variance was mainly driven by a decrease in net deferred tax assets of $64.2 million due to positive changes in the

valuation of AFS securities, a reduction in unsettled trade receivables of $14.6 million related to proceeds from maturities of U.S.

Treasury securities, lower principal, interest and escrow servicing advances of $8.0 million, and a reduction in investments under the

equity method by $7.0 million mainly related to unrealized losses on the underlying investment portfolio held by the investee,

partially offset by an increase in capitalized software costs of $33.1 million mainly related to technology modernization and higher

prepaid taxes of $20.8 million. Refer to Note 12 to the Consolidated Financial Statements for a breakdown of the principal

categories that comprise the caption of “Other Assets” in the Consolidated Statements of Financial Condition at June 30, 2025 and

December 31, 2024.

Liabilities

The Corporation’s total liabilities were $70.1 billion at June 30, 2025, an increase of $2.7 billion, when compared to December 31,

2024. The following is a discussion of the significant changes in liabilities.

Deposits and Borrowings

Total Deposits

The Corporation’s deposits totaled $67.2 billion as of June 30, 2025, compared to $64.9 billion as of December 31, 2024. Ending

deposit balances increased by $2.3 billion, while average quarterly balances grew by $2.1 billion. The average deposit balance,

excluding P.R. public deposits, increased by $1.1 billion. Non-interest-bearing deposits remained flat when compared to December

31, 2024. At the end of the second quarter of 2025, Puerto Rico public deposits were $20.9 billion, an increase of $1.5 billion when

compared to December 31, 2024. P.R public deposits represent 31% of total deposits and are expected to continue to range in the

short term between $18 billion and $20 billion. However, the rate at which public deposit balances may change is uncertain and

difficult to predict. The amount and timing of any such change is likely to be impacted by, for example, the level of federal assistance

and speed at which any federal assistance is distributed, the financial condition, liquidity and cash management practices of the

Puerto Rico Government and its instrumentalities, and the implementation of fiscal and debt adjustment plans approved pursuant to

PROMESA or other actions mandated by the Fiscal Oversight and Management Board for Puerto Rico (the “Oversight Board”).

Additionally, the Trump Administration is conducting a review of federal funding, which could entail a reduction in federal funding

available for Puerto Rico. P.R public deposits costs are generally indexed to changes in short-term market rates with a one-quarter

lag, in accordance with contractual terms. As a result, these deposits’ costs have typically lagged variable asset repricing. These

deposits require that the bank pledge high credit quality securities as collateral; therefore, liquidity risks arising from deposit outflows

are lower.

At BPPR, excluding Puerto Rico public deposits, ending deposits increased by $340 million, while at PB segment ending deposit

balances increased by $400 million, net of intercompany activity. We continue to expect third quarter deposit balances in BPPR to

reflect historical seasonality and decrease based on past experience of our retail client behavior.

The volume and cost of P.R. public deposits and the proportion of high-cost deposits in the U.S, directly impact the balance and mix

of earning assets and therefore represent a key factor in the Corporation’s ability to expand its net interest margin.

Refer to Table 7 for a breakdown of the Corporation’s deposits at June 30, 2025 and December 31, 2024.

Table 7 - Deposits Ending Balances

(In thousands)

June 30, 2025

December 31, 2024

Variance

Deposits excluding P.R. public deposits:

Demand deposits

15,114,614

15,139,555

(24,941)

Savings, NOW and money market deposits (non-brokered)

21,554,606

21,177,506

377,100

Savings, NOW and money market deposits (brokered)

829,506

736,225

93,281

Time deposits (non-brokered)

7,938,858

7,476,924

461,934

Time deposits (brokered CDs)

861,947

890,704

(28,757)

Sub-total deposits excluding P.R. public deposits

46,299,531

45,420,914

878,617

P.R. public deposits:

Demand deposits

[1]

12,376,316

11,730,273

646,043

Savings, NOW and money market deposits (non-brokered)

7,743,663

7,087,904

655,759

Time deposits (non-brokered)

797,981

645,254

152,727

Sub-total P.R. public deposits

20,917,960

19,463,431

1,454,529

Total deposits

67,217,491

64,884,345

2,333,146

[1] Includes interest bearing demand deposits.

Borrowings

The Corporation’s borrowings totaled $1.4 billion at June 30, 2025 compared to $1.2 billion at December 31, 2024. The increase

was mainly related to higher FHLB advances by $236.5 million, mainly at PB. Refer to Note 15 to the Consolidated Financial

Statements for detailed information on the Corporation’s borrowings. Also, refer to the Liquidity section in this MD&A for additional

information on the Corporation’s funding sources.

Stockholders’ Equity

Stockholders’ equity totaled $6.0 billion at June 30, 2025, an increase of $341.0 million when compared to December 31, 2024. The

increase was principally due to net income for the six months ended June 30, 2025 of $387.9 million, coupled with the after-tax

effect of the decrease in net unrealized losses in the portfolio of AFS securities of $188.6 million and the amortization of unrealized

losses from securities previously reclassified to HTM of $73.2 million, partially offset by an increase in treasury stock of $226.9

million, mainly due to common stock repurchases, and the common and preferred dividends declared of $96.9 million. Refer to the

Consolidated Statements of Financial Condition, Comprehensive Income and Changes in Stockholders’ Equity for information on

the composition of stockholders’ equity.

The composition of the Corporation’s financing to total assets at June 30, 2025 and December 31, 2024 is included in Table 8.

Table 8 - Financing to Total Assets

June 30,

December 31,

% (decrease) increase

% of total assets

(Dollars in millions)

2025

2024

from 2024 to 2025

2025

2024

Non-interest-bearing core deposits

15,115

15,139

(0.2)

19.9

20.7

Interest-bearing core deposits

46,517

44,622

4.2

61.2

61.1

Interest-bearing other deposits

5,586

5,123

9.0

7.3

7.0

Repurchase agreements

56

55

1.8

0.1

0.1

Other short-term borrowings

550

225

144.4

0.7

0.3

Notes payable

808

896

(9.8)

1.1

1.2

Other liabilities

1,479

1,372

7.8

1.9

1.9

Stockholders’ equity

5,954

5,613

6.1

7.8

7.7

CAPITAL

Regulatory Capital

The Corporation, BPPR and PB are subject to regulatory capital requirements established by the Federal Reserve Board. The risk-

based capital standards applicable to the Corporation, BPPR and PB (“Basel III capital rules”) are based on the final capital

framework for strengthening international capital standards, known as Basel III, of the Basel Committee on Banking Supervision. As

of June 30, 2025, the Corporation’s, BPPR’s and PB’s capital ratios continue to exceed the minimum requirements for being “well-

capitalized”.

The risk-based capital ratios presented in Table 9, which include common equity tier 1, Tier 1 capital, total capital and leverage

capital as of June 30, 2025 and December 31, 2024.

Table 9 - Capital Adequacy Data

(Dollars in thousands)

June 30, 2025

December 31, 2024

Common equity tier 1 capital:

Common stockholders' equity - U.S. GAAP basis

5,931,875

5,590,923

CECL transitional amount

[1]

42,375

AOCI related adjustments due to opt-out election

1,325,146

1,589,875

Goodwill, net of associated deferred tax liability (DTL)

(653,493)

(657,181)

Intangible assets, net of associated DTLs

(5,844)

(6,826)

Deferred tax assets and other deductions

(228,617)

(296,374)

Common equity tier 1 capital

6,369,067

6,262,792

Additional tier 1 capital:

Preferred stock

22,143

22,143

Additional tier 1 capital

22,143

22,143

Tier 1 capital

6,391,210

6,284,935

Tier 2 capital:

Trust preferred securities subject to phase in as tier 2

192,674

192,674

Other inclusions (deductions), net

503,781

490,594

Tier 2 capital

696,455

683,268

Total risk-based capital

7,087,665

6,968,203

Minimum total capital requirement to be well capitalized

4,003,691

3,907,346

Excess total capital over minimum well capitalized

3,083,974

3,060,857

Total risk-weighted assets

40,036,914

39,073,462

Total assets for leverage ratio

75,114,655

72,593,464

Risk-based capital ratios:

Common equity tier 1 capital

15.91

16.03

Tier 1 capital

15.96

16.08

Total capital

17.70

17.83

Tier 1 leverage

8.51

8.66

[1] The CECL transitional amount includes the impact of Popular's adoption of the new CECL accounting standard on January 1, 2020.

The Basel III capital rules provide that a depository institution is deemed to be well capitalized if it maintains a leverage ratio of at

least 5%, a common equity Tier 1 ratio of at least 6.5%, a Tier 1 capital ratio of at least 8% and a total risk-based ratio of at least

10%. The Corporation, BPPR and PB leverage ratio, common equity Tier 1 ratio and Tier 1 capital ratio, respectively as of June 30,

2025, continue to exceed the minimum requirements for being “well-capitalized” under the Basel III capital rules.

Pursuant to the adoption of the CECL accounting standard on January 1, 2020, the Corporation elected to use the five-year

transition period option as provided in the final interim regulatory capital rules effective March 31, 2020. The five-year transition

period provision delayed for two years the estimated impact of CECL on regulatory capital, followed by a three-year transition period

to phase out the aggregate amount of the capital benefit provided during the initial two-year delay. During the first quarter of 2025,

the Corporation phased-in all the cumulative CECL deferral over the three-year transition period.

The decrease in the common equity Tier I capital ratio, Tier I capital ratio, total capital ratio, and leverage ratio as of June 30, 2025

as compared to December 31, 2024 was mainly due to higher risk weighted assets driven by the increase in loans held in portfolio,

the repurchase of shares under the 2024 Repurchase Program and common stock dividends, partially offset by the six-month

period’s earnings.

Reconciliation to Tangible Common Equity and Tangible Assets

Table 10 provides a reconciliation of total stockholders’ equity to tangible common equity and total assets to tangible assets as of

June 30, 2025, and December 31, 2024.

Table 10 - Reconciliation of Tangible Common Equity and Tangible Assets

(In thousands, except share or per share information)

June 30, 2025

December 31, 2024

Total stockholders’ equity

5,954,018

5,613,066

Less: Preferred stock

(22,143)

(22,143)

Less: Goodwill

(802,954)

(802,954)

Less: Other intangibles

(5,844)

(6,826)

Total tangible common equity

5,123,077

4,781,143

Total assets

76,065,090

73,045,383

Less: Goodwill

(802,954)

(802,954)

Less: Other intangibles

(5,844)

(6,826)

Total tangible assets

75,256,292

72,235,603

Tangible common equity to tangible assets

6.81

6.62

Common shares outstanding at end of period

67,937,468

70,141,291

Tangible book value per common share

75.41

68.16

Quarterly average

Total stockholders’ equity [1]

6,849,789

6,620,766

Average unrealized (gains) losses on AFS securities transferred to HTM

334,183

505,791

Adjusted total stockholder's equity

7,183,972

7,126,557

Less: Preferred Stock

(22,143)

(22,143)

Less: Goodwill

(802,953)

(804,411)

Less: Other intangibles

(6,096)

(7,288)

Total tangible common equity

6,352,780

6,292,715

Return on average tangible common equity

13.26

11.22

[1] Average balances exclude unrealized gains or losses on debt securities available-for-sale.

RISK MANAGEMENT

Market / Interest Rate Risk

The Corporation’s assets that are mainly subject to market valuation risk are debt securities classified as available-for-sale. Refer to

Notes 5 and 6 to the Consolidated Financial Statements for further information on the debt securities available-for-sale and held-to-

maturity portfolios. Debt securities classified as available-for-sale and held-to-maturity amounted to $20.5 billion and $7.5 billion,

respectively, as of June 30, 2025. Other assets subject to market risk include mortgage servicing rights ("MSRs") with a fair value of

$103.1 million as of June 30, 2025.

Interest Rate Risk (“IRR”)

The Corporation’s net interest income is subject to various categories of interest rate risk, including repricing, basis, yield curve and

option risks. In managing interest rate risk, management may alter the mix of floating and fixed rate assets and liabilities, change

pricing schedules, adjust maturities through sales and purchases of investment securities, and enter into derivative contracts,

among other alternatives.

Management utilizes various tools to assess IRR, including Net Interest Income (“NII”) simulation modeling, static gap analysis, and

Economic Value of Equity (“EVE”) to monitor the risk arising from the dynamic characteristics of assets and liabilities subject to IRR.

The three methodologies complement each other and are used jointly in the evaluation of the Corporation’s IRR. NII simulation

modeling is prepared for a five-year period, which in conjunction with the EVE analysis, provides management a better view of long-

term IRR.

Net interest income simulation analysis performed by legal entity and on a consolidated basis is used to estimate the potential

change in net interest income resulting from hypothetical changes in interest rates. Sensitivity analysis is calculated using a

simulation model which incorporates actual balance sheet figures detailed by maturity and interest yields or costs.

Management assesses interest rate risk by comparing various NII simulations under different interest rate scenarios to assess the

degree of change and the projected shape of the yield curve. Management also performs analyses to isolate and measure basis

and prepayment risk exposures. These models are periodically monitored. Assumptions are validated by management and are

subject to independent validations according to the Corporations’ Model Governance Policy.

The Corporation processes NII simulations under interest rate scenarios in which the yield curve is assumed to rise and decline by

the same magnitude (parallel shifts). The rate scenarios considered in these market risk simulations include instantaneous parallel

changes of -100, -200, +100, and +200 basis points during the succeeding twelve-month period. Assumptions included in these

analyses include that the balance sheet remains flat, relative levels of market interest rates across all yield curve points and

indexes, interest rate spreads, loan prepayments and deposit elasticity. Thus, they should not be relied upon as indicative of actual

results and do not contemplate actions that management may engage in as a response to future changes in interest rates.

Additionally, the Corporation is also subject to the risk inherent in the use of different rate indexes for the repricing of assets and

liabilities, as well the risk of pricing lags due to contractual or timing differences between the market and management response to

changes in the rate environment. These forward-looking computations are management’s best estimate based on known and

available information and actual results may differ. The following table presents the results of the simulations at June 30, 2025 and

December 31, 2024, assuming a static balance sheet and parallel changes over flat spot rates over a one-year time horizon:

Table 11 - Net Interest Income Sensitivity (One Year Projection)

June 30, 2025

December 31, 2024

(Dollars in thousands)

Amount Change

Percent Change

Amount Change

Percent Change

Change in interest rate

+200 basis points

22,433

0.85

44,747

1.78

+100 basis points

10,515

0.40

22,917

0.91

-100 basis points

(12,636)

(0.48)

9,157

0.36

-200 basis points

(18,563)

(0.71)

588

0.02

As of June 30, 2025, NII simulations show the Corporation maintains an asset sensitive position that is symmetric in the rising and

declining rates scenarios. Compared to the results as of December 31, 2024, the variation in sensitivity and the resulting profile are

mainly driven by updated deposit beta model assumptions that reflect lower elasticity in declining rate scenarios. In declining rate

scenarios, the reduction in net interest income is driven by the repricing of short-term assets and variable rate loans offset in part by

declining deposit costs. In rising rate scenarios, Popular’s net interest income would increase due to the repricing of short-term

assets, variable rate loans, and intermediate maturity assets coming due within one year, that are offset in part by increased

deposits costs due to BPPR’s large proportion of market-linked Puerto Rico public sector deposits. Changes in the balance sheet

during the quarter led to reduced asset sensitivity. The Corporation purchased $2.4 billion in U.S. Treasury Notes with an average

maturity of approximately 1.5 years. Higher loan balances and growth in market-linked Puerto Rico public sector deposits also

contributed to reduced asset sensitivity.

The Corporation’s loan and investment portfolios are subject to prepayment risk. Prepayment risk also could have a significant

impact on the duration of mortgage-backed securities and collateralized mortgage obligations.

Trading

The Corporation engages in trading activities in the ordinary course of business at its subsidiaries, BPPR and Popular Securities.

Popular Securities’ trading activities consist primarily of market-making activities to meet expected customers’ needs related to its

retail brokerage business, and purchases and sales of U.S. Government and government sponsored securities with the objective of

realizing gains from expected short-term price movements. BPPR’s trading activities consist primarily of holding U.S. Government

sponsored mortgage-backed securities and economic hedges of the related market risk with “TBA” (to-be-announced) market

transactions. In addition, BPPR uses forward contracts or TBAs that have characteristics similar to that of the forecasted security

and its conversion timeline to hedge its securitization pipeline.

At June 30, 2025, the Corporation held trading securities with a fair value of $29.6 million, representing 0.04% of the Corporation’s

total assets, compared with $32.8 million and 0.05%, respectively, at December 31, 2024. The trading portfolio consists principally

of investment grade securities such as mortgage-backed securities of $23.0 million with a weighted average yield of 5.28% and U.S.

Treasuries of $5.8 million with a weighted average yield of 3.41% at June 30, 2025 and $29.1 million with a yield of 5.54% and $2.8

million with a yield of 3.28%, respectively, as of December 31, 2024.

The Corporation’s trading activities are limited by internal policies. For each of the two subsidiaries, the market risk assumed under

trading activities is measured by the 5-day net value-at-risk (“VAR”), with a confidence level of 99%. The VAR measures the

maximum estimated loss that may occur over a 5-day holding period, given a 99% probability.

The Corporation’s trading portfolio had a 5-day VAR of $0.4 million for the last week in June 2025. VAR models include assumptions

and estimates thus actual results could differ from the outputs from these models and assumptions. Back-testing is performed on

model results to compare actual results against maximum estimated losses, in order to evaluate model and assumptions accuracy.

In the opinion of management, the size and composition of the trading portfolio does not represent a significant source of market risk

for the Corporation.

Liquidity

Liquidity Risk Management Process

The Corporation has adopted policies and limits to monitor the Corporation’s liquidity position and that of its banking subsidiaries.

Refer to the Enterprise Risk Management section of Management’s Discussion and Analysis included in the 2024 Form 10-K for

information on the framework in place to monitor, review, and approve policies to measure, limit and manage funding activities and

strategies impacting liquidity risk. Additionally, contingency funding plans are used to model various stress events of different

magnitudes that affect different time horizons, to assist management in evaluating the size of the liquidity buffers needed if those

events occur. However, such models may not predict accurately how the market and customers might react to every event and are

dependent on many assumptions. The objective of effective liquidity management is to ensure that the Corporation has sufficient

liquidity to meet all its financial obligations, finance expected future growth, fund planned capital distributions and maintain a

reasonable safety margin for cash needs under both normal and stressed market conditions.

Sources of Liquidity

Deposits, including customer deposits, brokered deposits and public funds deposits, continue to be the most significant source of

funds for the Corporation, representing 88% and 89% of funding of the Corporation’s total assets at June 30, 2025 and December

31, 2024, respectively. The ratio of total ending loans to deposits remained at 57% at June 30, 2025 and December 31, 2024. In

addition to traditional deposits, the Corporation maintains borrowing arrangements, which amounted to $1.4 billion in outstanding

balances at June 30, 2025 (December 31, 2024 - $1.2 billion). A detailed description of the Corporation’s borrowings, including their

terms, is included in Note 15 to the Consolidated Financial Statements. Also, the Consolidated Statements of Cash Flows in the

accompanying Consolidated Financial Statements provide information on the Corporation’s cash inflows and outflows.

The following sections provide further information on the Corporation’s major funding activities and needs, as well as the risks

involved in these activities.

Banking Subsidiaries

Primary sources of funding for the Corporation’s banking subsidiaries (BPPR and PB or, collectively, “the banking subsidiaries”)

include retail, commercial and public sector deposits, brokered deposits, unpledged investment securities, mortgage loan

securitization and, to a lesser extent, loan sales. In addition, the Corporation maintains borrowing facilities with the FHLB and at the

discount window of the Federal Reserve Bank of New York (the “FRB”) and has a considerable amount of collateral pledged that

can be used to raise funds under these facilities.

During the second quarter of 2025, BPPR was able to increase its available liquidity by approximately $2.9 billion after the merger of

Popular Auto, LLC with and into BPPR, effective on May 1, 2025, that allowed BPPR to pledge auto loans and leases as collateral

under the federal reserve’s discount window. At June 30, 2025, the Corporation’s available liquidity increased to $26.1 billion from

$21.6 billion on December 31, 2024. During the second quarter of 2025, the Corporation had no material incremental use of its

available liquidity sources. The liquidity sources of the Corporation at June 30, 2025 are presented in Table 12 below:

Table 12 - Liquidity Sources

June 30, 2025

December 31, 2024

(In thousands)

BPPR

Popular U.S.

Total

BPPR

Popular U.S.

Total

Unpledged securities and unused funding

sources:

Money market (excess funds at the

Federal Reserve Bank)

4,753,672

1,576,770

6,330,442

4,882,358

1,488,857

6,371,215

Unpledged securities

4,453,281

519,711

4,972,992

3,806,066

522,869

4,328,935

FHLB borrowing capacity

3,178,798

816,840

3,995,638

2,777,090

1,058,921

3,836,011

Discount window of the Federal Reserve

Bank borrowing capacity

7,895,298

2,875,787

10,771,085

4,839,388

2,178,646

7,018,034

Total available liquidity

20,281,049

5,789,108

26,070,157

16,304,902

5,249,293

21,554,195

Refer to Note 15 to the Consolidated Financial Statements for additional information of the Corporation’s borrowing facilities

available through its banking subsidiaries.

The principal uses of funds for the banking subsidiaries include loan originations, investment portfolio purchases, loan purchases

and repurchases, repayment of outstanding obligations (including deposits), advances on certain serviced portfolios and operational

expenses. Also, the banking subsidiaries assume liquidity risk related to collateral posting requirements for certain activities mainly

in connection with contractual commitments, recourse provisions, servicing advances, derivatives and credit card licensing

agreements.

The banking subsidiaries maintain sufficient funding capacity to address large increases in funding requirements such as deposit

outflows. The Corporation has established liquidity guidelines that require the banking subsidiaries to have sufficient liquidity to

cover all short-term borrowings and a portion of deposits.

Deposits are a key source of funding. Refer to Table 7 for a breakdown of deposits by major types. Core deposits are generated

from a large base of consumer, corporate and public sector customers. Core deposits include certificates of deposit under $250,000,

all interest-bearing transactional deposit accounts, non-interest-bearing deposits, and savings deposits. Core deposits exclude

brokered deposits and certificates of deposit over $250,000. Core deposits, excluding P.R. public funds, which are fully

collateralized, have historically provided the Corporation with a sizable source of relatively stable and low-cost funds. P.R. public

funds, while linked to market interest rates, provide a stable source of funding with an attractive earning spread. As of June 30,

2025, total Puerto Rico public sector deposits were $20.9 billion, compared to $19.5 billion at December 31, 2024.

Core deposits continue to represent 92% of total deposits at $61.6 billion, as of June 30, 2025, and compared to December 31,

2024. Core deposits financed 85% of the Corporation’s earning assets at June 30, 2025, compared to 86% at December 31, 2024.

The distribution by maturity of certificates of deposit with denominations of $250,000 and over at June 30, 2025 is presented in the

table that follows:

Table 13 - Distribution by Maturity of Certificates of Deposit of $250,000 and Over

(In thousands)

3 months or less

2,591,418

Over 3 to 12 months

992,191

Over 1 year to 3 years

287,373

Over 3 years

147,470

Total

4,018,452

The Corporation had $1.7 billion in brokered deposits at June 30, 2025, which financed approximately 2% of its total assets

(December 31, 2024 - $1.6 billion and 2%, respectively).

As of June 30, 2025, the banking subsidiaries had sufficient current and projected liquidity sources to meet their anticipated cash

flow obligations, as well as special needs and off-balance sheet commitments, in the ordinary course of business and have sufficient

liquidity resources to address a stress event. Although the banking subsidiaries have historically been able to replace maturing

deposits and advances, no assurance can be given that they would be able to replace those funds in the future if the Corporation’s

financial condition or general market conditions were to deteriorate. The Corporation’s financial flexibility would be severely

constrained if the banking subsidiaries are unable to maintain access to funding or if adequate funding is not available to

accommodate future financing needs at acceptable interest rates. The banking subsidiaries also are required to deposit cash or

qualifying securities to meet margin requirements on repurchase agreements, deposit agreements and other collateralized

borrowing facilities. To the extent that the value of securities previously pledged as collateral declines because of market changes,

the Corporation will be required to deposit additional cash or securities to meet its margin or collateral requirements and would need

to rely more heavily on alternative funding sources. In these scenarios, the Corporation’s financial flexibility and ability to grow

revenues may not increase proportionately to cover costs and profitability would be adversely affected.

The Corporation considers balances in excess of $250,000 to have a higher potential liquidity risk. Table 14 reflects the aggregate

balance in deposit accounts in excess of $250,000, including collateralized public funds and deposits outside of the U.S. and its

territories. Collateralized public funds, as presented in Table 14, represent public deposit balances from governmental entities in the

U.S. and its territories, including Puerto Rico and the United States Virgin Islands, collateralized based on such jurisdictions’

applicable collateral requirements.

Table 14 - Deposits

30-Jun-25

Popular, Inc.

(Dollars in thousands)

BPPR

% of Total

Popular U.S.

% of Total

(Consolidated)

% of Total

Deposits:

Deposits balances under $250,000 [1]

23,741,443

42

8,341,661

70

32,083,104

48

Transactional deposits balances over

$250,000

7,968,081

14

2,042,469

17

10,010,550

15

Time deposits balances over $250,000

2,262,268

4

833,527

7

3,095,795

5

Uninsured foreign deposits

444,748

1

444,748

1

Collateralized public funds

21,269,940

39

313,354

3

21,583,294

31

Intercompany deposits

195,313

415,184

3

Total deposits

55,881,793

100

11,946,195

100

67,217,491

100

[1] Includes the first $250,000 in balances of transactional and time deposit accounts with balances in excess of $250,000.

31-Dec-24

Popular, Inc.

(Dollars in thousands)

BPPR

% of Total

Popular U.S.

% of Total

(Consolidated)

% of Total

Deposits

Deposits balances under $250,000 [1]

23,588,937

44

7,961,334

68

31,550,271

49

Transactional deposits balances over

$250,000

8,046,175

15

1,944,674

16

9,990,849

15

Time deposits balances over $250,000

1,991,934

4

813,424

7

2,805,358

4

Uninsured foreign deposits

450,068

1

450,068

1

Collateralized public funds

19,771,083

36

316,716

3

20,087,799

31

Intercompany deposits

205,839

667,839

6

Total deposits

54,054,036

100

11,703,987

100

64,884,345

100

[1] Includes the first $250,000 in balances of transactional and time deposit accounts with balances in excess of $250,000.

Bank Holding Companies

The principal sources of funding for the BHCs, which are Popular, Inc. (holding company only) and PNA, include cash on hand,

investment securities, dividends received from banking and non-banking subsidiaries, asset sales, credit facilities available from

affiliate banking subsidiaries and proceeds from potential securities offerings. Dividends from banking and non-banking subsidiaries

are subject to various regulatory limits and authorization requirements imposed by banking regulators, including the FED and the

NYDFS, that may limit the ability of those subsidiaries to act as a source of funding to the BHCs.

The principal uses of these funds include the repayment of debt, interest payments to holders of senior debt and junior subordinated

deferrable interest debentures (related to trust preferred securities), the payment of dividends to common stockholders, repurchases

of the Corporation’s securities and capitalizing its subsidiaries.

The outstanding balance of notes payable at the BHCs amounted to $594 million at June 30, 2025 and December 31, 2024.

The contractual maturities of the BHCs notes payable at June 30, 2025 are presented in Table 15.

Table 15 - Distribution of BHC's Notes Payable by Contractual Maturity

Year

(In thousands)

2028

395,865

Later years

198,386

Total

594,251

As of June 30, 2025, the BHCs had cash and money markets investments totaling $503 million and borrowing potential of $165

million from its secured facility with BPPR. The BHCs’ liquidity position continues to be adequate with sufficient cash on hand,

investments and other sources of liquidity that are expected to be sufficient to meet all interest payments and dividend obligations

for the foreseeable future. Additionally, the Corporation’s latest quarterly paid dividend was $0.70 per share or approximately $48

million per quarter.

The BHCs have in the past borrowed in the corporate debt market primarily to finance their non-banking subsidiaries and refinance

debt obligations. These sources of funding are more costly given that two out of three principal credit rating agencies rate the

Corporation’s debt securities below “investment grade”. The Corporation has a shelf registration statement filed and effective with

the Securities and Exchange Commission, which permits the Corporation to issue an unspecified amount of debt or equity

securities.

Non-Banking Subsidiaries

The principal sources of funding for the non-banking subsidiaries include internally generated cash flows from operations, loan

sales, repurchase agreements, capital injections and borrowed funds from their direct parent companies or the holding companies.

The principal uses of funds for the non-banking subsidiaries include repayment of maturing debt, operational expenses and payment

of dividends to the BHCs.

Dividends

During the six months ended June 30, 2025, the Corporation declared cash dividends of $1.40 per common share outstanding

($96.2 million in the aggregate). The dividends for the Corporation’s Series A preferred stock amounted to $0.7 million.

On July 16,

2025, the Corporation announced an increase in its quarterly common stock dividend from $0.70 to $0.75 per share, commencing

with the dividend payable in the fourth quarter of 2025, subject to the approval by the Corporation’s Board of Directors.

During the six months ended June 30, 2025, the BHCs received dividends and distributions amounting to $200 million from BPPR,

$23 from Popular International Bank, Inc. (“PIBI”) and $15 million from its other non-banking subsidiaries. Dividends from BPPR

constitute Popular, Inc.’s primary source of liquidity. In addition, during the six months ended June 30, 2025,PIBI, a wholly owned

subsidiary of Popular, Inc., received $20.0 million in cash dividends and $5.3 million in stock dividends from its investment in BHD.

In addition to regulatory limits previously discussed, the ability of a bank subsidiary to up-stream dividends to its BHC could be

impacted by its financial performance and capital, including tangible and regulatory capital, thus potentially limiting the amount of

cash up streamed to the BHCs from the banking subsidiaries. This could, in turn, affect BHC’s ability to declare dividends on its

outstanding common and preferred stock, repurchase its securities or meet its debt obligations, for example. At June 30, 2025,

BPPR could declare a dividend of up to approximately $209 million without prior approval of the Federal Reserve Board due to its

retained income, declared dividend activity and transfers to statutory reserves over the measurement period. In addition, pursuant to

the FRB requirements, PB may not declare or pay a dividend without the prior approval of the Federal Reserve Board and the

NYSDFS.

Other Funding Sources and Capital

In addition to cash reserves held at the FRB that totaled $6.3 billion at June 30, 2025, the debt securities portfolio provides an

additional source of liquidity, which may be realized through either securities sales, collateralized borrowings or repurchase

agreements. The Corporation’s debt securities portfolio consists primarily of liquid U.S. government debt securities, U.S.

government sponsored agency debt securities, U.S. government sponsored agency mortgage-backed securities, and U.S.

government sponsored agency collateralized mortgage obligations that can be used to raise funds in the repo markets. The

availability of repurchase agreements would be subject to having sufficient unpledged collateral available at the time the

transactions are consummated, in addition to overall liquidity and risk appetite of the various counterparties. Refer to Table 12 for

details of the Corporation’s unpledged debt securities and available credit facilities with the FHLB and the discount window of the

Federal Reserve Bank. A substantial portion of these debt securities could be used to raise financing in the U.S. money markets or

from secured lending sources, subject to changes in their fair market value and customary adjustments (haircuts).

Additional liquidity may be provided through loan maturities, prepayments and sales. The loan portfolio provides a source of

collateral to secure the available credit facilities with the FHLB and the discount window of the Federal Reserve Bank. After the

merger of Popular Auto LLC into its parent company BPPR, effective on May 1, 2025, the Corporation has $2.9 billion in auto loans

pledged at June 30, 2025, in addition to mortgage loans, to secure credit facilities with the Federal Reserve's discount window. The loan portfolio can also be used to obtain funding in the capital markets. Mortgage loans and some types of consumer loans, have secondary markets which the Corporation could use.

Off-Balance Sheet Arrangements and Other Commitments

In the ordinary course of business, the Corporation engages in financial transactions that are not recorded on the balance sheet or

may be recorded on the balance sheet in amounts that are different than the full contract or notional amount of the transaction. As a

provider of financial services, the Corporation routinely enters into commitments with off-balance sheet risk to meet the financial

needs of its customers. Refer to Note 20 to the Consolidated Financial Statements for information on the Corporation’s

commitments to extent credit and other non-credit commitments.

Other types of off-balance sheet arrangements that the Corporation enters in the ordinary course of business include derivatives,

operating leases and provision of guarantees, indemnifications, and representation and warranties. Refer to Note 27 to the

Consolidated Financial Statements for more information on operating leases and to Note 19 to the Consolidated Financial

Statements for a detailed discussion related to the Corporation’s guarantees, indemnifications obligations, and representation and

warranties arrangements.

The Corporation monitors its cash requirements, including its contractual obligations and debt commitments.

Financial Information of Guarantor and Issuers of Registered Guaranteed Securities

The principal sources of funding for Popular, Inc. Holding Company (“PIHC”) and Popular North America, Inc. (“PNA”) have included

dividends received from their banking and non-banking subsidiaries subject to statutory provisions that limit dividends paid by the

banking subsidiary without regulatory approval, asset sales and proceeds from the issuance of debt and equity.

The Corporation ("PIHC") is the parent holding company of Popular North America (“PNA”) and operates financial services through

its subsidiaries. PNA, a wholly owned subsidiary of Popular, Inc., manages entities such as Equity One, Inc., and PB, including PB’s

subsidiaries: Popular Equipment Finance, LLC, Popular Insurance Agency, U.S.A., and E-LOAN, Inc.

PNA has issued junior subordinated debentures guaranteed by PIHC (the “obligor group”), purchased by statutory trusts established

by the Corporation using proceeds from trust preferred securities (“capital securities”) and common securities of the trusts.

PIHC guarantees the junior subordinated debentures issued by PNA. If PIHC fails to make interest payments on the debentures

held by the trust, the trust will not distribute payments on the capital securities. The guarantee ranks subordinate and junior in right

of payment to all other liabilities of PIHC and equally with all other PIHC-issued guarantees, allowing direct legal action against

PIHC without involving other entities.

Funding for PIHC and PNA includes dividends from subsidiaries, asset sales, and proceeds from debt and equity issuance.

Statutory provisions limit the dividends an insured depository institution can pay to its holding company without regulatory approval.

The summarized financial information below shows the combined financial position of the obligor group as of June 30, 2025, and

December 31, 2024, and the results of their operations for the six-month period ended June 30, 2025 and June 30, 2024. Excluded

are investments and equity in earnings from subsidiaries and affiliates outside the obligor group.

Intercompany balances and transactions within the obligor group have been eliminated. Material amounts due from, due to, and

transactions with subsidiaries and affiliates are shown separately. Related party transactions are also presented separately.

Table 16 - Summarized Statement of Condition

(In thousands)

June 30, 2025

December 31, 2024

Assets

Cash and money market investments

502,784

634,809

Investment securities

35,557

35,150

Accounts receivables from non-obligor subsidiaries

29,111

14,602

Other loans (net of allowance for credit losses of $197 (2024 - $281))

24,791

25,381

Investment in equity method investees

5,281

5,279

Other assets

83,401

65,483

Total assets

680,925

780,704

Liabilities and Stockholders' equity

Accounts payable to non-obligor subsidiaries

5,004

12,163

Notes payable

594,251

593,571

Other liabilities

129,332

126,718

Stockholders' (deficit) equity

(47,662)

48,252

Total liabilities and stockholders' equity

680,925

780,704

Table 17 - Summarized Statement of Operations

For the period ended

(In thousands)

June 30, 2025

June 30, 2024

Income:

Dividends from non-obligor subsidiaries

215,100

313,000

Interest income from non-obligor subsidiaries and affiliates

2,248

7,106

Earnings (losses) from investments in equity method investees

1

(10)

Other operating income

6,155

2,439

Total income

223,504

322,535

Expenses:

Services provided by non-obligor subsidiaries and affiliates (net of

reimbursement by subsidiaries for services provided by parent of

$127,054 (2024 - $120,987))

7,739

6,447

Other expenses

14,359

22,685

Income tax expense

[1]

5,952

22,208

Total expenses

28,050

51,340

Net income

195,454

271,195

[1] The net income for the six months ended June 30, 2024, included $22.9 million of expenses, of which $16.5 million was reflected in

income tax expense and $6.4 million was reflected in other operating expenses, related to an out-of-period adjustment associated with the

Corporation’s U.S. subsidiary’s non-payment of taxes on certain intercompany distributions to the Bank Holding Company (BHC) in Puerto

Rico, a foreign corporation for U.S. tax purposes.

In addition to the dividend income reflected in the Statement of Operations table above, during the six months ended June

30, 2025, the obligor group recorded a $23.0 million of dividend distributions from non-obligor subsidiary which was

recorded as a reduction to the investment (2024 - $67.4 million).

Risk to Liquidity

The Corporation’s liquidity may come under pressure if it experiences significant unexpected cash outflows due to deposit

withdrawals, which could arise from various factors like economic conditions, loss of depositor confidence, competition, exogenous

events, regulatory requirements or changes, a downgrade in credit rating, or other events causing counterparties to avoid exposure.

Investors should refer to Liquidity Risks section of “Part I, Item 1A” of 2024 Form 10-K for an additional discussion of liquidity risks to

which the Corporation is subject.

Credit Risk

Geographic and Government Risk

The Corporation is exposed to geographic and government risk. The Corporation’s assets and revenue composition by geographical

area and by business segment reporting are presented in Note 32 to the Consolidated Financial Statements. Readers should refer

to Economic and Market Risk section and Business Risk Section of “Part I, Item 1A” of the 2024 Form 10-K for an additional

discussion on how the Corporation is impacted by global and local economic and market conditions, including weakness in the

economy, particularly in Puerto Rico, where a significant portion of our business is concentrated. This section also addresses how

our credit risk and credit losses can increase to the extent our loans are concentrated on borrowers engaged in the same or similar

activities or in borrowers who as a group may be uniquely or disproportionately affected by certain economic or market conditions.

Commonwealth of Puerto Rico

A

significant portion of our financial activities and credit exposure is concentrated in the Commonwealth of Puerto Rico (“Puerto

Rico”) which has faced severe economic and fiscal challenges in the past and may face additional challenges in the future.

Economic Performance

The latest estimates from the Puerto Rico Planning Board (the “Planning Board”) indicate that real GNP grew by 2.1% during fiscal

year 2024 (July 2023-June 2024) and by 1.1% in fiscal year 2025 (July 2024-June 2025). For fiscal year 2026 (July 2025-June

2026), the Planning Board forecasts more modest GNP growth of 0.5%. Meanwhile, the Puerto Rico Economic Activity Index

showed a 0.9% year-over-year decline and a 0.5% month-over-month increase in February 2025. While this index is not a direct

measure of real GNP, it serves as an indicator of ongoing economic activity.

In 2021 and 2022, inflation rose sharply in the U.S. and Puerto Rico due to post-pandemic demand and supply chain issues.

Inflation began to decrease by mid-2022 as the Federal Reserve raised interest rates, largely stabilizing by September 2024,

leading to a series of rate reductions by the Federal Reserve for the first time in four years. As of June 2025, the U.S. Consumer

Price Index showed a 2.7% year-over-year increase, which is significantly lower than peak 2022 inflation levels but still above the

Federal Reserve’s 2% target. In Puerto Rico, the Consumer Price Index increased by 0.9% over the 12 months ending in June

Fiscal Challenges of Puerto Rico and its Municipalities

As Puerto Rico’s economy contracted in the 2000s, public debt increased rapidly due to borrowing to cover deficits to pay debt

service, pension benefits, and other expenditures. By 2016, the government had over $120 billion in combined debt and unfunded

pension liabilities, lost access to capital markets, and faced a fiscal crisis.

In response, the U.S. Congress enacted PROMESA in June 2016. PROMESA established an Oversight Board with significant

control over Puerto Rico’s fiscal and economic affairs, including those of its public corporations, instrumentalities and municipalities

(collectively, “PR Government Entities”). On August 5, 2025, President Donald J. Trump dismissed five of the seven members of the

Oversight Board, reportedly due to inefficient leadership and excessive spending. As of the date of this report, the vacant Oversight

Board seats remain unfilled, and no official replacements have been announced. While the two remaining members may continue to

act on behalf of the Oversight Board, their authority is limited with respect to certain matters specified in PROMESA and the

Oversight Board’s by-laws. It is still too early to determine what impact these changes may have on the Oversight Board’s

operations or on Puerto Rico’s fiscal and economic affairs.

Under PROMESA, the Oversight Board will remain in place until market access is restored and balanced budgets are achieved for

at least four consecutive years. PROMESA also established two mechanisms for the restructuring of the obligations of PR

Government Entities: (a) Title III, an in-court process akin to that of the U.S. Bankruptcy Code and which permits adjustment of a

broad range of obligations, and (b) Title VI, a largely out-of-court process through which a supermajority of creditors can accept

modifications to debt and bind holdouts.

Since 2017, Puerto Rico and several of its instrumentalities have availed themselves of these mechanisms. The Puerto Rico

government exited Title III in March 2022, and several instrumentalities, such as the Government Development Bank and the Puerto

Rico Highways and Transportation Authority have also completed debt restructurings under Titles III or VI of PROMESA. However,

the Puerto Rico Electric Power Authority is still undergoing its debt restructuring.

Puerto Rico's economic difficulties have also impacted its municipalities. Historically, the central government provided significant

municipal subsidies. However, these, have decreased pursuant to fiscal measures required by the Oversight Board. This decline

has been partly offset by federal disaster and COVID-relief funding received by municipalities in recent years. The latest Puerto Rico

fiscal plan proposes a restructured grant system to enhance municipal services and encourage accountability through performance

metrics.

Municipalities are subject to PROMESA, and the Oversight Board has required certain municipalities to submit fiscal plans and

annual budgets for review and approval. Municipalities are also required to seek Oversight Board approval to issue, guarantee or

modify their debts and to enter into significant contracts. To date no municipality has availed itself of the debt restructuring

mechanisms available to them under PROMESA.

Exposure of the Corporation

The credit quality of BPPR’s loan portfolio reflects, among other things, the general economic conditions in Puerto Rico and other

adverse conditions affecting Puerto Rico consumers and businesses. Deterioration in the Puerto Rico economy has resulted in the

past, and could result in the future, in higher delinquencies, greater charge-offs and increased losses, which could materially affect

our financial condition and results of operations.

At June 30, 2025, the Corporation’s direct exposure to PR Government Entities totaled $412 million, of which $362 million were

outstanding, compared to $336 million, at December 31, 2024, all of which were outstanding. The Corporation’s exposure to PR

Government Entities at June 30, 2025 included up to $47.4 million in Automated Clearing House (“ACH”) transaction settlement

exposure, none of which was outstanding. Substantially all of the Corporation’s direct exposure outstanding at June 30, 2025 were

obligations from various Puerto Rico municipalities. In most cases, these were “general obligations” of a municipality, to which the

applicable municipality has pledged its good faith, credit and unlimited taxing power, or “special obligations” of a municipality, to

which the applicable municipality has pledged basic property tax or sales tax revenues.

At June 30, 2025, 81% of the Corporation’s

exposure to municipal loans and securities was concentrated in the municipalities of San Juan, Guaynabo, Carolina and Caguas.

For additional discussion of the Corporation’s direct exposure to the Puerto Rico government and its instrumentalities and

municipalities, refer to Note 20 – Commitments and Contingencies to the Consolidated Financial Statements.

In addition, at June 30, 2025, the Corporation had $212 million in loans insured or securities issued by PR Governmental Entities,

but for which the principal source of repayment is non-governmental ($220 million at December 31, 2024). These included $168

million in residential mortgage loans insured by the Puerto Rico Housing Finance Authority (“HFA”), a Puerto Rico Government

Entity ($176 million at December 31, 2024). The Corporation also had, at June 30, 2025, $37 million in bonds issued by HFA which

are secured by second mortgage loans on Puerto Rico residential properties, and for which HFA also provides insurance to cover

losses in the event of a borrower default, and upon the satisfaction of certain other conditions ($38 million at December 31, 2024).

HFA’s ability to honor its insurance will depend, among other factors, on the financial condition of HFA at the time such obligations

become due and payable. The Corporation does not consider the government guarantee when estimating the credit losses

associated with this portfolio.

BPPR’s commercial loan portfolio also includes loans to private borrowers who are service providers, lessors, suppliers or have

other relationships with the PR government. These borrowers could be negatively affected by a deterioration in the fiscal and

economic situation of PR Government Entities. Similarly, BPPR’s mortgage and consumer loan portfolios include loans to

government employees and retirees, which could also be negatively affected by fiscal measures, such as employee layoffs or

furloughs or reductions in pension benefits, if the fiscal and economic situation deteriorates.

As of June 30, 2025, BPPR had $20.9 billion in deposits from the Puerto Rico government, its instrumentalities, and municipalities.

The rate at which public deposit balances may decline is uncertain and difficult to predict. The amount and timing of any such

reduction is likely to be impacted by, for example, the level of federal assistance, the speed at which such assistance is distributed and the financial condition, liquidity and cash management practices of such entities, as well as the ability of BPPR to maintain these customer relationships.

United States Virgin Islands

The Corporation has operations in the United States Virgin Islands (the “USVI”) and has credit exposure to USVI government

entities.

The USVI has been experiencing a number of fiscal and economic challenges, which could adversely affect the ability of its public

corporations and instrumentalities to service their outstanding debt obligations. PROMESA does not apply to the USVI and, as such,

there is currently no federal legislation permitting the restructuring of the debts of the USVI and its public corporations and

instrumentalities.

Non-Performing Assets

NPAs include primarily past-due loans that are no longer accruing interest, renegotiated loans, and real estate property acquired

through foreclosure. A summary, including certain credit quality metrics, is presented in Table 18.

The Corporation’s credit quality metrics demonstrated favorable trends in the second quarter of 2025 with improvements in NPLs

and Net Charge-Offs (NCOs). The Corporation continues to closely monitor the economic landscape and borrower performance, as

economic uncertainty remains a key consideration. The Corporation’s experience managing credit risk under different

macroeconomic and operating environments and, more recently, the steps taken around credit tightening supports management’s

view that exposure to riskier borrowers is adequately managed. Nonetheless, carefully monitoring the performance of our loan

portfolio and its response to the environment will continue to be a priority.

Total NPAs of $357.8 million as of June 30, 2025 decreased by $50.3 million when compared with December 31, 2024. Total NPLs

of $311.6 million decreased by $39.2 million from December 31, 2024. BPPR’s NPLs decreased by $34.4 million, mainly driven by

lower consumer, mortgage and commercial NPLs by $12.9 million, $11.0 million and $8.9 million, respectively. Popular U.S. NPLs

decreased by $4.7 million, mostly driven by decreases of $1.9 million and $1.8 million in commercial and mortgage NPLs,

respectively.

On June 30, 2025, the ratio of NPLs to total loans held-in-portfolio was 0.82%, compared to 0.95% on December 31, 2024. Other

real estate owned loans (“OREOs”) decreased by $11.1 million from December 31, 2024. The decrease in OREO was mainly driven

by the combination of sales and lower residential property foreclosures. On June 30, 2025, NPLs secured by real estate amounted

to $189 million in the Puerto Rico operations and $50 million in Popular U.S, compared with $200 million and $56 million,

respectively, on December 31, 2024.

The Corporation’s commercial loan portfolio secured by real estate (“CRE”) amounted to $11.0 billion on June 30, 2025, with $3.0

billion secured by owner-occupied properties (December 31, 2024 - $10.9 billion and $3.2 billion, respectively).

The non-owner occupied CRE portfolio was $5.5 billion at June 30, 2025, split between $3.3 billion in BPPR and $2.2 billion in

Popular U.S. This portfolio is diversified across sectors: retail (33%), hotels (19%), and office space (13%) which together represent

two-thirds of total non-owner occupied CRE exposure. Specifically, office space leasing accounts for just 1.8% ($688.8 million) of

the total loan portfolio, mainly comprising mid-rise properties with an average loan size of $2.4 million, and is well diversified by

tenant type.

Within CRE, the commercial multi-family portfolio is $2.5 billion (approximately 7% of total loans), concentrated in New York Metro

($1.5 billion), South Florida ($716.6 million) and Puerto Rico ($202.1 million) regions. In the New York Metro, there is no exposure to

rent-controlled buildings and rent-stabilized units make up less than 40% of total units, with most originated after 2019.

CRE NPLs amounted to $52.5 million on June 30, 2025, compared with $53.7 million on December 31, 2024. The CRE NPL ratios

for the BPPR and Popular U.S. segments were 0.69% and 0.30%, respectively, on June 30, 2025, compared with 0.64% and

0.37%, respectively, on December 31, 2024.

In addition to the NPLs included in Table 18, on June 30, 2025, there were $529 million of performing loans, mostly commercial

loans, which in management’s opinion, are currently subject to potential future classification as non-performing (December 31, 2024

- $596 million).

The following table presents the Corporation’s NPAs as of June 30, 2025 and December 31, 2024:

Table 18 - Non-Performing Assets

June 30, 2025

December 31, 2024

(Dollars in thousands)

BPPR

Popular

U.S.

Popular,

Inc.

As a % of

loans HIP

by

category

BPPR

Popular

U.S.

Popular,

Inc.

As a % of

loans HIP

by

category

Commercial

Commercial multi-family

174

10,751

10,925

0.4

79

8,700

8,779

0.4

Commercial real estate non-owner

occupied

6,084

7,893

13,977

0.3

6,429

8,015

14,444

0.3

Commercial real estate owner

occupied

27,320

231

27,551

0.9

25,258

5,191

30,449

1.0

Commercial and industrial

8,588

2,836

11,424

0.1

19,335

1,748

21,083

0.3

Total Commercial

42,166

21,711

63,877

0.3

51,101

23,654

74,755

0.4

Leasing

7,976

7,976

0.4

9,588

9,588

0.5

Mortgage

147,464

28,052

175,516

2.1

158,442

29,890

188,332

2.3

Consumer

Home equity lines of credit

3,120

3,120

4.0

3,393

3,393

4.6

Personal

17,499

1,094

18,593

1.0

20,269

1,741

22,010

1.2

Auto

40,595

40,595

1.1

51,792

51,792

1.4

Other

1,948

1,948

1.2

899

11

910

0.5

Total Consumer

60,042

4,214

64,256

0.9

72,960

5,145

78,105

1.1

Total non-performing loans held-in-

portfolio

257,648

53,977

311,625

0.8

292,091

58,689

350,780

0.9

Other real estate owned (“OREO”)

45,643

483

46,126

57,197

71

57,268

Total non-performing assets

[1]

303,291

54,460

357,751

349,288

58,760

408,048

Accruing loans past due 90 days or

more

[2]

206,205

189

206,394

242,250

190

242,440

Ratios:

Non-performing assets to total assets

0.51

0.34

0.47

0.61

0.37

0.56

Non-performing loans held-in-portfolio

to loans held-in-portfolio

0.96

0.47

0.82

1.12

0.54

0.95

Allowance for credit losses to loans

held-in-portfolio

2.53

0.79

2.02

2.56

0.69

2.01

Allowance for credit losses to non-

performing loans, excluding held-for-

sale

263.63

167.17

246.93

229.61

128.40

212.68

[1] There were no non-performing loans held-for-sale as of June 30, 2025 and December 31, 2024.

[2] It is the Corporation’s policy to report delinquent residential mortgage loans insured by FHA or guaranteed by the VA as accruing loans past due 90

days or more as opposed to non-performing since the principal repayment is insured. These balances include $52 million of residential mortgage

loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of June 30, 2025 (December 31, 2024 - $65 million).

Furthermore, the Corporation has $29 million in reverse mortgage loans which are guaranteed by FHA, but which are currently not accruing interest.

Due to the guaranteed nature of the loans, it is the Corporation’s policy to exclude these balances from non-performing assets (December 31, 2024 -

$31 million).

For the quarter ended June 30, 2025, total inflows of NPLs held-in-portfolio, excluding consumer loans, decreased by $26.1 million,

when compared to the inflows for the same period in 2024. Inflows of NPLs held-in-portfolio at the BPPR segment decreased by

$8.8 million, compared to the same period in 2024, mainly driven by lower mortgage NPL inflows by $6.6 million. Inflows of NPLs

held-in-portfolio at the Popular U.S. segment decreased by $17.3 million from the same period in 2024, driven by lower commercial

NPL inflows by $16.6 million, as the prior period was impacted by a single $17.3 million loan.

Tables 19 to 25 present the Corporation’s inflows to NPLs for the quarters and six months ended June 30, 2025 and 2024.

Table 19 - Activity in Non -Performing Loans Held-in-Portfolio (Excluding Consumer Loans)

For the quarter ended June 30, 2025

For the six months ended June 30, 2025

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

191,103

46,594

237,697

209,543

53,544

263,087

Plus:

New non-performing loans

32,205

8,909

41,114

69,228

17,067

86,295

Advances on existing non-performing loans

20

20

38

38

Less:

Non-performing loans transferred to OREO

(2,385)

(433)

(2,818)

(4,940)

(433)

(5,373)

Non-performing loans charged-off

(790)

(583)

(1,373)

(1,717)

(1,713)

(3,430)

Loans returned to accrual status / loan collections

(30,503)

(4,744)

(35,247)

(82,484)

(18,740)

(101,224)

Ending balance NPLs

189,630

49,763

239,393

189,630

49,763

239,393

Table 20 - Activity in Non -Performing Loans Held-in-Portfolio (Excluding Consumer Loans)

For the quarter ended June 30, 2024

For the six months ended June 30, 2024

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

229,796

49,478

279,274

254,476

22,354

276,830

Plus:

New non-performing loans

41,040

25,907

66,947

74,543

61,280

135,823

Advances on existing non-performing loans

298

298

320

320

Less:

Non-performing loans transferred to OREO

(4,540)

(24)

(4,564)

(8,649)

(24)

(8,673)

Non-performing loans charged-off

(5,590)

(18)

(5,608)

(13,899)

(968)

(14,867)

Loans returned to accrual status / loan collections

(40,746)

(26,324)

(67,070)

(86,511)

(33,645)

(120,156)

Ending balance NPLs

219,960

49,317

269,277

219,960

49,317

269,277

Table 21 - Activity in Non -Performing Commercial Loans Held-in-Portfolio

For the quarter ended June 30, 2025

For the six months ended June 30, 2025

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

42,597

17,507

60,104

51,101

23,654

74,755

Plus:

New non-performing loans

1,768

5,632

7,400

7,549

11,045

18,594

Advances on existing non-performing loans

20

20

37

37

Less:

Non-performing loans transferred to OREO

(140)

(140)

(260)

(260)

Non-performing loans charged-off

(403)

(583)

(986)

(1,142)

(1,713)

(2,855)

Loans returned to accrual status / loan

collections

(1,656)

(865)

(2,521)

(15,082)

(11,312)

(26,394)

Ending balance NPLs

42,166

21,711

63,877

42,166

21,711

63,877

Table 22 - Activity in Non -Performing Commercial Loans Held-in-Portfolio

For the quarter ended June 30, 2024

For the six months ended June 30, 2024

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

63,323

21,407

84,730

72,992

11,163

84,155

Plus:

New non-performing loans

4,031

21,940

25,971

8,374

36,979

45,353

Advances on existing non-performing loans

282

282

302

302

Less:

Non-performing loans transferred to OREO

(280)

(280)

(280)

(280)

Non-performing loans charged-off

(5,700)

(5,700)

(13,699)

(950)

(14,649)

Loans returned to accrual status / loan collections

(5,204)

(5,866)

(11,070)

(11,217)

(9,731)

(20,948)

Ending balance NPLs

56,170

37,763

93,933

56,170

37,763

93,933

Table 23 - Activity in Non -Performing Construction Loans Held-in-Portfolio

For the quarter ended June 30, 2024

For the six months ended June 30, 2024

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

6,378

6,378

Less:

Loans returned to accrual status / loan collections

(6,378)

(6,378)

Ending balance NPLs

Table 24 - Activity in Non -Performing Mortgage Loans Held-in-Portfolio

For the quarter ended June 30, 2025

For the six months ended June 30, 2025

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

148,506

29,087

177,593

158,442

29,890

188,332

Plus:

New non-performing loans

30,437

3,277

33,714

61,679

6,022

67,701

Advances on existing non-performing loans

1

1

Less:

Non-performing loans transferred to OREO

(2,245)

(433)

(2,678)

(4,680)

(433)

(5,113)

Non-performing loans charged-off

(387)

(387)

(575)

(575)

Loans returned to accrual status / loan

collections

(28,847)

(3,879)

(32,726)

(67,402)

(7,428)

(74,830)

Ending balance NPLs

147,464

28,052

175,516

147,464

28,052

175,516

Table 25 - Activity in Non -Performing Mortgage Loans Held-in-Portfolio

For the quarter ended June 30, 2024

For the six months ended June 30, 2024

(Dollars in thousands)

BPPR

Popular U.S.

Popular, Inc.

BPPR

Popular U.S.

Popular, Inc.

Beginning balance

166,473

28,071

194,544

175,106

11,191

186,297

Plus:

New non-performing loans

37,009

3,967

40,976

66,169

24,301

90,470

Advances on existing non-performing loans

16

16

18

18

Less:

Non-performing loans transferred to OREO

(4,260)

(24)

(4,284)

(8,369)

(24)

(8,393)

Non-performing loans charged-off

110

(18)

92

(200)

(18)

(218)

Loans returned to accrual status / loan collections

(35,542)

(20,458)

(56,000)

(68,916)

(23,914)

(92,830)

Ending balance NPLs

163,790

11,554

175,344

163,790

11,554

175,344

Loan Delinquencies

Another key measure used to evaluate and monitor the Corporation’s asset quality is loan delinquencies. Loans delinquent 30 days

or more, as a percentage of their related portfolio category on June 30, 2025 and December 31, 2024, are presented below.

Table 26 - Loan Delinquencies

(Dollars in thousands)

June 30, 2025

December 31, 2024

Loans delinquent

30 days or more

Total loans

Total delinquencies

as a percentage

of total loans

Loans delinquent

30 days or more

Total loans

Total delinquencies

as a percentage

of total loans

Commercial

Commercial multi-family

21,937

2,520,789

0.87

15,826

2,399,620

0.66

Commercial real estate

non-owner occupied

17,272

5,521,374

0.31

24,925

5,363,235

0.46

Commercial real estate

owner occupied

41,413

3,003,855

1.38

42,311

3,157,746

1.34

Commercial and industrial

37,213

8,043,752

0.46

49,942

7,741,562

0.65

Total Commercial

117,835

19,089,770

0.62

133,004

18,662,163

0.71

Construction

3,720

1,468,201

0.25

1,039

1,263,792

0.08

Leasing

36,714

1,983,068

1.85

39,641

1,925,405

2.06

Mortgage

[1]

728,253

8,444,427

8.62

798,130

8,114,183

9.84

Consumer

Credit cards

48,745

1,215,293

4.01

59,078

1,218,079

4.85

Home equity lines of credit

4,682

77,479

6.04

5,054

73,571

6.87

Personal

51,109

1,876,463

2.72

57,835

1,855,244

3.12

Auto

165,642

3,861,702

4.29

191,008

3,823,437

5.00

Other

5,567

168,775

3.30

3,930

171,778

2.29

Total Consumer

275,745

7,199,712

3.83

316,905

7,142,109

4.44

Loans held-for-sale

2,898

5,423

Total

1,162,267

38,188,076

3.04

1,288,719

37,113,075

3.47

[1] Loans delinquent 30 days or more includes $0.4 billion of residential mortgage loans insured by FHA or guaranteed by the VA as of June 30,

2025 (December 31, 2024 - $0.4 billion). Refer to Note 7 to the Consolidated Financial Statements for additional information of guaranteed loans.

Allowance for Credit Losses Loans Held-in-Portfolio

The ACL represents management’s estimate of expected credit losses through the remaining contractual life of the different loan

segments, impacted by expected prepayments. The ACL is maintained at a sufficient level to provide for estimated credit losses on

collateral dependent loans as well as loans modified for borrowers with financial difficulties separately from the remainder of the loan

portfolio. Refer to Note 8 to the Consolidated Financial Statements, for additional information on the Corporation’s methodology to

estimate its ACL.

On June 30, 2025, the ACL increased by $23.5 million from December 31, 2024 to $769.5 million. The increase in ACL was driven

by changes in the economic scenario probability weights and increases in qualitative reserves, in response to the current economic

environment uncertainty, coupled with reserve build-up associated with portfolio growth and unfavorable changes in the economic

assumptions used in the ACL model. These increases were offset in part by the net effect of changes in credit quality and NCOs

during the period. Given that any economic outlook is inherently uncertain, the Corporation leverages multiple scenarios to estimate

its ACL. Prior to the first quarter of 2025, the Corporation assigned the baseline scenario the highest probability among the

scenarios used to estimate the ACL, followed by the pessimistic scenario given the uncertainties in the economic outlook and

downside risk, and the optimistic scenario had the lowest probability. During the first quarter of 2025, the Corporation modified the

weight assigned to the pessimistic scenario to be equal to the baseline scenario in response to the current economic uncertainty,

resulting in an increase of $18.2 million in the reserves. In the second quarter of 2025, the probability weight for the pessimistic scenario was moderately decreased based on changes in the economic outlook and a reassessment of uncertainty compared to the previous quarter. This change resulted in a $4.5 million reduction in ACL reserve levels, for a $13.7 million net increase from

December 31, 2024. The probability weight for the pessimistic scenario remains above the levels observed in 2024, given the

ongoing economic uncertainty. Refer to Note 8 to the Consolidated Financial Statements, for additional information on the

Corporation’s methodology to estimate its ACL, including probability weights assigned

On June 30, 2025, the ACL for BPPR increased by $8.6 million from December 31, 2024, driven by changes in the probability

weights that resulted in a $8.8 million net ACL increase, coupled with an increase in the reserves for auto loans due to migrations

between FICO score categories and changes in the economic scenarios. This increase was partially offset by lower reserves for

commercial loans due to improvements in credit quality, partially offset by ACL reserve build-up due to portfolio growth. In PB, on

June 30, 2025, the ACL increased by $14.9 million, when compared to December 31, 2024. This increase was influenced by

changes in the forecast of the U.S. unemployment rate as well as higher qualitative reserves for the CRE portfolio in response to

current market volatility and economic uncertainty, coupled with changes in the probability weights that resulted in a $4.9 million net

increase.

The Corporation’s ratio of the allowance for credit losses to loans held-in-portfolio was 2.02% on June 30, 2025, compared to 2.01%

on December 31, 2024. The ratio of the ACL to NPLs held-in-portfolio stood at 246.9%, compared to 212.7% on December 31,

Tables 27 and 28 detail the allowance for credit losses by loan categories and the percentage it represents of total loans held-in-

portfolio and NPLs. The breakdown is made for analytical purposes, and it is not necessarily indicative of the categories in which

future loan losses may occur.

Table 27 - Allowance for Credit Losses - Loan Portfolios

June 30, 2025

(Dollars in thousands)

Total ACL

Total loans held-

in-portfolio

ACL to loans held-

in-portfolio

Total non-

performing loans

held-in-portfolio

ACL to non-

performing loans

held-in-portfolio

Commercial

Commercial multi-family

16,781

2,520,789

0.67

10,925

153.60

Commercial real estate non-owner occupied

59,117

5,521,374

1.07

13,977

422.96

Commercial real estate owner occupied

49,051

3,003,855

1.63

27,551

178.04

Commercial and industrial

141,362

8,043,752

1.76

11,424

N.M.

Total Commercial

266,311

19,089,770

1.40

63,877

416.91

Construction

10,579

1,468,201

0.72

Leasing

20,040

1,983,068

1.01

7,976

251.25

Mortgage

85,175

8,444,427

1.01

175,516

48.53

Consumer

Credit cards

92,306

1,215,293

7.60

Home equity lines of credit

1,384

77,479

1.79

3,120

44.36

Personal

103,654

1,876,463

5.52

18,593

557.49

Auto

182,274

3,861,702

4.72

40,595

449.01

Other

7,762

168,775

4.60

1,948

398.46

Total Consumer

387,380

7,199,712

5.38

64,256

602.87

Total

769,485

38,185,178

2.02

311,625

246.93

N.M. - Not meaningful.

Table 28 - Allowance for Credit Losses - Loan Portfolios

December 31, 2024

(Dollars in thousands)

Total ACL

Total loans held-

in-portfolio

ACL to loans held-

in-portfolio

Total non-

performing loans

held-in-portfolio

ACL to non-

performing loans

held-in-portfolio

Commercial

Commercial multi-family

9,236

2,399,620

0.38

8,779

105.21

Commercial real estate non-owner occupied

54,494

5,363,235

1.02

14,444

377.28

Commercial real estate owner occupied

49,828

3,157,746

1.58

30,449

163.64

Commercial and industrial

146,006

7,741,562

1.89

21,083

692.53

Total Commercial

259,564

18,662,163

1.39

74,755

347.22

Construction

11,264

1,263,792

0.89

Leasing

16,419

1,925,405

0.85

9,588

171.25

Mortgage

82,409

8,114,183

1.02

188,332

43.76

Consumer

Credit cards

99,130

1,218,079

8.14

Home equity lines of credit

1,503

73,571

2.04

3,393

44.30

Personal

102,736

1,855,244

5.54

22,010

466.77

Auto

165,995

3,823,437

4.34

51,792

320.50

Other

7,004

171,778

4.08

910

769.67

Total Consumer

376,368

7,142,109

5.27

78,105

481.87

Total

746,024

37,107,652

2.01

350,780

212.68

Annualized net charge-offs (recoveries)

The following table presents annualized net charge-offs (recoveries) to average loans held-in-portfolio (“HIP”) by loan category for

the quarters and six months ended June 30, 2025 and 2024.

Table 29 - Annualized Net Charge -offs (Recoveries) to Average Loans Held-in-Portfolio

Quarters ended

June 30, 2025

June 30, 2024

BPPR

Popular U.S.

Popular Inc.

BPPR

Popular U.S.

Popular Inc.

Commercial

0.02

0.01

0.20

0.04

0.13

Construction

(0.04)

(0.04)

Mortgage

(0.14)

(0.01)

(0.12)

(0.23)

(0.01)

(0.19)

Leasing

0.56

0.56

0.60

0.60

Consumer

2.29

4.00

2.33

2.68

6.58

2.80

Total annualized net charge-offs

(recoveries) to average loans held-in-

portfolio

0.61

0.07

0.45

0.79

0.16

0.61

Six months ended

June 30, 2025

June 30, 2024

BPPR

Popular U.S.

Popular Inc.

BPPR

Popular U.S.

Popular Inc.

Commercial

(0.05)

0.02

(0.02)

0.25

0.04

0.15

Construction

(0.02)

(0.02)

Mortgage

(0.14)

(0.03)

(0.12)

(0.25)

(0.01)

(0.21)

Leasing

0.62

0.62

0.72

0.72

Consumer

2.55

3.95

2.59

2.83

7.54

2.98

Total annualized net charge-offs

(recoveries) to average loans held-in-

portfolio

0.67

0.07

0.49

0.86

0.19

0.66

NCOs for the quarter ended June 30, 2025, amounted to $42.2 million, decreasing by $11.4 million when compared to the same

period in 2024. The BPPR segment decreased by $9.1 million, mainly driven by decreases of $5.6 million and $4.9 million in

consumer and commercial NCOs, respectively. The PB segment NCOs decreased by $2.3 million, mainly driven by lower consumer

NCOs by $1.8 million

NCOs for the six months ended June 30, 2025, amounted to $91.3 million, decreasing by $24.5 million when compared to the same

period in 2024. The BPPR segment decreased by $18.6 million, mainly driven by decreases of $14.4 million and $7.0 million in

commercial and consumer NCOs, respectively. The PB segment NCOs decreased by $5.9 million, mainly driven by lower consumer

NCOs by $4.9 million.

Loan Modifications

For the quarter ended June 30, 2025, modified loans to borrowers with financial difficulty amounted to $276.9 million, of which

$266.6 million were in accruing status. The BPPR segment’s modifications to borrowers with financial difficulty amounted to $217.5

million, mainly comprised of commercial and mortgage loans of $192.5 million and $17.4 million, respectively. A total of $10.7 million

of the mortgage modifications were related to government guaranteed loans. The Popular U.S. segment’s modifications to

borrowers with financial difficulty amounted to $59.4 million, mostly comprised of commercial loans.

Refer to Note 8 to the Consolidated Financial Statements for additional information on modifications made to borrowers

experiencing financial difficulties.

ADOPTION OF NEW ACCOUNTING STANDARDS AND ISSUED BUT NOT YET EFFECTIVE ACCOUNTING STANDARDS

Refer to Note 3, “New Accounting Pronouncements” to the Consolidated Financial Statements.

Quantitative and qualitative disclosures for the current period can be found in the Market Risk section of this report, which includes

changes in market risk exposures from disclosures presented in the 2024 Form 10-K.

Disclosure Controls and Procedures

The Corporation’s management, with the participation of the Corporation’s Chief Executive Officer and Chief Financial Officer, has

evaluated the effectiveness of the Corporation’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and

15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this report. Based

on such evaluation, the Corporation’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such

period, the Corporation’s disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a

timely basis, information required to be disclosed by the Corporation in the reports that it files or submits under the Exchange Act

and such information is accumulated and communicated to management, as appropriate, to allow timely decisions regarding

required disclosures.

Internal Control Over Financial Reporting

There have been no changes in the Corporation’s internal control over financial reporting (as such term is defined in Rules 13a-15(f)

and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2025 that have materially affected, or are

reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

Corporation is subject.

All forward-looking statements included in this Form 10-Q are based upon information available to Popular as of the date of this

Form 10-Q, and other than as required by law, including the requirements of applicable securities laws, we assume no obligation to

update or revise any such forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date

of such statements.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

[UNAUDITED]

June 30,

December 31,

(In thousands, except share information)

2025

2024

Assets:

Cash and due from banks

400,631

419,638

Money market investments:

Time deposits with other banks

6,340,786

6,380,948

Total money market investments

6,340,786

6,380,948

Trading account debt securities, at fair value

29,643

32,831

Debt securities available-for-sale, at fair value:

Pledged securities with creditors’ right to repledge

31,022

30,486

Other debt securities available-for-sale

20,459,190

18,215,417

Debt securities available-for-sale

20,490,212

18,245,903

Debt securities held-to-maturity, at amortized cost:

Pledged securities with creditors’ right to repledge

27,560

27,405

Other debt securities held-to-maturity

7,514,164

7,730,672

Debt securities held-to-maturity (fair value 2025 - $

7,555,517

; 2024 - $

7,682,664

7,541,724

7,758,077

Less – Allowance for credit losses

5,999

5,317

Debt securities held-to-maturity, net

7,535,725

7,752,760

Equity securities (realizable value 2025 - $

222,907

; 2024 - $

208,663

222,391

208,166

Loans held-for-sale, at fair value

2,898

5,423

Loans held-in-portfolio

38,611,834

37,522,995

Less – Unearned income

426,656

415,343

Allowance for credit losses

769,485

746,024

Total loans held-in-portfolio, net

37,415,693

36,361,628

Premises and equipment, net

649,191

601,787

Other real estate

46,126

57,268

Accrued income receivable

274,867

263,389

Mortgage servicing rights, at fair value

103,077

108,103

Other assets

1,745,052

1,797,759

Goodwill

802,954

802,954

Other intangible assets

5,844

6,826

Total assets

76,065,090

73,045,383

Liabilities and Stockholders’ Equity

Liabilities:

Deposits:

Non-interest bearing

15,114,614

15,139,555

Interest bearing

52,102,877

49,744,790

Total deposits

67,217,491

64,884,345

Assets sold under agreements to repurchase

56,043

54,833

Other short-term borrowings

550,000

225,000

Notes payable

808,451

896,293

Other liabilities

1,479,087

1,371,846

Total liabilities

70,111,072

67,432,317

Commitments and contingencies (Refer to Note 20)

Stockholders’ equity:

Preferred stock,

30,000,000

shares authorized;

885,726

shares issued and outstanding (2024 -

885,726

22,143

22,143

Common stock, $

0.01

par value;

170,000,000

shares authorized;

104,889,180

shares issued (2024 -

104,849,460

) and

67,937,468

shares outstanding (2024 -

70,141,291

1,049

1,048

Surplus

4,919,950

4,908,693

Retained earnings

4,861,958

4,570,957

Treasury stock - at cost,

36,951,712

shares (2024 -

34,708,169

(2,455,425)

(2,228,535)

Accumulated other comprehensive loss, net of tax

(1,395,657)

(1,661,240)

Total stockholders’ equity

5,954,018

5,613,066

Total liabilities and stockholders’ equity

76,065,090

73,045,383

The accompanying notes are an integral part of these Consolidated Financial Statements.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

Quarters ended June 30,

Six months ended June 30,

(In thousands, except per share information)

2025

2024

2025

2024

Interest income:

Loans

684,587

648,739

1,351,260

1,287,469

Money market investments

69,532

88,316

139,698

176,832

Investment securities

189,753

184,852

369,912

351,747

Total interest income

943,872

921,907

1,860,870

1,816,048

Interest expense:

Deposits

295,058

339,939

592,921

669,435

Short-term borrowings

5,300

1,126

6,726

2,318

Long-term debt

11,965

12,530

24,077

25,239

Total interest expense

312,323

353,595

623,724

696,992

Net interest income

631,549

568,312

1,237,146

1,119,056

Provision for credit losses

48,941

46,794

113,022

119,392

Net interest income after provision for credit losses

582,608

521,518

1,124,124

999,664

Non-interest income:

Service charges on deposit accounts

38,826

37,526

77,880

74,968

Other service fees

100,522

96,863

195,030

191,135

Mortgage banking activities (Refer to Note 9)

4,872

5,723

8,561

10,083

Net gain, including impairment on equity securities

1,862

319

1,448

1,422

Net gain on trading account debt securities

538

277

1,058

638

Adjustments to indemnity reserves on loans sold

120

212

293

(25)

Other operating income

21,737

25,386

36,268

51,903

Total non-interest income

168,477

166,306

320,538

330,124

Operating expenses:

Personnel costs

229,355

197,424

442,068

412,801

Net occupancy expenses

29,140

27,692

56,358

55,733

Equipment expenses

5,789

9,662

11,091

19,229

Other taxes

18,632

15,333

37,357

29,708

Professional fees

28,108

37,744

54,933

66,662

Technology and software expenses

84,696

79,752

168,364

159,214

Processing and transactional services

37,861

39,096

75,642

73,290

Communications

5,010

4,357

9,914

8,914

Business promotion

26,385

25,449

50,060

46,438

Deposit insurance

9,407

10,581

19,442

34,468

Other real estate owned (OREO) income

(4,124)

(5,750)

(7,454)

(11,071)

Other operating expenses

22,117

27,502

45,016

55,774

Amortization of intangibles

385

734

982

1,529

Total operating expenses

492,761

469,576

963,773

952,689

Income before income tax

258,324

218,248

480,889

377,099

Income tax expense

47,884

40,459

92,947

96,027

Net Income

210,440

177,789

387,942

281,072

Net Income Applicable to Common Stock

210,087

177,436

387,236

280,366

Net Income per Common Share – Basic

3.09

2.47

5.64

3.90

Net Income per Common Share – Diluted

3.09

2.46

5.64

3.90

The accompanying notes are an integral part of these Consolidated Financial Statements.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Quarters ended,

Six months ended,

June 30,

June 30,

(In thousands)

2025

2024

2025

2024

Net income

210,440

177,789

387,942

281,072

Other comprehensive income (loss) before tax:

Foreign currency translation adjustment

7,499

165

854

(3,855)

Amortization of net losses of pension and postretirement benefit plans

2,272

3,618

4,545

7,236

Unrealized holding gains (losses) on debt securities arising during the period

58,972

22,422

224,957

(50,608)

Amortization of unrealized losses of debt securities transfer from available-for-

sale to held-to-maturity

46,242

44,421

91,552

88,430

Other comprehensive income before tax

114,985

70,626

321,908

41,203

Income tax expense

(20,655)

(15,722)

(56,325)

(23,954)

Total other comprehensive income, net of tax

94,330

54,904

265,583

17,249

Comprehensive income, net of tax

304,770

232,693

653,525

298,321

Tax effect allocated to each component of other comprehensive income:

Quarters ended

Six months ended,

June 30,

June 30,

(In thousands)

2025

2024

2025

2024

Amortization of net losses of pension and postretirement benefit plans

852

1,357

1,704

2,714

Unrealized holding losses on debt securities arising during the period

(10,555)

(5,481)

(36,311)

(3,555)

Amortization of unrealized losses of debt securities transfer from available-for-

sale to held-to-maturity

(9,248)

(8,884)

(18,310)

(17,685)

Income tax expense

(20,655)

(15,722)

(56,325)

(23,954)

The accompanying notes are an integral part of the Consolidated Financial Statements.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Accumulated

other

Common

Preferred

Retained

Treasury

comprehensive

(In thousands)

stock

stock

Surplus

earnings

stock

loss

Total

Balance at March 31, 2024

1,048

22,143

4,847,466

4,253,030

(2,013,187)

(1,933,186)

5,177,314

Net income

177,789

177,789

Issuances of common stock

1,768

1,768

Dividends declared:

Common stock

[1]

(44,944)

(44,944)

Preferred stock

(353)

(353)

Common stock purchases

(3,200)

(3,200)

Stock based compensation

3,513

5,887

9,400

Other comprehensive income, net of tax

54,904

54,904

Balance at June 30, 2024

1,048

22,143

4,852,747

4,385,522

(2,010,500)

(1,878,282)

5,372,678

Balance at March 31, 2025

1,049

22,143

4,912,886

4,699,697

(2,346,093)

(1,489,987)

5,799,695

Net income

210,440

210,440

Issuances of common stock

1,760

1,760

Dividends declared:

Common stock

[1]

(47,826)

(47,826)

Preferred stock

(353)

(353)

Common stock purchases

[2]

(117,075)

(117,075)

Stock based compensation

5,304

7,743

13,047

Other comprehensive income, net of tax

94,330

94,330

Balance at June 30, 2025

1,049

22,143

4,919,950

4,861,958

(2,455,425)

(1,395,657)

5,954,018

[1]

Dividends declared per common share during the quarter ended June 30, 2025 - $

0.7

0 (2024 - $

0.62

[2]

Includes common stock repurchases of $

112

.0 million as part of a repurchase authorization up to $

500

million announced by the Corporation on

July 24, 2024 (the "2024 Repurchase Program"). Refer to Note 17 for additional information.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Accumulated

other

Common

Preferred

Retained

Treasury

comprehensive

(In thousands)

stock

stock

Surplus

earnings

stock

loss

Total

Balance at December 31, 2023

1,048

22,143

4,843,399

4,194,851

(2,018,957)

(1,895,531)

5,146,953

Net income

281,072

281,072

Issuances of common stock

3,567

3,567

Dividends declared:

Common stock

[1]

(89,695)

(89,695)

Preferred stock

(706)

(706)

Common stock purchases

(6,776)

(6,776)

Stock based compensation

5,781

15,233

21,014

Other comprehensive income, net of tax

17,249

17,249

Balance at June 30, 2024

1,048

22,143

4,852,747

4,385,522

(2,010,500)

(1,878,282)

5,372,678

Balance at December 31, 2024

1,048

22,143

4,908,693

4,570,957

(2,228,535)

(1,661,240)

5,613,066

Net income

387,942

387,942

Issuances of common stock

1

3,529

3,530

Dividends declared:

Common stock

[1]

(96,235)

(96,235)

Preferred stock

(706)

(706)

Common stock purchases

[2]

(243,055)

(243,055)

Stock based compensation

7,728

16,165

23,893

Other comprehensive income, net of tax

265,583

265,583

Balance at June 30, 2025

1,049

22,143

4,919,950

4,861,958

(2,455,425)

(1,395,657)

5,954,018

[1]

Dividends declared per common share during the six months ended June 30, 2025 - $

1.40

(2024 - $

1.24

[2]

Includes common stock repurchases of $

234.3

million as part of the 2024 Repurchase Program. Refer to Note 17 for additional information.

For the six months ended

June 30,

June 30,

Disclosure of changes in number of shares:

2025

2024

Preferred Stock:

Balance at beginning and end of period

885,726

885,726

Common Stock – Issued:

Balance at beginning of period

104,849,460

104,767,348

Issuances of common stock

39,720

44,623

Balance at end of period

104,889,180

104,811,971

Treasury stock

(36,951,712)

(32,446,045)

Common Stock – Outstanding

67,937,468

72,365,926

The accompanying notes are an integral part of these Consolidated Financial Statements.

POPULAR, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six months ended June 30,

(In thousands)

2025

2024

Cash flows from operating activities:

Net income

387,942

281,072

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for credit losses

113,022

119,392

Amortization of intangibles

982

1,529

Depreciation and amortization of premises and equipment

25,319

31,249

Net accretion of discounts and amortization of premiums and deferred fees

(136,208)

(127,770)

Interest capitalized on loans subject to the temporary payment moratorium or loss mitigation alternatives

(2,822)

(4,047)

Share-based compensation

21,930

16,391

Fair value adjustments on mortgage servicing rights

5,523

5,384

Adjustments to indemnity reserves on loans sold

(293)

25

Earnings from investments under the equity method, net of dividends or distributions

152

(2,871)

Deferred income tax expense

20,832

19,702

Gain on:

Disposition of premises and equipment and other productive assets

(91)

(6,295)

Sale of loans, including valuation adjustments on loans held-for-sale and mortgage banking activities

(156)

(76)

Sale of equity method investment

(1,226)

Sale of foreclosed assets, including write-downs

(5,076)

(10,575)

Acquisitions of loans held-for-sale

(2,332)

(1,767)

Proceeds from sale of loans held-for-sale

15,584

19,358

Net originations on loans held-for-sale

(12,137)

(22,580)

Net decrease (increase) in:

Trading debt securities

10,040

6,735

Equity securities

(1,411)

(4,445)

Accrued income receivable

(11,419)

(17,340)

Other assets

(19,371)

(8,463)

Net increase (decrease) in:

Interest payable

2,584

3,145

Pension and other postretirement benefits obligation

2,191

3,732

Other liabilities

1,434

(59,481)

Total adjustments

27,051

(39,068)

Net cash provided by operating activities

414,993

242,004

Cash flows from investing activities:

Net decrease in money market investments

40,765

147,650

Purchases of investment securities:

Available-for-sale

(18,905,199)

(17,231,900)

Equity

(25,811)

(1,667)

Proceeds from calls, paydowns, maturities and redemptions of investment securities:

Available-for-sale

17,145,332

15,375,714

Held-to-maturity

303,212

304,653

Proceeds from sale of investment securities:

Equity

14,497

4,046

Net disbursements on loans

(912,037)

(287,684)

Proceeds from sale of loans

40,983

17,640

Acquisition of loan portfolios

(319,297)

(384,479)

Return of capital from equity method investments

279

Net proceeds from sale of equity method investment

1,226

Acquisition of premises and equipment and other productive assets

(96,200)

(95,412)

Proceeds from sale of:

Premises and equipment and other productive assets

344

4,409

Foreclosed assets

47,590

58,979

Net cash used in investing activities

(2,664,595)

(2,087,772)

Cash flows from financing activities:

Net increase in:

Deposits

2,334,656

1,912,286

Assets sold under agreements to repurchase

1,210

14,300

Other short-term borrowings

325,000

Payments of notes payable

(88,522)

(46,000)

Principal payments of finance leases

(1,829)

(1,774)

Proceeds from issuances of common stock

3,530

3,567

Dividends paid

(98,661)

(90,151)

Net payments for repurchase of common stock

(236,203)

(452)

Payments related to tax withholding for share-based compensation

(7,983)

(6,324)

Net cash provided by financing activities

2,231,198

1,785,452

Net decrease in cash and due from banks, and restricted cash

(18,404)

(60,316)

Cash and due from banks, and restricted cash at beginning of period

429,406

427,575

Cash and due from banks, and restricted cash at the end of the period

411,002

367,259

The accompanying notes are an integral part of these Consolidated Financial Statements.

Notes to Consolidated Financial

Statements (Unaudited)

Note 1 -

Nature of operations

13

Note 2 -

Basis of presentation

14

Note 3 -

New accounting pronouncements

15

Note 4 -

Restrictions on cash and due from banks and

certain securities

20

Note 5 -

Debt securities available-for-sale

21

Note 6 -

Debt securities held-to-maturity

24

Note 7 -

Loans

27

Note 8 -

Allowance for credit losses – loans held-in-

portfolio

35

Note 9 -

Mortgage banking activities

78

Note 10 -

Transfers of financial assets and mortgage

servicing assets

79

Note 11 -

Other real estate owned

83

Note 12 -

Other assets

84

Note 13 -

Goodwill and other intangible assets

86

Note 14 -

Deposits

88

Note 15 -

Borrowings

89

Note 16 -

Other liabilities

91

Note 17 -

Stockholders’ equity

92

Note 18 -

Other comprehensive income

93

Note 19 -

Guarantees

95

Note 20 -

Commitments and contingencies

97

Note 21-

Non-consolidated variable interest entities

100

Note 22 -

Related party transactions

102

Note 23 -

Fair value measurement

103

Note 24 -

Fair value of financial instruments

111

Note 25 -

Net income per common share

114

Note 26 -

Revenue from contracts with customers

115

Note 27 -

Leases

116

Note 28 -

Pension and postretirement benefits

118

Note 29 -

Stock-based compensation

119

Note 30 -

Income taxes

122

Note 31 -

Supplemental disclosure on the consolidated

statements of cash flows

126

Note 32 -

Segment reporting

Note 1 – Nature of Operations

Popular, Inc. (the “Corporation” or “Popular”) is a diversified, publicly owned financial holding company subject to the supervision

and regulation of the Board of Governors of the Federal Reserve System. The Corporation has operations in Puerto Rico, the

mainland United States (“U.S.”) and U.S. and British Virgin Islands. In Puerto Rico, the Corporation provides retail, mortgage and

commercial banking services and auto and equipment leasing and financing through its principal banking subsidiary, Banco Popular

de Puerto Rico (“BPPR”), as well as broker-dealer and insurance services through specialized subsidiaries. In the U.S. mainland,

the Corporation provides retail, mortgage, commercial banking services, as well as equipment leasing and financing, through its

New York-chartered banking subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches located in New York, New

Jersey, and Florida.

Note 2 – Basis of Presentation

Basis of Presentation

The (unaudited) interim Consolidated Financial Statements are, in the opinion of management, a fair statement of the results for the

periods reported. The consolidated statement of financial condition presented as of December 31, 2024 was derived from audited

Consolidated Financial Statements of the Corporation for the year ended December 31, 2024.

Certain information and notes to the financial statements disclosures which would normally be included in financial statements

prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP), have been

condensed or omitted from the unaudited financial statements pursuant to the rules and regulations of the Securities and Exchange

Commission. Accordingly, these financial statements should be read in conjunction with the audited Consolidated Financial

Statements of the Corporation for the year ended December 31, 2024, included in the 2024 Form 10-K. Operating results for the

interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and contingent

assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the

reporting period. Actual results could differ from those estimates.

Note 3 - New accounting pronouncements

Recently Adopted Accounting Standards Updates

Standard

Description

Date of adoption

Effect on the financial statements

FASB ASU 2025-02,

Liabilities (Topic 405) -

Amendments to SEC

Paragraphs Pursuant to

SEC Staff Accounting

Bulletin No. 122

The Financial Accounting Standards Board

("FASB") issued Accounting Standard

Update ("ASU") 2025-02 in March 2025,

which amends the guidance in Accounting

Standards Codification ("ASC") 450-10-

S99-1 by removing the interpretative

guidance of Section FF of Topic 5 in the

Staff Accounting Bulletin Series ("SAB") text

that addressed the accounting for

obligations to safeguard crypto-assets held

by platform users to align the ASC with the

latest SAB 112 directive, ensuring

consistency and clarity.

March 18, 2025

The Corporation was not impacted by

the adoption of this ASU since it does

not hold crypto-assets.

FASB ASU 2024-02,

Codification

Improvements—

Amendments to Remove

References to the

Concepts Statements

The FASB issued ASU 2024-02 in March

2024, which removes various references to

concept statements from the ASC. The ASU

intends to simplify the Codification and

distinguish between nonauthoritative and

authoritative guidance.

January 1, 2025

The Corporation was not impacted by

the adoption of this ASU since it did not

provide for accounting changes or new

presentation or disclosure

requirements. The ASU eliminated

references within the ASC to the

concept statements, which is

considered non-authoritative guidance.

FASB ASU 2024-01,

Compensation - Stock

Compensation (Topic 718)

- Scope Application of

Profits Interest and Similar

Awards

The FASB issued ASU 2024-01 in March

2024, which amends ASC Topic 718 by

including an illustrative example to

demonstrate how an entity would apply the

scope guidance in paragraph 718-10-15-3

to determine whether profits interest awards

should be accounted for in accordance with

ASC Topic 718. The ASU is intended to

reduce complexity and diversity in practice.

January 1, 2025

The Corporation was not impacted by

the adoption of this ASU since the

performance share awards of the

Corporation continue to meet the

requirements of ASC 718-10-15-3.

FASB ASU 2023-08,

Intangibles - Goodwill and

Other - Crypto Assets

(Subtopic 350-60) -

Accounting for and

Disclosure of Crypto

Assets

The FASB issued ASU 2023-08 in

December 2023, which amends ASC

Subtopic 350-60 by requiring that crypto

assets are measured at fair value in the

statement of financial position each

reporting period with changes from

remeasurement being recognized in net

income. The ASU also requires enhanced

disclosures for both annual and interim

reporting periods to provide investors with

relevant information to analyze and assess

the exposure and risk of significant

individual crypto asset holdings.

January 1, 2025

The Corporation was not impacted by

the adoption of this ASU since it does

not hold crypto-assets.

Recently Adopted Accounting Standards Updates

Standard

Description

Date of adoption

Effect on the financial statements

FASB ASU 2023-05,

Business Combinations -

Joint Venture Formations

(Subtopic 805-60) -

Recognition and initial

measurement

The FASB issued ASU 2023-05 in August

2023, which amends ASC Subtopic 805-60

to include specific guidance about how joint

ventures should recognize and initially

measure assets contributed and liabilities

assumed. The amendments require that a

joint venture, upon formation, recognize and

initially measure its assets and liabilities at

fair value.

January 1, 2025

The Corporation was not impacted by

the adoption of this ASU but it will

consider this guidance for the initial

measurement of assets and liabilities of

newly created joint ventures

prospectively.

Accounting Standards Updates Not Yet Adopted

Standard

Description

Date of adoption

Effect on the financial statements

FASB ASU 2025-05,

Financial Instruments -

Credit Losses (Topic 326)

- Measurement of Credit

Losses for Accounts

Receivables and Contract

Assets

The FASB issued ASU 2025-05 in July

2025, which permits entities to elect a

practical expedient when accounting for

current accounts receivable and current

contract assets arising from transactions

accounted for under Topic 606, Revenue

from Contracts with Customers. This

practical expedient establishes that, in

developing reasonable and supportable

forecasts as part of estimating expected

credit losses, entities assume that current

conditions as of the balance sheet date do

not change for the remaining life of the

asset.

January 1, 2026

The Corporation is currently evaluating

any impact that the adoption of this

guidance will have on its financial

statements and presentation and

disclosures.

FASB ASU 2025-04,

Compensation—Stock

Compensation (Topic 718)

and Revenue from

Contracts with Customers

(Topic 606) - Clarifications

to Share-Based

Consideration Payable to

a Customer

The FASB issued ASU 2025-04 in May

2025, which clarifies the accounting for

share-based awards granted as

consideration payable to a customer. The

ASU expands the definition of performance

condition for share-based consideration

under ASC 718 and eliminates the forfeiture

policy election for service conditions. It also

confirms that the variable consideration

constraint in ASC 606 does not apply to

such awards.

January 1, 2027

The Corporation does not expect to be

impacted by the adoption of this ASU

since it does not grant share-based

payment awards to customers.

FASB ASU 2025-03,

Business Combinations

(Topic 805) and

Consolidation (Topic 810)

- Determining the

Accounting Acquirer in the

Acquisition of a Variable

Interest Entity

The FASB issued ASU 2025-03 in May

2025 which requires that an entity consider

the factors in paragraphs 805-10-55-12

through 55-15 when it is involved in an

acquisition transaction effected primarily by

exchanging equity interests when the legal

acquiree is a variable interest entity ("VIE")

that meets the definition of a business to

determine which entity is the accounting

acquirer. This replaces the previous

requirement that the primary beneficiary

always is the acquirer.

January 1, 2027

The Corporation is currently evaluating

any impact that the adoption of this

guidance will have on its financial

statements and presentation and

disclosures.

FASB ASU 2024-04,

Debt—Debt with

Conversion and Other

Options (Subtopic 470-

20) - Induced Conversions

of Convertible Debt

Instruments

The FASB issued ASU 2024-04 in

November 2024, which clarifies the

requirements for determining whether

certain settlements of convertible debt

instruments should be accounted for as an

induced conversion. Also it makes

additional clarifications to assist

stakeholders in applying the guidance. The

ASU clarifies that the incorporation,

elimination, or modification of a volume-

weighted average price ("VWAP") formula

does not automatically cause a settlement

to be accounted for as an extinguishment

and that the induced conversion guidance

applies to a convertible debt instrument that

is not currently convertible as long as it had

a substantive conversion feature as of both

its issuance date and the date the

inducement offer is accepted.

January 1, 2026

The Corporation is currently evaluating

any impact that the adoption of this

guidance will have on its financial

statements and presentation and

disclosures.

Accounting Standards Updates Not Yet Adopted

Standard

Description

Date of adoption

Effect on the financial statements

FASB ASU 2024-03,

Income Statement—

Reporting Comprehensive

Income—Expense

Disaggregation

Disclosures (Subtopic

220-40) - Disaggregation

of Income Statement

Expenses (As updated by

ASU 2025-01)

The FASB issued ASU 2024-03 in

November 2024, which requires public

entities to disclose additional information

about specific expense categories in the

notes to financial statements at interim and

annual reporting periods to improve

financial transparency.

For fiscal years

beginning on

January 1, 2027

For interim periods

within fiscal years

beginning after

January 1, 2028

The Corporation is currently evaluating

any impact that the adoption of this

guidance will have on its financial

statements and presentation and

disclosures.

FASB ASU 2023-09,

Income Tax (Topic 740) -

Improvements to Income

Tax Disclosures

The FASB issued ASU 2023-09 in

December 2023, which amends ASC Topic

740 by enhancing disclosures regarding

rate reconciliation and requiring the

disclosure of income taxes paid, income (or

loss) before income tax expense and

income tax expense disaggregated by

national, state and foreign level. Disclosures

that no longer were considered cost

beneficial or relevant were removed from

ASC Topic 740.

For fiscal years

beginning on

January 1, 2025

The Corporation will prospectively

adopt ASU 2023-09 for it's

Consolidated Financial Statements in

the 2025 Form 10-K. The adoption of

this standard will result in the inclusion

of certain new categories in the

effective income tax rate and income

tax expense tabular disclosures, as well

as the disclosure of income taxes paid,

within the income taxes note.

FASB ASU 2023-06,

Disclosure Improvements -

Codification Amendments

in Response to the SEC’s

Disclosure Update and

Simplification Initiative

The FASB issued ASU 2023-06 in October

2023 which modifies the disclosure or

presentation requirements of various

subtopics in the Codification with the

purpose of aligning U.S. GAAP

requirements with those of the SEC under

Regulation S-X and S-K.

The date on which

the SEC removes

related disclosure

requirements from

Regulation S-X or

Regulation S-K. If by

June 30, 2027, the

SEC has not

removed the

applicable

requirements from

Regulation S-X or

Regulation S-K, the

pending content of

the related

amendment will be

removed from the

Codification and will

not become

effective for any

entity.

The Corporation does not expect to be

impacted by the adoption of this ASU

since it is subject to SEC's current

disclosure and presentation

requirements under Regulation S-X and

S-K.

Note 4 - Restrictions on cash and due from banks and certain securities

BPPR is required by regulatory agencies to maintain average reserve balances with the Federal Reserve Bank of New York (the

“Fed”) or other banks. Required average reserve balances in BPPR amounted to $

2.7

billion at June 30, 2025 (December 31, 2024 -

2.6

billion). Cash and due from banks, as well as other highly liquid securities, are used to cover these required average reserve

balances.

At June 30, 2025, the Corporation held $

60

million in restricted assets in the form of funds deposited in money market accounts,

debt securities available for sale and equity securities (December 31, 2024 - $

61

million). The restricted assets held in debt

securities available for sale and equity securities consist primarily of assets held for the Corporation’s non-qualified retirement plans

and fund deposits guaranteeing possible liens or encumbrances over the title of insured properties.

Note 5 – Debt securities available-for-sale

The following tables present the amortized cost, gross unrealized gains and losses, fair value, weighted average yield and

contractual maturities of debt securities available-for-sale at June 30, 2025 and December 31, 2024.

At June 30, 2025

Gross

Gross

Weighted

Amortized

unrealized

unrealized

Fair

average

(In thousands)

cost

gains

losses

value

yield

U.S. Treasury securities

Within 1 year

11,617,164

81

23,332

11,593,913

3.66

After 1 to 5 years

3,823,444

20,739

25,300

3,818,883

3.80

Total U.S. Treasury securities

15,440,608

20,820

48,632

15,412,796

3.69

Collateralized mortgage obligations - federal agencies

After 1 to 5 years

7,520

199

7,321

1.52

After 5 to 10 years

13,024

626

12,398

2.52

After 10 years

97,807

99

7,193

90,713

2.90

Total collateralized mortgage obligations - federal agencies

118,351

99

8,018

110,432

2.77

Mortgage-backed securities - federal agencies

Within 1 year

15,394

1

149

15,246

2.54

After 1 to 5 years

83,070

7

2,438

80,639

2.28

After 5 to 10 years

696,835

290

31,836

665,289

2.38

After 10 years

5,174,509

710

970,159

4,205,060

1.67

Total mortgage-backed securities - federal agencies

5,969,808

1,008

1,004,582

4,966,234

1.77

Other

Within 1 year

500

500

4.38

After 1 to 5 years

250

250

4.84

Total other

750

750

4.53

Total debt securities available-for-sale

[1]

21,529,517

21,927

1,061,232

20,490,212

3.15

[1]

Includes $

15.5

billion pledged to secure government and trust deposits, assets sold under agreements to repurchase, credit facilities and loan

servicing agreements that the secured parties are not permitted to sell or repledge the collateral, of which $

14.3

billion serve as collateral for

public funds. The Corporation had unpledged Available for Sale securities with a fair value of $

5

.0 billion that could be used to increase its

borrowing facilities.

At December 31, 2024

Gross

Gross

Weighted

Amortized

unrealized

unrealized

Fair

average

(In thousands)

cost

gains

losses

value

yield

U.S. Treasury securities

Within 1 year

10,555,397

1,282

46,275

10,510,404

3.33

After 1 to 5 years

2,547,936

151

63,381

2,484,706

3.07

Total U.S. Treasury securities

13,103,333

1,433

109,656

12,995,110

3.28

Collateralized mortgage obligations - federal agencies

After 1 to 5 years

10,538

345

10,193

1.53

After 5 to 10 years

15,334

904

14,430

2.24

After 10 years

104,168

132

8,639

95,661

2.76

Total collateralized mortgage obligations - federal agencies

130,040

132

9,888

120,284

2.60

Mortgage-backed securities - federal agencies

Within 1 year

776

5

771

1.65

After 1 to 5 years

79,542

8

2,700

76,850

2.35

After 5 to 10 years

733,506

82

45,078

688,510

2.37

After 10 years

5,468,448

337

1,106,657

4,362,128

1.67

Total mortgage-backed securities - federal agencies

6,282,272

427

1,154,440

5,128,259

1.75

Other

Within 1 year

500

500

5.00

After 1 to 5 years

1,750

1,750

5.50

Total other

2,250

2,250

5.39

Total debt securities available-for-sale

[1]

19,517,895

1,992

1,273,984

18,245,903

2.78

[1]

Includes $

13.9

billion pledged to secure government and trust deposits, assets sold under agreements to repurchase, credit facilities and loan

servicing agreements that the secured parties are not permitted to sell or repledge the collateral, of which $

12.9

billion serve as collateral for

public funds. The Corporation had unpledged Available for Sale securities with a fair value of $

4.3

billion that could be used to increase its

borrowing facilities.

The weighted average yield on debt securities available-for-sale is based on amortized cost; therefore, it does not give effect to

changes in fair value.

Securities not due on a single contractual maturity date, such as mortgage-backed securities and collateralized mortgage

obligations, are classified based on the period of final contractual maturity. The expected maturities of collateralized mortgage

obligations, mortgage-backed securities and certain other securities may differ from their contractual maturities because they may

be subject to prepayments or may be called by the issuer.

At June 30, 2025, the Corporation did not intend to sell or believed it was more likely than not that it would be required to sell debt

securities classified as available-for-sale. There were

no

debt securities classified as available-for-sale sold during the six months

ended June 30, 2025 and 2024.

The following tables present the Corporation’s fair value and gross unrealized losses of debt securities available-for-sale,

aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at

June 30, 2025 and December 31, 2024.

At June 30, 2025

Less than 12 months

12 months or more

Total

Gross

Gross

Gross

Fair

unrealized

Fair

unrealized

Fair

unrealized

(In thousands)

value

losses

value

losses

value

losses

U.S. Treasury securities

8,477,646

11,934

2,097,347

36,698

10,574,993

48,632

Collateralized mortgage obligations - federal agencies

6,592

21

92,871

7,997

99,463

8,018

Mortgage-backed securities -federal agencies

50,680

2,594

4,863,122

1,001,988

4,913,802

1,004,582

Total debt securities available-for-sale in an unrealized loss position

8,534,918

14,549

7,053,340

1,046,683

15,588,258

1,061,232

At December 31, 2024

Less than 12 months

12 months or more

Total

Gross

Gross

Gross

Fair

unrealized

Fair

unrealized

Fair

unrealized

(In thousands)

value

losses

value

losses

value

losses

U.S. Treasury securities

2,309,894

24,646

3,638,092

85,010

5,947,986

109,656

Collateralized mortgage obligations - federal agencies

4,878

27

102,160

9,861

107,038

9,888

Mortgage-backed securities - federal agencies

70,777

3,175

5,031,414

1,151,265

5,102,191

1,154,440

Total debt securities available-for-sale in an unrealized loss position

2,385,549

27,848

8,771,666

1,246,136

11,157,215

1,273,984

As of June 30, 2025, the portfolio of available-for-sale debt securities reflects gross unrealized losses of $

1.1

billion (December 31,

2024 - $

1.3

billion), driven mainly by mortgage-backed securities, which have been impacted by the-interest rate environment and

the portfolio’s longer duration. The portfolio of available-for-sale debt securities is comprised mainly of U.S Treasuries and

obligations from the U.S. Government, its agencies or government sponsored entities, including Federal National Mortgage

Association (“FNMA”), Federal Home Loan Mortgage Corporation (“FHLMC”) and Government National Mortgage Association

(“GNMA”). These securities carry an explicit or implicit guarantee from the U.S. Government, are highly rated by major rating

agencies, and have a long history of no credit losses. Accordingly, the Corporation applies a zero-credit loss assumption.

Note 6 –Debt securities held-to-maturity

The following tables present the amortized cost, allowance for credit losses, gross unrealized gains and losses, approximate fair

value, weighted average yield and contractual maturities of debt securities held-to-maturity at June 30, 2025 and December 31,

At June 30, 2025

Allowance

Carrying

Value

Gross

Gross

Weighted

Amortized

Book

[1]

for Credit

Net of

unrealized

unrealized

Fair

average

(In thousands)

cost

Value

Losses

Allowance

gains

losses

value

yield

U.S. Treasury securities

Within 1 year

1,504,543

1,481,291

1,481,291

2,667

1,478,624

1.86

After 1 to 5 years

6,362,489

5,998,366

5,998,366

22,074

6,020,440

1.22

Total U.S. Treasury securities

7,867,032

7,479,657

7,479,657

22,074

2,667

7,499,064

1.34

Obligations of Puerto Rico, States and

political subdivisions

Within 1 year

2,540

2,540

7

2,533

6

2,539

6.41

After 1 to 5 years

14,777

14,777

60

14,717

31

98

14,650

3.40

After 5 to 10 years

655

655

21

634

21

655

5.81

After 10 years

36,625

36,625

5,911

30,714

2,740

2,117

31,337

1.42

Total obligations of Puerto Rico, States and

political subdivisions

54,597

54,597

5,999

48,598

2,798

2,215

49,181

2.24

Collateralized mortgage obligations - federal

agencies

After 10 years

1,510

1,510

1,510

198

1,312

2.87

Total collateralized mortgage obligations -

federal agencies

1,510

1,510

1,510

198

1,312

2.87

Securities in wholly owned statutory business

trusts

After 5 to 10 years

5,960

5,960

5,960

5,960

6.33

Total securities in wholly owned statutory

business trusts

5,960

5,960

5,960

5,960

6.33

Total debt securities held-to-maturity [2]

7,929,099

7,541,724

5,999

7,535,725

24,872

5,080

7,555,517

1.35

[1]

Book value includes $

387

million of unrealized loss which remains in Accumulated other comprehensive (loss) income (AOCI) related to certain

securities previously transferred from available-for-sale securities portfolio to the held-to-maturity securities portfolio.

[2]

Includes $

7.4

billion pledged to secure public and trust deposits that the secured parties are not permitted to sell or repledge the collateral. The

Corporation had unpledged held-to-maturities securities with a fair value of $

138.6

million that could be used to increase its borrowing facilities.

At December 31, 2024

Allowance

Carrying

Value

Gross

Gross

Weighted

Amortized

Book

[1]

for Credit

Net of

unrealized

unrealized

Fair

average

(In thousands)

cost

Value

Losses

Allowance

gains

losses

value

yield

U.S. Treasury securities

Within 1 year

599,910

599,910

599,910

4,498

595,412

2.76

After 1 to 5 years

7,572,435

7,093,508

7,093,508

65,096

7,028,412

1.28

Total U.S. Treasury securities

8,172,345

7,693,418

7,693,418

69,594

7,623,824

1.39

Obligations of Puerto Rico, States and

political subdivisions

Within 1 year

2,440

2,440

5

2,435

3

2,438

6.39

After 1 to 5 years

16,454

16,454

80

16,374

47

80

16,341

3.69

After 5 to 10 years

655

655

22

633

20

653

5.81

After 10 years

37,633

37,633

5,210

32,423

2,318

2,596

32,145

1.42

Total obligations of Puerto Rico, States and

political subdivisions

57,182

57,182

5,317

51,865

2,388

2,676

51,577

2.34

Collateralized mortgage obligations - federal

agencies

After 10 years

1,518

1,518

1,518

214

1,304

2.87

Total collateralized mortgage obligations -

federal agencies

1,518

1,518

1,518

214

1,304

2.87

Securities in wholly owned statutory business

trusts

After 5 to 10 years

5,959

5,959

5,959

5,959

6.33

Total securities in wholly owned statutory

business trusts

5,959

5,959

5,959

5,959

6.33

Total debt securities held-to-maturity [2]

8,237,004

7,758,077

5,317

7,752,760

2,388

72,484

7,682,664

1.40

[1]

Book value includes $

479

million of unrealized loss which remains in Accumulated other comprehensive (loss) income (AOCI) related to certain

securities transferred from available-for-sale securities portfolio to the held-to-maturity securities portfolio.

[2]

Includes $

7.6

billion pledged to secure public and trust deposits that the secured parties are not permitted to sell or repledge the collateral. The

Corporation had unpledged held-to-maturities securities with a fair value of $

139.9

million that could be used to increase its borrowing facilities.

Debt securities not due on a single contractual maturity date, such as collateralized mortgage obligations, are classified in the period

of final contractual maturity. The expected maturities of collateralized mortgage obligations and certain other securities may differ

from their contractual maturities because they may be subject to prepayments or may be called by the issuer.

Credit Quality Indicators

The following describes the credit quality indicators by major security type that the Corporation considers to develop the estimate of

the allowance for credit losses for investment securities held-to-maturity.

As discussed in Note 2 of the 2024 Form 10-K, U.S. Treasury securities carry an explicit guarantee from the U.S. Government are

highly rated by major rating agencies and have a long history of no credit losses. Accordingly, the Corporation applies a zero-credit

loss assumption and no allowance for credit losses (“ACL”) for these securities has been established.

At June 30, 2025 and December 31, 2024, the “Obligations of Puerto Rico, States and political subdivisions” classified as held-to-

maturity, includes securities issued by municipalities of Puerto Rico that are generally not rated by a credit rating agency. The

Corporation performs periodic credit quality reviews of these securities and internally assigns standardized credit risk ratings based

on its evaluation. For the definitions of the obligor risk ratings, refer to the Credit Quality section of Note 8 to the Consolidated

Financial Statements. This includes $

11

million of general and special obligation bonds issued by three municipalities of Puerto

Rico, of which $

9.5

million have a “Pass” rating, that are payable primarily from certain property taxes imposed by the issuing

municipality (compared to $

13

million and $

11.1

million, respectively, at December 31, 2024).

At June 30, 2025, the portfolio of “Obligations of Puerto Rico, States and political subdivisions” also includes $

37

million in securities

issued by the Puerto Rico Housing Finance Authority (“HFA”), a government instrumentality, for which the underlying source of

payment is second mortgage loans in Puerto Rico residential properties (not the government), but for which HFA, provides a

guarantee in the event of default and upon the satisfaction of certain other conditions (December 31, 2024 - $

38

million). These

securities are not rated by a credit rating agency.

The Corporation assesses the credit risk associated with these securities by evaluating the refreshed FICO scores of a

representative sample of the underlying borrowers. As of June 30, 2025, the average refreshed FICO score for the sample,

comprised of

74

% of the nominal value of the securities, used for the loss estimate was of

676

(compared to

72

% and

674

respectively, at December 31, 2024). The loss estimates for this portfolio was based on the methodology established under CECL

for similar loan obligations. The Corporation does not consider the government guarantee when estimating the credit losses

associated with this portfolio.

A

deterioration of the Puerto Rico economy or of the fiscal health of the Government of Puerto Rico and/or its instrumentalities

(including if any of the issuing municipalities become subject to a debt restructuring proceeding under the Puerto Rico Oversight

Management and Economic Stability Act (“PROMESA”) could adversely affect the value of these securities, resulting in losses to the

Corporation.

Refer to Note 20

to the Consolidated Financial Statements

for additional information on the Corporation’s exposure to the Puerto

Rico Government.

Delinquency status

At June 30, 2025 and December 31, 2024, there were

no

securities held-to-maturity in past due or non-performing status.

Allowance for credit losses on debt securities held-to-maturity

The allowance for credit losses related to the Obligations of Puerto Rico and the States and Political subdivisions securities at June

30, 2025 was $

6.0

million (December 31, 2024 - $

5.3

million).

Note 7 – Loans

For a summary of the accounting policies related to loans, interest recognition and allowance for credit losses refer to Note 2 –

Summary of Significant Accounting Policies of the 2024 Form 10-K.

The following table presents the Corporation's loan purchases for the quarters and six months ended June 30, 2025 and 2024 by

class of loans:

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Commercial

67,726

159,258

74,886

215,422

Mortgage

125,690

84,849

246,597

170,653

Ending balance

193,416

244,107

321,483

386,075

The following table presents the Corporation’s loan sales for the quarters and six months ended June 30, 2025 and 2024 by class of

loans:

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Commercial

1,000

27,349

Construction

9,338

11,656

Mortgage

8,450

12,752

15,387

23,756

Ending balance

9,450

12,752

52,074

35,412

During the quarter ended June 30, 2025, the Corporation securitized $

3

million of mortgage loans into FNMA mortgage-backed

securities, compared to $

3

million during the quarter ended June 30, 2024. The Corporation securitized $

3

million of mortgage loans

into GNMA mortgage-backed securities during the quarter ended June 30, 2025. There were

no

GNMA securitizations during the

quarter ended June 30, 2024.

During the six months ended June 30, 2025, the Corporation securitized $

4

million of mortgage loans into FNMA mortgage-backed

securities, compared to $

4

million during the six months ended June 30, 2024. The Corporation securitized $

3

million of mortgage

loans into GNMA mortgage-backed securities during the six months ended June 30, 2025, compared to $

1

million during the six

months ended June 30, 2024.

Delinquency status

The following tables present the amortized cost basis of loans held-in-portfolio (“HIP”), net of unearned income, by past due status,

and by loan class including those that are in non-performing status or that are accruing interest but are past due 90 days or more at

June 30, 2025 and December 31, 2024.

June 30, 2025

BPPR

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

loans

loans

Commercial multi-family

6,337

174

6,511

299,852

306,363

174

Commercial real estate:

Non-owner occupied

113

1,679

6,084

7,876

3,322,108

3,329,984

6,084

Owner occupied

1,087

2,098

27,320

30,505

1,171,601

1,202,106

27,320

Commercial and industrial

4,657

2,449

12,652

19,758

5,574,966

5,594,724

8,588

4,064

Construction

3,720

3,720

249,579

253,299

Mortgage

262,525

109,530

324,140

696,195

6,407,811

7,104,006

147,464

176,676

Leasing

23,109

5,629

7,976

36,714

1,946,354

1,983,068

7,976

Consumer:

Credit cards

14,184

9,360

25,201

48,745

1,166,545

1,215,290

25,201

Home equity lines of credit

1,809

1,809

Personal

19,022

11,917

17,499

48,438

1,743,772

1,792,210

17,499

Auto

102,643

22,404

40,595

165,642

3,696,060

3,861,702

40,595

Other

2,500

160

2,212

4,872

155,550

160,422

1,948

264

Total

439,897

165,226

463,853

1,068,976

25,736,007

26,804,983

257,648

206,205

June 30, 2025

Popular U.S.

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

loans

loans

Commercial multi-family

4,675

10,751

15,426

2,199,000

2,214,426

10,751

Commercial real estate:

Non-owner occupied

1,503

7,893

9,396

2,181,994

2,191,390

7,893

Owner occupied

10,677

231

10,908

1,790,841

1,801,749

231

Commercial and industrial

9,235

5,195

3,025

17,455

2,431,573

2,449,028

2,836

189

Construction

1,214,902

1,214,902

Mortgage

677

3,329

28,052

32,058

1,308,363

1,340,421

28,052

Consumer:

Credit cards

3

3

Home equity lines of

credit

845

717

3,120

4,682

70,988

75,670

3,120

Personal

1,045

532

1,094

2,671

81,582

84,253

1,094

Other

694

1

695

7,658

8,353

Total

24,676

14,449

54,166

93,291

11,286,904

11,380,195

53,977

June 30, 2025

Popular, Inc.

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

[2] [3]

loans

loans

Commercial multi-family

6,337

4,675

10,925

21,937

2,498,852

2,520,789

10,925

Commercial real estate:

Non-owner occupied

1,616

1,679

13,977

17,272

5,504,102

5,521,374

13,977

Owner occupied

11,764

2,098

27,551

41,413

2,962,442

3,003,855

27,551

Commercial and industrial

13,892

7,644

15,677

37,213

8,006,539

8,043,752

11,424

4,253

Construction

3,720

3,720

1,464,481

1,468,201

Mortgage

[1]

263,202

112,859

352,192

728,253

7,716,174

8,444,427

175,516

176,676

Leasing

23,109

5,629

7,976

36,714

1,946,354

1,983,068

7,976

Consumer:

Credit cards

14,184

9,360

25,201

48,745

1,166,548

1,215,293

25,201

Home equity lines of credit

845

717

3,120

4,682

72,797

77,479

3,120

Personal

20,067

12,449

18,593

51,109

1,825,354

1,876,463

18,593

Auto

102,643

22,404

40,595

165,642

3,696,060

3,861,702

40,595

Other

3,194

161

2,212

5,567

163,208

168,775

1,948

264

Total

464,573

179,675

518,019

1,162,267

37,022,911

38,185,178

311,625

206,394

[1]

At June 30, 2025, mortgage loans held-in-portfolio include $

2.9

billion of loans that carry certain guarantees from the FHA or the VA, for which the

Corporation’s policy is to exclude them from non-performing status, of which $

177

million are 90 days or more past due. The portfolio of

guaranteed loans includes $

52

million of residential mortgage loans in Puerto Rico that are no longer accruing interest as of June 30, 2025. The

Corporation has $

29

million in reverse mortgage loans in Puerto Rico which are guaranteed by FHA, but which are currently not accruing interest

at June 30, 2025.

[2]

Loans held-in-portfolio are net of $

427

million in unearned income and exclude $

3

million in loans held-for-sale.

[3]

Includes $

21.4

billion pledged to secure credit facilities and public funds that the secured parties are not permitted to sell or repledge the collateral,

of which $

7.5

billion were pledged at the Federal Home Loan Bank ("FHLB") as collateral for borrowings and $

13.9

billion at the Federal Reserve

Bank ("FRB") for discount window borrowings. As of June 30, 2025, the Corporation had an available borrowing facility with the FHLB and the

discount window of FRB of $

4

.0 billion and $

10.8

billion, respectively.

December 31, 2024

BPPR

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

loans

loans

Commercial multi-family

1,491

113

79

1,683

306,318

308,001

79

Commercial real estate:

Non-owner occupied

3,103

586

6,429

10,118

3,236,385

3,246,503

6,429

Owner occupied

11,054

808

25,258

37,120

1,338,791

1,375,911

25,258

Commercial and industrial

5,738

2,712

23,895

32,345

5,314,549

5,346,894

19,335

4,560

Construction

1,039

1,039

211,251

212,290

Mortgage

262,222

116,694

365,759

744,675

6,065,206

6,809,881

158,442

207,317

Leasing

23,991

6,062

9,588

39,641

1,885,764

1,925,405

9,588

Consumer:

Credit cards

17,399

11,719

29,960

59,078

1,158,975

1,218,053

29,960

Home equity lines of credit

16

129

145

1,895

2,040

Personal

19,503

13,005

20,269

52,777

1,697,600

1,750,377

20,269

Auto

111,358

27,858

51,792

191,008

3,632,429

3,823,437

51,792

Other

1,816

277

1,312

3,405

156,824

160,229

899

413

Total

458,730

179,963

534,341

1,173,034

25,005,987

26,179,021

292,091

242,250

December 31, 2024

Popular U.S.

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

loans

loans

Commercial multi-family

5,443

8,700

14,143

2,077,476

2,091,619

8,700

Commercial real estate:

Non-owner occupied

6,792

8,015

14,807

2,101,925

2,116,732

8,015

Owner occupied

5,191

5,191

1,776,644

1,781,835

5,191

Commercial and industrial

10,336

5,323

1,938

17,597

2,377,071

2,394,668

1,748

190

Construction

1,051,502

1,051,502

Mortgage

18,148

5,417

29,890

53,455

1,250,847

1,304,302

29,890

Consumer:

Credit cards

26

26

Home equity lines of credit

530

986

3,393

4,909

66,622

71,531

3,393

Personal

1,808

1,509

1,741

5,058

99,809

104,867

1,741

Other

514

11

525

11,024

11,549

11

Total

38,128

18,678

58,879

115,685

10,812,946

10,928,631

58,689

December 31, 2024

Popular, Inc.

Past due

Past due 90 days or more

30-59

60-89

90 days

Total

Non-accrual

Accruing

(In thousands)

days

days

or more

past due

Current

Loans HIP

[2]

[3]

loans

loans

Commercial multi-family

1,491

5,556

8,779

15,826

2,383,794

2,399,620

8,779

Commercial real estate:

Non-owner occupied

9,895

586

14,444

24,925

5,338,310

5,363,235

14,444

Owner occupied

11,054

808

30,449

42,311

3,115,435

3,157,746

30,449

Commercial and industrial

16,074

8,035

25,833

49,942

7,691,620

7,741,562

21,083

4,750

Construction

1,039

1,039

1,262,753

1,263,792

Mortgage

[1]

280,370

122,111

395,649

798,130

7,316,053

8,114,183

188,332

207,317

Leasing

23,991

6,062

9,588

39,641

1,885,764

1,925,405

9,588

Consumer:

Credit cards

17,399

11,719

29,960

59,078

1,159,001

1,218,079

29,960

Home equity lines of credit

546

1,115

3,393

5,054

68,517

73,571

3,393

Personal

21,311

14,514

22,010

57,835

1,797,409

1,855,244

22,010

Auto

111,358

27,858

51,792

191,008

3,632,429

3,823,437

51,792

Other

2,330

277

1,323

3,930

167,848

171,778

910

413

Total

496,858

198,641

593,220

1,288,719

35,818,933

37,107,652

350,780

242,440

[1]

At December 31, 2024 mortgage loans held-in-portfolio include $

2.6

billion of loans that carry certain guarantees from the FHA or the VA, for

which the Corporation’s policy is to exclude them from non-performing status, of which $

207

million are 90 days or more past due. The portfolio of

guaranteed loans includes $

65

million of residential mortgage loans in Puerto Rico that are no longer accruing interest as of December 31, 2024.

The Corporation has $

31

million in reverse mortgage loans in Puerto Rico which are guaranteed by FHA, but which are currently not accruing

interest at December 31, 2024.

[2]

Loans held-in-portfolio are net of $

415

million in unearned income and exclude $

5

million in loans held-for-sale.

[3]

Includes $

16.8

billion pledged to secure credit facilities and public funds that the secured parties are not permitted to sell or repledge the collateral,

of which $

7.3

billion were pledged at the FHLB as collateral for borrowings and $

9.5

billion at the FRB for discount window borrowings. As of

December 31, 2024, the Corporation had an available borrowing facility with the FHLB and the discount window of FRB of $

3.8

billion and $

7

.0

billion, respectively.

Recognition of interest income on mortgage loans is generally discontinued when loans are 90 days or more in arrears on payments

of principal or interest. The Corporation discontinues the recognition of interest income on residential mortgage loans insured by the

FHA or guaranteed by the VA when 15 months delinquent as to principal or interest, since the principal repayment on these loans is

insured.

Loans with a delinquency status of 90 days past due as of June 30, 2025 include $

8

million in loans previously pooled into GNMA

securities (December 31, 2024 - $

9

million). Under the GNMA program, issuers such as BPPR have the option but not the obligation

to repurchase loans that are 90 days or more past due. For accounting purposes, these loans subject to the repurchase option are

required to be reflected on the financial statements of BPPR with an offsetting liability. Loans in our serviced GNMA portfolio benefit

from payment forbearance programs but continue to reflect the contractual delinquency until the borrower repays deferred payments

or completes a payment deferral modification or other borrower assistance alternative.

The following tables present the amortized cost basis of non-accrual loans as of June 30, 2025 and December 31, 2024 by class of

loans:

June 30, 2025

BPPR

Popular U.S.

Popular, Inc.

(In thousands)

Non-accrual

with no

allowance

Non-accrual

with

allowance

Non-accrual

with no

allowance

Non-accrual

with

allowance

Non-accrual

with no

allowance

Non-accrual

with

allowance

Commercial multi-family

174

10,751

10,751

174

Commercial real estate non-owner occupied

3,168

2,916

7,016

877

10,184

3,793

Commercial real estate owner occupied

17,795

9,525

231

17,795

9,756

Commercial and industrial

8,588

2,836

11,424

Mortgage

63,464

84,000

905

27,147

64,369

111,147

Leasing

479

7,497

479

7,497

Consumer:

HELOCs

3,120

3,120

Personal

3,460

14,039

1,094

3,460

15,133

Auto

1,973

38,622

1,973

38,622

Other

1,948

1,948

Total

90,339

167,309

18,672

35,305

109,011

202,614

December 31, 2024

BPPR

Popular U.S.

Popular, Inc.

(In thousands)

Non-accrual

with no

allowance

Non-accrual

with

allowance

Non-accrual

with no

allowance

Non-accrual

with

allowance

Non-accrual

with no

allowance

Non-accrual

with

allowance

Commercial multi-family

79

8,700

8,700

79

Commercial real estate non-owner occupied

3,450

2,979

7,115

900

10,565

3,879

Commercial real estate owner occupied

17,767

7,491

4,957

234

22,724

7,725

Commercial and industrial

9,020

10,315

1,748

9,020

12,063

Mortgage

66,176

92,266

1,069

28,821

67,245

121,087

Leasing

500

9,088

500

9,088

Consumer:

HELOCs

3,393

3,393

Personal

2,960

17,309

1,741

2,960

19,050

Auto

1,992

49,800

1,992

49,800

Other

899

11

910

Total

101,865

190,226

21,841

36,848

123,706

227,074

The Corporation has designated loans classified as collateral dependent for which the ACL is measured based on the fair value of

the collateral less cost to sell, when foreclosure is probable or when the repayment is expected to be provided substantially by the

sale or operation of the collateral and the borrower is experiencing financial difficulty. The fair value of the collateral is based on

appraisals, which may be adjusted due to their age, type, location, and condition of the property or area or general market

conditions to reflect the expected change in value between the effective date of the appraisal and the measurement date. Appraisals

are updated every one to two years depending on the type of loan and the total exposure of the borrower.

Loans in non-accrual status with no allowance at June 30, 2025 include $

109

million in collateral dependent loans (December 31,

2024 - $

124

million). The Corporation recognized $

3

million in interest income on non-accrual loans during the six months ended

June 30, 2025 (June 30, 2024 - $

2

million).

The following tables present the amortized cost basis of collateral-dependent loans, for which the ACL was measured based on the

fair value of the collateral less cost to sell, by class of loans and type of collateral as of June 30, 2025 and December 31, 2024:

June 30, 2025

(In thousands)

Real Estate

Auto

Equipment

Accounts

Receivables

Other

Total

BPPR

Commercial multi-family

1,250

1,250

Commercial real estate:

Non-owner occupied

143,152

143,152

Owner occupied

24,596

24,596

Commercial and industrial

2,436

124

2,248

4,808

Mortgage

71,234

71,234

Leasing

1,393

1,393

Consumer:

Personal

3,572

3,572

Auto

16,545

16,545

Other

12

12

Total BPPR

246,240

17,950

124

2,248

266,562

Popular U.S.

Commercial multi-family

16,542

16,542

Commercial real estate:

Non-owner occupied

65,668

65,668

Commercial and industrial

13

13

Mortgage

1,408

1,408

Total Popular U.S.

83,618

13

83,631

Popular, Inc.

Commercial multi-family

17,792

17,792

Commercial real estate:

Non-owner occupied

208,820

208,820

Owner occupied

24,596

24,596

Commercial and industrial

2,436

13

124

2,248

4,821

Mortgage

72,642

72,642

Leasing

1,393

1,393

Consumer:

Personal

3,572

3,572

Auto

16,545

16,545

Other

12

12

Total Popular, Inc.

329,858

17,950

13

124

2,248

350,193

December 31, 2024

(In thousands)

Real Estate

Auto

Equipment

Other

Total

BPPR

Commercial multi-family

1,278

1,278

Commercial real estate:

Non-owner occupied

145,974

145,974

Owner occupied

23,361

23,361

Commercial and industrial

2,754

11,593

14,347

Construction

576

576

Mortgage

77,910

77,910

Leasing

1,437

1

1,438

Consumer:

Personal

3,347

3,347

Auto

15,782

15,782

Other

16

16

Total BPPR

255,200

17,219

1

11,609

284,029

Popular U.S.

Commercial multi-family

14,517

14,517

Commercial real estate:

Non-owner occupied

7,116

7,116

Owner occupied

4,956

4,956

Commercial and industrial

18

1,154

1,172

Mortgage

1,430

1,430

Total Popular U.S.

28,019

18

1,154

29,191

Popular, Inc.

Commercial multi-family

15,795

15,795

Commercial real estate:

Non-owner occupied

153,090

153,090

Owner occupied

28,317

28,317

Commercial and industrial

2,754

18

12,747

15,519

Construction

576

576

Mortgage

79,340

79,340

Leasing

1,437

1

1,438

Consumer:

Personal

3,347

3,347

Auto

15,782

15,782

Other

16

16

Total Popular, Inc.

283,219

17,219

19

12,763

313,220

Note 8 – Allowance for credit losses – loans held-in-portfolio

The

Corporation follows the current expected credit loss (“CECL”) model to establish and evaluate the adequacy of the ACL to

provide for expected losses in the loan portfolio. This model establishes a forward-looking methodology that reflects the expected

credit losses over the lives of financial assets starting when such assets are first acquired or originated. In addition, CECL provides

that the initial ACL on PCD financial assets be recorded as an increase to the purchase price, with subsequent changes to the

allowance recorded as a credit loss expense. The provision for credit losses recorded in current operations is based on this

methodology. Loan losses are charged and recoveries are credited to the ACL. The Corporation’s modeling framework includes

competing risk models that generate lifetime default and prepayment estimates as well as other loan level techniques to estimate

loss severity. These models combine credit risk factors which include the impact of loan modifications, with macroeconomic

expectations to derive the lifetime expected loss.

At June 30, 2025, the Corporation estimated the ACL by weighting the outputs of optimistic, baseline, and pessimistic scenarios.

The weightings applied are subject to evaluation on a quarterly basis as part of the ACL’s governance process. During the first

quarter of 2025, the Corporation assigned equal probability weights to the baseline and pessimistic scenarios in response to

economic uncertainty, the optimistic scenario being the lowest of probabilities. During the second quarter of 2025, the Corporation

moderately reduced the probability weight for the pessimistic scenario based on changes in the economic outlook and a

reassessment of uncertainty compared to the previous quarter. The net impact of these two changes in the assigned weights on the

ACL levels for the six months ended June 30, 2025 was $

13.7

million in additional reserves. The probability weight for the

pessimistic scenario remains above the levels observed in 2024, given the ongoing economic uncertainty.

The following tables present the changes in the ACL of loans held-in-portfolio and unfunded commitments for the quarters and six

months ended June 30, 2025 and 2024.

For the quarter ended June 30, 2025

BPPR

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

3,420

270

6

3,696

Commercial real estate non-owner occupied

42,848

(160)

(21)

472

43,139

Commercial real estate owner occupied

36,019

(1,176)

(14)

1,019

35,848

Commercial and industrial

131,407

(6,769)

(2,466)

1,030

123,202

Total Commercial

213,694

(7,835)

(2,501)

2,527

205,885

Construction

2,719

356

3,075

Mortgage

74,289

(1,752)

(550)

2,979

74,966

Leasing

20,206

2,570

(3,982)

1,246

20,040

Consumer

Credit cards

96,523

13,094

(20,011)

2,700

92,306

Home equity lines of credit

60

(313)

307

54

Personal

89,786

18,881

(19,553)

3,777

92,891

Auto

171,979

16,852

(13,418)

6,861

182,274

Other

7,007

1,297

(700)

154

7,758

Total Consumer

365,355

49,811

(53,682)

13,799

375,283

Total - Loans

676,263

43,150

(60,715)

20,551

679,249

Allowance for credit losses - unfunded commitments:

Commercial

7,445

(1,569)

5,876

Construction

1,560

309

1,869

Ending balance - unfunded commitments [1]

9,005

(1,260)

7,745

[1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the quarter ended June 30, 2025

Popular U.S.

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

10,081

3,567

(563)

13,085

Commercial real estate non-owner occupied

15,453

525

15,978

Commercial real estate owner occupied

14,193

(1,016)

(14)

40

13,203

Commercial and industrial

16,422

1,533

(49)

254

18,160

Total Commercial

56,149

4,609

(626)

294

60,426

Construction

6,793

711

7,504

Mortgage

9,740

437

32

10,209

Consumer

Home equity lines of credit

1,550

(799)

(16)

595

1,330

Personal

11,651

1,417

(2,920)

615

10,763

Other

2

14

(13)

1

4

Total Consumer

13,203

632

(2,949)

1,211

12,097

Total - Loans

85,885

6,389

(3,575)

1,537

90,236

Allowance for credit losses - unfunded commitments:

Commercial

1,630

305

1,935

Construction

3,492

(203)

3,289

Consumer

42

42

84

Ending balance - unfunded commitments [1]

5,164

144

5,308

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the quarter ended June 30, 2025

Popular Inc.

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

13,501

3,837

(563)

6

16,781

Commercial real estate non-owner occupied

58,301

365

(21)

472

59,117

Commercial real estate owner occupied

50,212

(2,192)

(28)

1,059

49,051

Commercial and industrial

147,829

(5,236)

(2,515)

1,284

141,362

Total Commercial

269,843

(3,226)

(3,127)

2,821

266,311

Construction

9,512

1,067

10,579

Mortgage

84,029

(1,315)

(550)

3,011

85,175

Leasing

20,206

2,570

(3,982)

1,246

20,040

Consumer

Credit cards

96,523

13,094

(20,011)

2,700

92,306

Home equity lines of credit

1,610

(1,112)

(16)

902

1,384

Personal

101,437

20,298

(22,473)

4,392

103,654

Auto

171,979

16,852

(13,418)

6,861

182,274

Other

7,009

1,311

(713)

155

7,762

Total Consumer

378,558

50,443

(56,631)

15,010

387,380

Total - Loans

762,148

49,539

(64,290)

22,088

769,485

Allowance for credit losses - unfunded commitments:

Commercial

9,075

(1,264)

7,811

Construction

5,052

106

5,158

Consumer

42

42

84

Ending balance - unfunded commitments [1]

14,169

(1,116)

13,053

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2025

BPPR

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

2,783

905

8

3,696

Commercial real estate non-owner occupied

44,852

(2,759)

(86)

1,132

43,139

Commercial real estate owner occupied

37,355

(2,918)

(103)

1,514

35,848

Commercial and industrial

130,136

(7,026)

(5,778)

5,870

123,202

Total Commercial

215,126

(11,798)

(5,967)

8,524

205,885

Construction

2,743

332

3,075

Mortgage

72,901

(2,870)

9

(985)

5,911

74,966

Leasing

16,419

9,629

(8,526)

2,518

20,040

Consumer

Credit cards

99,130

26,916

(38,876)

5,136

92,306

Home equity lines of credit

54

(421)

(25)

446

54

Personal

91,296

35,709

(41,506)

7,392

92,891

Auto

165,995

36,323

(34,474)

14,430

182,274

Other

7,002

2,020

(1,580)

316

7,758

Total Consumer

363,477

100,547

(116,461)

27,720

375,283

Total - Loans

670,666

95,840

9

(131,939)

44,673

679,249

Allowance for credit losses - unfunded commitments:

Commercial

6,725

(849)

5,876

Construction

1,663

206

1,869

Ending balance - unfunded commitments [1]

8,388

(643)

7,745

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2025

Popular U.S.

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

6,453

7,194

(563)

1

13,085

Commercial real estate non-owner occupied

9,642

6,336

15,978

Commercial real estate owner occupied

12,473

193

(26)

563

13,203

Commercial and industrial

15,870

3,010

(1,196)

476

18,160

Total Commercial

44,438

16,733

(1,785)

1,040

60,426

Construction

8,521

(1,017)

7,504

Mortgage

9,508

484

217

10,209

Consumer

Home equity lines of credit

1,449

(935)

(46)

862

1,330

Personal

11,440

3,617

(5,546)

1,252

10,763

Other

2

35

(42)

9

4

Total Consumer

12,891

2,717

(5,634)

2,123

12,097

Total - Loans

75,358

18,917

(7,419)

3,380

90,236

Allowance for credit losses - unfunded commitments:

Commercial

1,662

273

1,935

Construction

5,409

(2,120)

3,289

Consumer

11

73

84

Ending balance - unfunded commitments [1]

7,082

(1,774)

5,308

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2025

Popular Inc.

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

9,236

8,099

(563)

9

16,781

Commercial real estate non-owner occupied

54,494

3,577

(86)

1,132

59,117

Commercial real estate owner occupied

49,828

(2,725)

(129)

2,077

49,051

Commercial and industrial

146,006

(4,016)

(6,974)

6,346

141,362

Total Commercial

259,564

4,935

(7,752)

9,564

266,311

Construction

11,264

(685)

10,579

Mortgage

82,409

(2,386)

9

(985)

6,128

85,175

Leasing

16,419

9,629

(8,526)

2,518

20,040

Consumer

Credit cards

99,130

26,916

(38,876)

5,136

92,306

Home equity lines of credit

1,503

(1,356)

(71)

1,308

1,384

Personal

102,736

39,326

(47,052)

8,644

103,654

Auto

165,995

36,323

(34,474)

14,430

182,274

Other

7,004

2,055

(1,622)

325

7,762

Total Consumer

376,368

103,264

(122,095)

29,843

387,380

Total - Loans

746,024

114,757

9

(139,358)

48,053

769,485

Allowance for credit losses - unfunded commitments:

Commercial

8,387

(576)

7,811

Construction

7,072

(1,914)

5,158

Consumer

11

73

84

Ending balance - unfunded commitments [1]

15,470

(2,417)

13,053

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the quarter ended June 30, 2024

BPPR

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

3,567

(264)

3,303

Commercial real estate non-owner occupied

53,666

(324)

44

53,386

Commercial real estate owner occupied

43,537

(5,296)

1,134

39,375

Commercial and industrial

102,844

14,440

(8,072)

2,051

111,263

Total Commercial

203,614

8,556

(8,072)

3,229

207,327

Construction

3,114

524

3,638

Mortgage

76,564

(6,419)

6

(26)

3,775

73,900

Leasing

8,991

8,094

(3,841)

1,141

14,385

Consumer

Credit cards

88,169

11,856

(16,419)

2,707

86,313

Home equity lines of credit

102

22

(94)

53

83

Personal

99,504

15,492

(23,293)

2,318

94,021

Auto

157,456

10,250

(16,609)

6,352

157,449

Other

6,808

210

(680)

151

6,489

Total Consumer

352,039

37,830

(57,095)

11,581

344,355

Total - Loans

644,322

48,585

6

(69,034)

19,726

643,605

Allowance for credit losses - unfunded commitments:

Commercial

4,942

598

5,540

Construction

1,441

654

2,095

Ending balance - unfunded commitments [1]

6,383

1,252

7,635

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the quarter ended June 30, 2024

Popular U.S.

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

9,176

(1,303)

4

7,877

Commercial real estate non-owner occupied

11,958

(1,151)

42

10,849

Commercial real estate owner occupied

20,270

(1,514)

59

18,815

Commercial and industrial

17,574

(1,367)

(1,195)

207

15,219

Total Commercial

58,978

(5,335)

(1,195)

312

52,760

Construction

8,025

1,126

100

9,251

Mortgage

9,874

(502)

(18)

35

9,389

Consumer

Home equity lines of credit

1,770

(510)

(14)

397

1,643

Personal

16,573

795

(4,596)

655

13,427

Other

2

(2)

(18)

20

2

Total Consumer

18,345

283

(4,628)

1,072

15,072

Total - Loans

95,222

(4,428)

(5,841)

1,519

86,472

Allowance for credit losses - unfunded commitments:

Commercial

2,542

308

2,850

Construction

7,837

562

8,399

Consumer

5

(5)

Ending balance - unfunded commitments [1]

10,384

865

11,249

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the quarter ended June 30, 2024

Popular Inc.

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

12,743

(1,567)

4

11,180

Commercial real estate non-owner occupied

65,624

(1,475)

86

64,235

Commercial real estate owner occupied

63,807

(6,810)

1,193

58,190

Commercial and industrial

120,418

13,073

(9,267)

2,258

126,482

Total Commercial

262,592

3,221

(9,267)

3,541

260,087

Construction

11,139

1,650

100

12,889

Mortgage

86,438

(6,921)

6

(44)

3,810

83,289

Leasing

8,991

8,094

(3,841)

1,141

14,385

Consumer

Credit cards

88,169

11,856

(16,419)

2,707

86,313

Home equity lines of credit

1,872

(488)

(108)

450

1,726

Personal

116,077

16,287

(27,889)

2,973

107,448

Auto

157,456

10,250

(16,609)

6,352

157,449

Other

6,810

208

(698)

171

6,491

Total Consumer

370,384

38,113

(61,723)

12,653

359,427

Total - Loans

739,544

44,157

6

(74,875)

21,245

730,077

Allowance for credit losses - unfunded commitments:

Commercial

7,484

906

8,390

Construction

9,278

1,216

10,494

Consumer

5

(5)

Ending balance - unfunded commitments [1]

16,767

2,117

18,884

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2024

BPPR

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

3,614

(312)

1

3,303

Commercial real estate non-owner occupied

53,754

(737)

369

53,386

Commercial real estate owner occupied

40,637

(149)

(2,785)

1,672

39,375

Commercial and industrial

107,577

14,816

(14,741)

3,611

111,263

Total Commercial

205,582

13,618

(17,526)

5,653

207,327

Construction

5,294

(1,656)

3,638

Mortgage

72,440

(6,738)

23

(791)

8,966

73,900

Leasing

9,708

11,062

(8,691)

2,306

14,385

Consumer

Credit cards

80,487

33,496

(32,815)

5,145

86,313

Home equity lines of credit

103

125

(291)

146

83

Personal

101,181

35,755

(47,642)

4,727

94,021

Auto

157,931

23,621

(36,776)

12,673

157,449

Other

7,132

310

(1,344)

391

6,489

Total Consumer

346,834

93,307

(118,868)

23,082

344,355

Total - Loans

639,858

109,593

23

(145,876)

40,007

643,605

Allowance for credit losses - unfunded commitments:

Commercial

5,062

478

5,540

Construction

1,618

477

2,095

Ending balance - unfunded commitments [1]

6,680

955

7,635

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2024

Popular U.S.

Beginning

credit losses

Ending

(In thousands)

Balance

(benefit)

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

10,126

(1,813)

(441)

5

7,877

Commercial real estate non-owner occupied

11,699

(956)

106

10,849

Commercial real estate owner occupied

16,227

2,505

83

18,815

Commercial and industrial

14,779

1,836

(1,759)

363

15,219

Total Commercial

52,831

1,572

(2,200)

557

52,760

Construction

7,392

1,759

100

9,251

Mortgage

10,774

(1,427)

(18)

60

9,389

Consumer

Home equity lines of credit

1,875

(763)

(21)

552

1,643

Personal

16,609

5,786

(10,308)

1,340

13,427

Other

2

23

(49)

26

2

Total Consumer

18,486

5,046

(10,378)

1,918

15,072

Total - Loans

89,483

6,950

(12,596)

2,635

86,472

Allowance for credit losses - unfunded commitments:

Commercial

1,851

999

2,850

Construction

8,446

(47)

8,399

Consumer

29

(29)

Ending balance - unfunded commitments [1]

10,326

923

11,249

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition.

For the six months ended June 30, 2024

Popular Inc.

Allowance for

Beginning

credit losses

credit losses -

Ending

(In thousands)

Balance

(benefit)

PCD Loans

Charge-offs

Recoveries

Balance

Allowance for credit losses - loans:

Commercial

Commercial multi-family

13,740

(2,125)

(441)

6

11,180

Commercial real estate non-owner occupied

65,453

(1,693)

475

64,235

Commercial real estate owner occupied

56,864

2,356

(2,785)

1,755

58,190

Commercial and industrial

122,356

16,652

(16,500)

3,974

126,482

Total Commercial

258,413

15,190

(19,726)

6,210

260,087

Construction

12,686

103

100

12,889

Mortgage

83,214

(8,165)

23

(809)

9,026

83,289

Leasing

9,708

11,062

(8,691)

2,306

14,385

Consumer

Credit cards

80,487

33,496

(32,815)

5,145

86,313

Home equity lines of credit

1,978

(638)

(312)

698

1,726

Personal

117,790

41,541

(57,950)

6,067

107,448

Auto

157,931

23,621

(36,776)

12,673

157,449

Other

7,134

333

(1,393)

417

6,491

Total Consumer

365,320

98,353

(129,246)

25,000

359,427

Total - Loans

729,341

116,543

23

(158,472)

42,642

730,077

Allowance for credit losses - unfunded commitments:

Commercial

6,913

1,477

8,390

Construction

10,064

430

10,494

Consumer

29

(29)

Ending balance - unfunded commitments [1]

17,006

1,878

18,884

[1]

Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial

Condition.

Modifications

A modification constitutes a change in loan terms in the form of principal forgiveness, an interest rate reduction, other than-

insignificant payment delay, term extension or combination of the above made to a borrower experiencing financial difficulty.

The amount of outstanding commitments to lend additional funds to debtors with financial difficulties owing receivables whose terms

have been modified during the six months ended June 30, 2025 amounted to $

158

million (During the year ended December 31,

2024 - $

75

million), related to the commercial loan portfolios.

The following tables show the amortized cost basis of the loans modified to borrowers experiencing financial difficulties at the end of

the reporting period disaggregated by class of financing receivable and type of concession granted for the quarters and six months

ended June 30, 2025 and 2024. Loans modified to borrowers experiencing financial difficulties that were fully paid down, charged-off

or foreclosed upon by period end are not reported.

Loan Modifications Made to Borrowers Experiencing Financial Difficulty for the quarter ended June 30, 2025

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June

30, 2025

% of total class

of Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Commercial and industrial

837

0.01

837

0.01

Mortgage

69

69

Consumer:

Credit cards

395

0.03

395

0.03

Personal

1,159

0.06

1,159

0.06

Total

2,460

0.01

2,460

0.01

Term Extension

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June

30, 2025

% of total class

of Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

CRE non-owner occupied

108

58,652

2.68

58,760

1.06

CRE owner occupied

5,308

0.44

5,308

0.18

Commercial and industrial

5,693

0.10

5,693

0.07

Mortgage

12,983

0.18

665

0.05

13,648

0.16

Consumer:

Personal

260

0.01

21

0.02

281

0.01

Auto

49

49

Total

24,401

0.09

59,338

0.52

83,739

0.22

Other-Than-Insignificant Payment Delays

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June

30, 2025

% of total class

of Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

CRE non-owner occupied

4,436

0.13

4,436

0.08

CRE owner occupied

8,827

0.73

8,827

0.29

Commercial and industrial

166,870

2.98

166,870

2.07

Mortgage

420

0.01

420

Total

180,553

0.67

180,553

0.47

Combination - Term Extension and Interest Rate Reduction

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June

30, 2025

% of total class

of Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Commercial and industrial

100

100

Mortgage

3,936

0.06

3,936

0.05

Consumer:

Personal

3,429

0.19

73

0.09

3,502

0.19

Auto

16

16

Total

7,481

0.03

73

7,554

0.02

Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction

Puerto Rico

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June

30, 2025

% of total class

of Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June

30, 2025

% of total class of

Financing

Receivable

Commercial and industrial

310

0.01

310

Consumer:

Credit cards

2,293

0.19

2,293

0.19

Total

2,603

0.01

2,603

0.01

Loan Modifications Made to Borrowers Experiencing Financial Difficulty for the six months ended June 30, 2025

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Commercial and industrial

2,048

0.04

2,048

0.03

Mortgage

69

69

Consumer:

Credit cards

542

0.04

542

0.04

Personal

2,280

0.13

2,280

0.12

Other

5

5

Total

4,944

0.02

4,944

0.01

Term Extension

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

CRE non-owner occupied

108

58,652

2.68

58,760

1.06

CRE owner occupied

5,308

0.44

5,308

0.18

Commercial and industrial

11,271

0.20

11,271

0.14

Mortgage

22,922

0.32

665

0.05

23,587

0.28

Consumer:

Personal

495

0.03

21

0.02

516

0.03

Auto

87

87

Total

40,191

0.15

59,338

0.52

99,529

0.26

Other-Than-Insignificant Payment Delays

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

CRE non-owner occupied

4,436

0.13

4,436

0.08

CRE owner occupied

20,980

1.75

20,980

0.70

Commercial and industrial

177,506

3.17

177,506

2.21

Mortgage

420

0.01

420

Total

203,342

0.76

203,342

0.53

Combination - Term Extension and Interest Rate Reduction

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Commercial and industrial

100

100

Mortgage

7,061

0.10

7,061

0.08

Consumer:

Personal

6,534

0.36

114

0.14

6,648

0.35

Auto

16

16

Total

13,711

0.05

114

13,825

0.04

Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction

Puerto Rico

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2025

% of total class of

Financing

Receivable

Commercial and industrial

861

0.02

861

0.01

Consumer:

Credit cards

4,867

0.40

4,867

0.40

Total

5,728

0.02

5,728

0.02

Loan Modifications Made to Borrowers Experiencing Financial Difficulty for the quarter ended June 30, 2024

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class

of Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE owner occupied

33

33

Commercial and industrial

1,747

0.03

1,747

0.02

Mortgage

42

42

Consumer:

Credit cards

422

0.04

422

0.04

Personal

848

0.05

848

0.05

Other

25

0.02

25

0.02

Total

3,117

0.01

3,117

0.01

Term Extension

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class

of Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE non-owner occupied

3,084

0.10

3,084

0.06

CRE owner occupied

1,134

0.08

6,071

0.35

7,205

0.23

Commercial and industrial

23,059

0.46

23,059

0.32

Mortgage

16,933

0.26

642

0.05

17,575

0.22

Consumer:

Personal

238

0.01

136

0.10

374

0.02

Auto

56

56

Total

44,504

0.18

6,849

0.07

51,353

0.14

Other-Than-Insignificant Payment Delays

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class

of Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE non-owner occupied

57,071

1.92

57,071

1.14

CRE owner occupied

6,230

0.44

6,230

0.20

Commercial and industrial

52,124

1.04

52,124

0.72

Mortgage

127

127

Total

115,552

0.46

115,552

0.32

Combination - Term Extension and Interest Rate Reduction

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class

of Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Commercial and industrial

490

0.01

490

0.01

Mortgage

5,246

0.08

31

5,277

0.07

Consumer:

Personal

2,190

0.13

2,190

0.12

Total

7,926

0.03

31

7,957

0.02

Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction

Puerto Rico

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class

of Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Commercial and industrial

89

89

Consumer:

Credit cards

243

0.02

243

0.02

Total

332

332

Loan Modifications Made to Borrowers Experiencing Financial Difficulty for the six months ended June 30, 2024

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE owner occupied

33

33

Commercial and industrial

2,122

0.04

2,122

0.03

Mortgage

42

42

Consumer:

Credit cards

549

0.05

549

0.05

Personal

1,085

0.06

1,085

0.06

Other

25

0.02

25

0.02

Total

3,856

0.02

3,856

0.01

Term Extension

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE non-owner occupied

39,484

1.33

39,484

0.79

CRE owner occupied

11,718

0.83

6,071

0.35

17,789

0.57

Commercial and industrial

23,767

0.48

23,767

0.33

Mortgage

29,868

0.45

642

0.05

30,510

0.39

Consumer:

Personal

436

0.02

141

0.10

577

0.03

Auto

56

56

Total

105,329

0.42

6,854

0.07

112,183

0.32

Other-Than-Insignificant Payment Delays

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE non-owner occupied

57,071

1.92

57,071

1.14

CRE owner occupied

16,207

1.14

16,207

0.52

Commercial and industrial

56,477

1.13

56,477

0.78

Mortgage

127

127

Total

129,882

0.52

129,882

0.36

Combination - Term Extension and Interest Rate Reduction

BPPR

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

CRE non-owner occupied

890

0.03

890

0.02

Commercial and industrial

586

0.01

586

0.01

Mortgage

8,655

0.13

68

0.01

8,723

0.11

Consumer:

Personal

3,234

0.19

144

0.11

3,378

0.18

Total

13,365

0.05

212

13,577

0.04

Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction

Puerto Rico

Popular U.S.

Popular, Inc.

(Dollars in thousands)

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Amortized Cost

Basis at June 30,

2024

% of total class of

Financing

Receivable

Commercial and industrial

89

89

Consumer:

Credit cards

539

0.05

539

0.05

Total

628

628

The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulties:

For the quarter ended June 30, 2025

Loan Type

Financial Effect

Commercial and industrial

Reduced weighted-average contractual interest rate from

22.7

% to

9.9

Mortgage

Reduced weighted-average contractual interest rate from

7

.0% to

5.4

Consumer:

Credit cards

Reduced weighted-average contractual interest rate from

20.8

% to

7.9

Personal

Reduced weighted-average contractual interest rate from

20.9

% to

11.1

Auto

Reduced weighted-average contractual interest rate from

18.3

0% to

18.29

Term extension

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

2

years to the life of loans.

CRE Owner occupied

Added a weighted-average of

17

months to the life of loans.

Commercial and industrial

Added a weighted-average of

10

months to the life of loans.

Mortgage

Added a weighted-average of

12

years to the life of loans.

Consumer:

Personal

Added a weighted-average of

5

years to the life of loans.

Auto

Added a weighted-average of

19

months to the life of loans.

Other than insignificant payment delays

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

13

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

14

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

20

months to the life of loans.

Consumer:

Credit cards

Added a weighted-average of

17

months to the life of loans.

For the six months ended June 30, 2025

Interest rate reduction

Loan Type

Financial Effect

Commercial and industrial

Reduced weighted-average contractual interest rate from

24.3

% to

9.7

Mortgage

Reduced weighted-average contractual interest rate from

6.8

% to

5.5

Consumer:

Credit cards

Reduced weighted-average contractual interest rate from

21

.0% to

8.2

Personal

Reduced weighted-average contractual interest rate from

21.3

% to

11.5

Auto

Reduced weighted-average contractual interest rate from

18.3

0% to

18.29

Other

Reduced weighted-average contractual interest rate from

18

.0% to

0

.0%.

Term extension

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

2

years to the life of loans.

CRE Owner occupied

Added a weighted-average of

17

months to the life of loans.

Commercial and industrial

Added a weighted-average of

17

months to the life of loans.

Mortgage

Added a weighted-average of

13

years to the life of loans.

Consumer:

Personal

Added a weighted-average of

5

years to the life of loans.

Auto

Added a weighted-average of

years to the life of loans.

Other than insignificant payment delay

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

13

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

10

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

20

months to the life of loans.

Consumer:

Credit cards

Added a weighted-average of

months to the life of loans.

For the quarter ended June 30, 2024

Loan Type

Financial Effect

CRE Owner occupied

Reduced weighted-average contractual interest rate from

12

.0% to

5

.0%.

Commercial and industrial

Reduced weighted-average contractual interest rate from

18

.0% to

9.3

Mortgage

Reduced weighted-average contractual interest rate from

6.4

% to

4.4

Consumer:

Credit cards

Reduced weighted-average contractual interest rate from

19.7

% to

4.2

Personal

Reduced weighted-average contractual interest rate from

19.2

% to

10.1

Other

Reduced weighted-average contractual interest rate from

18

.0% to

0

.0%.

Term extension

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

2

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

8

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

13

years to the life of loans.

Consumer:

Personal

Added a weighted-average of

10

years to the life of loans.

Auto

Added a weighted-average of

4

years to the life of loans.

Other than insignificant payment delay

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

12

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

8

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

30

months to the life of loans.

Consumer:

Credit cards

Added a weighted-average of

months to the life of loans.

For the six months ended June 30, 2024

Loan Type

Financial Effect

CRE Non-owner occupied

Reduced weighted-average contractual interest rate from

10.1

% to

8.3

CRE Owner occupied

Reduced weighted-average contractual interest rate from

12

.0% to

5

.0%.

Commercial and industrial

Reduced weighted-average contractual interest rate from

19.2

% to

9.4

Mortgage

Reduced weighted-average contractual interest rate from

6.2

% to

4.5

Consumer:

Credit cards

Reduced weighted-average contractual interest rate from

20.2

% to

5

.0%.

Personal

Reduced weighted-average contractual interest rate from

18.8

% to

10

.0%.

Other

Reduced weighted-average contractual interest rate from

18

.0% to

0

.0%.

Term extension

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

11

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

8

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

13

years to the life of loans.

Consumer:

Personal

Added a weighted-average of

10

years to the life of loans.

Auto

Added a weighted-average of

4

years to the life of loans.

Other than insignificant payment delay

Loan Type

Financial Effect

CRE Non-owner occupied

Added a weighted-average of

12

months to the life of loans.

CRE Owner occupied

Added a weighted-average of

11

months to the life of loans.

Commercial and industrial

Added a weighted-average of

11

months to the life of loans.

Mortgage

Added a weighted-average of

30

months to the life of loans.

Consumer:

Credit cards

Added a weighted-average of

months to the life of loans.

The following tables present, by class, the performance of loans that have been modified during the twelve months preceding June

30, 2025. The past due 90 days or more categories includes all loans modified classified as non-accruing at the time of the

modification. These loans will continue in non-accrual status, and presented as past due 90 days or more, until the borrower has

demonstrated a willingness and ability to make the restructured loan payments (at least six months of sustained performance after

the modification or one year for loans providing for quarterly or semi-annual payments) and management has concluded that it is

probable that the borrower would not be in payment default in the foreseeable future.

BPPR

June 30, 2025

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

CRE non-owner occupied

556

556

4,536

5,092

448

108

CRE owner occupied

386

2,583

2,969

43,635

46,604

429

2,154

Commercial and industrial

291

92

2,325

2,708

215,888

218,596

387

1,938

Mortgage

5,765

2,431

18,854

27,050

31,215

58,265

4,876

13,978

Consumer:

Credit cards

729

539

1,153

2,421

5,851

8,272

882

271

Personal

631

300

2,365

3,296

13,243

16,539

281

2,084

Auto

135

135

Other

5

5

Total

7,802

3,362

27,836

39,000

314,508

353,508

7,303

20,533

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Popular U.S.

June 30, 2025

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

Commercial multi-family

5,791

5,791

CRE non-owner occupied

58,652

58,652

Commercial and industrial

609

609

Mortgage

1,481

1,481

Consumer:

Personal

17

17

208

225

Total

17

17

66,741

66,758

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Popular Inc.

June 30, 2025

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

Commercial multi-family

5,791

5,791

CRE non-owner occupied

556

556

63,188

63,744

448

108

CRE owner occupied

386

2,583

2,969

43,635

46,604

429

2,154

Commercial and industrial

291

92

2,325

2,708

216,497

219,205

387

1,938

Mortgage

5,765

2,431

18,854

27,050

32,696

59,746

4,876

13,978

Consumer:

Credit cards

729

539

1,153

2,421

5,851

8,272

882

271

Personal

648

300

2,365

3,313

13,451

16,764

281

2,084

Auto

135

135

Other

5

5

Total

7,819

3,362

27,836

39,017

381,249

420,266

7,303

20,533

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

The following tables present, by class, the performance of loans that have been modified during the twelve months preceding June

30, 2024.

BPPR

June 30, 2024

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

Commercial multi-family

64

64

64

64

CRE non-owner occupied

176

2,847

3,023

123,280

126,303

2,847

CRE owner occupied

335

1,976

2,311

187,369

189,680

1,976

Commercial and industrial

379

27

16,325

16,731

81,051

97,782

11,994

4,331

Mortgage

8,969

3,596

23,535

36,100

46,337

82,437

4,833

18,702

Consumer:

Credit cards

81

174

113

368

1,269

1,637

79

34

Personal

78

172

1,461

1,711

5,085

6,796

232

1,229

Auto

48

48

59

107

48

Other

25

25

4

29

25

Total

10,018

3,969

46,394

60,381

444,454

504,835

17,138

29,256

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Popular U.S.

June 30, 2024

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

CRE owner occupied

48,948

48,948

Mortgage

772

772

919

1,691

772

Consumer:

Personal

19

24

110

153

164

317

3

107

Total

19

24

882

925

50,031

50,956

3

879

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Popular Inc.

June 30, 2024

Past Due 90 days or more [1]

(In thousands)

30-59 days

60-89 days

Past due 90

days or more

Total past

due

Current

Total

With Payment

Default

Without

Payment Default

Commercial multi-family

64

64

64

64

CRE non-owner occupied

176

2,847

3,023

123,280

126,303

2,847

CRE owner occupied

335

1,976

2,311

236,317

238,628

1,976

Commercial and industrial

379

27

16,325

16,731

81,051

97,782

11,994

4,331

Mortgage

8,969

3,596

24,307

36,872

47,256

84,128

4,833

19,474

Consumer:

Credit cards

81

174

113

368

1,269

1,637

79

34

Personal

97

196

1,571

1,864

5,249

7,113

235

1,336

Auto

48

48

59

107

48

Other

25

25

4

29

25

Total

10,037

3,993

47,276

61,306

494,485

555,791

17,141

30,135

[1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability

to make the restructured loan payments. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or

charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification

date. Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off,

whichever occurs first.

The following tables provide the outstanding balance of loans modified for borrowers under financial

difficulties that were subject to payment default and that had been modified during the twelve months prior to default.

Amortized Cost Basis of Modified Financing Receivables That Subsequently Defaulted During the Quarter Ended June 30, 2025

(In thousands)

Interest Rate

Reduction

Term Extension

Other-Than-

Insignificant

Payment Delays

Combination - Term

Extension and Interest

Rate Reduction

Combination - Other-

Than-Insignificant

Payment Delays and

Interest Rate

Reduction

Total

CRE non-owner occupied

448

448

CRE owner occupied

254

254

Commercial and industrial

70

318

388

Mortgage

4,478

1,256

5,734

Consumer:

Credit cards

172

771

943

Personal

127

105

139

371

Total

369

4,583

702

1,395

1,089

8,138

Amortized Cost Basis of Modified Financing Receivables That Subsequently Defaulted During the Six Months Ended June 30, 2025

(In thousands)

Interest Rate

Reduction

Term Extension

Other-Than-

Insignificant

Payment Delays

Combination - Term

Extension and Interest

Rate Reduction

Combination - Other-

Than-Insignificant

Payment Delays and

Interest Rate

Reduction

Total

CRE non-owner occupied

448

448

CRE owner occupied

88

429

517

Commercial and industrial

99

30

395

524

Mortgage

8,129

1,411

9,540

Consumer:

Credit cards

290

983

1,273

Personal

143

105

147

395

Total

532

8,322

907

1,558

1,378

12,697

Amortized Cost Basis of Modified Financing Receivables That Subsequently Defaulted During the Quarter Ended June 30, 2024

(In thousands)

Interest Rate

Reduction

Term Extension

Other-Than-

Insignificant

Payment Delays

Combination - Term

Extension and Interest

Rate Reduction

Combination - Other-

Than-Insignificant

Payment Delays and

Interest Rate

Reduction

Total

Commercial and industrial

57

22

51

130

Mortgage

5,012

1,246

6,258

Consumer:

Credit cards

60

76

136

Personal

270

66

336

Total

330

5,069

22

1,312

127

6,860

Amortized Cost Basis of Modified Financing Receivables That Subsequently Defaulted During the Six Months Ended June 30, 2024

(In thousands)

Interest Rate

Reduction

Term Extension

Other-Than-

Insignificant

Payment Delays

Combination - Term

Extension and Interest

Rate Reduction

Combination - Other-

Than-Insignificant

Payment Delays and

Interest Rate

Reduction

Total

CRE owner occupied

543

543

Commercial and industrial

11,936

32

76

12,044

Mortgage

6,707

1,548

8,255

Consumer:

Credit cards

85

147

232

Personal

309

144

453

Total

394

19,186

32

1,692

223

21,527

Credit Quality

The risk rating system provides for the assignment of ratings at the obligor level based on the financial condition of the borrower.

The risk rating analysis process is performed at least once a year or more frequently if events or conditions change which may

deteriorate the credit quality. In the case of consumer and mortgage loans, these loans are classified considering their delinquency

status at the end of the reporting period.

The following tables present the amortized cost basis, net of unearned income, of loans held-in-portfolio based on the Corporation’s

assignment of obligor risk ratings as defined at June 30, 2025 and December 31, 2024 and the gross write-offs recorded by vintage

year. For the definitions of the obligor risk ratings, refer to the Credit Quality section of Note 8 to the Consolidated Financial

Statements included in the 2024 Form 10-K:

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

BPPR

Commercial:

Commercial multi-family

Pass

5,807

49,680

36,848

134,824

20,776

49,916

107

297,958

Watch

532

974

1,506

Special Mention

3,052

3,052

Substandard

3,847

3,847

Total commercial

multi-family

5,807

49,680

36,848

135,356

20,776

57,789

107

306,363

Commercial real estate non-owner occupied

Pass

170,876

435,905

277,255

800,396

539,661

851,734

6,502

3,082,329

Watch

8,463

9,012

2,133

736

4,929

55,975

72

81,320

Special Mention

40,950

150

21,642

62,742

Substandard

14,255

8,650

30,652

26,150

23,886

103,593

Total commercial

real estate non-

owner occupied

179,339

459,172

328,988

831,934

570,740

953,237

6,574

3,329,984

Year-to-Date gross

write-offs

86

86

Commercial real estate owner occupied

Pass

37,062

137,720

79,163

103,152

183,384

334,315

6,647

881,443

Watch

1,871

14,458

5,509

26,227

21,246

80,797

150,108

Special Mention

1,671

16,158

743

11,605

1,461

31,638

Substandard

361

1,581

45,868

2,600

76,599

11,823

138,832

Doubtful

85

85

Total commercial

real estate owner

occupied

38,933

152,539

87,924

191,405

207,973

503,401

19,931

1,202,106

Year-to-Date gross

write-offs

103

103

Commercial and industrial

Pass

610,403

726,378

802,741

507,669

213,257

406,259

1,375,443

4,642,150

Watch

24,809

98,741

24,041

69,784

52,631

24,827

114,548

409,381

Special Mention

25

20,707

15,190

193

155,494

3,748

15,670

211,027

Substandard

4,506

14,137

39,212

77,310

4,268

27,254

165,473

332,160

Doubtful

6

6

Total commercial

and industrial

639,743

859,963

881,184

654,956

425,650

462,094

1,671,134

5,594,724

Year-to-Date gross

write-offs

505

134

209

370

21

207

4,332

5,778

Construction

Pass

12,476

93,063

71,433

13,614

2,392

10,344

28,788

232,110

Watch

15,355

82

15,437

Substandard

5,752

5,752

Total construction

12,476

93,063

86,788

13,614

8,226

10,344

28,788

253,299

Mortgage

Pass

500,848

896,365

701,587

393,941

390,381

4,147,454

7,030,576

Substandard

76

2,349

2,923

837

67,245

73,430

Total mortgage

500,848

896,441

703,936

396,864

391,218

4,214,699

7,104,006

Year-to-Date gross

write-offs

985

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

BPPR

Leasing

Pass

401,501

606,339

415,561

304,802

174,810

72,079

1,975,092

Substandard

102

947

2,339

2,527

1,318

743

7,976

Total leasing

401,603

607,286

417,900

307,329

176,128

72,822

1,983,068

Year-to-Date gross

write-offs

96

2,005

2,801

2,692

932

8,526

Consumer:

Credit cards

Pass

1,190,089

1,190,089

Substandard

25,179

25,179

Loss

22

22

Total credit cards

1,215,290

1,215,290

Year-to-Date gross

write-offs

38,876

38,876

HELOCs

Pass

1,809

1,809

Total HELOCs

1,809

1,809

Year-to-Date gross

write-offs

25

25

Personal

Pass

463,420

565,928

361,675

187,632

73,097

94,447

28,023

1,774,222

Substandard

23

1,776

3,660

1,823

675

7,307

2,295

17,559

Loss

128

173

59

61

8

429

Total Personal

463,443

567,832

365,508

189,514

73,833

101,762

30,318

1,792,210

Year-to-Date gross

write-offs

55

7,261

19,056

10,308

2,754

1,137

935

41,506

Auto

Pass

631,487

1,141,753

823,831

563,712

402,200

249,272

3,812,255

Substandard

559

10,807

13,078

10,413

7,488

7,015

49,360

Loss

17

57

8

5

87

Total Auto

632,046

1,152,577

836,966

574,133

409,688

256,292

3,861,702

Year-to-Date gross

write-offs

907

14,215

9,433

6,088

2,823

1,008

34,474

Other consumer

Pass

11,209

26,344

27,484

17,591

8,930

4,052

62,591

158,201

Substandard

221

105

55

264

645

Loss

1,026

550

1,576

Total Other

consumer

11,209

26,344

27,705

18,722

9,480

4,107

62,855

160,422

Year-to-Date gross

write-offs

12

159

152

158

115

984

1,580

Total BPPR

2,885,447

4,864,897

3,773,747

3,313,827

2,293,712

6,636,547

3,006,488

30,318

26,804,983

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

Popular U.S.

Commercial:

Commercial multi-family

Pass

220,110

141,968

158,579

463,959

304,759

713,040

7,845

2,010,260

Watch

19,739

24,169

124,218

168,126

Special Mention

7,922

7,922

Substandard

2,742

25,376

28,118

Total commercial

multi-family

220,110

141,968

158,579

494,362

328,928

862,634

7,845

2,214,426

Year-to-Date gross

write-offs

563

563

Commercial real estate non-owner occupied

Pass

134,448

184,579

311,357

474,945

168,109

650,531

9,897

1,933,866

Watch

10,300

8,875

10,900

11,365

9,221

85,023

135,684

Substandard

1,937

13,105

5,830

100,718

250

121,840

Total commercial

real estate non-

owner occupied

144,748

193,454

324,194

499,415

183,160

836,272

10,147

2,191,390

Commercial real estate owner occupied

Pass

182,187

256,245

256,523

265,347

267,836

283,143

8,454

1,519,735

Watch

13,500

25,370

7,838

859

55,575

103,142

Special Mention

18,056

38,063

22,984

79,103

Substandard

16,310

2,557

80,902

99,769

Total commercial

real estate owner

occupied

182,187

287,801

281,893

327,558

271,252

442,604

8,454

1,801,749

Year-to-Date gross

write-offs

26

26

Commercial and industrial

Pass

128,135

324,089

288,628

319,633

290,456

714,577

245,021

2,310,539

Watch

5,203

38,038

24,093

38,311

5,940

111,585

Special Mention

3,909

4,822

427

215

1,906

11,279

Substandard

2,623

274

196

1,509

11,023

15,625

Total commercial

and industrial

128,135

326,712

298,014

362,493

315,172

754,612

263,890

2,449,028

Year-to-Date gross

write-offs

552

599

7

38

1,196

Construction

Pass

153,767

373,195

503,352

62,476

6,030

11,641

1,110,461

Watch

324

3,945

4,615

67,330

7,057

83,271

Special Mention

12,568

12,568

Substandard

8,602

8,602

Total construction

154,091

377,140

520,535

138,408

13,087

11,641

1,214,902

Mortgage

Pass

82,666

89,746

86,297

209,953

267,057

576,649

1,312,368

Substandard

644

27,409

28,053

Total mortgage

82,666

89,746

86,941

209,953

267,057

604,058

1,340,421

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

Popular U.S.

Consumer:

Credit cards

Pass

3

3

Total credit cards

3

3

HELOCs

Pass

5,408

56,341

10,802

72,551

Substandard

1,478

13

558

2,049

Loss

164

906

1,070

Total HELOCs

7,050

56,354

12,266

75,670

Year-to-Date gross

write-offs

46

46

Personal

Pass

11,637

22,435

16,958

25,006

5,594

1,530

83,160

Substandard

231

228

251

49

279

1,038

Loss

7

48

55

Total Personal

11,637

22,666

17,193

25,257

5,643

1,857

84,253

Year-to-Date gross

write-offs

1,158

1,379

2,535

437

37

5,546

Other consumer

Pass

8,353

8,353

Total Other

consumer

8,353

8,353

Year-to-Date gross

write-offs

42

42

Total Popular U.S.

923,574

1,439,487

1,687,349

2,057,446

1,371,212

3,522,174

366,687

12,266

11,380,195

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

Popular, Inc.

Commercial:

Commercial multi-family

Pass

225,917

191,648

195,427

598,783

325,535

762,956

7,952

2,308,218

Watch

20,271

24,169

125,192

169,632

Special Mention

7,922

3,052

10,974

Substandard

2,742

29,223

31,965

Total commercial

multi-family

225,917

191,648

195,427

629,718

349,704

920,423

7,952

2,520,789

Year-to-Date gross

write-offs

563

563

Commercial real estate non-owner occupied

Pass

305,324

620,484

588,612

1,275,341

707,770

1,502,265

16,399

5,016,195

Watch

18,763

17,887

13,033

12,101

14,150

140,998

72

217,004

Special Mention

40,950

150

21,642

62,742

Substandard

14,255

10,587

43,757

31,980

124,604

250

225,433

Total commercial

real estate non-

owner occupied

324,087

652,626

653,182

1,331,349

753,900

1,789,509

16,721

5,521,374

Year-to-Date gross

write-offs

86

86

Commercial real estate owner occupied

Pass

219,249

393,965

335,686

368,499

451,220

617,458

15,101

2,401,178

Watch

1,871

27,958

30,879

34,065

22,105

136,372

253,250

Special Mention

18,056

1,671

54,221

743

34,589

1,461

110,741

Substandard

361

1,581

62,178

5,157

157,501

11,823

238,601

Doubtful

85

85

Total commercial

real estate owner

occupied

221,120

440,340

369,817

518,963

479,225

946,005

28,385

3,003,855

Year-to-Date gross

write-offs

129

129

Commercial and industrial

Pass

738,538

1,050,467

1,091,369

827,302

503,713

1,120,836

1,620,464

6,952,689

Watch

24,809

98,741

29,244

107,822

76,724

63,138

120,488

520,966

Special Mention

25

20,707

19,099

5,015

155,921

3,963

17,576

222,306

Substandard

4,506

16,760

39,486

77,310

4,464

28,763

176,496

347,785

Doubtful

6

6

Total commercial

and industrial

767,878

1,186,675

1,179,198

1,017,449

740,822

1,216,706

1,935,024

8,043,752

Year-to-Date gross

write-offs

505

686

209

370

620

214

4,370

6,974

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

Popular, Inc.

Construction

Pass

166,243

466,258

574,785

76,090

2,392

16,374

40,429

1,342,571

Watch

324

3,945

19,970

67,330

82

7,057

98,708

Special Mention

12,568

12,568

Substandard

8,602

5,752

14,354

Total construction

166,567

470,203

607,323

152,022

8,226

23,431

40,429

1,468,201

Mortgage

Pass

583,514

986,111

787,884

603,894

657,438

4,724,103

8,342,944

Substandard

76

2,993

2,923

837

94,654

101,483

Total mortgage

583,514

986,187

790,877

606,817

658,275

4,818,757

8,444,427

Year-to-Date gross

write-offs

985

985

Leasing

Pass

401,501

606,339

415,561

304,802

174,810

72,079

1,975,092

Substandard

102

947

2,339

2,527

1,318

743

7,976

Total leasing

401,603

607,286

417,900

307,329

176,128

72,822

1,983,068

Year-to-Date gross

write-offs

96

2,005

2,801

2,692

932

8,526

June 30, 2025

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2025

2024

2023

2022

2021

Prior

Years

Total

Popular, Inc.

Consumer:

Credit cards

Pass

1,190,092

1,190,092

Substandard

25,179

25,179

Loss

22

22

Total credit cards

1,215,293

1,215,293

Year-to-Date gross

write-offs

38,876

38,876

HELOCs

Pass

5,408

58,150

10,802

74,360

Substandard

1,478

13

558

2,049

Loss

164

906

1,070

Total HELOCs

7,050

58,163

12,266

77,479

Year-to-Date gross

write-offs

71

71

Personal

Pass

475,057

588,363

378,633

212,638

78,691

95,977

28,023

1,857,382

Substandard

23

2,007

3,888

2,074

724

7,586

2,295

18,597

Loss

128

180

59

61

56

484

Total Personal

475,080

590,498

382,701

214,771

79,476

103,619

30,318

1,876,463

Year-to-Date gross

write-offs

55

8,419

20,435

12,843

3,191

1,174

935

47,052

Auto

Pass

631,487

1,141,753

823,831

563,712

402,200

249,272

3,812,255

Substandard

559

10,807

13,078

10,413

7,488

7,015

49,360

Loss

17

57

8

5

87

Total Auto

632,046

1,152,577

836,966

574,133

409,688

256,292

3,861,702

Year-to-Date gross

write-offs

907

14,215

9,433

6,088

2,823

1,008

34,474

Other consumer

Pass

11,209

26,344

27,484

17,591

8,930

4,052

70,944

166,554

Substandard

221

105

55

264

645

Loss

1,026

550

1,576

Total Other

consumer

11,209

26,344

27,705

18,722

9,480

4,107

71,208

168,775

Year-to-Date gross

write-offs

12

159

152

158

115

984

42

1,622

Total Popular Inc.

3,809,021

6,304,384

5,461,096

5,371,273

3,664,924

10,158,721

3,373,175

42,584

38,185,178

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

BPPR

Commercial:

Commercial multi-family

Pass

50,384

37,211

136,093

20,939

20,134

34,009

105

298,875

Watch

541

1,601

2,142

Special Mention

3,161

3,161

Substandard

3,823

3,823

Total commercial

multi-family

50,384

37,211

136,634

20,939

20,134

42,594

105

308,001

Commercial real estate non-owner occupied

Pass

419,200

322,998

828,404

547,674

335,060

525,088

6,159

2,984,583

Watch

26,097

2,296

654

5,349

28,832

50,924

72

114,224

Special Mention

7,018

41,274

156

406

46,390

95,244

Substandard

1,002

110

26,430

1,954

22,956

52,452

Total commercial

real estate non-

owner occupied

452,315

367,570

829,324

579,859

365,846

645,358

6,231

3,246,503

Year-to-Date gross

write-offs

69

59

128

Commercial real estate owner occupied

Pass

131,449

79,109

94,008

214,520

46,206

309,791

7,214

882,297

Watch

14,002

2,637

64,735

7,225

4,890

85,580

3

179,072

Special Mention

1,209

19,436

19,288

15,872

1,499

57,304

Substandard

455

1,651

20,528

3,872

140,579

77,098

13,021

257,204

Doubtful

34

34

Total commercial

real estate owner

occupied

145,906

84,606

198,707

244,905

191,675

488,375

21,737

1,375,911

Year-to-Date gross

write-offs

2,793

2,793

Commercial and industrial

Pass

790,273

910,355

602,454

304,227

66,395

331,493

1,495,490

4,500,687

Watch

124,987

24,935

49,497

6,394

3,465

31,609

135,811

376,698

Special Mention

5,519

7,316

1,895

157,627

53

30,360

28,171

230,941

Substandard

6,063

30,496

37,558

4,203

14,776

23,135

122,275

238,506

Doubtful

11

11

Loss

51

51

Total commercial

and industrial

926,842

973,102

691,404

472,451

84,689

416,608

1,781,798

5,346,894

Year-to-Date gross

write-offs

1,099

707

331

122

2,838

11,841

7,617

24,555

Construction

Pass

63,107

53,070

33,423

14,908

9,483

1,011

16,782

191,784

Watch

13,872

13,872

Special Mention

6,058

6,058

Substandard

576

576

Total construction

63,107

66,942

33,423

21,542

9,483

1,011

16,782

212,290

Mortgage

Pass

879,075

724,383

409,133

401,113

234,486

4,085,088

6,733,278

Substandard

1,961

1,331

1,675

347

71,289

76,603

Total mortgage

879,075

726,344

410,464

402,788

234,833

4,156,377

6,809,881

Year-to-Date gross

write-offs

9

8

1,067

1,084

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

BPPR

Leasing

Pass

731,053

477,226

362,426

217,537

104,812

22,762

1,915,816

Substandard

1,195

2,280

2,834

1,885

920

402

9,516

Loss

73

73

Total leasing

732,248

479,506

365,260

219,422

105,732

23,237

1,925,405

Year-to-Date gross

write-offs

1,733

4,842

5,373

3,281

694

1,052

16,975

Consumer:

Credit cards

Pass

1,188,093

1,188,093

Substandard

29,960

29,960

Total credit cards

1,218,053

1,218,053

Year-to-Date gross

write-offs

69,731

69,731

HELOCs

Pass

2,040

2,040

Total HELOCs

2,040

2,040

Year-to-Date gross

write-offs

380

380

Personal

Pass

722,949

499,604

262,011

101,155

29,078

91,004

23,802

1,729,603

Substandard

924

4,965

3,561

1,221

271

8,205

1,626

20,773

Loss

1

1

Total Personal

723,873

504,569

265,572

102,377

29,349

99,209

25,428

1,750,377

Year-to-Date gross

write-offs

2,362

39,193

38,077

10,822

2,708

3,525

1,982

98,669

Auto

Pass

1,277,016

938,769

665,431

494,529

254,621

133,054

3,763,420

Substandard

7,239

16,876

13,579

10,775

6,377

5,131

59,977

Loss

14

15

2

9

40

Total Auto

1,284,269

955,660

679,010

505,306

260,998

138,194

3,823,437

Year-to-Date gross

write-offs

11,229

36,992

20,486

9,997

4,965

1,731

85,400

Other consumer

Pass

28,543

29,585

20,021

10,129

4,588

3,364

62,678

158,908

Substandard

228

44

29

57

413

771

Loss

550

550

Total Other

consumer

28,543

29,813

20,065

10,679

4,617

3,421

63,091

160,229

Year-to-Date gross

write-offs

29

213

130

96

128

2,205

2,801

Total BPPR

5,286,562

4,225,323

3,629,863

2,580,268

1,307,356

6,014,384

3,109,837

25,428

26,179,021

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular U.S.

Commercial:

Commercial multi-family

Pass

139,370

148,423

491,750

313,610

207,327

560,891

5,700

1,867,071

Watch

10,974

27,441

26,679

10,668

114,419

190,181

Special Mention

8,004

8,004

Substandard

2,761

23,602

26,363

Total commercial

multi-family

139,370

159,397

529,956

340,289

217,995

698,912

5,700

2,091,619

Year-to-Date gross

write-offs

441

441

Commercial real estate non-owner occupied

Pass

178,355

368,597

480,055

167,839

193,309

456,689

8,588

1,853,432

Watch

12,932

17,125

13,138

45,864

64,390

300

153,749

Special Mention

594

594

Substandard

2,657

2,741

5,758

97,801

108,957

Total commercial

real estate non-

owner occupied

178,355

381,529

499,837

183,718

244,931

619,474

8,888

2,116,732

Year-to-Date gross

write-offs

54

54

Commercial real estate owner occupied

Pass

304,778

257,586

244,811

279,419

35,459

246,158

7,669

1,375,880

Watch

25,614

13,531

32,132

16,301

54,877

142,455

Special Mention

488

69,505

34,428

27,406

10,825

142,652

Substandard

17,101

2,596

3,678

97,473

120,848

Total commercial

real estate owner

occupied

304,778

283,688

344,948

348,575

82,844

409,333

7,669

1,781,835

Year-to-Date gross

write-offs

154

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular U.S.

Commercial and industrial

Pass

260,479

275,971

318,564

322,697

268,591

506,973

273,222

2,226,497

Watch

11,420

48,953

28,138

9,521

35,498

15,050

148,580

Special Mention

58

5,270

568

255

3,835

9,986

Substandard

2,276

195

45

1,610

5,479

9,605

Total commercial

and industrial

262,813

287,391

372,787

351,598

278,157

544,336

297,586

2,394,668

Year-to-Date gross

write-offs

1,103

1,571

190

300

211

480

123

3,978

Construction

Pass

259,194

512,428

155,268

765

927,655

Watch

1,541

36,264

7,172

24,691

69,668

Special Mention

4,897

6,367

11,264

Substandard

8,104

25,473

9,338

42,915

Total construction

259,194

518,866

206,003

33,410

34,029

1,051,502

Mortgage

Pass

98,345

88,788

215,600

272,908

216,025

382,746

1,274,412

Substandard

644

106

860

28,280

29,890

Total mortgage

98,345

89,432

215,706

273,768

216,025

411,026

1,304,302

Year-to-Date gross

write-offs

18

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular U.S.

Consumer:

Credit cards

Pass

26

26

Total credit cards

26

26

HELOCs

Pass

5,914

50,533

11,691

68,138

Substandard

1,657

15

700

2,372

Loss

122

899

1,021

Total HELOCs

7,693

50,548

13,290

71,531

Year-to-Date gross

write-offs

53

53

Personal

Pass

28,083

23,084

41,182

8,618

651

1,507

103,125

Substandard

157

399

627

134

7

302

1,626

Loss

53

10

5

48

116

Total Personal

28,293

23,493

41,809

8,757

658

1,857

104,867

Year-to-Date gross

write-offs

802

4,536

10,869

2,458

231

307

19,203

Other consumer

Pass

11,537

11,537

Substandard

12

12

Total Other

consumer

11,549

11,549

Year-to-Date gross

write-offs

101

101

Total Popular U.S.

1,271,148

1,743,796

2,211,046

1,506,705

1,040,610

2,726,041

415,995

13,290

10,928,631

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular, Inc.

Commercial:

Commercial multi-family

Pass

189,754

185,634

627,843

334,549

227,461

594,900

5,805

2,165,946

Watch

10,974

27,982

26,679

10,668

116,020

192,323

Special Mention

8,004

3,161

11,165

Substandard

2,761

27,425

30,186

Total commercial

multi-family

189,754

196,608

666,590

361,228

238,129

741,506

5,805

2,399,620

Year-to-Date gross

write-offs

441

441

Commercial real estate non-owner occupied

Pass

597,555

691,595

1,308,459

715,513

528,369

981,777

14,747

4,838,015

Watch

26,097

15,228

17,779

18,487

74,696

115,314

372

267,973

Special Mention

7,018

41,274

156

406

46,984

95,838

Substandard

1,002

2,767

29,171

7,712

120,757

161,409

Total commercial

real estate non-

owner occupied

630,670

749,099

1,329,161

763,577

610,777

1,264,832

15,119

5,363,235

Year-to-Date gross

write-offs

69

113

182

Commercial real estate owner occupied

Pass

436,227

336,695

338,819

493,939

81,665

555,949

14,883

2,258,177

Watch

14,002

28,251

78,266

39,357

21,191

140,457

3

321,527

Special Mention

1,697

88,941

53,716

27,406

26,697

1,499

199,956

Substandard

455

1,651

37,629

6,468

144,257

174,571

13,021

378,052

Doubtful

34

34

Total commercial

real estate owner

occupied

450,684

368,294

543,655

593,480

274,519

897,708

29,406

3,157,746

Year-to-Date gross

write-offs

2,947

2,947

Commercial and industrial

Pass

1,050,752

1,186,326

921,018

626,924

334,986

838,466

1,768,712

6,727,184

Watch

124,987

36,355

98,450

34,532

12,986

67,107

150,861

525,278

Special Mention

5,577

7,316

7,165

158,195

53

30,615

32,006

240,927

Substandard

8,339

30,496

37,558

4,398

14,821

24,745

127,754

248,111

Doubtful

11

11

Loss

51

51

Total commercial

and industrial

1,189,655

1,260,493

1,064,191

824,049

362,846

960,944

2,079,384

7,741,562

Year-to-Date gross

write-offs

2,202

2,278

521

422

3,049

12,321

7,740

28,533

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular, Inc.

Construction

Pass

322,301

565,498

188,691

14,908

9,483

1,776

16,782

1,119,439

Watch

15,413

36,264

7,172

24,691

83,540

Special Mention

4,897

6,367

6,058

17,322

Substandard

8,104

576

25,473

9,338

43,491

Total construction

322,301

585,808

239,426

21,542

9,483

34,421

50,811

1,263,792

Mortgage

Pass

977,420

813,171

624,733

674,021

450,511

4,467,834

8,007,690

Substandard

2,605

1,437

2,535

347

99,569

106,493

Total mortgage

977,420

815,776

626,170

676,556

450,858

4,567,403

8,114,183

Year-to-Date gross

write-offs

9

8

1,085

1,102

Leasing

Pass

731,053

477,226

362,426

217,537

104,812

22,762

1,915,816

Substandard

1,195

2,280

2,834

1,885

920

402

9,516

Loss

73

73

Total leasing

732,248

479,506

365,260

219,422

105,732

23,237

1,925,405

Year-to-Date gross

write-offs

1,733

4,842

5,373

3,281

694

1,052

16,975

December 31, 2024

Term Loans

Revolving

Loans

Amortized

Cost Basis

Revolving

Loans

Converted to

Term Loans

Amortized

Cost Basis

Amortized Cost Basis by Origination Year

(In thousands)

2024

2023

2022

2021

2020

Prior

Years

Total

Popular, Inc.

Consumer:

Credit cards

Pass

1,188,119

1,188,119

Substandard

29,960

29,960

Total credit cards

1,218,079

1,218,079

Year-to-Date gross

write-offs

69,731

69,731

HELOCs

Pass

5,914

52,573

11,691

70,178

Substandard

1,657

15

700

2,372

Loss

122

899

1,021

Total HELOCs

7,693

52,588

13,290

73,571

Year-to-Date gross

write-offs

433

433

Personal

Pass

751,032

522,688

303,193

109,773

29,729

92,511

23,802

1,832,728

Substandard

1,081

5,364

4,188

1,355

278

8,507

1,626

22,399

Loss

53

10

6

48

117

Total Personal

752,166

528,062

307,381

111,134

30,007

101,066

25,428

1,855,244

Year-to-Date gross

write-offs

3,164

43,729

48,946

13,280

2,939

3,832

1,982

117,872

Auto

Pass

1,277,016

938,769

665,431

494,529

254,621

133,054

3,763,420

Substandard

7,239

16,876

13,579

10,775

6,377

5,131

59,977

Loss

14

15

2

9

40

Total Auto

1,284,269

955,660

679,010

505,306

260,998

138,194

3,823,437

Year-to-Date gross

write-offs

11,229

36,992

20,486

9,997

4,965

1,731

85,400

Other consumer

Pass

28,543

29,585

20,021

10,129

4,588

3,364

74,215

170,445

Substandard

228

44

29

57

425

783

Loss

550

550

Total Other

consumer

28,543

29,813

20,065

10,679

4,617

3,421

74,640

171,778

Year-to-Date gross

write-offs

29

213

130

96

128

2,205

101

2,902

Total Popular Inc.

6,557,710

5,969,119

5,840,909

4,086,973

2,347,966

8,740,425

3,525,832

38,718

37,107,652

Note 9 – Mortgage banking activities

Income from mortgage banking activities includes mortgage servicing fees earned in connection with administering residential

mortgage loans and valuation adjustments on mortgage servicing rights. It also includes gain on sales and securitizations of

residential mortgage loans, losses on repurchased loans, including interest advances, and trading gains and losses on derivative

contracts used to hedge the Corporation’s securitization activities. In addition, fair value valuation adjustments to residential

mortgage loans held for sale, if any, are recorded as part of the mortgage banking activities.

The following table presents the components of mortgage banking activities:

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Mortgage servicing fees, net of fair value adjustments:

Mortgage servicing fees

6,912

7,602

14,080

15,353

Mortgage servicing rights fair value adjustments

(1,954)

(1,945)

(5,524)

(5,384)

Total mortgage servicing fees, net of fair value adjustments

4,958

5,657

8,556

9,969

Net (loss) gain on sale of loans, including valuation on loans held-for-sale

(37)

2

156

76

Trading account (loss) profit:

Unrealized (losses) gains on outstanding derivative positions

(8)

56

(95)

157

Realized (losses) gains on closed derivative positions

(10)

9

(9)

12

Total trading account (loss) profit

(18)

65

(104)

169

Losses on repurchased loans, including interest advances

(31)

(1)

(47)

(131)

Total mortgage banking activities

4,872

5,723

8,561

10,083

Note 10 – Transfers of financial assets and mortgage servicing assets

The Corporation typically transfers conforming residential mortgage loans in conjunction with GNMA, FNMA and FHLMC

securitization transactions whereby the loans are exchanged for cash or securities and servicing rights. As seller, the Corporation

has made certain representations and warranties with respect to the originally transferred loans and, in the past, has sold certain

loans with credit recourse to a government-sponsored entity, namely FNMA. Refer to Note 19 to the Consolidated Financial

Statements for a description of such arrangements.

No

liabilities were incurred as a result of these securitizations during the quarters and six months ended June 30, 2025 and 2024

because they did not contain any credit recourse arrangements.

The following tables present the initial fair value of the assets obtained as proceeds from residential mortgage loans securitized

during the quarters and six months ended June 30, 2025 and 2024:

Proceeds Obtained During the Quarter Ended June 30, 2025

(In thousands)

Level 1

Level 2

Level 3

Initial Fair Value

Assets

Trading account debt securities:

Mortgage-backed securities - GNMA

2,581

2,581

Mortgage-backed securities - FNMA

2,553

2,553

Total trading account debt securities

5,134

5,134

Mortgage servicing rights

92

92

Total

5,134

92

5,226

Proceeds Obtained During the Six months Ended June 30, 2025

(In thousands)

Level 1

Level 2

Level 3

Initial Fair Value

Assets

Trading account debt securities:

Mortgage-backed securities - GNMA

2,581

2,581

Mortgage-backed securities - FNMA

4,271

4,271

Total trading account debt securities

6,852

6,852

Mortgage servicing rights

135

135

Total

6,852

135

6,987

Proceeds Obtained During the Quarter Ended June 30, 2024

(In thousands)

Level 1

Level 2

Level 3

Initial Fair Value

Assets

Trading account debt securities:

Mortgage-backed securities - FNMA

2,601

2,601

Total trading account debt securities

2,601

2,601

Mortgage servicing rights

72

72

Total

2,601

72

2,673

Proceeds Obtained During the Six months Ended June 30, 2024

(In thousands)

Level 1

Level 2

Level 3

Initial Fair Value

Assets

Trading account debt securities:

Mortgage-backed securities - GNMA

1,100

1,100

Mortgage-backed securities - FNMA

3,706

3,706

Total trading account debt securities

4,806

4,806

Mortgage servicing rights

117

117

Total

4,806

117

4,923

During the six months ended June 30, 2025, the Corporation retained servicing rights on whole loan sales involving $

15

million in

principal balance outstanding (June 30, 2024 - $

23

million), with net realized gains of $

0.4

million (June 30, 2024 - gains of $

0.5

million). All loan sales performed during the six months ended June 30, 2025 and 2024 were without credit recourse agreements.

The Corporation recognizes as assets the rights to service loans for others, whether these rights are purchased or result from asset

transfers such as sales and securitizations. These mortgage servicing rights (“MSRs”) are measured at fair value.

The Corporation uses a discounted cash flow model to estimate the fair value of MSRs. The discounted cash flow model

incorporates assumptions that market participants would use in estimating future net servicing income, including estimates of

prepayment speeds, discount rate, cost to service, escrow account earnings, contractual servicing fee income, prepayment and late

fees, among other considerations. Prepayment speeds are adjusted for the loans’ characteristics and portfolio behavior.

The following table presents the changes in MSRs measured using the fair value method for the six months ended June 30, 2025

and 2024.

Residential MSRs

(In thousands)

June 30, 2025

June 30, 2024

Fair value at beginning of period

108,103

118,109

Additions

498

661

Changes due to payments on loans

[1]

(4,326)

(4,435)

Reduction due to loan repurchases

(221)

(247)

Changes in fair value due to changes in valuation model inputs or assumptions

(977)

(702)

Fair value at end of period

[2]

103,077

113,386

[1] Represents changes due to collection / realization of expected cash flows over time.

[2] At June 30, 2025, PB had MSRs amounting to $

1.8

million (June 30, 2024 - $

1.9

million).

Residential mortgage loans serviced for others were $

8.6

billion at June 30, 2025 (December 31, 2024 -$

9.0

billion).

Net mortgage servicing fees, a component of mortgage banking activities in the Consolidated Statements of Operations, include the

changes from period to period in the fair value of the MSRs, including changes due to collection / realization of expected cash flows.

The banking subsidiaries receive servicing fees based on a percentage of the outstanding loan balance. These servicing fees are

credited to income when they are collected. At June 30, 2025, those weighted average mortgage servicing fees were

0.32

% (June

30, 2024 -

0.32

%). Under these servicing agreements, the banking subsidiaries do not generally earn significant prepayment penalty

fees on the underlying loans serviced.

The section below includes information on assumptions used in the valuation model of the MSRs, originated and purchased. Key

economic assumptions used in measuring the servicing rights derived from loans securitized or sold by the Corporation during the

quarters and six months ended June 30, 2025 and 2024 were as follows:

Quarters ended

Six months ended

June 30, 2025

June 30, 2024

June 30, 2025

June 30, 2024

BPPR

PB

BPPR

PB

BPPR

PB

BPPR

PB

Prepayment speed

5.9

5.8

6.9

6.3

6.8

6.0

6.4

6.2

Weighted average life (in years)

10.4

8.8

9.2

8.6

9.8

8.8

9.4

8.7

Discount rate (annual rate)

9.5

12.9

9.8

12.9

9.7

12.9

9.6

12.7

Key economic assumptions used to estimate the fair value of MSRs derived from sales and securitizations of mortgage loans

performed by the banking subsidiaries and servicing rights purchased from other financial institutions, and the sensitivity to

immediate changes in those assumptions, were as follows as of the end of the periods reported:

Originated MSRs

Purchased MSRs

June 30,

December 31,

June 30,

December 31,

(In thousands)

2025

2024

2025

2024

Fair value of servicing rights

33,734

34,019

69,343

74,084

Weighted average life (in years)

6.4

6.4

6.6

6.6

Weighted average prepayment speed (annual rate)

5.6

5.8

6.9

6.9

Impact on fair value of 10% adverse change

(658)

(667)

(1,346)

(1,448)

Impact on fair value of 20% adverse change

(1,289)

(1,308)

(2,641)

(2,840)

Weighted average discount rate (annual rate)

11.3

11.4

10.9

10.8

Impact on fair value of 10% adverse change

(1,245)

(1,267)

(2,496)

(2,689)

Impact on fair value of 20% adverse change

(2,410)

(2,451)

(4,837)

(5,211)

The sensitivity analyses presented in the table above for servicing rights are hypothetical and should be used with caution. As the

figures indicate, changes in fair value based on a 10 and 20 percent variation in assumptions generally cannot be extrapolated

because the relationship of the change in assumption to the change in fair value may not be linear. Also, in the sensitivity tables

included herein the effect of a variation in a particular assumption on the fair value of the retained interest is calculated without

changing any other assumption. In reality, changes in one factor may result in changes in another (for example, increases in market

interest rates may result in lower prepayments and increased credit losses), which might magnify or counteract the sensitivity.

At June 30, 2025, the Corporation serviced $

460

million in residential mortgage loans with credit recourse to the Corporation

(December 31, 2024 - $

495

million). Also refer to Note 19 to the Consolidated Financial Statements for information on changes in

the Corporation’s liability of estimated losses related to loans serviced with credit recourse.

During the six months ended June 30, 2025, the Corporation repurchased $

17

million (June 30, 2024 - $

18

million) of mortgage

loans from its GNMA servicing portfolio. The determination to repurchase these loans was based on the economic benefits of the

transaction, which results in a reduction of the servicing costs for these severely delinquent loans, mainly related to principal and

interest advances. The risk associated with the loans is reduced due to their guaranteed nature. The Corporation may place these

loans under modification programs offered by FHA, VA or United States Department of Agriculture (USDA) or other loss mitigation

programs offered by the Corporation, and once brought back to current status, these may be either retained in portfolio or re-sold in

the secondary market.

Note 11 – Other real estate owned

The following tables present the activity related to Other Real Estate Owned (“OREO”), for the quarters and six months ended June

30, 2025 and 2024.

For the quarter ended June 30, 2025

OREO

OREO

(In thousands)

Commercial/Construction

Mortgage

Total

Balance at beginning of period

7,111

45,003

52,114

Write-downs in value

(835)

(516)

(1,351)

Additions

314

7,908

8,222

Sales

(693)

(12,145)

(12,838)

Other adjustments

(21)

(21)

Ending balance

5,897

40,229

46,126

For the quarter ended June 30, 2024

OREO

OREO

(In thousands)

Commercial/Construction

Mortgage

Total

Balance at beginning of period

15,962

64,580

80,542

Write-downs in value

(1,039)

(427)

(1,466)

Additions

516

12,146

12,662

Sales

(6,011)

(15,502)

(21,513)

Ending balance

9,428

60,797

70,225

For the six months ended June 30, 2025

OREO

OREO

(In thousands)

Commercial/Construction

Mortgage

Total

Balance at beginning of period

8,424

48,844

57,268

Write-downs in value

(864)

(1,715)

(2,579)

Additions

571

16,697

17,268

Sales

(2,234)

(23,374)

(25,608)

Other adjustments

(223)

(223)

Ending balance

5,897

40,229

46,126

For the six months ended June 30, 2024

OREO

OREO

(In thousands)

Commercial/Construction

Mortgage

Total

Balance at beginning of period

11,189

69,227

80,416

Write-downs in value

(1,064)

(711)

(1,775)

Additions

5,860

24,782

30,642

Sales

(6,557)

(32,436)

(38,993)

Other adjustments

(65)

(65)

Ending balance

9,428

60,797

70,225

Note 12 − Other assets

The caption of other assets in the Consolidated Statements of Financial Condition consists of the following major categories:

(In thousands)

June 30, 2025

December 31, 2024

Net deferred tax assets (net of valuation allowance)

862,089

926,329

Investments under the equity method

244,510

251,537

Prepaid taxes

63,677

42,909

Other prepaid expenses

31,982

28,376

Capitalized software costs

169,583

136,442

Derivative assets

24,792

25,975

Trades receivable from brokers and counterparties

880

588

Receivables from investments maturities

14,600

Principal, interest and escrow servicing advances

35,818

43,793

Guaranteed mortgage loan claims receivable

13,084

17,226

Operating ROU assets (Note 27)

89,253

93,389

Finance ROU assets (Note 27)

17,685

19,174

Assets for pension benefit

34,503

33,233

Others

157,196

164,188

Total other assets

1,745,052

1,797,759

The Corporation regularly incurs in capitalizable costs associated with software development or licensing which are recorded within

the Other Assets line item in the accompanying Consolidated Statements of Financial Condition. In addition, the Corporation incurs

costs associated with hosting arrangements that are service contracts that are also recorded within Other Assets. The hosting

arrangements can include capitalizable implementation costs that are amortized during the term of the hosting arrangement.

The

following table summarizes the composition of acquired or developed software costs as well as costs related to hosting

arrangements:

Gross Carrying

Accumulated

Net Carrying

(In thousands)

Amount

Amortization

Value

June 30, 2025

Software development costs

83,809

29,575

54,234

Software license costs

52,630

26,924

25,706

Cloud computing arrangements

98,766

9,123

89,643

Total Capitalized software costs [1] [2]

235,205

65,622

169,583

December 31, 2024

Software development costs

79,233

23,057

56,176

Software license costs

42,234

21,459

20,775

Cloud computing arrangements

65,797

6,306

59,491

Total Capitalized software costs [1] [2]

187,264

50,822

136,442

[1]

Software intangible assets are presented as part of Other Assets in the Consolidated Statements of Financial Condition.

[2]

The tables above exclude assets that have been fully amortized.

Total amortization expense for all capitalized software and hosting arrangement cost, reflected as part of technology and software

expenses in the consolidated statement of operations, is as follows:

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Software development and license costs

22,254

18,612

43,982

36,313

Cloud computing arrangements

1,462

666

2,828

1,538

Total amortization expense

23,716

19,278

46,810

37,851

Note 13 – Goodwill and other intangible assets

Goodwill

There were

no

changes in the carrying amount of goodwill for the quarters and six months ended June 30, 2025 and 2024.

The following tables present the gross amount of goodwill and accumulated impairment losses by reportable segment:

June 30, 2025

Balance at

Balance at

June 30,

Accumulated

June 30,

2025

impairment

2025

(In thousands)

(gross amounts)

losses

(net amounts)

Banco Popular de Puerto Rico

438,710

3,801

434,909

Popular U.S.

564,456

196,411

368,045

Total Popular, Inc.

1,003,166

200,212

802,954

December 31, 2024

Balance at

Balance at

December 31,

Accumulated

December 31,

2024

impairment

2024

(In thousands)

(gross amounts)

losses

(net amounts)

Banco Popular de Puerto Rico

438,710

3,801

434,909

Popular U.S.

564,456

196,411

368,045

Total Popular, Inc.

1,003,166

200,212

802,954

Other Intangible Assets

The following table reflects the components of other intangible assets subject to amortization:

Gross Carrying

Accumulated

Net Carrying

(In thousands)

Amount

Amortization

Value

June 30, 2025

Core deposits

12,810

12,810

Other customer relationships

14,286

9,202

5,084

Total other intangible assets

27,096

22,012

5,084

December 31, 2024

Core deposits

12,810

12,595

215

Other customer relationships

14,286

8,435

5,851

Total other intangible assets

27,096

21,030

6,066

During the quarter ended June 30, 2025, the Corporation recognized $

0.4

million in amortization expense related to other intangible

assets with definite useful lives (June 30, 2024 - $

0.7

million). During the six months ended June 30, 2025, the Corporation

recognized $

1.0

million in amortization related to other intangible assets with definite useful lives (June 30, 2024 - $

1.5

million).

The following table presents the estimated amortization of the intangible assets with definite useful lives for each of the following

periods:

(In thousands)

Remaining 2025

768

Year 2026

1,440

Year 2027

959

Year 2028

959

Year 2029

Note 14 – Deposits

Total deposits as of the end of the periods presented consisted of:

(In thousands)

June 30, 2025

December 31, 2024

Savings accounts

14,337,808

14,224,271

NOW, money market and other interest -bearing demand deposits

28,166,283

26,507,637

Total savings, NOW, money market and other interest-bearing demand deposits

42,504,091

40,731,908

Certificates of deposit:

Under $250,000

5,580,334

5,383,331

$250,000 and over

4,018,452

3,629,551

Total certificates of deposit

9,598,786

9,012,882

Total interest-bearing deposits

52,102,877

49,744,790

Non- interest-bearing deposits

15,114,614

15,139,555

Total deposits

67,217,491

64,884,345

A summary of certificates of deposits by maturity at June 30, 2025 follows:

(In thousands)

2025

4,645,684

2026

2,633,316

2027

823,872

2028

666,327

2029

446,123

2030 and thereafter

383,464

Total certificates of deposit

9,598,786

At June 30, 2025, the Corporation had brokered deposits amounting to $

1.7

billion (December 31, 2024 - $

1.6

billion).

The aggregate amount of overdrafts in demand deposit accounts that were reclassified to loans was $

6.4

million at June 30, 2025

(December 31, 2024 - $

10.4

million).

At June 30, 2025, Puerto Rico government deposits amounted to $

20.9

billion. Puerto Rico government deposits are interest

bearing accounts, which are indexed to short-term market rates and fluctuate in cost with changes in those rates, in accordance with

contractual terms.

Note 15 – Borrowings

Assets sold under agreements to repurchase

Assets sold under agreements to repurchase amounted to $

56

million at June 30, 2025 and $

55

million at December 31, 2024.

The Corporation’s repurchase transactions are overcollateralized with the securities detailed in the table below. The Corporation’s

repurchase agreements have a right of set-off with the respective counterparty under the supplemental terms of the master

repurchase agreements. In an event of default, each party has a right of set-off against the other party for amounts owed in the

related agreement and any other amount or obligation owed in respect of any other agreement or transaction between them.

Pursuant to the Corporation’s accounting policy, the repurchase agreements are not offset with other repurchase agreements held

with the same counterparty.

The following table presents information related to the Corporation’s repurchase transactions accounted for as secured borrowings

that are collateralized with debt securities available-for-sale, debt securities held-to-maturity, and other assets held-for-trading

purposes or which have been obtained under agreements to resell. It is the Corporation’s policy to maintain effective control over

assets sold under agreements to repurchase; accordingly, such securities continue to be carried on the Consolidated Statements of

Financial Condition.

Repurchase agreements accounted for as secured borrowings

June 30, 2025

December 31, 2024

Repurchase

Repurchase

(In thousands)

liability

liability

U.S. Treasury securities

Within 30 days

27,789

22,591

After 30 to 90 days

23,781

13,813

Total U.S. Treasury securities

51,570

36,404

Mortgage-backed securities

Within 30 days

4,473

4,924

After 30 to 90 days

13,505

Total mortgage-backed securities

4,473

18,429

Total

56,043

54,833

Repurchase agreements in this portfolio are generally short-term, often overnight. As such our risk is very limited. We manage the

liquidity risks arising from secured funding by sourcing funding globally from a diverse group of counterparties, providing a range of

securities collateral and pursuing longer durations, when appropriate.

Other short-term borrowings

At June 30, 2025 and December 31, 2024, other short-term borrowings consisted of $

550

million and $

225

million, respectively, in

FHLB Advances.

Notes Payable

The following table presents the composition of notes payable at June 30, 2025 and December 31, 2024.

(In thousands)

June 30, 2025

December 31, 2024

Advances with the FHLB with maturities ranging from

2025

through

2029

paying interest at

monthly

fixed rates ranging from

0.57

% to

4.17

214,200

302,722

Unsecured senior debt securities maturing on

2028

paying interest

semi-annually

at a fixed rate of

7.25

%, net of debt issuance costs of $

4,135

395,865

395,198

Junior subordinated deferrable interest debentures (related to trust preferred securities) maturing on

2034

with fixed interest rates ranging from

6.125

% to

6.564

%, net of debt issuance costs of $

248

198,386

198,373

Total notes payable

808,451

896,293

Note: Refer to the 2024 Form 10-K for rates information at December 31, 2024.

A breakdown of borrowings by contractual maturities at June 30, 2025 is included in the table below.

Assets sold under

Short-term

(In thousands)

agreements to

repurchase

borrowings

Notes payable

Total

2025

56,043

550,000

55,692

661,735

2026

74,500

74,500

2028

440,215

440,215

2029

39,658

39,658

Later years

198,386

198,386

Total borrowings

56,043

550,000

808,451

1,414,494

At June 30, 2025 and December 31, 2024, the Corporation had FHLB borrowing facilities whereby the Corporation could borrow up

to $

4.8

billion and $

4.7

billion, respectively, of which $

0.8

billion and $

0.5

billion, respectively, were used. In addition, at December

31, 2024, the Corporation had placed $

0.3

billion of the available FHLB credit facility as collateral for municipal letters of credit to

secure deposits. The FHLB borrowing facilities are collateralized with securities and loans held-in-portfolio, and do not have

restrictive covenants or callable features.

Also, at June 30, 2025, the Corporation had borrowing facilities at the discount window of the Federal Reserve Bank of New York

amounting to $

10.8

billion (December 31, 2024 - $

7.0

billion), which remained unused at June 30, 2025 and December 31, 2024.

The facilities are a collateralized source of credit that is highly dependable even under difficult market conditions.

Note 16 − Other liabilities

The caption of other liabilities in the Consolidated Statements of Financial Condition consists of the following major categories:

(In thousands)

June 30, 2025

December 31, 2024

Accrued expenses

333,826

334,145

Accrued interest payable

63,307

60,723

Accounts payable

100,842

91,218

Dividends payable

47,826

49,546

Trades payable

593,949

495,139

Liability for GNMA loans sold with an option to repurchase

8,097

9,108

Reserves for loan indemnifications

2,331

2,779

Reserve for operational losses

28,699

29,465

Operating lease liabilities (Note 27)

98,575

103,198

Finance lease liabilities (Note 27)

21,316

23,141

Pension benefit obligation

5,684

5,816

Postretirement benefit obligation

98,219

99,172

Others

76,416

68,396

Total other liabilities

1,479,087

1,371,846

Note 17 – Stockholders’ equity

As of June 30, 2025, stockholders’ equity totaled $

6.0

billion. During the six months ended June 30, 2025, the Corporation declared

cash dividends of $

1.40

(2024 - $

1.24

) per common share amounting to $

96.2

million (2024 - $

89.7

million). The quarterly dividend

of $

0.70

per share declared to stockholders of record as of the close of business on

May 29, 2025

was paid on

July 1, 2025

During the quarter ended June 30, 2025, the Corporation completed the repurchase of

1,136,390

shares of common stock for

112.0

million at an average price of $

98.54

per share. As of June 30, 2025, a total of $

451.5

million has been repurchased under

the common stock repurchase program of up to $

500

million announced by the Corporation on July 24, 2024.

On July 16, 2025, the Corporation announced the following actions as part of its capital plan: (i) an increase in its quarterly common

stock dividend from $

0.70

per share to $

0.75

per share, beginning with the dividend payable in the fourth quarter of 2025, subject to

approval by its Board of Directors, and (ii) a new common stock repurchase program of up to $

million.

Note 18 – Other comprehensive income

The following table presents changes in accumulated other comprehensive income by component for the quarters and six months

ended June 30, 2025 and 2024.

Changes in Accumulated Other Comprehensive Loss by Component [1]

Quarters ended

Six months ended

June 30,

June 30,

(In thousands)

2025

2024

2025

2024

Foreign currency translation

Beginning Balance

(78,011)

(68,548)

(71,365)

(64,528)

Other comprehensive income (loss)

7,499

165

854

(3,855)

Net change

7,499

165

854

(3,855)

Ending balance

(70,512)

(68,383)

(70,511)

(68,383)

Adjustment of pension and

postretirement benefit plans

Beginning Balance

(93,271)

(115,632)

(94,692)

(117,894)

Amounts reclassified from accumulated other

comprehensive loss for amortization of net losses

1,420

2,261

2,841

4,522

Net change

1,420

2,261

2,841

4,522

Ending balance

(91,851)

(113,371)

(91,851)

(113,372)

Unrealized net holding losses

on debt securities

Beginning Balance

(1,318,705)

(1,749,006)

(1,495,183)

(1,713,109)

Other comprehensive income (loss)

48,417

16,941

188,646

(54,163)

Amounts reclassified from accumulated other

comprehensive loss for amortization of net unrealized

losses of debt securities transferred from available-for-

sale to held-to-maturity

36,994

35,537

73,242

70,745

Net change

85,411

52,478

261,888

16,582

Ending balance

(1,233,294)

(1,696,528)

(1,233,295)

(1,696,527)

Total

(1,395,657)

(1,878,282)

(1,395,657)

(1,878,282)

[1]

All amounts presented are net of tax.

The following table presents the amounts reclassified out of each component of accumulated other comprehensive income during

the quarters and six months ended June 30, 2025 and 2024.

Reclassifications Out of Accumulated Other Comprehensive Loss

Quarters ended

Six months ended

Affected Line Item in the

June 30,

June 30,

(In thousands)

Consolidated Statements of Operations

2025

2024

2025

2024

Adjustment of pension and postretirement benefit plans

Amortization of net losses

Other operating expenses

(2,272)

(3,618)

(4,545)

(7,236)

Total before tax

(2,272)

(3,618)

(4,545)

(7,236)

Income tax benefit

852

1,357

1,704

2,714

Total net of tax

(1,420)

(2,261)

(2,841)

(4,522)

Unrealized net holding losses on debt securities

Amortization of unrealized net losses of debt

securities transferred to held-to-maturity

Interest income from investment securities

(46,242)

(44,421)

(91,552)

(88,430)

Total before tax

(46,242)

(44,421)

(91,552)

(88,430)

Income tax expense

9,248

8,884

18,310

17,685

Total net of tax

(36,994)

(35,537)

(73,242)

(70,745)

Total reclassification adjustments, net of tax

(38,414)

(37,798)

(76,083)

(75,267)

Note 19 – Guarantees

The Corporation has obligations upon the occurrence of certain events under financial guarantees provided in certain contractual

agreements. Also, from time to time, the Corporation securitized mortgage loans into guaranteed mortgage-backed securities

subject in certain instances, to lifetime credit recourse on the loans that serve as collateral for the mortgage-backed securities. The

Corporation has not sold any mortgage loans subject to credit recourse since 2009. Also, from time to time, the Corporation may

sell, in bulk sale transactions, residential mortgage loans and Small Business Administration (“SBA”) commercial loans subject to

credit recourse or to certain representations and warranties from the Corporation to the purchaser. These representations and

warranties may relate, for example, to borrower creditworthiness, loan documentation, collateral, prepayment and early payment

defaults. The Corporation may be required to repurchase the loans under the credit recourse agreements or representation and

warranties

At June 30, 2025, the Corporation serviced $

460

million (December 31, 2024 - $

495

million) in residential mortgage loans subject to

credit recourse provisions, principally loans associated with FNMA and FHLMC residential mortgage loan securitization programs. In

the event of any customer default, pursuant to the credit recourse provided, the Corporation is required to repurchase the loan or

reimburse the third-party investor for the loss incurred. The maximum potential amount of future payments that the Corporation

would be required to make under the recourse arrangements in the event of nonperformance by the borrowers is equivalent to the

total outstanding balance of the residential mortgage loans serviced with recourse and interest, if applicable. During the quarter and

six months ended June 30, 2025, the Corporation repurchased $

0.5

million and $

0.8

million, respectively, of unpaid principal

balance in mortgage loans subject to the credit recourse provisions (June 30, 2024

0.5

million and $

1.1

million, respectively). In

the event of nonperformance by the borrower, the Corporation has rights to the underlying collateral securing the mortgage loan.

The Corporation suffers ultimate losses on these loans when the proceeds from a foreclosure sale of the property underlying a

defaulted mortgage loan are less than the outstanding principal balance of the loan plus any uncollected interest advanced and the

costs of holding and disposing the related property. At June 30, 2025, the Corporation’s liability established to cover the estimated

credit loss exposure related to loans sold or serviced with credit recourse amounted to $

2

million (December 31, 2024 - $

3

million).

The following table shows the changes in the Corporation’s liability of estimated losses related to loans serviced with credit recourse

provisions during the quarters and six months ended June 30, 2025 and 2024.

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Balance as of beginning of period

2,397

4,353

2,611

4,211

Provision (benefit) for recourse liability

(205)

(204)

(375)

40

Net charge-offs

(21)

(91)

(65)

(193)

Balance as of end of period

2,171

4,058

2,171

4,058

From time to time, the Corporation sells loans and agrees to indemnify the purchaser for credit losses or any breach of certain

representations and warranties made in connection with the sale.

Servicing agreements relating to the mortgage-backed securities programs of FNMA, FHLMC and GNMA, and to mortgage loans

sold or serviced to certain other investors, including FHLMC, require the Corporation to advance funds to make scheduled payments

of principal, interest, taxes and insurance, if such payments have not been received from the borrowers. At June 30, 2025, the

Corporation serviced $

8.6

billion in mortgage loans for third-parties, including the loans serviced with credit recourse (December 31,

2024 - $

9.0

billion). The Corporation generally recovers funds advanced pursuant to these arrangements from the mortgage owner,

from liquidation proceeds when the mortgage loan is foreclosed or, in the case of FHA/VA loans, under the applicable FHA and

VA

insurance and guarantees programs. However, in the meantime, the Corporation must absorb the cost of the funds it advances

during the time the advance is outstanding. The Corporation must also bear the costs of attempting to collect on delinquent and

defaulted mortgage loans. In addition, if a defaulted loan is not cured, the mortgage loan would be canceled as part of the

foreclosure proceedings and the Corporation would not receive any future servicing income with respect to that loan. At June 30,

2025, the outstanding balance of funds advanced by the Corporation under such mortgage loan servicing agreements was $

36

million (December 31, 2024 - $

44

million). To the extent the mortgage loans underlying the Corporation’s servicing portfolio

experience increased delinquencies, the Corporation would be required to dedicate additional cash resources to comply with its

obligation to advance funds as well as incur additional administrative costs related to increases in collection efforts.

Popular, Inc. Holding Company (“PIHC”) fully and unconditionally guarantees certain borrowing obligations issued by certain of its

100

% owned consolidated subsidiaries amounting to $

94

million at June 30, 2025 and December 31, 2024, respectively. In addition,

at both June 30, 2025 and December 31, 2024, PIHC fully and unconditionally guaranteed on a subordinated basis $

193

million of

capital securities (trust preferred securities) issued by wholly-owned issuing trust entities to the extent set forth in the applicable

guarantee agreement. Refer to Note 17 to the Consolidated Financial Statements in the 2024 Form 10-K for further information on

the trust preferred securities.

Note 20 – Commitments and contingencies

Off-balance sheet risk

The Corporation is a party to financial instruments with off-balance sheet credit risk in the normal course of business to meet the

financial needs of its customers. These financial instruments include loan commitments, letters of credit and standby letters of credit.

These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the

Consolidated Statements of Financial Condition.

The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for

commitments to extend credit, standby letters of credit and financial guarantees is represented by the contractual notional amounts

of those instruments. The Corporation uses the same credit policies in making these commitments and conditional obligations as it

does for those reflected on the Consolidated Statements of Financial Condition.

Financial instruments with off-balance sheet credit risk, whose contract amounts represent potential credit risk as of the end of the

periods presented were as follows:

(In thousands)

June 30, 2025

December 31, 2024

Commitments to extend credit:

Credit card lines

6,201,145

5,599,823

Commercial lines of credit

4,271,702

3,971,331

Construction lines of credit

1,114,750

1,131,824

Other consumer unused credit commitments

271,638

260,121

Commercial letters of credit

10,284

5,002

Standby letters of credit

124,831

144,845

Commitments to originate or fund mortgage loans

17,556

29,604

At June 30, 2025 and December 31, 2024, the Corporation maintained a reserve of $

13

million and $

15

million, respectively, for

potential losses associated with unfunded loan commitments related to commercial and construction lines of credit.

Other commitments

At June 30, 2025 and December 31, 2024, the Corporation also maintained other non-credit commitments for $

2

million, primarily

for the acquisition of other investments.

Business concentration

Since the Corporation’s business activities are concentrated primarily in Puerto Rico, its results of operations and financial condition

are dependent upon the general trends of the Puerto Rico economy and, in particular, the residential and commercial real estate

markets. The concentration of the Corporation’s operations in Puerto Rico exposes it to greater risk than other banking companies

with a wider geographic base. Its asset and revenue composition by geographical area is presented in Note 32 to the Consolidated

Financial Statements.

Puerto Rico has faced significant fiscal and economic challenges for over a decade. In response to such challenges, the U.S.

Congress enacted PROMESA in 2016, which, among other things, established the Oversight Board and a framework for the

restructuring of the debts of the Commonwealth, its instrumentalities and municipalities. The Commonwealth and several of its

instrumentalities have availed themselves of debt restructuring proceedings under PROMESA. As of the date of this report, while

municipalities have been designated as covered entities under PROMESA, no municipality has commenced or has been authorized

by the Oversight Board to commence, any such debt restructuring proceeding under PROMESA.

At June 30, 2025, the Corporation’s direct exposure to the Puerto Rico government and its instrumentalities and municipalities

totaled $

412

million, of which $

362

million were outstanding ($

336

million and $

336

million at December 31, 2024). The

Corporation’s exposure at June 30, 2025 included up to $

47.4

million in Automated Clearing House (“ACH”) transaction settlement

exposure, none of which was outstanding. Of the amount outstanding, $

351

million consists of loans and $

11

million are securities

323

million and $

13

million at December 31, 2024). Substantially all of the amount outstanding at June 30, 2025 and December

31, 2024 were obligations from various Puerto Rico municipalities. In most cases, these were “general obligations” of a municipality,

to which the applicable municipality has pledged its good faith, credit and unlimited taxing power, or “special obligations” of a

municipality, to which the applicable municipality has pledged other revenues. At June 30, 2025, approximately

% of the

Corporation’s exposure to municipal loans and securities was concentrated in the municipalities of San Juan, Guaynabo, Carolina

and Caguas.

The following table details the loans and investments representing the Corporation’s direct exposure to the Puerto Rico government

according to their maturities as of June 30, 2025

(In thousands)

Investment

Portfolio

Loans

Total Outstanding

Total Exposure

Central Government

Within 1 year

3

3

47,403

After 10 years

40

40

40

Total Central Government

43

43

47,443

Municipalities

Within 1 year

2,540

12,764

15,304

17,304

After 1 to 5 years

7,885

147,033

154,918

154,918

After 5 to 10 years

655

146,732

147,387

147,387

After 10 years

44,582

44,582

44,582

Total Municipalities

11,080

351,111

362,191

364,191

Total Direct Government Exposure

11,123

351,111

362,234

411,634

In addition, at June 30, 2025, the Corporation had $

212

million in loans insured or securities issued by Puerto Rico governmental

entities but for which the principal source of repayment is non-governmental ($

220

million at December 31, 2024). These included

168

million in residential mortgage loans insured by the Puerto Rico Housing Finance Authority (“HFA”), a governmental

instrumentality that has been designated as a covered entity under PROMESA (December 31, 2024 - $

176

million). These

mortgage loans are secured by first mortgages on Puerto Rico residential properties and the HFA insurance covers losses in the

event of a borrower default and upon the satisfaction of certain other conditions. The Corporation also had at June 30, 2025, $

37

million in bonds issued by HFA which are secured by second mortgage loans on Puerto Rico residential properties, and for which

HFA also provides insurance to cover losses in the event of a borrower default and upon the satisfaction of certain other conditions

(December 31, 2024 - $

38

million). In the event that the mortgage loans insured by HFA and held by the Corporation directly or

those serving as collateral for the HFA bonds default and the collateral is insufficient to satisfy the outstanding balance of these

loans, HFA’s ability to honor its insurance will depend, among other factors, on the financial condition of HFA at the time such

obligations become due and payable. The Corporation does not consider the government guarantee when estimating the credit

losses associated with this portfolio. Although the Governor is currently authorized by local legislation to impose a temporary

moratorium on the financial obligations of the HFA, a moratorium on such obligations has not been imposed as of the date hereof.

BPPR’s commercial loan portfolio also includes loans to private borrowers who are service providers, lessors, suppliers or have

other relationships with the government. These borrowers could be negatively affected by the Commonwealth’s fiscal crisis and the

ongoing Title III proceedings under PROMESA. Similarly, BPPR’s mortgage and consumer loan portfolios include loans to

government employees and retirees, which could also be negatively affected by fiscal measures such as employee layoffs or

furloughs or reductions in pension benefits.

In addition, $

2.3

billion of residential mortgages and $

83.1

million commercial loans were insured or guaranteed by the U.S.

Government or its agencies at June 30, 2025 (compared to $

2.1

billion and $

87.4

million, respectively, at December 31, 2024). The

Corporation also had U.S. Treasury and obligations from the U.S. Government, its agencies or government sponsored entities within

the portfolio of available-for-sale and held-to-maturity securities as described in Note 5 and 6 to the Consolidated Financial

Statements.

At June 30, 2025, the Corporation had operations in the United States Virgin Islands (the “USVI”) and had $

28

million in direct

exposure to USVI government entities (December 31, 2024 - $

28

million). The USVI has been experiencing a number of fiscal and

economic challenges that could adversely affect the ability of its public corporations and instrumentalities to service their outstanding

debt obligations.

At June 30, 2025, the Corporation had operations in the British Virgin Islands (“BVI”) and it had a loan portfolio amounting to $

194

million comprised of various retail and commercial clients, compared to a loan portfolio of $

196

million at December 31, 2024. At

June 30, 2025, the Corporation had

no

significant exposure to a single borrower in the BVI.

FDIC Special Assessment

On November 16, 2023, the Federal Deposit Insurance Corporation (“FDIC”) imposed a special assessment (the “FDIC Special

Assessment”) amount to recover the losses to the deposit insurance fund resulting from the FDIC’s funds used, in March 2023, in

connection with the systemic risk exception, to the least-cost resolution test, under the Federal Deposit Insurance Act to manage the

receiverships of several failed banks. In connection with this assessment, the Corporation accrued $

71.4

million, $

45.3

million net of

tax, in the fourth quarter of 2023, representing the full amount of the assessment.

During the first quarter of 2024, the Corporation recorded an additional expense of $

14.3

million, $

9.1

million net of tax, to reflect the

FDIC's higher loss estimate communicated by the FDIC. The special assessment amount and collection period may change as the

estimated loss is periodically adjusted or if the total amount collected varies.

Legal Proceedings

The nature of Popular’s business ordinarily generates claims, litigation, arbitration, regulatory and governmental investigations, and

legal and administrative cases and proceedings (collectively, “Legal Proceedings”). Popular’s Legal Proceedings may involve

various lines of business and include claims relating to contract, torts, consumer protection, securities, antitrust, employment, tax

and other laws. The recovery sought in Legal Proceedings may include substantial or indeterminate compensatory damages,

punitive damages, injunctive relief, or recovery on a class-wide basis. When the Corporation determines that it has meritorious

defenses to the claims asserted, it vigorously defends itself. The Corporation will consider the settlement of cases (including cases

where it has meritorious defenses) when, in management’s judgment, it is in the best interest of the Corporation and its stockholders

to do so. On at least a quarterly basis, Popular assesses its liabilities and contingencies relating to outstanding Legal Proceedings

utilizing the most current information available. For matters where it is probable that the Corporation will incur a material loss and the

amount can be reasonably estimated, the Corporation establishes an accrual for the loss. Once established, the accrual is adjusted

on at least a quarterly basis to reflect any relevant developments, as appropriate. For matters where a material loss is not probable,

or the amount of the loss cannot be reasonably estimated, no accrual is established.

In certain cases, exposure to loss exists in excess of any accrual to the extent such loss is reasonably possible, but not probable.

Management believes and estimates that the range of reasonably possible losses (with respect to those matters where such limits

may be determined in excess of amounts accrued) for current Legal Proceedings ranged from $

0

to approximately $

7.1

million as of

June 30, 2025. In certain cases, management cannot reasonably estimate the possible loss at this time. Any estimate involves

significant judgment, given the varying stages of the Legal Proceedings (including the fact that many of them are currently in

preliminary stages), the existence of multiple defendants in several of the current Legal Proceedings whose share of liability has yet

to be determined, the numerous unresolved issues in many of the Legal Proceedings, and the inherent uncertainty of the various

potential outcomes of such Legal Proceedings. Accordingly, management’s estimate will change from time-to-time, and actual

losses may be more or less than the current estimate.

While the outcome of Legal Proceedings is inherently uncertain, based on information currently available, advice of counsel, and

available insurance coverage, management believes that the amount it has already accrued is adequate and any incremental

liability arising from the Legal Proceedings in matters in which a loss amount can be reasonably estimated will not have a material

adverse effect on the Corporation’s consolidated financial position. However, in the event of unexpected future developments, it is

possible that the ultimate resolution of these matters in a reporting period, if unfavorable, could have a material adverse effect on

the Corporation’s consolidated financial position for that period.

Note 21 – Non-consolidated variable interest entities

The Corporation is involved with

two

statutory trusts which it created to issue trust preferred securities to the public. These trusts are

deemed to be variable interest entities (“VIEs”) since the equity investors at risk have no substantial decision-making rights. The

Corporation does not hold any variable interest in the trusts, and therefore, cannot be the trusts’ primary beneficiary. Furthermore,

the Corporation concluded that it did not hold a controlling financial interest in these trusts since the decisions of the trusts are

predetermined through the trust documents and the guarantee of the trust preferred securities is irrelevant since in substance the

sponsor is guaranteeing its own debt.

Also, the Corporation is involved with various special purpose entities mainly in guaranteed mortgage securitization transactions,

including GNMA and FNMA.

The Corporation has also engaged in securitization transactions with FHLMC, but considers its

exposure in the form of servicing fees and servicing advances not to be significant

at June 30, 2025

These special purpose entities

are deemed to be VIEs since they lack equity investments at risk. The Corporation’s continuing involvement in these guaranteed

loan securitizations includes owning certain beneficial interests in the form of securities as well as the servicing rights retained. The

Corporation is not required to provide additional financial support to any of the variable interest entities to which it has transferred

the financial assets. The mortgage-backed securities, to the extent retained, are classified in the Corporation’s Consolidated

Statements of Financial Condition as available-for-sale or trading securities. The Corporation concluded that, essentially, these

entities (FNMA and GNMA) control the design of their respective VIEs, dictate the quality and nature of the collateral, require the

underlying insurance, set the servicing standards via the servicing guides and can change them at will, and can remove a primary

servicer with cause, and without cause in the case of FNMA. Moreover, through their guarantee obligations, agencies (FNMA and

GNMA) have the obligation to absorb losses that could be potentially significant to the VIE.

The Corporation holds variable interests in these VIEs in the form of agency mortgage-backed securities and collateralized

mortgage obligations, including those securities originated by the Corporation and those acquired from third parties. Additionally, the

Corporation holds agency mortgage-backed securities and agency collateralized mortgage obligations issued by third party VIEs in

which it has no other form of continuing involvement. Refer to Note 23 to the Consolidated Financial Statements for additional

information on the debt securities outstanding at June 30, 2025 and December 31, 2024, which are classified as available-for-sale

and trading securities in the Corporation’s Consolidated Statements of Financial Condition. In addition, the Corporation holds

variable interests in the form of servicing fees, since it retains the right to service the transferred loans in those government-

sponsored special purpose entities (“SPEs”) and may also purchase the right to service loans in other government-sponsored SPEs

that were transferred to those SPEs by a third-party.

The following table presents the carrying amount and classification of the assets related to the Corporation’s variable interests in

non-consolidated VIEs and the maximum exposure to loss as a result of the Corporation’s involvement as servicer of GNMA and

FNMA loans at June 30, 2025 and December 31, 2024.

(In thousands)

June 30, 2025

December 31, 2024

Assets

Servicing assets:

Mortgage servicing rights

79,881

84,356

Total servicing assets

79,881

84,356

Other assets:

Servicing advances

5,598

6,112

Total other assets

5,598

6,112

Total assets

85,479

90,468

Maximum exposure to loss

85,479

90,468

The size of the non-consolidated VIEs, in which the Corporation has a variable interest in the form of servicing fees, measured as

the total unpaid principal balance of the loans, amounted to $

6.3

billion at June 30, 2025 (December 31, 2024 - $

6.6

billion).

The Corporation determined that the maximum exposure to loss includes the fair value of the MSRs and the assumption that the

servicing advances at June 30, 2025 and December 31, 2024, will not be recovered. The agency debt securities are not included as

part of the maximum exposure to loss since they are guaranteed by the related agencies.

ASU 2009-17 requires that an ongoing primary beneficiary assessment should be made to determine whether the Corporation is the

primary beneficiary of any of the VIEs it is involved with. The conclusion on the assessment of these non-consolidated VIEs has not

changed since their initial evaluation. The Corporation concluded that it is still not the primary beneficiary of these VIEs, and

therefore, these VIEs are not required to be consolidated in the Corporation’s financial statements at June 30, 2025.

Note 22 – Related party transactions

Centro Financiero BHD, S.A.

At June 30, 2025, the Corporation had a

15.63

% equity interest in Centro Financiero BHD, S.A. (“BHD”), one of the largest banking

and financial services groups in the Dominican Republic. During the six months ended June 30, 2025, the Corporation recorded

13.0

million in equity pickup (June 30, 2024 - $

17.4

million), including the net impact of $

19.9

million from net earnings (June 30,

2024 - $

22.0

million), offset by ($

6.9

) million recorded through Other Comprehensive Income (June 30, 2024 - ($

4.6

) million) related

to foreign currency translation adjustments and changes in the fair value of available for sale securities. At June 30, 2025, the

investment in BHD had a carrying amount of $

232.5

million (December 31, 2024 - $

239.5

million) and the Corporation received $

20

million in cash dividend distributions during the six months ended June 30, 2025 (June 30, 2024 - $

19.4

million).

Note 23 – Fair value measurement

ASC Subtopic 820-10 “Fair Value Measurements and Disclosures” establishes a fair value hierarchy that prioritizes the inputs to

valuation techniques used to measure fair value into three levels in order to increase consistency and comparability in fair value

measurements and disclosures. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

Level 1

- Unadjusted quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to

access at the measurement date. Valuation on these instruments does not necessitate a significant degree of judgment since

valuations are based on quoted prices that are readily available in an active market.

Level 2

- Quoted prices other than those included in Level 1 that are observable either directly or indirectly. Level 2 inputs

include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in

markets that are not active, or other inputs that are observable or that can be corroborated by observable market data for

substantially the full term of the financial instrument.

Level 3

- Inputs are unobservable and significant to the fair value measurement. Unobservable inputs reflect the Corporation’s

own judgements about assumptions that market participants would use in pricing the asset or liability.

The Corporation maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the

observable inputs be used when available. Fair value is based upon quoted market prices when available. If listed prices or quotes

are not available, the Corporation employs internally-developed models that primarily use market-based inputs including yield

curves, interest rates, volatilities, and credit curves, among others. Valuation adjustments are limited to those necessary to ensure

that the financial instrument’s fair value is adequately representative of the price that would be received or paid in the marketplace.

These adjustments include amounts that reflect counterparty credit quality, the Corporation’s credit standing, constraints on liquidity

and unobservable parameters that are applied consistently. There have been no changes in the Corporation’s methodologies used

to estimate the fair value of assets and liabilities from those disclosed in the 2024 Form 10-K.

The estimated fair value may be subjective in nature and may involve uncertainties and matters of significant judgment for certain

financial instruments. Changes in the underlying assumptions used in calculating fair value could significantly affect the results.

Fair Value on a Recurring and Nonrecurring Basis

The following fair value hierarchy tables present information about the Corporation’s assets and liabilities measured at fair value on

a recurring basis at June 30, 2025 and December 31, 2024:

At June 30, 2025

(In thousands)

Level 1

Level 2

Level 3

Measured at NAV

Total

RECURRING FAIR VALUE MEASUREMENTS

Assets

Debt securities available-for-sale:

U.S. Treasury securities

7,908,859

7,503,937

15,412,796

Collateralized mortgage obligations - federal

agencies

110,432

110,432

Mortgage-backed securities

4,965,802

432

4,966,234

Other

750

750

Total debt securities available-for-sale

7,908,859

12,580,171

1,182

20,490,212

Trading account debt securities, excluding

derivatives:

U.S. Treasury securities

5,813

10

5,823

Obligations of Puerto Rico, States and political

subdivisions

50

50

Collateralized mortgage obligations

615

615

Mortgage-backed securities

22,949

84

23,033

Other

122

122

Total trading account debt securities, excluding

derivatives

5,813

23,624

206

29,643

Equity securities

47,009

447

47,456

Mortgage servicing rights

103,077

103,077

Loans held-for-sale

2,898

2,898

Derivatives

24,792

24,792

Total assets measured at fair value on a

recurring basis

7,914,672

12,678,494

104,465

447

20,698,078

Liabilities

Derivatives

(23,349)

(23,349)

Total liabilities measured at fair value on a

recurring basis

(23,349)

(23,349)

At December 31, 2024

(In thousands)

Level 1

Level 2

Level 3

Measured at NAV

Total

RECURRING FAIR VALUE MEASUREMENTS

Assets

Debt securities available-for-sale:

U.S. Treasury securities

7,512,171

5,482,939

12,995,110

Collateralized mortgage obligations - federal

agencies

120,284

120,284

Mortgage-backed securities

5,127,775

484

5,128,259

Other

2,250

2,250

Total debt securities available-for-sale

7,512,171

10,730,998

2,734

18,245,903

Trading account debt securities, excluding

derivatives:

U.S. Treasury securities

2,814

10

2,824

Obligations of Puerto Rico, States and political

subdivisions

55

55

Collateralized mortgage obligations

655

655

Mortgage-backed securities

29,032

84

29,116

Other

133

133

Total trading account debt securities, excluding

derivatives

2,814

29,752

217

32,783

Equity securities

45,664

381

46,045

Mortgage servicing rights

108,103

108,103

Loans held-for-sale

5,423

5,423

Derivatives

26,023

26,023

Total assets measured at fair value on a

recurring basis

7,514,985

10,837,860

111,054

381

18,464,280

Liabilities

Derivatives

(22,832)

(22,832)

Total liabilities measured at fair value on a

recurring basis

(22,832)

(22,832)

Loans held-for-sale measured at fair value

Loans held-for-sale measured at fair value were priced based on secondary market prices. These loans are classified as Level 2.

The following tables summarize the difference between the aggregate fair value and the aggregate unpaid principal balance for

mortgage loans originated as held-for-sale measured at fair value as of June 30, 2025 and December 31, 2024.

(In thousands)

June 30, 2025

Aggregate Unpaid

Fair Value

Principal Balance

Difference

Loans held for sale

2,898

2,832

66

(In thousands)

December 31, 2024

Aggregate Unpaid

Fair Value

Principal Balance

Difference

Loans held for sale

5,423

5,436

(13)

No

loans held-for-sale were 90 or more days past due or on nonaccrual status as of June 30, 2025 and December 31, 2024.

The fair value information included in the following tables is not as of period end, but as of the date that the fair value measurement

was recorded during the six months ended June 30, 2025 and 2024 and excludes nonrecurring fair value measurements of assets

no longer outstanding as of the reporting date.

Six months ended June 30, 2025

(In thousands)

Level 1

Level 2

Level 3

Total

NONRECURRING FAIR VALUE MEASUREMENTS

Assets

Write-downs

Loans

[1]

4,361

4,361

(91)

Other real estate owned

[2]

3,919

3,919

(1,573)

Other foreclosed assets

[2]

162

162

(46)

Total assets measured at fair value on a nonrecurring basis

8,442

8,442

(1,710)

[1] Relates mainly to certain impaired collateral dependent loans. The impairment was measured based on the fair value of the collateral, which is

derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations. Costs to sell are

excluded from the reported fair value amount.

[2] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are

excluded from the reported fair value amount.

Six months ended June 30, 2024

(In thousands)

Level 1

Level 2

Level 3

Total

NONRECURRING FAIR VALUE MEASUREMENTS

Assets

Write-downs

Loans

[1]

2,039

2,039

(329)

Loans held-for-sale

[2]

3,028

3,028

(38)

Other real estate owned

[3]

4,426

4,426

(1,602)

Other foreclosed assets

[3]

211

211

(46)

Total assets measured at fair value on a nonrecurring basis

3,028

6,676

9,704

(2,015)

[1] Relates mainly to certain impaired collateral dependent loans. The impairment was measured based on the fair value of the collateral, which is

derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations. Costs to sell are

excluded from the reported fair value amount.

[2] Relates to a quarterly valuation on loans held-for-sale. Costs to sell are excluded from the reported fair value amount.

[3] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are

excluded from the reported fair value amount.

The following tables present the changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the quarters

and six months ended June 30, 2025 and 2024.

Quarter ended June 30, 2025

MBS

Other

MBS

Other

classified

securities

classified

securities

as debt

classified as

as trading

classified

securities

debt securities

account

as trading

Mortgage

available-

available-

debt

account debt

servicing

Total

(In thousands)

for-sale

for-sale

securities

securities

rights

assets

Balance at March 31, 2025

457

750

84

127

104,743

106,161

Gains (losses) included in earnings

(5)

(1,954)

(1,959)

Additions

288

288

Settlements

(25)

(25)

Balance at June 30, 2025

432

750

84

122

103,077

104,465

Changes in unrealized gains (losses) included in

earnings relating to assets still held at June 30,

2025

8

348

356

Six months ended June 30, 2025

MBS

Other

MBS

Other

classified

securities

classified

securities

as debt

classified as

as trading

classified

securities

debt securities

account

as trading

Mortgage

available-

available-

debt

account debt

servicing

Total

(In thousands)

for-sale

for-sale

securities

securities

rights

assets

Balance at January 1, 2025

484

2,250

84

133

108,103

111,054

Gains (losses) included in earnings

(11)

(5,524)

(5,535)

Gains (losses) included in OCI

(2)

(2)

Additions

498

498

Settlements

(50)

(50)

Transfers out of Level 3

(1,500)

(1,500)

Balance at June 30, 2025

432

750

84

122

103,077

104,465

Changes in unrealized gains (losses) included in

earnings relating to assets still held at June 30,

2025

16

(977)

(961)

Quarter ended June 30, 2024

MBS

Other

Other

classified

securities

MBS

securities

as debt

classified as

classified

classified

securities

debt securities

as trading

as trading

Mortgage

available-

available-

account debt

account debt

servicing

Total

(In thousands)

for-sale

for-sale

securities

securities

rights

assets

Balance at March 31, 2024

607

2,000

84

166

114,964

117,821

Gains (losses) included in earnings

(8)

(1,945)

(1,953)

Gains (losses) included in OCI

(1)

(1)

Additions

367

367

Settlements

(25)

(25)

Balance at June 30, 2024

581

2,000

84

158

113,386

116,209

Changes in unrealized gains (losses) included in

earnings relating to assets still held at June 30,

2024

10

500

510

Six months ended June 30, 2024

MBS

Other

Other

classified

securities

CMOs

securities

as debt

classified as

classified

MBS

classified

securities

debt securities

as trading

classified as

as trading

Mortgage

available-

available-

account debt

trading account

account debt

servicing

Total

(In thousands)

for-sale

for-sale

securities

securities

securities

rights

assets

Balance at January 1, 2024

606

2,500

5

112

167

118,109

121,499

Gains (losses) included in earnings

(500)

(9)

(5,384)

(5,893)

Additions

661

661

Settlements

(25)

(5)

(28)

(58)

Balance at June 30, 2024

581

2,000

84

158

113,386

116,209

Changes in unrealized gains (losses)

included in earnings relating to assets

still held at June 30, 2024

(500)

12

(702)

(1,190)

Gains and losses (realized and unrealized) included in earnings for the quarters and six months ended June 30, 2025 and 2024 for

Level 3 assets and liabilities included in the previous tables are reported in the Consolidated Statement of Operations as follows:

Quarter ended June 30, 2025

Six months ended June 30, 2025

Changes in unrealized

Changes in unrealized

Total gains

gains (losses) relating to

Total gains

gains (losses) relating to

(losses) included

assets still held at

(losses) included

assets still held at

(In thousands)

in earnings

reporting date

in earnings

reporting date

Mortgage banking activities

(1,954)

348

(5,524)

(977)

Trading account profit (loss)

(5)

8

(11)

16

Total

(1,959)

356

(5,535)

(961)

Quarter ended June 30, 2024

Six months ended June 30, 2024

Changes in unrealized

Changes in unrealized

Total gains

gains (losses) relating to

Total gains

gains (losses) relating to

(losses) included

assets still held at

(losses) included

assets still held at

(In thousands)

in earnings

reporting date

in earnings

reporting date

Mortgage banking activities

(1,945)

500

(5,384)

(702)

Trading account profit (loss)

(8)

10

(9)

12

Provision for credit losses

(500)

(500)

Total

(1,953)

510

(5,893)

(1,190)

The following tables include quantitative information about significant unobservable inputs used to derive the fair value of Level 3

instruments, excluding those instruments for which the unobservable inputs were not developed by the Corporation such as prices

of prior transactions and/or unadjusted third-party pricing sources at June 30, 2025 and 2024.

Fair value at

June 30,

(In thousands)

2025

Valuation technique

Unobservable inputs

Weighted average (range) [1]

Other - trading

122

Discounted cash flow model

Weighted average life

2

years

Yield

12

.0%

Prepayment speed

10.8

Loans held-in-portfolio

4,361

[2]

External appraisal

Haircut applied on

external appraisals

5.0

[1]

Weighted average of significant unobservable inputs used to develop Level 3 fair value measurements were calculated by relative fair value.

[2]

Loans held-in-portfolio in which haircuts were not applied to external appraisals were excluded from this table.

Fair value at

June 30,

(In thousands)

2024

Valuation technique

Unobservable inputs

Weighted average (range) [1]

Other - trading

158

Discounted cash flow model

Weighted average life

2.3

years

Yield

12

.0%

Prepayment speed

10.8

Loans held-in-portfolio

2,039

[2]

External appraisal

Haircut applied on

external appraisals

10

.0%

[1]

Weighted average of significant unobservable inputs used to develop Level 3 fair value measurements were calculated by relative fair value.

[2]

Loans held-in-portfolio in which haircuts were not applied to external appraisals were excluded from this table.

Note 24 – Fair value of financial instruments

The fair value of financial instruments is the amount at which an asset or obligation could be exchanged in a current transaction

between willing parties, other than in a forced or liquidation sale. For those financial instruments with no quoted market prices

available, fair values have been estimated using present value calculations or other valuation techniques, as well as management’s

best judgment with respect to current economic conditions, including discount rates, estimates of future cash flows, and prepayment

assumptions. Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized

in actual transactions.

The fair values reflected herein have been determined based on the prevailing rate environment at June 30, 2025 and December

31, 2024, as applicable. In different interest rate environments, fair value estimates can differ significantly, especially for certain fixed

rate financial instruments. In addition, the fair values presented do not attempt to estimate the value of the Corporation’s fee

generating businesses and anticipated future business activities, that is, they do not represent the Corporation’s value as a going

concern. There have been no changes in the Corporation’s valuation methodologies and inputs used to estimate the fair values for

each class of financial assets and liabilities not measured at fair value.

The following tables present the carrying amount and estimated fair values of financial instruments with their corresponding level in

the fair value hierarchy. The aggregate fair value amounts of the financial instruments disclosed do not represent management’s

estimate of the underlying value of the Corporation.

June 30, 2025

Carrying

Measured

(In thousands)

amount

Level 1

Level 2

Level 3

at NAV

Fair value

Financial Assets:

Cash and due from banks

400,631

400,631

400,631

Money market investments

6,340,786

6,330,415

10,371

6,340,786

Trading account debt securities, excluding derivatives

[1]

29,643

5,813

23,624

206

29,643

Debt securities available-for-sale

[1]

20,490,212

7,908,859

12,580,171

1,182

20,490,212

Debt securities held-to-maturity:

U.S. Treasury securities

7,479,657

7,499,064

7,499,064

Obligations of Puerto Rico, States and political

subdivisions

48,598

6,820

42,361

49,181

Collateralized mortgage obligation-federal agency

1,510

1,312

1,312

Securities in wholly owned statutory business trusts

5,960

5,960

5,960

Total debt securities held-to-maturity

7,535,725

7,513,156

42,361

7,555,517

Equity securities:

FHLB stock

66,152

66,152

66,152

FRB stock

101,252

101,252

101,252

Other investments

54,987

47,009

8,047

447

55,503

Total equity securities

222,391

214,413

8,047

447

222,907

Loans held-for-sale

2,898

2,898

2,898

Loans held-in-portfolio

37,415,693

36,611,781

36,611,781

Mortgage servicing rights

103,077

103,077

103,077

Derivatives

24,792

24,792

24,792

June 30, 2025

Carrying

Measured

(In thousands)

amount

Level 1

Level 2

Level 3

at NAV

Fair value

Financial Liabilities:

Deposits:

Demand deposits

57,618,705

57,618,705

57,618,705

Time deposits

9,598,786

9,378,576

9,378,576

Total deposits

67,217,491

66,997,281

66,997,281

Assets sold under agreements to repurchase

56,043

56,049

56,049

Other short-term borrowings

[2]

550,000

550,000

550,000

Notes payable:

FHLB advances

214,200

211,087

211,087

Unsecured senior debt securities

395,865

416,044

416,044

Junior subordinated deferrable interest debentures

(related to trust preferred securities)

198,386

187,515

187,515

Total notes payable

808,451

814,646

814,646

Derivatives

23,349

23,349

23,349

[1]

Refer to Note 23 to the Consolidated Financial Statements for the fair value by class of financial asset and its hierarchy level.

[2]

Refer to Note 15 to the Consolidated Financial Statements for the composition of other short-term borrowings.

December 31, 2024

Carrying

Measured

(In thousands)

amount

Level 1

Level 2

Level 3

at NAV

Fair value

Financial Assets:

Cash and due from banks

419,638

419,638

419,638

Money market investments

6,380,948

6,371,180

9,768

6,380,948

Trading account debt securities, excluding derivatives

[1]

32,783

2,814

29,752

217

32,783

Debt securities available-for-sale

[1]

18,245,903

7,512,171

10,730,998

2,734

18,245,903

Debt securities held-to-maturity:

U.S. Treasury securities

7,693,418

7,623,824

7,623,824

Obligations of Puerto Rico, States and political

subdivisions

51,865

6,866

44,711

51,577

Collateralized mortgage obligation-federal agency

1,518

1,304

1,304

Securities in wholly owned statutory business trusts

5,959

5,959

5,959

Total debt securities held-to-maturity

7,752,760

7,637,953

44,711

7,682,664

Equity securities:

FHLB stock

55,786

55,786

55,786

FRB stock

100,304

100,304

100,304

Other investments

52,076

45,664

6,528

381

52,573

Total equity securities

208,166

201,754

6,528

381

208,663

Loans held-for-sale

5,423

5,423

5,423

Loans held-in-portfolio

36,361,628

35,652,539

35,652,539

Mortgage servicing rights

108,103

108,103

108,103

Derivatives

26,023

26,023

26,023

December 31, 2024

Carrying

Measured

(In thousands)

amount

Level 1

Level 2

Level 3

at NAV

Fair value

Financial Liabilities:

Deposits:

Demand deposits

55,871,463

55,871,463

55,871,463

Time deposits

9,012,882

8,795,803

8,795,803

Total deposits

64,884,345

64,667,266

64,667,266

Assets sold under agreements to repurchase

54,833

54,845

54,845

Other short-term borrowings

[2]

225,000

225,000

225,000

Notes payable:

FHLB advances

302,722

295,023

295,023

Unsecured senior debt securities

395,198

415,148

415,148

Junior subordinated deferrable interest debentures

(related to trust preferred securities)

198,373

189,758

189,758

Total notes payable

896,293

899,929

899,929

Derivatives

22,832

22,832

22,832

[1]

Refer to Note 23 to the Consolidated Financial Statements for the fair value by class of financial asset and its hierarchy level.

[2]

Refer to Note 15 to the Consolidated Financial Statements for the composition of other short-term borrowings.

Refer to Note 20 to the Consolidated Financial Statements for the notional amount of commitments to extend credit, which

represents the unused portion of credit facilities granted to customers, and letters of credit, which represent the contractual amount

that is required to be paid in the event of nonperformance, at June 30, 2025 and December 31, 2024. The fair value of commitments

to extend credit and letters of credit, which are based on the fees charged to enter into those agreements, are not material to

Popular’s financial statements.

Note 25 – Net income per common share

The following table sets forth the computation of net income per common share (“EPS”), basic and diluted, for the quarters and six

months ended June 30, 2025 and 2024:

Quarters ended June 30,

Six months ended June 30,

(In thousands, except per share information)

2025

2024

2025

2024

Net income

210,440

177,789

387,942

281,072

Preferred stock dividends

(353)

(353)

(706)

(706)

Net income applicable to common stock

210,087

177,436

387,236

280,366

Average common shares outstanding

68,050,361

71,970,773

68,661,851

71,920,254

Average potential dilutive common shares

29,288

21,138

25,808

17,180

Average common shares outstanding - assuming dilution

68,079,649

71,991,911

68,687,659

71,937,434

Basic EPS

3.09

2.47

5.64

3.90

Diluted EPS

3.09

2.46

5.64

3.90

For the quarters and six months ended June 30, 2025 and 2024, the Corporation calculated the impact of potential dilutive common

shares under the treasury stock method, consistent with the method used for the preparation of the financial statements for the year

ended December 31, 2024. For a discussion of the calculation under the treasury stock method, refer to Note 30 of the Consolidated

Financial Statements included in the 2024 Form 10-K.

Note 26 – Revenue from contracts with customers

The following table presents the Corporation’s revenue streams from contracts with customers by reportable segment for the

quarters and six months ended June 30, 2025 and 2024.

Quarter ended June 30,

Six months ended June 30,

(In thousands)

2025

2025

BPPR

Popular U.S.

BPPR

Popular U.S.

Service charges on deposit accounts

36,194

2,632

72,650

5,230

Other service fees:

Debit card fees

27,707

211

53,941

409

Insurance fees, excluding reinsurance

8,719

2,223

16,400

3,910

Credit card fees, excluding late fees and membership fees

28,145

334

53,530

739

Sale and administration of investment products

9,058

18,031

Trust fees

6,879

13,510

Total revenue from contracts with customers [1]

116,702

5,400

228,062

10,288

[1]

The amounts include intersegment transactions of $

0.6

million and $

1.2

million, respectively, for the quarter and six months ended June 30, 2025.

Quarter ended June 30,

Six months ended June 30,

(In thousands)

2024

2024

BPPR

Popular U.S.

BPPR

Popular U.S.

Service charges on deposit accounts

35,055

2,471

70,071

4,897

Other service fees:

Debit card fees [2]

26,976

200

52,311

399

Insurance fees, excluding reinsurance

11,708

1,600

22,264

3,446

Credit card fees, excluding late fees and membership fees [2]

26,125

368

50,639

826

Sale and administration of investment products

7,850

15,277

Trust fees

6,923

13,908

Total revenue from contracts with customers [1]

114,637

4,639

224,470

9,568

[1]

The amounts include intersegment transactions of $

2.7

million and $

3.3

million, respectively, for the quarter and six months ended June 30, 2024.

[2]

Effective in the third quarter of 2024, the Corporation reclassified certain interchange fees, which were previously included jointly with credit card fees

from common network activity, as debit card fees. For the quarter and six month period ended June 30, 2024, interchange fees of $

10.9

million and $

22.2

million were reclassified.

Revenue from contracts with customers is recognized when, or as, the performance obligations are satisfied by the Corporation by

transferring the promised services to the customers based on ASC 606 Revenue from Contracts with Customers. Revenue streams

identified from contracts with customers, as listed above, will have certain timing for recognition based on the nature of the contract

including when the obligation is satisfied and/or services are rendered. Service charges on deposit accounts, debit card fees, and

credit card fees are recognized at a point in time, upon the occurrence of an activity or an event. Interchange fees on debit and

credit card transactions are recognized upon settlement of the payment transaction. For more details over nature and timing of

revenue streams from contracts with customers refer to Note 31 on the 2024 Form 10-K for a complete description of the nature and

timing of revenue streams from contracts with customers.

Note 27 – Leases

The Corporation enters in the ordinary course of business into operating and finance leases for land, buildings and equipment.

These contracts generally do not include purchase options or residual value guarantees. The remaining lease terms of

0.11

to

29.5

years considers options to extend the leases for up to

20

years. The Corporation identifies leases when it has both the right to

obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset.

The Corporation recognizes right-of-use assets (“ROU assets”) and lease liabilities related to operating and finance leases in its

Consolidated Statements of Financial Condition under the caption of other assets and other liabilities, respectively. Refer to Note 12

and Note 16 to the Consolidated Financial Statements, respectively, for information on the balances of these lease assets and

liabilities.

The Corporation uses the incremental borrowing rate for purposes of discounting lease payments for operating and finance leases,

since it does not have enough information to determine the rates implicit in the leases. The discount rates are based on fixed-rate

and fully amortizing borrowing facilities of its banking subsidiaries that are collateralized. For leases held by non-banking

subsidiaries, a credit spread is added to this rate based on financing transactions with a similar credit risk profile.

The following table presents the undiscounted cash flows of operating and finance leases for each of the following periods:

June 30, 2025

(In thousands)

Remaining

2025

2026

2027

2028

2029

Later

Years

Total Lease

Payments

Less: Imputed

Interest

Total

Operating Leases

14,190

21,975

16,790

14,278

12,184

35,255

114,672

(16,097)

98,575

Finance Leases

2,242

4,222

2,927

2,592

2,415

9,530

23,928

(2,612)

21,316

The following table presents the lease cost recognized by the Corporation in the Consolidated Statements of Operations as follows:

Quarters ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Finance lease cost:

Amortization of ROU assets

747

749

1,493

1,497

Interest on lease liabilities

190

226

390

463

Operating lease cost

7,599

7,650

15,148

15,338

Short-term lease cost

214

120

407

236

Variable lease cost

89

70

174

139

Sublease income

(20)

(21)

(40)

(41)

Total lease cost

[1]

8,819

8,794

17,572

17,632

[1]

Total lease cost is recognized as part of net occupancy expense.

The following table presents supplemental cash flow information and other related information related to operating and finance

leases.

Six months ended June 30, 2025

(Dollars in thousands)

2025

2024

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

15,610

15,689

Operating cash flows from finance leases

389

463

Financing cash flows from finance leases

1,829

1,774

ROU assets obtained in exchange for new lease obligations:

Operating leases

5,832

1,463

Weighted-average remaining lease term:

Operating leases

7.5

years

7.2

years

Finance leases

7.9

years

8.0

years

Weighted-average discount rate:

Operating leases

3.5

3.3

Finance leases

3.5

3.8

Note 28 – Pension and postretirement benefits

The Corporation has a non-contributory defined benefit pension plan and supplementary pension benefit restoration plans for

regular employees of certain of its subsidiaries (the “Pension Plans”). The accrual of benefits under the Pension Plans is frozen to

all participants. The Corporation also provides certain postretirement health care benefits for retired employees of certain

subsidiaries (the “OPEB Plan”).

The components of net periodic cost for the Pension Plans and the OPEB Plan for the periods presented were as follows:

Pension Plans

OPEB Plan

Quarter ended June 30,

Quarter ended June 30,

(In thousands)

2025

2024

2025

2024

Personnel Cost:

Service cost

15

32

Other operating expenses:

Interest cost

7,411

7,558

1,291

1,421

Expected return on plan assets

(8,069)

(8,594)

Amortization of prior service cost/(credit)

Amortization of net loss (gain)

3,449

4,166

(1,177)

(548)

Total net periodic pension cost

2,791

3,130

129

905

Pension Plans

OPEB Plan

Six months ended June 30,

Six months ended June 30,

(In thousands)

2025

2024

2025

2024

Personnel Cost:

Service cost

30

63

Other operating expenses:

Interest cost

14,821

15,117

2,582

2,843

Expected return on plan assets

(16,138)

(17,188)

Amortization prior service cost/(credit)

Amortization of net loss

6,899

8,332

(2,354)

(1,096)

Total net periodic pension cost

5,582

6,261

258

1,810

The Corporation paid the following contributions to the plans for the six months ended June 30, 2025 and expects to pay the

following contributions for the year ending December 31, 2025.

For the six months ended

For the year ending

(In thousands)

June 30, 2025

December 31, 2025

Pension Plans

114

227

OPEB Plan

3,223

5,428

Note 29 - Stock-based compensation

Incentive Plan

On May 12, 2020, the stockholders of the Corporation approved the Popular, Inc. 2020 Omnibus Incentive Plan, which permits the

Corporation to issue several types of stock-based compensation to employees and directors of the Corporation and/or any of its

subsidiaries (the “2020 Incentive Plan”). The 2020 Incentive Plan replaced the Popular, Inc. 2004 Omnibus Incentive Plan, which

was in effect prior to the adoption of the 2020 Incentive Plan (the “2004 Incentive Plan” and, together with the 2020 Incentive Plan,

the “Incentive Plan”). Participants under the Incentive Plan are designated by the Talent and Compensation Committee of the Board

of Directors (or its delegate, as determined by the Board). Under the Incentive Plan, the Corporation has issued restricted stock and

performance shares to its employees and restricted stock and restricted stock units (“RSUs”) to its directors.

The restricted stock granted under the Incentive Plan to employees becomes vested based on the employees’ continued service

with Popular.

Unless otherwise stated in an agreement, the compensation cost associated with the shares of restricted stock

granted prior to 2021 was determined based on a two-prong vesting schedule. These grants include ratable vesting over five or four

years commencing at the date of grant (“the graduated vesting portion”) with a portion vested at termination of employment after

attainment of 55 years of age and 10 years of service or 60 years of age and 5 years of service (“the retirement vesting portion”).

The graduated vesting portion is accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years

of service or 60 years of age and 5 years of service. Restricted stock granted on or after 2021 have ratable vesting in equal annual

installments over a period of 4 years or 3 years, depending on the classification of the employee. The vesting schedule is

accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age

and 5 years of service.

The performance share awards granted under the Incentive Plan consist of the opportunity to receive shares of Popular, Inc.’s

common stock provided that the Corporation achieves certain goals during a three-year performance cycle. The goals will be based

on two metrics weighted equally: the Relative Total Shareholder Return (“TSR”) and the Absolute Return on Average Tangible

Common Equity (“ROATCE”). The TSR metric is a market condition under ASC 718. For equity settled awards based on market

conditions, the fair value is determined as of the grant date and is not subsequently revised based on actual performance. The

ROATCE metric is a performance condition under ASC 718. The fair value is determined based on the probability of achieving the

ROATCE goal as of each reporting period. The TSR and ROATCE metrics are equally weighted and work independently.

The

number of shares that will ultimately vest ranges from 50% to a 150% target based on both market (TSR) and performance

(ROATCE) conditions. The performance shares will vest at the end of the three-year performance cycle. If a participant terminates

employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service, the

performance shares shall continue outstanding and vest at the end of the performance cycle.

The following table summarizes the restricted stock and performance shares activity under the Incentive Plan for members of

management.

(Not in thousands)

Shares

Weighted-Average

Grant Date Fair

Value

Non-vested at December 31, 2023

299,896

58.20

Granted

242,474

86.62

Performance Shares Quantity Adjustment

(18,650)

87.79

Vested

(267,873)

74.26

Forfeited

(7,939)

50.68

Non-vested at December 31, 2024

247,908

66.86

Granted

241,762

100.67

Performance Shares Quantity Adjustment

48,923

92.33

Vested

(277,721)

90.69

Forfeited

(5,515)

60.68

Non-vested at June 30, 2025

255,357

77.90

During the quarter ended June 30, 2025,

121,649

shares of restricted stock (June 30, 2024 –

97,732

) were awarded to

management under the Incentive Plan. During the quarters ended June 30, 2025 and 2024,

no

performance shares were awarded

to management under the Incentive Plan. During the six months ended June 30, 2025,

194,268

shares of restricted stock (June 30,

2024 –

175,591

) and

47,494

performance shares (June 30, 2024 -

65,225

) were awarded to management under the Incentive Plan.

During the quarter ended June 30, 2025, the Corporation recognized $

6.9

million of restricted stock expense related to management

incentive awards, with a tax benefit of $

1.0

million (June 30, 2024 - $

4.1

million, with a tax benefit of $

1.0

million). For the six months

ended June 30, 2025, the Corporation recognized $

14.4

million of restricted stock expense related to management incentive

awards, with a tax benefit of $

1.6

million (June 30, 2024 - $

10.5

million, with a tax benefit of $

1.7

million). For the six months ended

June 30, 2025, the fair market value of the restricted stock and performance shares vested was $

20.0

million on the grant date and

27.4

million at vesting date. This differential triggers a windfall of $

2.7

million that was recorded as a reduction on income tax

expense. During the quarter ended June 30, 2025, the Corporation recognized $

0.8

million of performance shares expense, with a

tax benefit of $

61

thousand due to performance shares target adjustment (June 30, 2024 - $

(0.9)

million, with a tax benefit of $

(55)

thousand). For the six months ended June 30, 2025, the Corporation recognized $

4.2

million of performance shares expense, with

a tax benefit of $

0.5

million (June 30, 2024 - $

4.1

million, with a tax benefit of $

0.3

million). The total unrecognized compensation

cost related to non-vested restricted stock awards and performance shares to members of management at June 30, 2025 was $

17.6

million and is expected to be recognized over a weighted-average period of

1.65

years.

The following table summarizes the restricted stock activity under the Incentive Plan for members of the Board of Directors:

(Not in thousands)

RSUs / Restricted stock

Weighted-Average Grant

Date Fair Value per Unit

Non-vested at December 31, 2023

Granted

25,462

89.51

Vested

(25,462)

89.51

Forfeited

Non-vested at December 31, 2024

Granted

22,050

99.42

Vested

(2,937)

92.45

Forfeited

Non-vested at June 30, 2025

19,113

99.42

The equity awards granted to members of the Board of Directors of Popular, Inc. (the “Directors”) after May 2025 will vest and

become non-forfeitable on the first anniversary of the grant date of such award. Equity awards granted to the Directors may be paid

in either common stock or RSUs, at each Director’s election. If RSUs are elected, the Directors may defer the delivery of the shares of common stock underlying the RSUs award until their retirement. To the extent that cash dividends are paid on the Corporation’s outstanding common stock, the Directors will receive an additional number of RSUs that reflect a reinvested dividend equivalent.

During the quarter ended June 30, 2025,

17,816

RSUs and

2,688

shares of restricted stock were granted to the Directors (June 30,

2024 -

20,411

RSUs and

1,392

shares of unrestricted stock) and the Corporation recognized $

0.4

million of expense related to

these shares with a tax benefit of $

84

thousand (June 30, 2024 - $

1.9

million with a tax benefit of $

0.4

million). For the six months

ended June 30, 2025, the Corporation

granted

19,362

RSUs and

2,688

shares of restricted stock to the Directors (June 30, 2024 -

21,606

RSUs and

1,392

shares of unrestricted stock) and the Corporation recognized $

0.7

million of expense related to these

shares, with a tax benefit of $

0.1

million, (June 30, 2024 - $

2.1

million, with a tax benefit of $

0.4

million). The fair value at vesting

date of the RSUs vested during the six months ended June 30, 2025 for the Directors was $

2.2

million.

Note 30 – Income taxes

The table below presents a reconciliation of the statutory income tax rate to the effective income tax rate:

Quarters ended

June 30, 2025

June 30, 2024

(In thousands)

Amount

% of pre-tax

income

Amount

% of pre-tax

income

Computed income tax expense at statutory rates

96,871

37.5

81,843

37.5

Net benefit of tax exempt income

(45,374)

(17.6)

(33,220)

(15.2)

Effect of income subject to preferential tax rate

(606)

(0.2)

1,272

0.6

Deferred tax asset valuation allowance

4,050

1.6

(235)

(0.1)

Difference in tax rates due to multiple jurisdictions

(2,282)

(0.9)

(4,456)

(2.1)

Other tax benefits

(4,500)

(2.1)

State and local taxes

414

0.1

2,204

1.0

Others

(5,189)

(2.0)

(2,449)

(1.1)

Income tax expense

47,884

18.5

40,459

18.5

Six months ended

June 30, 2025

June 30, 2024

(In thousands)

Amount

% of pre-tax

income

Amount

% of pre-tax

income

Computed income tax expense at statutory rates

180,333

37.5

141,412

37.5

Net benefit of tax exempt income

(85,329)

(17.7)

(61,979)

(16.4)

Effect of income subject to preferential tax rate

(1,519)

(0.3)

(148)

Deferred tax asset valuation allowance

7,932

1.6

2,328

0.6

Difference in tax rates due to multiple jurisdictions

(5,257)

(1.1)

(5,129)

(1.4)

Other tax benefits

(4,500)

(1.2)

Tax on intercompany distributions

[1]

24,325

6.4

U.S., States, and local taxes

4,450

0.9

3,240

0.9

Others

(7,663)

(1.6)

(3,522)

(0.9)

Income tax expense

92,947

19.3

96,027

25.5

[1]

Includes $

16.5

million of out-of-period adjustment recorded during the first quarter of 2024.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for

financial reporting purposes and their tax bases. Significant components of the Corporation’s deferred tax assets and liabilities at

June 30, 2025, and December 31, 2024, were as follows:

June 30, 2025

(In thousands)

PR

US

Total

Deferred tax assets:

Tax credits available for carryforward

4,861

32,925

37,786

Net operating loss and other carryforward available

59,441

594,642

654,083

Postretirement and pension benefits

28,197

28,197

Allowance for credit losses

245,070

28,339

273,409

Deferred loan origination fees/cost

3,005

(2,702)

303

Depreciation

7,700

7,551

15,251

FDIC-assisted transaction

152,665

152,665

Lease liability

27,417

13,953

41,370

Unrealized net loss on investment securities

202,822

15,914

218,736

Difference in outside basis from pass-through entities

53,043

53,043

Mortgage Servicing Rights

14,561

14,561

Other temporary differences

36,015

8,743

44,758

Total gross deferred tax assets

834,797

699,365

1,534,162

Deferred tax liabilities:

Intangibles

90,392

57,493

147,885

Right of use assets

24,908

12,280

37,188

Loans acquired

17,471

17,471

Other temporary differences

7,138

429

7,567

Total gross deferred tax liabilities

139,909

70,202

210,111

Valuation allowance

76,804

386,914

463,718

Net deferred tax asset

618,084

242,249

860,333

December 31, 2024

(In thousands)

PR

US

Total

Deferred tax assets:

Tax credits available for carryforward

4,861

24,728

29,589

Net operating loss and other carryforward available

52,211

610,279

662,490

Postretirement and pension benefits

27,786

27,786

Allowance for credit losses

247,153

24,415

271,568

Depreciation

7,700

7,229

14,929

FDIC-assisted transaction

152,665

152,665

Lease liability

25,167

16,451

41,618

Unrealized net loss on investment securities

252,411

20,996

273,407

Difference in outside basis from pass-through entities

50,144

50,144

Mortgage Servicing Rights

14,475

14,475

Other temporary differences

41,127

9,072

50,199

Total gross deferred tax assets

875,700

713,170

1,588,870

Deferred tax liabilities:

Intangibles

88,351

55,926

144,277

Right of use assets

22,784

14,454

37,238

Deferred loan origination fees/cost

(1,880)

2,085

205

Loans acquired

18,415

18,415

Other temporary differences

6,799

429

7,228

Total gross deferred tax liabilities

134,469

72,894

207,363

Valuation allowance

69,837

386,914

456,751

Net deferred tax asset

671,394

253,362

924,756

The net deferred tax assets shown in the table above at June 30, 2025, is reflected in the Consolidated Statements of Financial

Condition as $

862.1

million in net deferred tax assets in the “Other assets” caption (December 31, 2024 - $

926.3

million) and $

1.8

million in deferred tax liabilities in the “Other liabilities” caption (December 31, 2024 - $

1.6

million), reflecting the aggregate deferred

tax assets or liabilities of individual tax-paying subsidiaries of the Corporation in their respective tax jurisdiction, Puerto Rico or the

United States.

At June 30, 2025, the net deferred tax assets of the U.S. operations amounted to $

629.1

million with a valuation allowance of

386.9

million, for net deferred tax assets after valuation allowance of $

242.2

million. The Corporation evaluates on a quarterly

basis the realization of the deferred tax asset by taxing jurisdiction. The U. S. operations sustained profitability for the last three

years and better results than projected for the period ended June 30, 2025. These historical financial results are objectively

verifiable positive evidence, evaluated together with the positive evidence of stable credit metrics, in combination with the length of

the expiration of the NOLs. On the other hand, the Corporation evaluated the negative evidence accumulated over the years,

including financial results lower than expectations and challenges to the economy due to inflationary pressures that could stem from

U. S. tariff policies and global geopolitical challenges, in addition to the economic effect of cuts in federal government spending that

could negatively impact U. S. operations’ achieving expected pre-tax income levels. As of June 30, 2025, after weighting all positive

and negative evidence, the Corporation concluded that it is more likely than not that $

242.2

million of the deferred tax assets from

the U.S. operations, comprised mainly of net operating losses, will be realized. The Corporation based this determination on its

estimated earnings available to realize the deferred tax assets for the remaining carryforward period, together with the historical

level of book income adjusted by permanent differences. Management will continue to monitor and review the U.S. operation’s

results, including recent earnings trends, the pre-tax earnings forecast, any new tax initiative, and other factors, including net income

versus forecast, targeted loan growth, net interest income margin, changes in deposit costs, allowance for credit losses, charge offs,

non-performing loans held-in-portfolio (“NPLs”) inflows and non-performing asset (“NPA”) balances. Significant changes in these

factors or sustainable continuance of financial improvement could impact the future realization of the deferred tax assets.

At June 30, 2025, the Corporation’s net deferred tax assets related to its Puerto Rico operations amounted to $

618.1

million. The

Corporation’s Puerto Rico Banking operation has a historical record of profitability. This is considered a strong piece of objectively

verifiable positive evidence that outweighs any negative evidence considered by Management in the evaluation of the realization of

the deferred tax assets. Based on this evidence and management’s estimate of future taxable income, the Corporation has

concluded that it is more likely than not that such net deferred tax assets of the Puerto Rico Banking operations will be realized.

The Holding Company operation has been in a cumulative loss position in recent years. Management expects these losses will be a

trend in future years. This objectively verifiable negative evidence is considered by Management strong negative evidence that

suggests that income in future years will be insufficient to support the realization of all deferred tax assets. After weighting of all

positive and negative evidence Management concluded, as of the reporting date, that it is more likely than not that the Holding

Company will not be able to realize any portion of the deferred tax assets. Accordingly, the Corporation has maintained a valuation

allowance on the deferred tax assets of $

76.8

million as of June 30, 2025.

The reconciliation of unrecognized tax benefits, excluding interest, was as follows:

(In millions)

2025

2024

Balance at January 1

1.5

1.5

Balance at March 31

1.5

1.5

Balance at June 30

1.5

1.5

At June 30, 2025, the total amount of accrued interest recognized in the statement of financial condition amounted to $

2.5

million

(December 31, 2024 - $

2.4

million). Management determined that at June 30, 2025 and December 31, 2024, there was

no

need to

accrue for the payment of penalties. The Corporation’s policy is to report interest related to unrecognized tax benefits in income tax

expense, while the penalties, if any, are reported in other operating expenses in the Consolidated Statements of Operations.

After consideration of the effect on U.S. federal tax of unrecognized U.S. state tax benefits, the total amount of unrecognized tax

benefits that if recognized, would affect the Corporation’s effective tax rate, was $

3.0

million at June 30, 2025 (December 31, 2024 -

3.0

million).

The amount of unrecognized tax benefits may increase or decrease in the future for various reasons including adding amounts for

current tax year positions, expiration of open income tax returns due to the statutes of limitation, changes in Management’s

judgment about the level of uncertainty, status of examinations, litigation and legislative activity and the addition or elimination of

uncertain tax positions. The Corporation does not anticipate a reduction in the total amount of unrecognized tax benefits within the

next 12 months.

The Corporation and its subsidiaries file income tax returns in Puerto Rico, the U.S. federal jurisdiction, various U.S. states and

political subdivisions, and foreign jurisdictions. At June 30, 2025, the following years remain subject to examination in the U.S.

Federal jurisdiction: 2021 and thereafter; and in the Puerto Rico jurisdiction, 2018 and thereafter.

Note 31 – Supplemental disclosure on the consolidated statements of cash flows

Additional disclosures on cash flow information and non-cash activities for the six months ended June 30, 2025 and June 30, 2024

are listed in the following table:

(In thousands)

June 30, 2025

June 30, 2024

Non-cash activities:

Loans transferred to other real estate

14,006

25,922

Loans transferred to other property

45,065

38,867

Total loans transferred to foreclosed assets

59,071

64,789

Loans transferred to other assets

26,604

25,427

Financed sales of other real estate assets

2,580

6,220

Financed sales of other foreclosed assets

29,089

26,894

Total financed sales of foreclosed assets

31,669

33,114

Financed sale of premises and equipment

29,727

38,715

Transfers from loans held-in-portfolio to loans held-for-sale

2,662

7,505

Transfers from loans held-for-sale to loans held-in-portfolio

1,224

2,896

Loans securitized into investment securities

[1]

6,852

4,806

Trades receivable from brokers and counterparties

22

26,198

Trades payable to brokers and counterparties

593,949

24,603

Net change in receivables from investments maturities

14,377

124,000

Recognition of mortgage servicing rights on securitizations or asset transfers

498

661

Loans booked under the GNMA buy-back option

3,339

3,437

Capitalization of lease right of use asset

9,143

1,946

[1]

Includes loans securitized into trading securities and subsequently sold before quarter end.

The following table provides a reconciliation of cash and due from banks, and restricted cash reported within the Consolidated

Statement of Financial Condition that sum to the total of the same such amounts shown in the Consolidated Statement of Cash

Flows.

(In thousands)

June 30, 2025

June 30, 2024

Cash and due from banks

394,211

348,170

Restricted cash and due from banks

6,420

11,803

Restricted cash in money market investments

10,371

7,286

Total cash and due from banks, and restricted cash

[2]

411,002

367,259

[2]

Refer to Note 4 - Restrictions on cash and due from banks and certain securities for nature of restrictions.

Note 32 – Segment reporting

The Corporation’s corporate structure consists of

two

reportable segments –

Banco Popular de Puerto Rico and Popular U.S.

Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess

where to allocate resources.

The segments were determined based on the organizational structure, which focuses primarily on the

markets the segments serve, as well as on the products and services offered by the segments.

The chief operating decision maker (“CODM”) of the Corporation is the Chief Executive Officer (“CEO”) who utilizes net income as

one of the segment profitability measures, to evaluate the performance of each reportable segment and assess where to allocate

resources effectively. The CEO receives profitability reports that include net income per segment, net interest income and other

income and expense categories. The CODM uses the segment’s net income and components of net income, including segment

revenues and expenses to assess performance and to manage important aspects by each reportable segments, such as human

capital, investment in technology, making budget allocations, as well as other strategic decisions.

Banco Popular de Puerto Rico:

The Banco Popular de Puerto Rico reportable segment includes commercial, consumer and retail banking operations, as well as

mortgage and auto lending operations conducted at BPPR, including U.S. based activities conducted through its New York Branch.

Other financial services within the BPPR segment include the trust service units of BPPR, asset management services of Popular

Asset Management and the brokerage operations of Popular Securities, and the insurance agency and reinsurance businesses of

Popular Insurance, Popular Risk Services, Popular Life Re, and Popular Re.

Popular U.S.:

Popular U.S. reportable segment consists of the banking operations of Popular Bank (PB), Popular Insurance Agency, U.S.A., and

PEF. PB operates through a retail branch network in the U.S. mainland under the name of Popular, and equipment leasing and

financing services through PEF. Popular Insurance Agency, U.S.A. offers investment and insurance services across the PB branch

network.

The Corporate group consists primarily of the holding companies Popular, Inc., Popular North America, Popular International Bank

and certain of the Corporation’s investments accounted for under the equity method, including BHD.

The accounting policies of the individual operating segments are the same as those of the Corporation. Transactions between

reportable segments are primarily conducted at market rates, resulting in profits that are eliminated for reporting consolidated results

of operations. Assets representing transactions between reportable segments or the Corporate group are also eliminated in the

tables presented below.

The tables that follow present the results of operations and total assets by reportable segments:

2025

For the quarter ended June 30, 2025

Intersegment

(In thousands)

BPPR

Popular U.S.

Eliminations

Interest income

748,712

195,668

(1,041)

Interest expense

210,237

93,474

(1,041)

Net interest income

538,475

102,194

Provision for credit losses

42,452

6,532

Non-interest income

145,685

7,421

Personnel costs

164,794

27,387

Professional fees

13,025

2,450

Technology and software expenses

64,226

10,345

Processing and transactional services

37,276

582

Amortization of intangibles

240

145

Depreciation expense

10,344

2,266

Other operating expenses

[1]

132,004

28,021

Total operating expenses

421,909

71,196

Income before income tax

219,799

31,887

Income tax expense

35,256

9,280

Net income

184,543

22,607

Segment assets

60,926,458

14,865,364

(120,633)

For the quarter ended June 30, 2025

Reportable

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Interest income

943,339

1,578

(1,045)

943,872

Interest expense

302,670

10,698

(1,045)

312,323

Net interest income (expense)

640,669

(9,120)

631,549

Provision for credit losses (benefit)

48,984

(43)

48,941

Non-interest income

153,106

16,107

(736)

168,477

Personnel costs

192,181

37,174

229,355

Professional fees

15,475

12,887

(254)

28,108

Technology and software expenses

74,571

10,125

84,696

Processing and transactional services

37,858

3

37,861

Amortization of intangibles

385

385

Depreciation expense

12,610

429

13,039

Other operating expenses

[1]

160,025

(60,181)

(527)

99,317

Total operating expenses

493,105

437

(781)

492,761

Income before income tax

251,686

6,593

45

258,324

Income tax expense

44,536

3,277

71

47,884

Net income

207,150

3,316

(26)

210,440

Segment assets

75,671,189

5,786,893

(5,392,992)

76,065,090

[1]

Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes,

communications expense, business promotion expenses, deposit insurance costs and OREO expenses.

For the six months ended June 30, 2025

Intersegment

(In thousands)

BPPR

Popular U.S.

Eliminations

Interest income

1,480,600

382,060

(2,722)

Interest expense

420,233

186,924

(2,722)

Net interest income

1,060,367

195,136

Provision for credit losses

95,964

17,142

Non-interest income

283,190

13,564

Personnel costs

316,078

52,829

Professional fees

26,084

5,189

Technology and software expenses

128,377

20,433

Processing and transactional services

74,455

1,179

Amortization of intangibles

582

400

Depreciation expense

20,038

4,463

Other operating expenses

[1]

260,758

53,640

Total operating expenses

826,372

138,133

Income before income tax

421,221

53,425

Income tax expense

70,699

16,002

Net income

350,522

37,423

Segment assets

60,926,458

14,865,364

(120,633)

For the six months ended June 30, 2025

Reportable

Total

(In thousands)

Segments

Corporate

Eliminations

Popular, Inc.

Interest income

1,859,938

3,114

(2,182)

1,860,870

Interest expense

604,435

21,471

(2,182)

623,724

Net interest income (expense)

1,255,503

(18,357)

1,237,146

Provision for credit losses (benefit)

113,106

(84)

113,022

Non-interest income

296,754

25,136

(1,352)

320,538

Personnel costs

368,907

73,161

442,068

Professional fees

31,273

24,244

(584)

54,933

Technology and software expenses

148,810

19,554

168,364

Processing and transactional services

75,634

8

75,642

Amortization of intangibles

982

982

Depreciation expense

24,501

818

25,319

Other operating expenses

[1]

314,398

(116,583)

(1,350)

196,465

Total operating expenses

964,505

1,202

(1,934)

963,773

Income before income tax

474,646

5,661

582

480,889

Income tax expense

86,701

5,952

294

92,947

Net income (loss)

387,945

(291)

288

387,942

Segment assets

75,671,189

5,786,893

(5,392,992)

76,065,090

[1]

Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes,

communications expense, business promotion expenses, deposit insurance costs and OREO expenses.

2024

For the quarter ended June 30, 2024

Intersegment

(In thousands)

BPPR

Popular U.S.

Eliminations

Interest income

737,342

186,595

(2,622)

Interest expense

248,597

100,744

(2,622)

Net interest income

488,745

85,851

Provision for credit losses (benefit)

50,382

(3,563)

Non-interest income

152,354

6,000

Personnel costs

145,764

26,062

Professional fees

14,568

3,154

Technology and software expenses

60,256

9,784

Processing and transactional services

38,537

555

Amortization of intangibles

424

310

Depreciation expense

13,317

2,204

Other operating expenses

[1]

127,106

27,608

Total operating expenses

399,972

69,677

Income before income tax

190,745

25,737

Income tax expense

33,540

7,989

Net income

157,205

17,748

Segment assets

58,464,408

14,287,739

(264,040)

For the quarter ended June 30, 2024

Reportable

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Interest income

921,315

4,390

(3,798)

921,907

Interest expense

346,719

10,674

(3,798)

353,595

Net interest income (expense)

574,596

(6,284)

568,312

Provision for credit losses (benefit)

46,819

(25)

46,794

Non-interest income

158,354

10,716

(2,764)

166,306

Personnel costs

171,826

25,598

197,424

Professional fees

17,722

20,324

(302)

37,744

Technology and software expenses

70,040

9,712

79,752

Processing and transactional services

39,092

4

39,096

Amortization of intangibles

734

734

Depreciation expense

15,521

367

15,888

Other operating expenses

[1]

154,714

(54,854)

(922)

98,938

Total operating expenses

469,649

1,151

(1,224)

469,576

Income before income tax

216,482

3,306

(1,540)

218,248

Income tax expense (benefit)

41,529

(476)

(594)

40,459

Net income

174,953

3,782

(946)

177,789

Segment assets

72,488,107

5,828,667

(5,471,702)

72,845,072

[1]

Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes,

communications expense, business promotion expenses, deposit insurance costs and OREO expenses.

For the six months ended June 30, 2024

Intersegment

(In thousands)

BPPR

Popular U.S.

Eliminations

Interest income

1,451,330

369,478

(5,909)

Interest expense

489,744

198,774

(5,909)

Net interest income

961,586

170,704

Provision for credit losses

111,062

7,872

Non-interest income

298,023

13,120

(56)

Personnel costs

298,690

53,206

Professional fees

26,936

6,633

(56)

Technology and software expenses

123,440

18,684

Processing and transactional services

72,091

1,188

Amortization of intangibles

908

621

Depreciation expense

26,326

4,147

Other operating expenses

[1]

258,879

55,240

Total operating expenses

807,270

139,719

(56)

Income before income tax

341,277

36,233

Income tax expense

62,746

11,445

Net income

278,531

24,788

Segment assets

58,464,408

14,287,739

(264,040)

For the six months ended June 30, 2024

Reportable

Total

(In thousands)

Segments

Corporate

Eliminations

Popular, Inc.

Interest income

1,814,899

8,189

(7,040)

1,816,048

Interest expense

682,609

21,423

(7,040)

696,992

Net interest income (expense)

1,132,290

(13,234)

1,119,056

Provision for credit losses (benefit)

118,934

458

119,392

Non-interest income

311,087

22,438

(3,401)

330,124

Personnel costs

351,896

60,905

412,801

Professional fees

33,513

33,728

(579)

66,662

Technology and software expenses

142,124

17,090

159,214

Processing and transactional services

73,279

11

73,290

Amortization of intangibles

1,529

1,529

Depreciation expense

30,473

776

31,249

Other operating expenses

[1]

314,119

(104,339)

(1,836)

207,944

Total operating expenses

946,933

8,171

(2,415)

952,689

Income before income tax

377,510

575

(986)

377,099

Income tax expense (benefit)

74,191

22,200

(364)

96,027

Net income

303,319

(21,625)

(622)

281,072

Segment assets

72,488,107

5,828,667

(5,471,702)

72,845,072

[1]

Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes,

communications expense, business promotion expenses, deposit insurance costs and OREO expenses.

Geographic Information

The following information presents selected financial information based on the geographic location where the Corporation conducts

its business. The banking operations of BPPR are primarily based in Puerto Rico, where it has the largest retail banking franchise.

BPPR also conducts banking operations in the U.S. Virgin Islands, the British Virgin Islands and New York. BPPR’s banking

operations in the mainland United States include commercial lending activities in addition to periodic loan participations with PB.

During the six months ended June 30, 2025, BPPR participated in loans originated by PB totaling $

2

9 million (2024 - did

no

t

participate). Total assets for the BPPR segment related to its operations in the United States amounted to $

1.4

billion (December

31, 2024 - $

1.6

billion), including $

104

million in multifamily loans (December 31, 2024 - $

104

million), $

435

million in commercial

real estate loans (December 31, 2024 - $

588

million), $

689

million in C&I loans (December 31, 2024 - $

685

million), and $

70

million

in unsecured personal loans (December 31, 2024 - $

113

million). During the six months ended June 30, 2025, the BPPR segment

generated $

51.4

million (June 30, 2024 - $

60.1

million) in revenues from its operations in the United States, mainly from net interest

income. In the Virgin Islands, the BPPR segment offers banking products, including loans and deposits. Total assets for the BPPR

segment related to its operations in the U.S. and British Virgin Islands amounted to $

1.1

billion (December 31, 2024 - $

1.0

billion).

The BPPR segment generated $

25.0

million in revenues during the six months ended June 30, 2025 (June 30, 2024 - $

21.3

million)

from its operations in the U.S. and British Virgin Islands.

Geographic Information

Quarter ended

Six months ended

(In thousands)

June 30, 2025

June 30, 2024

June 30, 2025

June 30, 2024

Revenues:

[1]

Puerto Rico

636,232

586,338

1,246,193

1,152,082

United States

139,274

127,011

266,490

253,752

Other

24,520

21,269

45,001

43,346

Total consolidated revenues

800,026

734,618

1,557,684

1,449,180

[1]

Total revenues include net interest income, service charges on deposit accounts, other service fees, mortgage banking activities, net gain (loss),

including impairment, on equity securities, net gain on trading account debt securities, adjustments to indemnity reserves on loans sold, and

other operating income.

Selected Balance Sheet Information:

(In thousands)

June 30, 2025

December 31, 2024

Puerto Rico

Total assets

58,522,143

55,888,211

Loans

24,979,110

24,154,610

Deposits

53,876,271

52,099,309

United States

Total assets

16,236,670

15,890,339

Loans

12,686,305

12,431,859

Deposits

11,529,189

11,030,879

Other

Total assets

1,306,277

1,266,833

Loans

522,661

526,606

Deposits

[1]

1,812,031

1,754,157

[1]

Represents deposits from BPPR operations located in the U.S. and British Virgin Islands.