Core Insights - OFG Bancorp is considered one of the most undervalued small-cap stocks currently available for investment [1] - Wells Fargo analyst Timur Braziler reduced the price target for OFG Bancorp from $48 to $43 while maintaining an Equal Weight rating [1][2] - The company is expected to face challenges ahead, including increased deposit competition and potential rate cuts impacting net interest income through most of the first half of 2026 [2] Financial Performance - OFG Bancorp reported a diluted EPS of $1.16 for fiscal Q3 2025, an increase from $1.15 in fiscal Q2 2025 and $1.00 in fiscal Q3 2024 [3] - Total core revenue for fiscal Q3 2025 was $184.0 million, compared to $174.1 million in the same period last year, reflecting a 5.6% growth [3][4] - The CEO, José Rafael Fernández, noted a 16% year-over-year increase in Q3 EPS and highlighted strong performance and credit metrics for the quarter [4] Shareholder Actions - The company repurchased $20.4 million of common shares during the quarter, indicating a commitment to returning value to shareholders [4] Business Segments - OFG Bancorp operates through three main segments: Banking, Wealth Management, and Treasury [4]

Financial Data and Key Metrics Changes - The company reported diluted EPS of $1.16, a 16% increase year over year, with total core revenue rising by 5.6% [3] - Total interest income reached $200 million, up $6 million, while total interest expense increased to $45 million, up $3 million [7][8] - Net interest margin was 5.24%, down from 5.31% in the previous quarter [11] - Return on average assets was 1.69%, and return on tangible common equity was 16.39% [9] Business Line Data and Key Metrics Changes - Loans and core deposit balances increased year over year, with a particular focus on commercial loans [3] - Average loan balances were $8 billion, up nearly 2% from the second quarter, while end-of-loans held for investment totaled $8.1 billion, reflecting a 5% year-over-year increase [9][10] - Core deposits were up $287 million or 3% year over year, with average core deposits at $9.9 billion [10] Market Data and Key Metrics Changes - The Puerto Rico economy is performing well, with high levels of wages and employment, and a boost from tourism [16] - The company is seeing strong business activity in Puerto Rico, contributing to its growth outlook [3][16] Company Strategy and Development Direction - The company is pursuing a digital-first strategy, enhancing its position in banking innovation in Puerto Rico [4] - New product offerings, such as the Libre and Elite accounts, are aimed at attracting deposits from new and existing customers [5] - The company is leveraging AI to provide tailored insights to customers, enhancing customer engagement and operational efficiency [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the commercial pipeline and credit trends, anticipating annual loan growth of 5% to 6% [14][16] - The company remains watchful of global macroeconomic and geopolitical uncertainties but is optimistic about its growth prospects [17] - The anticipated effective tax rate for the year has been adjusted to 23.06% from a previous estimate of 24.9% [15] Other Important Information - The company repurchased $20.4 million of common shares during the quarter [3] - Credit quality remains stable, with a non-performing loan rate of 1.22% [14] Q&A Session Summary Question: Dynamics impacting deposit costs - Management indicated that higher deposit costs are driven by a strategic focus on attracting mass affluent clients through competitive rates on accounts [20][21] Question: Outlook for commercial loan growth - Management noted that while there were paydowns on lines of credit, the commercial pipeline remains solid, with confidence in future growth [22][23] Question: Credit quality and charge-offs - Management clarified that recent charge-offs are idiosyncratic and not indicative of broader market issues, with a focus on managing risk within the portfolio [31][32] Question: Guidance on net interest margin - Management provided guidance for the fourth quarter net interest margin at 5.10% to 5.20%, influenced by recent Fed rate cuts [42][45] Question: Investments in AI and operational efficiencies - Management discussed ongoing investments in AI to enhance customer service and operational efficiencies, with a focus on delivering unique insights to customers [46][47] Question: Capital management priorities - Management emphasized that capital priorities include funding loan growth, share buybacks, and dividends, supported by a strong economic outlook in Puerto Rico [49][50]

Financial Data and Key Metrics Changes - The company reported diluted EPS of $1.16, a 16% increase year-over-year, with total core revenue rising by 5.6% [3] - Core revenues totaled $184 million, with total interest income at $200 million, reflecting a $6 million increase [7] - Net interest expenses were $96.5 million, up $1.7 million, while the efficiency ratio was 52% [8][9] - Return on average assets was 1.69%, and return on tangible common equity was 16.39% [9][14] Business Line Data and Key Metrics Changes - Loans and core deposit balances increased year-over-year, particularly in commercial loans, while auto loans moderated [3][10] - Average loan balances were $8 billion, up nearly 2% from the second quarter, with year-over-year loans increasing by 5% [9][10] - Core deposits were up $287 million or 3% year-over-year, with average core deposits at $9.9 billion [10][11] Market Data and Key Metrics Changes - The Puerto Rico economy is performing well, with high levels of wages and employment, and a boost from tourism [16] - The company is seeing strong business activity in Puerto Rico, with a solid commercial pipeline and credit trends [16] Company Strategy and Development Direction - The company is focusing on a digital-first strategy, enhancing customer engagement through innovative product offerings and AI-driven insights [4][5] - The Libre and Elite accounts are designed to attract mass affluent clients, contributing to growth in core deposits and loans [16] - The company is actively pursuing share buybacks and anticipates continued growth in both retail and commercial accounts [15][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the Puerto Rican economy and its impact on business growth, while remaining cautious about global macroeconomic uncertainties [16][17] - The company anticipates annual loan growth in the range of 5%-6% and expects to maintain a net interest margin within the target range [14][15] Other Important Information - The company repurchased $20.4 million of common shares during the quarter [3] - Credit quality remains stable, with a non-performing loan rate of 1.22% and a CET1 ratio of 14.13% [12][14] Q&A Session Summary Question: Dynamics impacting deposit costs - Management indicated that higher deposit costs are driven by a strategic focus on attracting mass affluent clients through the Libre and Elite accounts [20][21] Question: Outlook for commercial loan growth - Management noted a solid pipeline for commercial loans and confidence in business activity in Puerto Rico [22][23] Question: Competitive landscape for savings account deposits - The average cost for the Elite account is around 1%+, targeting mass affluent clients while focusing on deepening customer relationships [30] Question: Credit quality and charge-offs - Management discussed idiosyncratic issues in the commercial loan portfolio but expressed overall confidence in credit quality [31][32] Question: Guidance on net interest margin - Management provided guidance for Q4 net interest margin at 5.10%-5.20%, influenced by recent Fed rate cuts [41][44] Question: Investments in AI and operational efficiencies - Management highlighted ongoing investments in AI to enhance customer service and operational efficiencies [46][47] Question: Capital management priorities - The company prioritizes loan growth, share buybacks, and dividends, supported by a strong capital position [50]

Financial Data and Key Metrics Changes - Earnings per share diluted increased to $1.16, up 16% year over year, with total core revenue rising by 5.6% [4] - Total interest income reached $200 million, an increase of $6 million, primarily due to higher loan and investment balances [11] - Total interest expense rose to $45 million, up $3 million, reflecting higher average balances of core deposits and wholesale funding [12] - Tangible book value was reported at $28.92 per share, with an efficiency ratio of 52% [13] - Return on average assets was 1.69%, and return on tangible common equity was 16.39% [13] Business Line Data and Key Metrics Changes - Loans and core deposit balances increased year over year, with a particular focus on commercial loans [4] - Average loan balances were $8 billion, up nearly 2% from the second quarter, while end-of-period loans held for investment totaled $8.1 billion [14] - Core deposits increased by $287 million or 3% year over year, with average core deposits at $9.9 billion [16] Market Data and Key Metrics Changes - The Puerto Rico economy is performing well, with high levels of wages and employment, and solid consumer and business liquidity [25] - The company is experiencing growth in digital banking, with digital enrollment up 8% and net new customer growth at 4.6% [6] Company Strategy and Development Direction - The company is focusing on a digital-first strategy, enhancing customer engagement through innovative product offerings and AI-driven insights [6][8] - The introduction of the Liberty and Elite accounts has successfully attracted deposits from new and existing customers [7] - The company aims to continue growing its market share in retail deposits and commercial lending [9][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the commercial pipeline and credit trends, anticipating annual loan growth of 5% to 6% [22] - The company remains watchful of global macroeconomic and geopolitical uncertainties but is optimistic about the Puerto Rican economy [26] - The anticipated effective tax rate for the year has been adjusted to 23.06% from a previous estimate of 24.99% [23] Other Important Information - The company repurchased $20.4 million of common shares during the quarter [5] - Credit quality remains stable, with a provision for credit losses of $28.3 million [19] - The company is actively investing in technology and AI to improve operational efficiency [61] Q&A Session Summary Question: Dynamics impacting deposit costs - Management indicated that higher deposit costs are driven by strategic positioning to attract mass affluent clients through the Elite account, which offers higher rates [31][32] Question: Outlook for commercial loan growth - Management noted that while there were paydowns on lines of credit, the commercial pipeline remains solid, with confidence in future growth [33][34] Question: Credit quality concerns - Management reassured that the recent charge-offs are idiosyncratic and not indicative of broader market issues, with a focus on managing risk within the portfolio [45][46] Question: Auto loan trends - Management acknowledged a seasonal increase in charge-offs but expressed optimism about the overall credit quality and growth in auto lending [50][49] Question: Margin guidance and Fed funds assumptions - Management discussed expectations for margin guidance in the fourth quarter, factoring in potential Fed rate cuts [58][60] Question: Investments in AI and operational efficiencies - Management highlighted ongoing investments in AI to enhance customer service and operational efficiencies, with a focus on delivering unique insights to customers [62][63] Question: Capital management priorities - Management outlined capital priorities, emphasizing loan growth, share buybacks, and dividends as key focuses moving forward [66]

Financial Data and Key Metrics Changes - The company reported diluted EPS of $1.16, a 16% increase year over year, with total core revenue rising by 5.6% [3] - Total interest income reached $200 million, up $6 million, while total interest expense increased to $45 million, reflecting higher average balances of core deposits and wholesale funding [7][9] - Net interest margin was 5.24%, down from 5.31%, influenced by increased interest income from the securities portfolio and a slightly higher cost of deposits [12][14] Business Line Data and Key Metrics Changes - Core revenues totaled $184 million, driven by solid performance across key areas, with banking and financial services revenues at $29 million, a decrease of $1 million [7][8] - Average loan balances were $8 billion, up nearly 2% from the second quarter, while end-of-period loans held for investment totaled $8.1 billion, reflecting a year-over-year increase of 5% [10][11] - Core deposit balances were $9.9 billion, up close to 1% year over year, with a cost of deposits at 1.47%, up five basis points [11][12] Market Data and Key Metrics Changes - The Puerto Rico economy is performing well, with historically high levels of wages and employment, and a boost from increased tourism [16] - The company is experiencing strong business activity in Puerto Rico, with a solid commercial pipeline and credit trends [16] Company Strategy and Development Direction - The company is focusing on a digital-first strategy, enhancing its position as a leader in banking innovation in Puerto Rico [4][6] - The introduction of innovative product offerings, such as the Libre and Elite accounts, is aimed at attracting new deposits and deepening customer relationships [5][16] - The company is leveraging AI to provide tailored insights to customers, enhancing customer engagement and operational efficiency [5][47] Management's Comments on Operating Environment and Future Outlook - Management remains watchful of global macroeconomic and geopolitical uncertainties but is optimistic about the company's growth prospects [17] - The company anticipates annual loan growth in the range of 5% to 6%, supported by a solid commercial pipeline [14][16] - The effective tax rate for the year is now expected to be 23.06%, down from a previous estimate of 24.9% [15] Other Important Information - The company repurchased $20.4 million of common shares during the quarter, reflecting strong capital growth [3][14] - Credit quality remains stable, with a non-performing loan rate of 1.22% and a CET1 ratio of 14.13% [14] Q&A Session Summary Question: Dynamics impacting deposit costs - Management indicated that higher deposit costs are driven by a strategy to attract mass affluent clients through competitive rates on the Libre and Elite accounts [20][21] Question: Outlook for commercial loan growth - Management expressed confidence in the commercial pipeline, noting solid business activity in Puerto Rico and expectations for continued growth [22][23] Question: Competitive rates for savings account deposits - The average cost for the Elite account is around 1% to 1.5%, targeting mass affluent clients while focusing on deepening customer relationships [28] Question: Credit quality and charge-offs - Management noted that recent charge-offs in the commercial portfolio are idiosyncratic and not indicative of broader market issues, with a focus on managing risk [29][30] Question: Q4 margin guidance and Fed funds assumptions - The company expects a net interest margin of 5.10% to 5.20% for Q4, factoring in anticipated Fed rate cuts [40][41] Question: Investments in AI and operational efficiencies - Management highlighted ongoing investments in AI to enhance customer value and operational efficiencies, with a focus on delivering unique insights [46][47] Question: Capital management and buyback outlook - The company plans to be more active in share buybacks, prioritizing loan growth and capital management in a favorable economic environment [49][50]

Financial Performance - Earnings per share (EPS) reached $1.16[7] - Total core revenues amounted to $184 million[7], showing an increase from $182 million in the previous quarter (2Q25)[15] - Net Interest Margin (NIM) stood at 5.24%[7] - Return on Average Assets (ROAA) was 1.69%[20] - Return on Average Tangible Common Equity (ROATCE) was 16.39%[21] Balance Sheet & Capital Strength - Total assets reached $12.2 billion[7] - Customer deposits totaled $9.8 billion[7] - Loans held for investment were $8.1 billion[7] - New loan production reached $623.9 million[7] - The Common Equity Tier 1 (CET1) ratio was 14.13%[7] - Stock buyback involved 477,641 common shares[7]

Financial Performance - 3Q25 diluted EPS was $1.16, up 16% year-over-year from $1.00 in 3Q24, with total core revenues of $184.0 million, a 5.6% increase from $174.1 million in 3Q24[1][2] - Net interest income for Q3 2025 was $154,724, an increase from $147,875 in Q3 2024, representing a year-over-year growth of 4.0%[26] - Total core revenues for Q3 2025 reached $183,980, up from $174,146 in Q3 2024, indicating a growth of 5.6%[26] - Net income available to common stockholders for Q3 2025 was $51,838, compared to $47,000 in Q3 2024, reflecting an increase of 10.0%[26] - Net income available to common shareholders was $149.2 million for the nine-month period ended September 30, 2025, compared to $147.8 million in 2024, an increase of 0.9%[31] Credit Quality - Total provision for credit losses increased to $28.3 million in 3Q25 from $21.7 million in 2Q25, primarily due to increased loan volume and specific reserves[7] - Net charge-offs were $20.2 million (1.00% of average loans) in 3Q25, compared to $12.8 million (0.64%) in 2Q25[8] - The provision for credit losses in Q3 2025 was $28,258, significantly higher than $21,359 in Q3 2024, marking a 32.5% increase[26] - The net charge-off rate for Q3 2025 was 1.00%, up from 0.90% in Q3 2024, indicating a deterioration in credit quality[26] - The allowance for credit losses for non-PCD loans was $189.7 million, up from $155.1 million year-over-year, indicating a rise of 22.3%[33] Loans and Deposits - Loans held for investment at the end of 3Q25 were $8.12 billion, a 4.73% increase year-over-year, despite a 0.8% sequential decrease[11] - New loan production in 3Q25 was $623.9 million, down from $783.7 million in 2Q25, but up 9.0% year-over-year[12] - Customer deposits at the end of 3Q25 were $9.82 billion, a decrease of $76.2 million from $9.90 billion in 2Q25, but an increase of $286.5 million from $9.53 billion in 3Q24[13] - Total loans held for investment were $8,117,267 thousand in Q3 2025, slightly down from $8,180,591 thousand in Q2 2025, a decrease of 0.8%[42] - Total deposits decreased to $10.01 billion from $10.14 billion at June 30, 2025, a decline of 1.3%[32] Capital Ratios - CET1 ratio improved to 14.13% in 3Q25 from 13.99% in 2Q25, with tangible common equity ratio at 10.55%[15] - The tangible common equity (TCE) ratio for Q3 2025 was reported at 10.55%, an increase from 10.20% in Q2 2025[46] - The common equity Tier 1 capital ratio stood at 14.13% in Q3 2025, slightly up from 13.99% in Q2 2025[47] - Total risk-based capital reached $1,430,713 thousand in Q3 2025, compared to $1,409,447 thousand in Q2 2025[47] Delinquency and Nonperforming Assets - Total early delinquency for Q3 2025 reached $205,972 thousand, up from $179,259 thousand in Q2 2025, representing a 14.8% increase[40] - The early delinquency rate for total loans increased to 2.84% in Q3 2025 from 2.46% in Q2 2025, marking a 15.4% rise[40] - Total nonperforming assets amounted to $99,035 thousand in Q3 2025, compared to $95,928 thousand in Q2 2025, reflecting a 2.2% increase[40] - Nonperforming loan rates for total loans increased to 1.25% in Q3 2025 from 1.21% in Q2 2025, indicating a 3.3% rise[42] - The total mortgage delinquency rate rose to 11.06% in Q3 2025 from 10.22% in Q2 2025, a significant increase of 8.2%[40] Shareholder Returns - The company repurchased $20.4 million of common shares during the quarter, reflecting confidence in its financial position[2][15] - Cash dividends per common share increased to $0.30 in Q3 2025 from $0.25 in Q3 2024, a rise of 20.0%[26] - The tangible book value per common share increased to $28.92 in Q3 2025 from $27.67 in Q2 2025[46]

Company Overview - OFG Bancorp (OFG) is based in San Juan and operates in the Finance sector, with a year-to-date share price change of -0.28% [3] - The company currently pays a dividend of $0.30 per share, resulting in a dividend yield of 2.84%, which is higher than the Banks - Northeast industry's yield of 2.67% and the S&P 500's yield of 1.51% [3] Dividend Performance - OFG Bancorp's annualized dividend of $1.20 has increased by 20% from the previous year [4] - Over the last five years, the company has raised its dividend five times, achieving an average annual increase of 36.70% [4] - The current payout ratio is 28%, indicating that the company pays out 28% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year, OFG expects solid earnings growth, with the Zacks Consensus Estimate for 2025 projected at $4.50 per share, reflecting a year-over-year growth rate of 6.38% [5] Investment Considerations - Dividends are favored by investors for various reasons, including improving stock investing profits and providing tax advantages [5] - It is noted that high-yielding stocks may face challenges during periods of rising interest rates, yet OFG is considered a compelling investment opportunity due to its strong dividend profile [6] - The stock currently holds a Zacks Rank of 3 (Hold) [6]

Core Insights - OFG Bancorp's earnings have largely met expectations for the year, indicating stable financial performance [1] - The stock price performance has not aligned with the earnings expectations, suggesting potential market challenges or investor sentiment issues [1] Financial Performance - Earnings for OFG Bancorp have been consistent with prior forecasts, reflecting a solid operational foundation [1] - The discrepancy between earnings and stock price performance may indicate underlying market dynamics that could affect future valuations [1]

Core Insights - The company, Octopus Future Generations VCT plc, focuses on investing in businesses that address significant societal challenges, providing investors with opportunities to participate in the growth of purpose-driven companies [1][2]. Financial Performance - The Net Asset Value (NAV) per share as of 30 June 2025 was 88.4p, reflecting a decrease of 0.4p per share (-0.5%) from 31 December 2024 [4][11]. - The company invested £4.5 million into five new and follow-on opportunities during the six-month period [5]. - The total net assets of the company stood at £52.6 million as of 30 June 2025 [11]. Fundraising Activities - An initial offer to raise up to £5 million was launched on 3 February 2025 and successfully closed on 1 April 2025 [6]. Dividend Declaration - A special dividend of 5.6p per share was declared on 22 August 2025, marking the company's first dividend payment [8][65]. Investment Strategy - The company aims to invest in businesses aligned with three key themes: revitalising healthcare, empowering people, and building a sustainable planet [7][16]. - As of 30 June 2025, the portfolio comprised 37 investments, with the following distribution: 19 in revitalising healthcare, 11 in empowering people, and 7 in building a sustainable planet [16]. Portfolio Performance - The NAV decline was attributed to downward valuation movements across 13 companies, which collectively decreased in value by £3.1 million [25]. - Conversely, 13 companies in the portfolio saw a collective increase in value of £3.2 million, indicating potential for growth despite economic challenges [26]. Compliance and Qualification - The company met the requirement for 80% of its funds to be invested in VCT-qualifying holdings by 30 June 2025, with 100% of the portfolio qualifying under HMRC rules [10][31]. Management and Team Changes - The company has committed to enhancing team resources to improve focus on driving returns and realisations from the existing portfolio [13].