First BanCorp Q2 2026 Earnings: Credit Expansion and Margin Upswing

First BanCorp posted a record $138 million pretax pre‑provision income, pushing its return on average assets above 1.5% for the 18th consecutive quarter.

Earnings Beat and Profitability

■Pretax pre‑provision income: $138 million

■Return on average assets: > 1.5%

■CET1 capital ratio: 17%

■Share buybacks this quarter: $50 million

Accelerating Credit Portfolio

■Loan growth: 5% (linked‑quarter annualized)

■Drivers: robust middle‑market commercial activity and infrastructure refinancing in Puerto Rico

■Digital transaction capture: 95% of deposits now processed via digital/self‑service channels

Margin and Liquidity Playbook

■Net interest margin base: 4.80%

■Expected margin expansion: 3‑5 basis points per quarter

■Anticipated $1.2 billion investment portfolio repricing over the next 18 months

■Quarterly operating expenses: projected $128‑130 million

Risk and Capital Management

■Early‑stage auto delinquencies rose seasonally but remain below December 2025 levels

■Identified $4.8 million C&I loan non‑performing in Florida, well‑collateralized

■Effective tax rate: 21%, down from 21.6% due to higher tax‑exempt income

Outlook and Investor Expectations

■Full‑year loan growth guidance: 3‑5%

■Opportunistic M&A under review; organic growth and capital returns remain priority

■Assuming a stable interest‑rate environment, margin expansion is expected to continue through 2026

Market dynamics suggest First BanCorp’s digital transformation and strong capital buffer will sustain its stability. The high CET1 ratio equips the bank to finance potential M&A opportunities, while the credit growth momentum underscores the durability of infrastructure projects in Puerto Rico and Florida. Nevertheless, seasonal upticks in auto delinquencies and the non‑performing loan in Florida warrant close risk monitoring. Overall, modest net‑interest‑margin expansion coupled with a disciplined risk stance offers investors a pathway to long‑term value creation.