OFG Bancorp delivered a solidQQ2 2024 with diluted earnings per share of $1.08, supported by more than 5% growth in core revenues to $179.4 million and a net interest margin of 5.51%. Reported net income of $51.1 million on revenue of $220.8 million resulted in a net income margin of ~23.2%. The balance sheet remained asset-rich, with total assets of about $11.3 billion, customer deposits of $9.6 billion, and loans held for investment of $7.6 billion. The company maintained a robust CET1 ratio of 14.29% and tangible common equity per share of $24.18, underscoring capital resilience and ability to fund growth within a favorable regulatory framework. Management highlighted a digital-first growth trajectory, including Elite deposit products and the Oriental Biz cash management upgrade, which contributed to a high rate of digital adoption (94% retail transactions and 96% of deposits conducted digitally). The quarter featured a substantial buyback, with roughly $24.3 million of the $50 million program executed, signaling capital discipline and an emphasis on value creation for shareholders.
Looking ahead, management reaffirmed a 3-4% full-year loan-growth target and guided NIM in a corridor of 5.45%-5.55%, with noninterest expense projected at $90-$92 million per quarter for the remainder of 2024 as the bank continues to invest in technology and process improvements. The Puerto Rico economy appears supportive, with improving employment and wage dynamics contributing to consumer health, while auto and small business lending pipelines remain robust. However, risk factors include macroeconomic uncertainty, potential additional rate volatility, and public-fund deposit dynamics that could influence funding costs and balance sheet composition. Overall, OFG presents an attractive, resilient profile in the Puerto Rico regional banking segment, with solid profitability, strong capital adequacy, and a clear digital-enhanced growth strategy that should help maintain earnings momentum into the second half of 2024 and beyond.