S&P acts on three Puerto Rican banks

S&P said it affirmed its ratings on FirstBank Puerto Rico, OFG Bancorp and Popular Inc.

At the same time, the agency revised the outlook on FirstBank Puerto Rico to stable from negative and maintained the negative outlooks on OFG Bancorp and Popular.

“The affirmations primarily reflect our view that all three Puerto Rican banks' operations have recovered in the aftermath of Hurricane Maria and they are maintaining financial performance that is consistent with our expectations and our current ratings on the companies,” S&P said in a news release.

“Our affirmations also consider that the three banks have substantially reduced their loan exposures to the Puerto Rican central government and its municipalities, built capital balances and reduced troubled loans in recent years.”

The agency said the outlook revision on FirstBank Puerto Rico mainly reflects a view that the bank's high capital levels provide it with sufficient room to absorb large loan losses under a stress scenario, as well as a view that the relatively low rating on the bank already fully reflects the challenges that S&P expects.

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