Popular maintains 2026 net interest income growth outlook at 8.5%
Key Facts
Popular maintained its forecast for net interest income growth of about 8.5% for the current fiscal year 2026, describing the guidance as "unchanged" in its third-quarter earnings presentation. The financial institution said in its earnings statement that net interest income totaled about $699 million in the third quarter, up $6 million from the second quarter of the same year. The company attributed the increase to higher income from investment securities and commercial loans, the two businesses it cited in explaining the quarterly improvement in interest income. Popular reported third-quarter 2026 net income of $266,334 thousand, according to its financial results statement for the period. Diluted earnings per share were $4.21 for the same quarter, according to the figures the company released with its results.
On a quarterly basis, net income was below the roughly $278 million Popular earned in the second quarter of 2026, according to the official earnings supplement. It exceeded earnings in the third quarter of 2025, however, when net income totaled about $211 million, putting the comparisons with the previous quarter and the year-earlier period in different directions. The results follow an increase in the company's annual net income to $833.2 million in 2025 from $614.2 million in 2024, according to its earnings statement for the previous fiscal year. Popular is Puerto Rico's largest financial institution by assets and deposits, according to the company's description of its business in its earnings date announcement. It also operates in the U.S. mainland through Popular Bank, alongside its presence in Puerto Rico.
On capital returns to shareholders, Popular said it repurchased $179 million of common stock in the third quarter of 2026. The company had announced on July 23, 2026, a new authorization to repurchase up to $1 billion of common stock, according to its capital actions statement. That authorization was announced after the company exhausted a previous share repurchase authorization approved in 2025. The previous authorization totaled $500 million, and Popular said in its July announcement that it had fully used it by June 30, 2026. Completion of the previous authorization thus preceded the announcement of the July authorization, and the company subsequently disclosed the repurchases executed during the third quarter in its results for that period.
Popular's common equity tier 1 capital ratio stood at 16.06% on September 30, 2026, according to its third-quarter earnings statement. Alongside share repurchases, the board approved a quarterly cash dividend of $0.90 per common share, according to the dividend announcement issued on August 20, 2026. The company linked the timing of repurchases to market conditions, among the factors it identified in its July capital actions statement. Those factors also include the institution's capital position, liquidity and financial performance, considerations that help determine when repurchases are executed. Repurchase timing is also subject to tax and regulatory considerations, according to the terms Popular included in its authorization announcement.
For the remainder of the current year, Popular expects loan growth of 2% during 2026, according to the guidance in its third-quarter earnings presentation. In outlining its lending outlook, the company pointed to the impact of lower auto financing and leasing activity, against the support commercial loans provided to interest income during the quarter just ended. On credit quality, it expects the annualized net charge-off rate to range between 80 and 90 basis points during 2026. It also expects operating expenses to increase by 2% during the same year, according to the guidance in its financial results statement. For the fourth quarter of 2026, the company expects non-interest income of about $170 million, according to the official third-quarter earnings supplement.