The liquidity needs of the non banking subsidiaries

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The liquidity needs of the non-banking subsidiaries are minimal since most of them are funded internally from operating cash flows or from intercompany borrowings from their holding companies, BPPR or PB. Dividends During the year ended December 31, 2018, the Corporation declared quarterly dividends on its outstanding common stock of $0.25 per share, for a total of $101.3 million. The dividends for the Corporation’s Series A and Series B preferred stock amounted to $3.7 million. The BHC’s received dividends amounting to $446 million from BPPR, $8 million in dividends from its non-banking subsidiaries, $1 million in dividends from EVERTEC’s parent company, $6 million from an investment in an equity investee and $13 million in dividend from its 40 POPULAR, INC. 2018 ANNUAL REPORT
investment in BHD Leon. A portion of these dividends was used by Popular, Inc. for the payments of the cash dividends on its outstanding common stock, the $125 million accelerated stock repurchase, to partially fund the redemption of $450 million, 7% senior notes and the redemption of $53 million in trust preferred securities. On January 23, 2019, the Corporation announced an increase in its quarterly common stock dividend from $0.25 per share to $0.30 per share, beginning in the second quarter of 2019, subject to approval by its Board of Directors. On February 15, 2019, the Corporation’s Board of Directors approved a quarterly cash dividend of $0.30 per share on its outstanding common stock, payable on April 1, 2019 to shareholders of record at the close of business on March 8, 2019. Other Funding Sources and Capital The debt securities portfolio provides an additional source of liquidity, which may be realized through either securities sales or repurchase agreements. The Corporation’s debt securities portfolio consists primarily of liquid U.S. government investment securities, sponsored U.S. agency securities, government sponsored mortgage-backed securities, and collateralized mortgage obligations that can be used to raise funds in the repo markets. The availability of the repurchase agreement would be subject to having sufficient unpledged collateral available at the time the transactions are to be consummated, in addition to overall liquidity and risk appetite of the various counterparties. The Corporation’s unpledged debt securities, amounted to $4.3 billion at December 31, 2018 and $3.2 billion at December 31, 2017. A substantial portion of these debt securities could be used to raise financing quickly in the U.S. money markets or from secured lending sources. Additional liquidity may be provided through loan maturities, prepayments and sales. The loan portfolio can also be used to obtain funding in the capital markets. In particular, mortgage loans and some types of consumer loans, have secondary markets which the Corporation could use.

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