v3.25.1
Stock-based compensation
 3 Months Ended
Mar. 31, 2025
Disclosure of compensation related costs sharebased payments [Abstract]  
Stock-based Compensation
Note 29 - Stock-based compensation
On May 12,
 
2020, the stockholders
 
of the Corporation
 
approved the Popular,
 
Inc. 2020 Omnibus
 
Incentive Plan, which
 
permits the
Corporation
 
to issue
 
several
 
types
 
of stock-based
 
compensation
 
to employees
 
and directors
 
of the
 
Corporation
 
and/or
 
any of
 
its
subsidiaries (the
 
“2020 Incentive
 
Plan”). The
 
2020 Incentive
 
Plan replaced
 
the Popular,
 
Inc. 2004
 
Omnibus Incentive
 
Plan, which
was in effect
 
prior to the
 
adoption of the
 
2020 Incentive Plan
 
(the “2004 Incentive
 
Plan” and, together
 
with the 2020
 
Incentive Plan,
the “Incentive Plan”). Participants under the
 
Incentive Plan are designated by the Talent
 
and Compensation Committee of the Board
of Directors (or its delegate, as
 
determined by the Board). Under the
 
Incentive Plan, the Corporation has
 
issued restricted stock and
performance shares to its employees and restricted stock and restricted stock units (“RSUs”) to its directors.
 
The restricted
 
stock granted
 
under the
 
Incentive
 
Plan to
 
employees becomes
 
vested based
 
on the
 
employees’ continued
 
service
with
 
Popular.
Unless otherwise stated in an agreement, the compensation cost associated with the shares of restricted stock
granted prior to 2021 was determined based on a two-prong vesting schedule. These grants include ratable vesting over five or four
years commencing at the date of grant (the “graduated vesting portion”) with a portion vested at termination of employment after
attainment of 55 years of age and 10 years of service or 60 years of age and 5 years of service (“the retirement vesting portion”).
The graduated vesting portion is accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years
of service or 60 years of age and 5 years of service. Restricted stock granted on or after 2021 have ratable vesting in equal annual
installments over a period of 4 years or 3 years, depending on the classification of the employee. The vesting schedule is
accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age
and 5 years of service.
 
The
 
performance
 
share
 
awards
 
granted
 
under
 
the
 
Incentive
 
Plan
 
consist
 
of
 
the
 
opportunity
 
to
 
receive
 
shares
 
of
 
Popular,
 
Inc.’s
common stock provided that the Corporation achieves
 
certain goals during a three-year performance cycle.
 
The goals will be based
on
 
two
 
metrics
 
weighted
 
equally:
 
the
 
Relative
 
Total
 
Shareholder
 
Return
 
(“TSR”)
 
and
 
the
 
Absolute
 
Return
 
on
 
Average
 
Tangible
Common Equity
 
(“ROATCE”).
 
The TSR
 
metric is
 
considered to
 
be a
 
market condition
 
under ASC
 
718.
 
For equity
 
settled awards
based
 
on
 
a
 
market
 
condition,
 
the
 
fair
 
value
 
is
 
determined
 
as
 
of
 
the
 
grant
 
date
 
and
 
is
 
not
 
subsequently
 
revised
 
based
 
on
 
actual
performance.
 
The
 
ROATCE
 
metric
 
is
 
considered
 
to
 
be
 
a
 
performance
 
condition
 
under
 
ASC
 
718.
 
The
 
fair
 
value
 
is
 
determined
based on
 
the probability
 
of achieving
 
the ROATCE
 
goal as
 
of each
 
reporting period.
 
The TSR
 
and ROATCE
 
metrics are
 
equally
weighted and
 
work independently.
 
The number of shares that will ultimately vest ranges from 50% to a 150% of target based on
both market (TSR) and performance (ROATCE) conditions. The performance shares vest at the end of the three-year performance
cycle. If a participant terminates employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age
and 5 years of service, the performance shares shall continue outstanding and vest at the end of the performance cycle.
The
 
following
 
table
 
summarizes
 
the
 
restricted
 
stock
 
and
 
performance
 
shares
 
activity
 
under
 
the
 
Incentive
 
Plan
 
for
 
members
 
of
management.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Not in thousands)
Shares
Weighted-Average
Grant Date Fair
Value
Non-vested at December 31, 2023
299,896
$
58.20
Granted
242,474
86.62
Performance Shares Quantity Adjustment
(18,650)
87.79
Vested
 
(267,873)
74.26
Forfeited
(7,939)
50.68
Non-vested at December 31, 2024
247,908
$
66.86
Granted
120,113
102.45
Performance Shares Quantity Adjustment
21,422
92.24
Vested
 
(125,640)
98.96
Forfeited
(880)
75.63
Non-vested at March 31, 2025
262,923
$
70.13
During the
 
quarter ended
 
March
 
31, 2025,
72,619
 
shares of
 
restricted
 
stock
 
(March 31,
 
2024 -
77,859
) and
47,494
 
performance
shares (March 31, 2024 -
65,225
) were awarded to management under the Incentive Plan.
 
During
 
the
 
quarter
 
ended
 
March
 
31,
 
2025,
 
the
 
Corporation
 
recognized
 
$
7.5
 
million
 
of
 
restricted
 
stock
 
expense
 
related
 
to
management incentive awards, with a tax benefit of $
0.6
 
million (March 31, 2024 - $
6.4
 
million, with a tax benefit of $
0.6
 
million). For
the quarter ended
 
March 31, 2025,
 
the fair market
 
value of the
 
restricted stock
 
and performance shares
 
vested was $
8.7
 
million at
grant date
 
and $
11.7
 
million at
 
vesting date.
 
This excess
 
requires the
 
recognition of
 
a windfall
 
tax benefit
 
of $
1.1
 
million that
 
was
recorded as
 
a reduction
 
in income
 
tax expense.
 
For the
 
quarter ended
 
March 31,
 
2025, the
 
Corporation recognized
 
$
3.4
 
million of
performance shares expense, with a tax
 
benefit of $
0.4
 
million (March 31, 2024 -
 
$
5.0
 
million, with a tax benefit of
 
$
0.3
 
million). The
total
 
unrecognized
 
compensation
 
cost
 
related
 
to
 
non-vested
 
restricted
 
stock
 
awards
 
and
 
performance
 
shares
 
to
 
members
 
of
management at March 31, 2025 was $
12.9
 
million and is expected to be recognized over a weighted-average period of
1.65
 
years.
The following table summarizes the restricted stock activity under the Incentive Plan for members of the Board of
 
Directors:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Not in thousands)
RSUs / Restricted stock
Weighted-Average
 
Grant
Date Fair Value per Unit
Non-vested at December 31, 2023
-
$
-
Granted
25,462
89.51
Vested
 
(25,462)
89.51
Forfeited
-
-
Non-vested at December 31, 2024
-
$
-
Granted
1,546
93.65
Vested
 
(1,546)
93.65
Forfeited
-
-
Non-vested at March 31, 2025
-
$
-
The
 
equity
 
awards
 
granted
 
to
 
members
 
of
 
the
 
Board
 
of
 
Directors
 
of
 
Popular,
 
Inc.
 
(the
 
“Directors”)
 
after
 
May
 
2025
 
will
 
vest
 
and
become non-forfeitable on the
 
first anniversary of the
 
grant date of such award.
 
Equity awards granted to
 
the Directors may be paid
in either common
 
stock or RSUs, at
 
each Director’s election. If
 
RSUs are elected the
 
Directors may defer the
 
delivery of the
 
shares
of common stock
 
underlying the RSUs
 
award after their
 
retirement. To
 
the extent that
 
cash dividends are
 
paid on the
 
Corporation’s
outstanding common stock, the Directors will receive an additional number of RSUs that reflect reinvested dividend equivalent.
 
During the quarter
 
ended March 31,
 
2025,
1,546
 
RSUs were granted
 
to the Directors
 
(March 31, 2024 -
1,195
).
 
During this period,
the
 
Corporation
 
recognized
 
$
0.3
 
million
 
of
 
restricted
 
stock
 
expense
 
related
 
to
 
these
 
RSUs,
 
with
 
a
 
tax
 
benefit
 
of
 
$
48
 
thousand
(March 31, 2024
 
- $
98
 
thousand, with
 
a tax
 
benefit of
 
$
18
 
thousand). The fair
 
value at
 
vesting date
 
of the RSUs
 
vested during
 
the
quarter ended March 31, 2025 for Directors was $
0.1
 
million.