v3.26.1
Stock-based compensation
 3 Months Ended
Mar. 31, 2026
Disclosure of compensation related costs sharebased payments [Abstract]  
Stock-based Compensation
Note 25 - 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.
 
For equity settled
 
awards based
on
 
a
 
performance
 
condition,
 
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 and employees.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Not in thousands)
Shares
Weighted-Average
Grant Date Fair
Value
Non-vested at December 31, 2024
247,908
$
66.86
Granted
226,259
100.35
Performance Shares Quantity Adjustment
55,517
91.18
Vested
 
(293,939)
90.00
Forfeited
(8,787)
66.53
Non-vested at December 31, 2025
226,958
$
76.13
Granted
78,215
144.93
Performance Shares Quantity Adjustment
12,282
117.41
Vested
 
(90,475)
120.95
Forfeited
(788)
88.87
Non-vested at March 31, 2026
226,192
$
87.80
During the
 
quarter ended
 
March 31,
 
2026,
42,395
 
shares of
 
restricted stock
 
(March 31,
 
2025 -
72,619
) and
35,820
 
performance
shares (March 31, 2025 -
47,494
) were awarded to employees under the Incentive
 
Plan.
 
During the quarter
 
ended March 31,
 
2026, the Corporation recognized
 
$
5.9
 
million of restricted stock
 
expense related to
 
employee
incentive awards, with a tax
 
benefit of $
0.6
 
million (March 31, 2025 -
 
$
7.5
 
million, with a tax
 
benefit of $
0.6
 
million). For the quarter
ended March 31,
 
2026, the fair
 
market value of
 
the restricted stock
 
and performance shares
 
vested was
 
$
8.3
 
million at
 
grant date
and $
17.3
 
million at vesting date. This excess requires the recognition of a windfall tax benefit of $
3.3
 
million that was recorded as a
reduction in
 
income tax
 
expense. For
 
the quarter
 
ended March
 
31, 2026,
 
the Corporation
 
recognized $
3.9
 
million of
 
performance
shares
 
expense,
 
with
 
a
 
tax
 
benefit
 
of
 
$
0.2
 
million
 
(March
 
31,
 
2025
 
-
 
$
3.4
 
million,
 
with
 
a
 
tax
 
benefit
 
of
 
$
0.4
 
million).
 
The
 
total
unrecognized compensation cost related to non-vested restricted stock awards
 
and performance shares to employees at March
 
31,
2026 was $
13.5
 
million and is expected to be recognized over
 
a weighted-average period of
1.56
 
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, 2024
-
$
-
Granted
24,476
101.33
Vested
 
(5,363)
104.33
Forfeited
-
-
Non-vested at December 31, 2025
19,113
$
100.49
Granted
1,166
125.96
Vested
 
(1,166)
125.96
Forfeited
-
-
Non-vested at March 31, 2026
19,113
$
100.49
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 restricted 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
 
until
 
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,
 
2026,
1,166
 
RSUs were granted to the
 
Directors (March 31, 2025 -
1,546
).
 
During this period,
the Corporation recognized $
0.6
 
million of restricted stock
 
expense related to these
 
RSUs, with a tax
 
benefit of $
0.1
 
million (March
31, 2025
 
- $
0.3
 
million, with
 
a tax
 
benefit of
 
$
48
 
thousand). The
 
fair value
 
at vesting
 
date of
 
the RSUs
 
vested during
 
the quarter
ended March 31, 2026 for the Directors was $
0.1
 
million.