Happy Birthday, Sis!!
Unrelated to that announcement:
"Chairman and Chief Executive Officer Richard Carrión’s sister and two of his nephews, one of whom is also a Popular director, have delinquent property loans to the San Juan-based lender, according to a regulatory filing. The bank has also restructured the loans of another director, the board’s head of corporate governance, and classifies his debts as “troubled,” the filing shows.
'The disclosures are seriously problematic,' said Orin Kramer, whose Boston Provident Partners LP hedge fund owns about 2 million Popular shares. 'The role of the board is to protect against credit losses, not create them.'”
From another source:
Have there been other deals of this sort that have gone on, and are shareholders entitled to know about that?”
The loan is among the latest “related-party transactions” between (the nephew of Uncle Richard, José) Vizcarrondo and Popular, which paid companies linked to him at least $33 million since 2004, regulatory filings show. The bank posted $1.87 billion of losses from 2007 through 2009 under Carrión, who has been Popular’s CEO since 1994 and a director of the Federal Reserve Board of New York since 2008."
From the same source, further down:
"Desarrollos isn’t the only company linked to Vizcarrondo to gain from Popular contracts. The bank paid $33 million from 2004 through 2006 to Metropolitan Builders SE, a firm in which Vizcarrondo is a partner, proxy filings show. This company was awarded construction contracts valued at $52 million in 2002, the filings show."
And for losing $1.87 billion, how much does Uncle Richie Wretch make? "Carrión’s overall compensation, including stock, increased 67 percent last year (2010) to $1.8 million, according to the proxy filing." Woo-hoo! A 67% raise and rampant nepotism, too! Way to go, Richie Dead Meat! ("Carrion" as it is properly defined, in this case...)
Another little fillip of rotting meat: Banco Popular still owes $935 million to TARP, the second-highest such debt in the U.S of part of A. banking system. They're #2! They're #2!
But then there's more back-office butchering going on here...
"Manuel Morales Jr., Popular director and chairman of the board’s corporate governance committee, owes the bank about $1.5 million through different lines of credit, according to a filing. The board agreed to restructure his debts in December, changing most of them to three-year term loans.
While Morales is “current” on his obligations, the loans “would be classified as troubled debt restructurings,” according to the bank."
Oh. So if you're IN the bank, you don't have to deal with the pesky little rules of actually running the bank properly. That's good to know. Especially since the Feds noticed long ago (well, last year, at least) and placed Banco Popular under its direct scrutiny "due to failings in the bank’s management of documentation concerning property loans."
Gosh. It almost makes you forget the time Banco Popular's Old San Juan branch "forgot" to properly report $25 million in laundered drug money...
Banco Popular is the largest local bank, with over 40% of all Our deposits; its closest rival is at 17%. As an economic pillar, Banco Popular is more like a ragged toothpick, using its local weight to squat and crap on Our growth with its near-monopolistic powers.
Want a mortgage? Banco Popular handles over 55% of them (and The Larva's wife, Lucé "I Met 'Meat' Romney" handles over 2100 of them...for a cool $900,000+). Car loan? Ditto. Personal loan? Same. Credit card? Yeah. Construction loan? Uh-huh, especially if Uncle Richie Wretch is kin.
Banco Popular is weak, troubled and run by nincompoops. TARP cash kept them afloat and because no other bank in their right mind would deal with the Dr. Moreau-like scenario here, the Feds handed Banco Popular pretty much all of WesternBank's cherry-picked "good assets," in a deal that shut down a weakened bank and propped up another.
Some analysts are touting buying Banco Popular shares. One even compares that purchase to that of buying lottery tickets. But that same "lottery gamble" source thinks alternative good buys are Doral Financial Group (DRL) and First Bancorp (FBP), numbers 2 and 3 amongst local banks. So it's not that Banco Popular is a hidden gem: it's that Puerto Rico's hybrid faux-economy could yield good deals if it kicks back into high-consumption gear.
I'll repeat Myself: Banco Popular is an obstacle to Our growth. It is a massive financial roadblock sitting squarely in key industrial and business sectors: construction, commercial loans, mortgages and personal loans. It dominates a weakened economy that was weaker than it should have been because Banco Popular--through its near-total control of 936 funds--used that money to build a national base (now rebranded as "Popular Community Bank") rather than truly build Our Island. In effect, it colluded with Stateside firms to zip profits back home, rather than invest them locally, as Section 936 intended.
Given that Banco Popular has long been run like a friquitín's greasy cash box, where any José, Julio or Manny can grab a handful of dollars and waltz away, that its economic base has been self-eroded, that its strategy is more "survival" than "revival" and that it believes Uncle Richie is worth more than $1.8 million to lead them exactly nowhere, I say it's time to topple Banco Popular.
The sooner the better. For Our Island's best and brightest sake.
The Jenius Has Spoken.