POPULAR CELEBRATES ANNUAL SHAREHOLDERS’ MEETING
(Reports significant growth for year 2004)
Banco Popular Dominicano, C. por A. held its annual shareholders’ meeting on Saturday, March 19, 2005 at the institution’s headquarters.
During the meeting, Mr. Manuel A. Grullón, President of the financial institution, emphasized the excellent results obtained during fiscal year 2004 showing growth in its principal financial and business indicators. Furthermore, these positive results lead to a significant increase in assets, liquidity, deposits, and the institution’s solvency as well as reserves.
The President indicated that one of the primary factors that lead the organization to such a successful year can be correlated to the institution’s comprehensive corporate governance philosophy.
Mr. Grullón asserted that the criteria used to prudently manage the financial variables permitted the institution to minimize the impact of the economic decline of 2003, which extended into 2004 and, as a result, brought about the implementation of new banking norms, such as the valuation of credits, capital adequacy, and risk management among others.
In addition, Mr. Grullón indicated that the macroeconomic measures adopted by the new financial and monetary authorities, designed to make an agreement with the International Monetary Fund viable, were significant factors that positively affected macroeconomic indicators, as well as promoting confidence among the country’s economic agents.
Mr. Grullón proudly announced that the institution “concluded the audit process conducted by the Bank Superintendence in a satisfactory manner.” He added “that aside from meeting with the objectives and requirements of the Superintendence regarding liquidity levels, the quality of the portfolio as well as the bank’s reserves and solvency, the bank presented it’s business plan according to the regulator’s requirements.”
Financial Indicators
The report to the shareholders, presented by that institution’s President, states that as of December 31, 2004 Total Assets for Banco Popular amounted to RD$80,588.4 million which represents an increase of RD$6,231 million compared to the RD$74,357.4 million balance from the previous year-end.
Mr. Grullón explained that the growth in total asset was due to the increase in total deposits, which surpassed by RD$7,982.2 million the RD$61,735.8 million balance reached in 2003. For the month of December 2004, the bank closed with a balance of RD$69,718 million in Total Deposits.
On the other hand, the net loan portfolio decreased by RD$3,477.4 million when compared to the amount reached the previous year, reporting a balance of RD$37,222.9 million at the close of 2004. Mr. Grullon specified that this decrease was a result of the economic situation and the reduction of the Foreign Currency Loan Portfolio, which was managed in response to the exchange rate instability that affected the country during the first half of 2004.
Mr. Grullón emphasized that the liquidity generated by the reduction of the Loan Portfolio was allocated to investments in the Central Bank of the Dominican Republic.
To that end, Mr. Grullón affirmed that Popular adopted a policy to prudently manage its financial variables, thus diminishing risks, and in return increased its levels of Loan Loss Provisions by 56% during 2004, equivalent to an absolute increase of RD$816.8 million.
Likewise, the bank managed to increase its Equity during 2004 by RD$709.8 million, reporting a Total Equity of RD$7,764.3 million at year-end. This allowed the institution to preserve adequate solvency levels, comfortably exceeding the requirements established by the Bank Superintendence.
The President concluded his report communicating to the shareholders that the bank had obtained Net Earnings of RD$1,393 million in 2004, which represents an absolute increase of RD$194.8 million compared to the previous year.
