Puerto Rico and its banks will benefit from US government-led economic analysis

Source: Jason Mercer, Genevieve Nolan, Moody’s, Sector Comment, March 10, 2019
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On 4 March, the US Department of Commerce’s Bureau of Economic Analysis (BEA)announced that later this year it will produce new economic data for Puerto Rico to estimate the island’s GDP. The move is credit positive for the island’s banks because it will bolster reforms by the island that should encourage unbanked residents to participate in the banking system, thereby spurring loan growth and increasing operating margins. Among the banks that will benefit are Popular Inc. (B2 review for upgrade, b1), FirstBank Puerto Rico (Caa1review for upgrade, b3) and Banco Santander Puerto Rico (BSPR, Baa1 stable, ba3).