First BanCorp's Restated Earnings Cut $17.1M

First BanCorp, San Juan, Puerto Rico, has announced that its restatement of financial results for 2000-2004 reflects changes in the treatment of mortgage-related transactions and contains cumulative reductions of $17.1 million (or 3.4%) in retained earnings and legal surplus.Approximately $15.1 million of the reductions represent noncash adjustments related to derivatives and broker placement fees. The company had concluded last December that "a substantial portion" of its mortgage-related transactions with Doral Financial Corp. and R&G Financial Corp. since 1999 did not qualify as true sales for accounting purposes, mainly because they included unlimited recourse provisions. "This filing culminates a painstakingly diligent accounting review and significant milestone of First BanCorp's path back to normal-course financial reporting," said Luis Beauchamp, the company's president and chief executive officer. First BanCorp can be found online at http://www.firstbankpr.com.