The Weekly Journal - Wednesday, November 3, 2021

Puerto Rico and the Caribbean

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Wednesday, November 3-9, 2021- // no. 132

New Labor Reform in the Works P6 TransPerfect Expands in San Juan P8 Evertec Sees Merchant Sales Grow P10

Banks:

Credit Demand Picks Up in Puerto Rico As local economy continues to rebound

B

>Courtesy

Rosario Fajardo

Panoteca San Miguel Opens Shop P15

rfajardo@wjournalpr.com

@RosarioWJournal

anks play a key role in all economies and a healthy economy is a key driver for banks, with consumers and businesses spending, and borrowing, at healthy levels. As Puerto Rico continues to recover from the COVID-19 pandemic and the economy’s reopening maintains its pace, the island’s three major banks are benefiting from increased spending from both consumers and businesses alike.

In fact, during their respective earnings conference call with investors on their third quarter (Q3) results for 2021, Banco Popular, FirstBank and Oriental Bank’s top executives outlined that credit demand has gone up and should continue in the coming months.

Banco Popular

Popular reported a quarterly net income of $248 million was $30 million higher than the second GO TO PAGE 4

The Weekly Journal > Wednesday, November 3, 2021 > 2

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a week in review FOMB Moving Forward With the Plan of Adjustment

Treasury Seizes 136 Investment Accounts in Puerto Rico and the U.S. Treasury Secretary Francisco Parés Alicea reported the seizure of 136 investment accounts in Puerto Rico and United States brokerages, owned by delinquent taxpayers. The liens that will be processed amount to $3,094,857, including interest, surcharges, penalties and costs of garnishment. Treasury’s action, coordinated by the Revenue Department of the Internal Revenue Area, arises from the failure of the taxpayers to attend to their debts and their failure to act on the available approaches and alternatives, the agency said.

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>Courtesy

>Archive

>Brandon Cruz González

The Financial Oversight and Management Board (FOMB) said it is willing to move forward with the confirmation process of the Plan of Adjustment (POA) to reduce the Puerto Rico Commonwealth’s debt by 80% and enable the island to leave bankruptcy behind. The FOMB said it carefully reviewed Act 532021 (former House Bill 1003) adopted by the Puerto Rico Legislature and signed by Gov. Pedro Pierluisi on Oct. 26, 2021 and concluded that the changes the Legislature made to the amended legislation following the Oct. 25, 2021 hearing by the U.S. District Court for the District of Puerto Rico forms the basis for the issuance of new general obligation bonds that is part of the 7th Amended POA.

Renovated Roads for San Juan The capital city of San Juan is getting a $26 million infusion of funds to repair and repave 200 miles of roads, from Old San Juan to Condado, as well as Santurce and beyond. San Juan Mayor Miguel Romero, who is serving his first term, acknowledged that San Juan’s roads have been in a state of disrepair for years, as he stressed that the project is an infrastructure priority. He explained that the road works will be divided into four phases around San Juan, and the entire project should be completed by the summer of 2022.

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CONTINUED FROM PAGE 1

strong consumer demand and are on a record pace with 31,000 units sold in the third quarter. quarter and $80 million higher than the same Year-to-date, auto sales are up 66 percent quarter of 2020. “A higher volume of credit and compared to the first nine months of 2020, and up debit card transactions in the quarter contributed 32 percent from the same period in 2019, Banco to the increase. Credit quality trends continued to Popular reported. be favorable in the period with lower NPLs (nonFor his part, Carlos J. Vázquez, executive VP performing loans) and low levels & chief financial officer of of net charge-offs,” said Ignacio Corporate Finance Group, noted Álvarez, president and CEO of that excluding the impact of the Popular.

U.S. Paycheck Protection Program Within Popular’s clientele, (PPP), loan balances grew by the dollar value of credit and $153 million, driven by higher Within debit card sales have continued commercial auto loan and lease Popular’s clientele, to trend higher, increasing by 5 balances in Puerto Rico. These the dollar value of percent compared to the same increases were offset, in part, by credit and debit quarter a year ago, he told lower commercial balances in the card sales have analysts.

U.S. driven by high prepayments. continued to trend “Sales are also well above “We do not expect overall loan higher, increasing by pre-pandemic levels, 34 percent growth to materialize until 5 percent compared higher than in the third quarter the middle of next year when to the same quarter a of 2019. Auto loan and lease demand resulting from expected year ago. originations at Banco Popular economic growth should outpace Oriental’s top have remained extremely strong. the forgiveness of PPP loans,” he executives concurred While they had decreased slightly said. that the strong compared to the third quarter Lidio Soriano, Executive VP trends in mortgage, in 2020, which reflected the & chief risk officer of Corporate commercial and reopening of the economy, they Risk Management Group, auto loans should were 26 percent higher versus the also reported that during the continue. third quarter in 2019. third quarter of 2021, Popular “We have continued to see continued to exhibit strong credit strength in the housing market. quality metrics and low credit While the dollar value of costs driven by the improving mortgage originations at Banco Popular decreased economic environment. by 3 percent compared to the third quarter of “Non-performing assets decreased by $57 2020, they increased by 51 percent compared to million to $710 million this quarter, mainly driven the third quarter of 2019,” Álvarez explained. by an NPL decrease of $52 million, coupled with Meanwhile, new auto sales continue to reflect a decrease of $9 million in non-performing loans

In fact,

held for sale, offset in part by an increase of $4 million due to other real estate owned. In Puerto Rico, NPLs decreased by $48 million, mainly due to lower commercial NPLs of $34 million. This was due to payments received and charge-offs taken on collateral dependent loans, coupled with lower mortgage NPLs of $16 million, resulting from lower inflows and continued improvements in the credit profile of the portfolio,” he said.

Overall, Popular’s results in 2021 to date have been strong driven by solid earnings, improved credit quality, record deposit levels, continued customer growth, and the successful execution of its capital actions, Álvarez said. “We are optimistic about the economic outlook. In addition to the unprecedented level of federal stimulus-related to COVID, Puerto Rico still has a significant amount of hurricane recovery funds that have yet to be dispersed, which we expect will now start flowing at a faster pace. The combined impact of these factors and continued consumer spending should generate considerable economic activity in many sectors for the coming years, and we are well positioned to benefit from such activity.

A successful resolution of the debt situation in Puerto Rico will also be a positive factor,” he added.

Puerto Rico reached one of the highest vaccination rates of any state in the U.S. jurisdiction.

This has led to an accelerated reopening of the economy, material improvement in the tourism, and an overall improvement in the business environment and consumer confidence. This should result in increased loan demand.

- Aurelio Alemán, president and CEO of First BanCorp

FirstBank

Ignacio Álvarez of Banco Popular >Archive

First BanCorp reported net income of $75.7 million for Q3 2021, compared to $70.6 million for the second quarter of 2021.

“On the macro front, we’re pleased to see improvements in the economic backdrop within our three operating regions. We see the improvement in Puerto Rico, including the -- obviously, all the stimulus, in the U.S. Virgin Islands, similar investments also made in reconstruction. And, obviously, Florida economy continues to be very, very solid. Both pandemic and [hurricane] relief funding continue to support

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new originations worth $556 million, ex-PPP that is down $85 million from the second quarter, but is up $109 million year-over-year,” she said to analysts.

The strong trends in mortgage, commercial and auto loans should continue, Arizmendi indicated.

“We continue to see increase in demand from commercial loans to expand business operations, with the new stores and warehouses, buying inventory or making acquisitions. Commercial portfolio ex-PPP has increased two consecutive quarters,” she said.

Oriental’s top executives concurred that looking at the big picture, Puerto Rico continues to benefit from federal reconstruction and COVID stimulus.

“But the relative economic impact here is more meaningful than in other U.S. jurisdictions, given the size of our economy and average incomes.

As a result, we continue to see incremental business sector optimism, confirming Puerto Rico’s economic revival,” Fernández said. “Our plan is to continue to take advantage of our momentum in this improved economic environment. We intend to deploy excess liquidity for loan growth and/or capital return initiatives.”

Aurelio Alemán of FirstBank >Archive

the economic activity,” said Aurelio Alemán, president and CEO of First BanCorp.

“And it’s important to also highlight that Puerto Rico reached one of the highest vaccination rates of any state in the U.S. jurisdiction. This has led to an accelerated reopening of the economy, material improvement in the tourism, and an overall improvement in the business environment and consumer confidence. This should result in increased loan demand,” he told analysts.

With the COVID federal stimulus funds coming to an end, consumer liquidity has also started to subside a bit, Alemán noted. But when looking at personal consumer loans and credit cards, “we’re seeing over recent months, including September, better activity. Also, when you look at the pipeline of small loans, that that actually is improving, and I have to say that the [pipeline] on the commercial side, including construction, it’s also continued to show improvement. As you know, it takes time from pipeline to closing, but if I have to, say, compare the pipeline to where we were in the first quarter, we are, overall, in a better place in all the commercial products itself,” he explained.

When looking at mortgages, there are two important components: rates, which drive the refinancing volume, and conforming originations, Alemán said. “The prepayment of mortgages is higher than we estimated when you look at the year numbers, which also contributed to some of the contraction of our loan portfolio, but, in general, a lot going on, a lot of new investments, new investors coming into the market. So, we feel

very optimistic that that would translate into loan demand,” he added.

Oriental Bank

For Q3 2021, OFG Bancorp reported total core revenues of $134.7 million compared to $133.3 million in Q2 2021.

Looking at the Q3 2021 balance sheet, customer deposits increased $154 million to $9.2 billion, reflecting even greater liquidity on the part of both commercial and consumer customers. As a result, both cash and assets grew, reported Oriental.

“Loans held for investment declined $87 million.

Excluding PPP loans forgiven, they increased $5 million. New loan origination remain strong at $556 million. Ex-PPP originations now total more than $1.6 billion as of the nine months, which is up 69 percent compared to the same period last year and 79 percent compared to the same period in 2019 pre-COVID, said José Rafael Fernández, Oriental’s president and CEO. Maritza Arizmendi, chief financial officer at Oriental, outlined that average loan balances totaled $6.5 billion, a decline of $133 million from the second quarter. “This was due primarily to residential mortgage pay downs on PPP loan forgiveness. In turn, this was partially offset by new commercial and auto loans… Higher levels of residential mortgage breakdowns reflected increased liquidity on the part of consumers. Our residential mortgage portfolio consists of legacy Oriental mortgage loans and mortgage loans from the BBVA and Scotiabank acquisition. Those are

José Rafael Fernández of Oriental Bank >Archive

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The cost of doing business will continue to rise in Puerto Rico with the new Labor Reform measure, says private sector leaders. >AP Photo/Steven Senne

Governor Rejects Double Overtime Pay and Eliminating ‘Flextime’

Private sector raises ‘red flag’ warnings on new labor reform

T Rosario Fajardo

rfajardo@wjournal.com

@RosarioWJournal

he Puerto Rico House and Senate are contemplating amendments to the 2017 Labor Reform Law, which include substantial changes that would affect the private sector. To that end, Gov. Pedro Pierluisi sent a letter over the weekend to the heads of both legislative bodies in which he listed various aspects of the new Labor Reform effort that he believes should be reviewed so that they are tempered with “the current reality of the labor market.”

He objected to two proposals: double pay for overtime and eliminating “flextime,” which he said has been particularly beneficial for many workers during the coronavirus pandemic. The first executive mentioned that he seeks to establish a consensus on the changes proposed by the legislative piece so that it can count on his signature.

Several private sector leaders have expressed concerns about the legislative proposals, saying they would be detrimental to economic development. “We cannot keep changing labor laws constantly. Maintaining a pattern of continuous changes destabilizes the economy at a time when we are recovering after the impact of the pandemic. We want to be an attraction for more companies to invest in our Island and for more people to join the working force,” said Iván Báez, president of the Retail Trade Association.

“It is fatal to pass labor legislation independently, piecemeal, without a joint impact analysis. The cost of fringe benefits are based on wages and the Legislature just approved increases without due analysis,” echoed Manuel Reyes, vice president of the Food Marketing, Industry and Distribution Chamber.

Pierluisi emphasized that he considers it prudent that the Labor Reform be amended to standardize the requirement, applicable to all private sector employees, that they are entitled to receive the bonus for working at least 700 hours during the year in question.

It should be noted that, currently, Puerto Rico’s labor laws require that employees hired before Jan. 26, 2017 work at least 700 hours a year in order to be entitled to the Christmas bonus.

However, employees hired after that date have to work at least 1,350 hours to be entitled to Christmas bonus.

Meanwhile, the governor stressed the importance of all workers having an adequate period of rest. “I support the amendment of the Labor Reform to decrease the requirement of hours worked per month to be able to accumulate vacation and sick leave. This requirement must be set again at 115 hours per month. Along the same lines, I support the amendment of the Labor Reform to establish that workers hired as of Jan. 26, 2017 can also accumulate one and one-fourth days of vacation for each month worked,” he added.

In his letter to the legislative heads, Pierluisi mentioned that the amendments aimed at - Luis Gierbolini, Chamber of increasing the current pay of time and a half to Commerce president double pay for working in excess of eight hours a day, on rest days and during the meal period, could be detrimental to small and medium-sized businesses, so these changes do not have his endorsement.

Pierluisi explains his position On the other hand, the governor also expressed In his missive, Pierluisi mentioned that a sixmonth probationary period is more reasonable for that he does not support the elimination of both exempt and non-exempt employees than the provisions that allow for flextime arrangements for workers. “My administration has always sought automatic nine-month probationary period.” This provides uniformity to the administration of human the balance that is required by promoting changes to strengthen our workforce and in turn, ensuring resources and therefore, an amendment to this that the commercial sector, especially small and end would have my endorsement,” the governor medium-sized merchants, can continue to create said in written statements. and maintain jobs to contribute to our economic Regarding the Christmas bonus which is growth,” Pierluisi said. regulated in accordance with Puerto Rico law, “We are surprised by these labor changes, whereby the opinion of the country’s productive sector has not been taken into consideration, at a time when we are recovering due to the effects of the pandemic and especially with a government that is bankrupt,” said the president of the Chamber of Commerce, Luis Gierbolini.

We are surprised by these labor changes, whereby the opinion of the country’s productive sector has not been taken into consideration, at a time when we are recovering due to the effects of the pandemic and especially with a government that is bankrupt.

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Access to Supplemental Security Income is Positive for Local Economy

T

Maricarmen Rivera Sánchez

mrivera@elvocero.com

@mriverasanchez

he possibility of Puerto Rico having access to Supplementary Security Income (SSI) benefits, as of 2024, is positive for the island’s economy and would help reduce the number of people who are living in poverty.

According to economist José Caraballo Cueto, the SSI program will help the neediest sectors. “It seems to me that it is good news because the SSI would reduce the poverty rate in Puerto Rico by seven percentage points,” he said.

“This program is for poor older adults, poor disabled people, and poor children. As the stipend is much greater than PAN (Spanish acronym for the Nutritional Assistance Program) benefits, it would take many people who are now close to the poverty level and move them above the poverty level. They are populations that need it,” Caraballo added.

For the economist, another positive aspect of President Biden’s budget blueprint and social agenda framework, under the Build Back Better Act, which is now being debated by U.S. lawmakers, is the employment credit in the manufacturing sector.

“Although it is true that it will not generate a return of manufacturing as we saw with Section 936, it does help so that the industries here in [Puerto Rico] do not continue to leave. This helps preserve Puerto Rico’s industrial base, which are jobs that do not compete with other jobs in the local sector,” he explained.

Caraballo pointed out that Biden’s framework on social welfare issues, which includes permanent funding for Medicaid in the U.S. territories, including Puerto Rico, came just as the island is preparing for the approval of the government’s Plan of Adjustment in federal court.

“The assignment to Medicaid gives us relief because the money that we are going to use for the debt would come from the contributions we now make for Mi Salud. They are funds that come in to replace that and can be used to pay off the debt. That alleviates a bit the threat of a second default,” he said.

Biden’s Build Back Better Act must pass the U.S. House of Representatives and U.S. Senate before it can be signed by the president.

to 55 percent as of December 3, but we already know that this will not happen. It will remain at 76 For her part, Carmen Feliciano, director of the percent,” she said.

Puerto Rico Federal Affairs Administration (PRFAA) Health Secretary Carlos Mellado also pointed cited a study by the Center for the New Economy out that the announcement of more funds for to indicate that this benefit could reach almost Medicaid would be a relief for the island. half a million people on the island. She explained “There is still a long way to go, but we are happy that the bill could go to a vote in because both the governor Congress in the coming week.

(Pedro Pierluisi) and I have been “For it to move in the House, visiting Washington, sitting down the Senate president has to give with members of Congress so assurance that we have the 50 that they understand that in Democratic senators supporting Puerto Rico, we do not have Although the the measure in the Senate. As access to the programs as in SSI money would it is a budgetary measure, it the rest of the nation. We don’t not be received in has to start in the House. What have the money for emergency Puerto Rico until is expected is that once it is transportation, durable diabetes 2024, the measure approved in the House, it will be medical equipment, and adult will imply immediate voted and passed in the Senate,” vaccinations. There is an allocations in certain she said. important need,” he said about areas, such as an Feliciano also indicated that, the money that will come to the increase in funds although the SSI money would island. for the Medicaid not be received in Puerto Rico “Right away, we would have a program, with which until 2024, the measure will imply match (in Medicaid funds) of the government’s immediate allocations in certain 76 percent and the next year it health plan for the areas, such as an increase in goes up to 80 percent. If it is not medically indigent is funds for the Medicaid program, approved, we would have a 50 paid. with which the government’s percent match again and that is health plan for the medically a lot of money that Puerto Rico indigent is paid. has to put up. If the legislation “That is for this fiscal year and is approved, it would be very it would be permanent. We were waiting for that contribution in Puerto Rico to drop positive for Puerto Rico, “he said.

Should pass in the U.S. House and Senate

In fact,

>Courtesy of the Puerto Rico Housing

Would reduce the high poverty rate on the island

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Phil Shawe of TransPerfect >Archive

TransPerfect to Open Training Center in San Juan

$30 million investment marks continued confidence in Puerto Rico

T

Zoe Landi Fontana, The Weekly Journal

ransPerfect, reportedly the world’s largest provider of language and technology solutions for global business, announced that it has officially acquired property in Puerto Rico as the location for its Management Learning Center, committing to a $30 million investment.

The new training center will be equipped with conference facilities and accommodations, and enhanced with state-of-the-art technology and connectivity. With its new facility, TransPerfect’s staff members will have the opportunity to participate in more frequent and effective group training in a retreat environment. The project’s timeline is projected to begin in the first quarter of 2022 and finish by the end of that year, with the first trainings to be held in 2023.

Chief Revenue Officer at TransPerfect, Kevin Obarski, commented, “The strength of our culture is what defines TransPerfect. We’ve always invested heavily in face-to-face interactions between our employees, and those bonds are a big part of what has carried us to where we are

diverse range of professionals across multiple today. This new facility takes that commitment to areas, including language services production, the next level.” technology R&D, and sales and client services.

TransPerfect has offices in over 100 cities and Other positions for which they are actively spans six continents, offering services in more recruiting include project managers, software than 170 languages to over 5,000 organizations developers and software engineers. globally. Year-to-date in 2021, the company has As reported by THE WEEKLY JOURNAL in grown 29 percent and surpassed $1 billion in annual billed revenue. In the third quarter of 2021, 2019, Shawe expressed his confidence in San Juan as a business hub with an TransPerfect also reported that extensive pool of local talent. In its sales had risen by 31 percent an interview with THE WEEKLY over the same period last year.

JOURNAL, Shawe explained that “The $1 billion mark is a a main driver for Puerto Rico is milestone we’ve had our sights Buoyed that “there is a tremendous need on for a long time. While sales by its strong for Spanish translations and we performance is not our only revenue numbers, know many people are bilingual important metric, our philosophy TransPerfect is in Puerto Rico. That was key in is that beyond being a good currently hiring our decision-making process.” indicator of overall demand, locally in San Juan, in He noted that many of the revenue helps measure how addition to expecting company’s jobs are for educated much value we’re able to add to to hire hundreds and skilled workers, in the sense our clients’ businesses in totality,” more worldwide. that they require a certain level of stated Phil Shawe, the company’s knowledge of English and Spanish. president and CEO. An additional motivator for Buoyed by these strong TransPerfect was the availability numbers, the company is of tax benefits in Puerto Rico, on currently hiring locally in San which Shawe commented, “We will comply with the Juan, in addition to expecting to hire hundreds letter and spirit of the law and create jobs in Puerto more worldwide.

Rico. It’s a win-win for all of us.”

The recent transaction on the new training At the time, in 2019, TransPerfect had invested center, brokered by Paco Diaz of Luxury Collection an estimated $200,000 for their new office in Hato Real Estate in San Juan and financed through Rey’s business district. The space was suitable for Oriental Bank, highlights the company’s continued 50 employees and was partially chosen for how interest in Puerto Rico’s talent pool and economic well it stood up to hurricanes. benefits. They continue their pledge to hire a

In fact,

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Paradores Association: Millions in Unpaid Taxes by Short-Term Rental Owners In 2021, estimated at over $70 million

C

Zoe Landi Fontana, The Weekly Journal

onservative estimates reflect that, in 2021, revenues on stays in independently owned shortterm accommodations in Puerto Rico could reach $450 million, while the evasion of taxes, contributions, permits, and regulatory patents and charges could exceed $70 million.

Furthermore, over 80 percent of the 25,000 independently owned accommodations that operate on the island are businesses administered by consolidators, and many allegedly operate as illegal hotels.

These findings were some of the charges brought by the president of the Paradores Association, Xavier Ramírez, who said that, “the vast majority of these independent accommodations are businesses with dozens of units and significant rentals, and they should comply with all of the requirements, permissions, licenses, patents, insurance and minimum standards required for other similar enterprises and even those much smaller.”

According to the head of the Paradores Association, Puerto Rico “[already] has the necessary laws and regulations to address the registration and regulation of this segment of short-term accommodations, and there are other areas of permits, patents, licenses and contributions that every municipality and other government agencies are responsible for implementing.

“It is time to assert our laws, and we can start with the consistent registration and payment of taxes. The Puerto Rico Tourism Company (PRTC) has Law 272 from 2003 and regulations 8395 from 2013 and 8856 from 2016, which empower it to enforce the registration and minimum regulations on these accommodations, and it can enforce fines and sanctions of up to $25,000 if they are not compliant,” Ramírez pointed out.

Despite repeated efforts to contact the PRTC, as of press time, officials there had not responded to THE WEEKLY JOURNAL’s requests.

According to Christian Rivera, vice president of the association that represents small inns across the island, given that many of these accommodations are posted on the internet, on several well-known platforms, identifying them and communicating with their owners or professional

Short-term rentals have boomed in recent years. >Courte-

operators should be relatively simple.

“In 2017, the association collaborated with the Cabo Rojo municipality and identified over 300 units of short-term, independent accommodations and their owners. [About] 90 percent of these accommodations belonged to non-residents of the city, which defeats the myth that the majority belong to the sharing economy,” he claimed.

The Paradores Association acknowledged that some of the 25,000 independent accommodations are necessary to support efforts to improve Puerto Rico’s tourism product. As such, the two officials indicated they are pushing for them to be duly registered and audited by the government. To date, however, the organization estimates that less than 17 percent are legally registered.

Arrival of MS The World in San Juan for a three-day stop

In other tourism news, the residential cruise ship MS The World arrived on Nov. 1, after a seven year absence, to Pier 4 in Old San Juan for a threeday transit stop, as dictated in port agreements between the cruise line, the Health Department and the Ports Authority, and in compliance with

requirements from the Centers for Disease Control and Prevention (CDC).

The ship arrived in San Juan from St. Martin on Nov. 1 and will depart the evening of Nov. 3. Its occupancy of 339 people, made up of 246 crew members and 93 residents, is 100 percent vaccinated against COVID-19, and passenger-residents must be older than 18 years old, according to a statement from the PRTC. Additionally, in compliance with the rigorous protocols established by the CDC and Puerto Rico government, the ship’s crew follows heightened sanitation procedures and performs routine tests to detect COVID-19 aboard the vessel.

Operated by the company ResidenSea Ltd, the MS The World comprises a community of passengers, each owning their own luxury residential unit on the vessel. The ship travels throughout the world’s oceans, visiting dozens of countries and stopping in ports for a couple of days at a time. The arrival of this cruise ship to Puerto Rico is another boost to the island’s tourism industry and vision as a desirable vacation destination, and joins more than a dozen cruises that include San Juan on their itinerary, the PRTC said.

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Evertec Reports Third Quarter 2021 Results Merchants show healthy sales volume growth

E Rosario Fajardo

rfajardo@wjournalpr.com

@RosarioWJournal

vertec Inc. announced that its revenue increased 7 percent to $145.9 million for the third quarter (Q3) ended Sept. 30, 2021 from the $136.5 million of the prior year quarter.

“We are pleased to have delivered strong third quarter results, driven by continued robust payment volume growth in both Puerto Rico and Latin America. We remain focused on innovation and execution on new contracts, and this has led to expansion in existing markets,” said Mac Schuessler, the company’s president and CEO. “In Puerto Rico, the continued effect from federal funds, increased digital usage and return to some pre-COVID seasonality drove strong transaction volumes. In Latin America, we are seeing strong growth, driven by both recent implementations as well as organic growth from existing clients,” he stated during the earnings conference call.

Specifically, Evertec reported that it also continues to benefit from increased transactions in Puerto Rico, driven by the continued effect from the inflow of federal funds to fight the coronavirus Evertec’s Mac Schuessler >Courtesy pandemic, and increased revenue from its digital payment solutions.

We remain pleased with the The company is a leading fullgrowth of ATH Movil, which was service transaction processing up 24 percent for the quarter business in Puerto Rico, the as we continue to see a shift in Caribbean, and Latin America. preference to digital payment Detailing Evertec’s update on methods,” he added.

Merchant the economic situation in Puerto Turning to the operating acquiring sales Rico, Schuessler said: “We saw environment in Puerto Rico, volume growth was continued strong volume and Schuessler reported that approximately 23 revenue growth in the third vaccination rates continue to percent year-overquarter. The ongoing effect from increase with over 70 percent year. And average the inflow of Federal stimulus of the population now fully ticket is coming down and EBITDA (earnings before vaccinated, the highest level on a year-over-year interest, taxes, depreciation and of any U.S. state or territory as basis, but remains amortization) funds earlier in the reported by the U.S. Centers for above pre-pandemic year was a major driver of growth Disease Control and Prevention. levels. as well as a pick up and back-to“Hospitalization rates are down school spending in August, a sign over 80 percent from Delta that we are returning to prevariant peaks back in August COVID spending patterns. and this is moving us closer to a “Merchant acquiring sales volume growth was more normal environment with the government approximately 23 percent year-over-year. And continuing to loosen restrictions. The third quarter average ticket is coming down on a year-over-year also had the highest hotel occupancy rates since basis, but remains above pre-pandemic levels. the beginning of the pandemic and we saw the

In fact,

first cruise ship docked in Puerto Rico since March of 2020,” he noted.

In other news, Evertec reported that revenue growth in Latin America was driven mainly by client implementations in the beginning of the current year, organic growth from existing customers and the continued expansion of its Place to Pay e-commerce platform. These increases were partially offset by the one-time impact in the prior year quarter from a contract with the Puerto Rico Department of Education, the company noted.

Other Q3 2021 highlights include:

GAAP (generally accepted accounting principles) Net Income attributable to common shareholders was $35.3 million, an increase of $0.9 million compared to the prior year.

Adjusted Net Income was $45.0 million, a decrease of 5 percent compared with $47.2 million in the prior year. The decrease was primarily due to a higher effective tax rate driven by certain discrete items in Evertec’s Latin America operations.

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Con el Plan Magenta Max y hasta $800 en valor futuro de trade-in, vía créditos mensuales a tu factura.

ACTÍVATE en TIENDAS o llama al 1-800-TMOBILE. Contáctanos antes de cancelar el servicio para continuar con los créditos mensuales restantes o los créditos se detendrán y deberás pagar el saldo restante en tu plan de pago a plazos requerido (iPhone 13 128GB: $799.99).

Oferta disponible solo por Ship-To. Impuestos sobre el precio del equipo antes de los créditos se pagan al momento de la compra. Oferta por tiempo limitado, sujeta a cambios. Válida hasta el 1 de noviembre de 2021. Requiere crédito, servicio en plan Magenta® Max o Magenta® Plus, y trade-in de un equipo elegible (iPhone 12 Pro/Pro Max, iPhone 11 Pro/Pro Max, iPhone 12/12 mini, iPhone 11, iPhone X/XR/XS/XS Max; Samsung Galaxy S20/S20+/S20 Ultra/S20 Fan Edition/S21/S21 Ultra/S21+/Note10/Note10 Lite/Note10+/Note20/Note20 Ultra, Z Flip 5G, Z Fold2; Motorola razr 5G; OnePlus 8 5G/8T+ 5G). En tiendas o llamadas de servicio al cliente, se puede requerir un cargo de $30 por asistencia en la actualización. Hasta $800 vía créditos por trade-in y créditos mensuales a tu factura; debes estar activo y al día para recibir los créditos; pueden demorar hasta 2 ciclos de facturación. Máx. 4/cuenta. No puede combinarse con otras ofertas o descuentos. Forever Upgrade: Oferta por tiempo limitado, sujeta a cambios. Válida hasta el 1 de noviembre de 2021. Haz trade-in de tu iPhone actual por un nuevo iPhone elegible cada 24+ meses. El valor de trade-in se basa en el precio regular de venta, hasta $800, y es aplicado al precio de venta del equipo nuevo; no tiene valor en efectivo. Requiere crédito y equipo elegibles, y plan de pago a plazos requerido en la misma línea; contáctanos antes de cancelar el servicio después de la actualización para continuar con los créditos restantes a tu factura o los créditos se detendrán y deberás pagar el saldo restante. Si haces el intercambio antes de los 24 meses, eso cambia el valor del trade-in y el tiempo para redimir. El programa puede terminar y es sujeto a cambios en cualquier momento. Hasta $800 vía crédito por trade-in y créditos a tu factura; debes estar activo y al día en el plan Magenta® Max para recibir los créditos; pueden demorar 2 ciclos de facturación. Máx. 1/línea y 4/cuenta. No puede combinarse con otras ofertas o descuentos (por ej. Ofertas de otros equipos en la misma línea o descuentos en servicio). Planes de Pago a Plazos (EIP): Disponibilidad de oferta y monto de los pagos a plazos estarán sujetos a aprobación de crédito. Requiere pago del IVU, pago inicial (de aplicar) y pago de la parte no aplazada al momento de la compra. El saldo se cancela en pagos mensuales. Pago por equipo es adicional al pago mensual de servicios. Ejemplos reflejan pago inicial y pagos mensuales para clientes con crédito excelente; cantidades pueden variar para otros clientes. Se pueden aplicar impuestos y cargos por pago tardío o por falta de pago. Control de la red: el servicio puede ponerse lento, suspenderse, cancelarse o restringirse por mal uso, uso anormal, interferencia con nuestra red, o con nuestra capacidad para brindar un servicio de calidad a otros usuarios, o por uso inmoderado de roaming. Durante congestión, clientes que usen >50GB/mes pueden notar velocidades reducidas hasta el próximo ciclo de facturación debido a priorización.

Uso en el equipo tiene mayor prioridad que el uso mediante enlace, lo cual puede resultar en velocidades mayores para la data usada en el equipo. Sujeto a los Términos y Condiciones (incluyendo cláusula de arbitraje) de T-Mobile® disponibles en www.t-mobilepr.com. Las imágenes de los equipos y pantallas son simuladas. iPhone es una marca comercial registrada de Apple, Inc. T-Mobile, el logotipo de la T, Magenta y el color magenta son marcas comerciales registradas de Deutsche Telekom AG. ©2021 T-Mobile Puerto Rico, LLC.

< The Weekly Journal > Wednesday, November 3, 2021

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/ Wednesday, November 3, 2021

opinion Chantal Benet Inteligencia Económica

Is Inflation Here to Stay?

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nflation has been at the top of everyone’s minds for the past months since in the United States it reached a 13-year high, and a 15-year high in Puerto Rico. We know some of the reasons why there has been inflation, but our true worry is… is it here to stay?

CNBC just released a poll that shows that people are as concerned in America about inflation as they are about COVID-19. In Puerto Rico, Inteligencia Económica does a monthly survey that shows inflation as one of the top-three concerns for Puerto Ricans, alongside COVID and crime. A lot of this is due to people feeling it at the cash register. It began last year when we saw increases in food prices, then during the summer with increases in car prices and now it’s finally reached everywhere else.

The one that concerns me is rent and new home prices, which have not been driven by increases in metro areas in the U.S. or Puerto Rico, but by aggressive buyers, mostly corporations, with sufficient capital to price out any middle- or working-class family who are confronting increasing prices everywhere they look.

The era of uncomfortable inflation is here.

Let’s begin with the causes. The first is the supply-chain backlog, where people are worried not only about their holiday gifts but also about their everyday needs. While Puerto Rico hasn’t seen inventory shortages like in the U.S., there are many U.S. jurisdictions where there have been difficulties in restocking shelves, leaving many families worried about their basic necessities. At the moment, supply-chain issues will likely linger until at least the summer of 2022. What should worry us is that there are other drivers of inflation that are picking up, such as labor shortages and increases in the minimum wage, which have been felt in increasing prices in restaurants, home goods, retailers, and more.

We will discuss in another article how the labor market is behaving, and it will likely not go back to normal in the short term. To summarize, in the U.S., millions of workers have either resigned from their jobs or have gone on strike because of poor labor conditions and fatigue.

There are three important points to include here. First, the countless number of employees who were worked to the bone because they were deemed essential, only to encounter their employers’ hesitancy to raise wages. Second, large chain stores received huge government bailouts while the stock market soared to record highs, improving quality of life and income for executives and middle management, but not “trickling down” to white-collar workers. Third, a 30-year high in

Retailers, auto makers and a wide range of manufacturers have all warned investors that a supply chain crunch and higher raw materials costs are adding to expenses and hurting revenue. >Archive

Supply-chain issues will likely linger until at least the summer of 2022. What should worry us is that there are other drivers of inflation that are picking up, such as labor shortages and increases in the minimum wage, which have been felt in increasing prices in restaurants, home goods, retailers, and more.

new businesses, showing many employees have moved to being their own bosses.

One man’s labor shortage is another man’s path to a higher income.

Average salary for workers in the U.S. is expected to increase by 3% in 2021 and another 3% in 2022, the largest increase in more than a decade. In the case of Puerto Rico, the government increased the minimum wage from $7.25 to $8.50 an hour, the only jurisdiction to increase the minimum wage during the pandemic, and yet many businesses have still faced a labor shortage.

This translates into an increase in prices, which won’t decrease once the supply-chain issues stop.

And while increasing wages are welcome news, increasing inflation? Less so.

So, the reality is… we don’t know for how long we’ll see inflation above 1.5%, but the signs are clear that at least in the U.S. and in Puerto Rico, inflation will likely continue to be a concern until well into 2022.

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/ Wednesday, November 3, 2021

How the Toy Shortage Could Affect Your Holidays Tips for saner, less stressful gift buying

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NerdWallet via AP

any popular toys may sell out long before the holidays, thanks to ongoing pandemic-related disruptions. This could be a disaster — or a great opportunity to reshape

how we celebrate.

We can shop earlier and more thoughtfully, resisting the last-minute scramble for “must-have” items that really aren’t. We can choose classic over trendy, handmade over mass-produced. We can swap experiences for stuff and even make this a learning opportunity for our kids.

This approach requires some strategizing but could result in a saner, less stressful holiday.

Why toys may be in short supply

Holiday shortages are nothing new. Most years, some trendy toy or gaming console becomes the hot, hard-to-find item when manufacturers and retailers misjudge demand.

What may be different this year is the number of toys in short supply. Most toys and electronics are manufactured in Asia, but bottlenecks at ports are delaying deliveries, while shipping costs have skyrocketed. The cost for shipping containers has risen during the pandemic from about $3,500 to “well over $20,000,” says Jonathan Gold, vice president of supply chain and customs policy for the National Retail Federation.

“The supply chain throughout the pandemic has been stretched from end to end,” Gold says.

Higher costs are often passed along to consumers as higher prices. That, and the potential for shortages, should encourage people to start shopping as early as possible, says Jillian Wahlquist, vice president of Tom’s Toys , an independent retailer with three locations in California.

“If there’s a special toy or something that parents are really looking for, buy it now,” Wahlquist says.

How to avoid the mad scramble for toys

Of course, panic buying early in the season can be just as destructive to your budget as waiting until the last minute. Consider drafting a holiday budget now

that incorporates all your expected costs, including gifts, decorations, entertaining and travel. Write down all the people you expect to buy presents for, along with the amount you intend to spend, then make adjustments to keep your spending in line with your means to avoid going into debt.

If you’re buying a gift for a child and not sure what they want, or are concerned that their interest will wane by the holidays, consider some alternatives.

The first substitute is to choose classic toys that retain their appeal over time. Board games, art supplies, crafting materials and building toys such as wooden blocks are some possibilities.

Another option: handmade gifts. If you aren’t crafty, you can buy wooden toys, stuffed animals and other handmade options at crafts fairs, farmers markets and online creative marketplaces like Etsy.

These can get pricey, but the quality and charm may justify the cost. Plus, you’re benefiting individuals and small businesses rather than retail giants.

Giving experiences can be another great option, especially for teenagers. Researchers at the University of Illinois Chicago found that kids ages 3 to 12 prefer material gifts, while older children get more happiness from experiences.

Teenagers have better developed memories and can recall details of an event, which contributes to lasting happiness, the researchers found. Younger children have a harder time remembering and appreciating past experiences, although sharing photos and videos of the event can help, according to the researchers.

Experiences can include passes to a rockclimbing or trampoline gym, a mini-golf course or

an amusement park; travel; or lessons to spark or feed a particular interest, such as horseback riding, coding or baking. In normal times, tickets to sporting events, concerts or shows also would be an option, but these may not be feasible or desired during the pandemic.

Play the memory game

Speaking of memory, try this with your kids: Ask them what their favorite gift was last year, and the year before, and the year before that. Even teenagers with well-developed memories may have trouble recalling presents of the past.

The point isn’t to shame kids for not remembering. Rather, you can share the memories you do have, which likely have more to do with the time you spent together than with what you gave each other. Together, you might create a list of what you want to do as a family during the holidays.

When my daughter was little, I created an Advent calendar that included one activity each day, from baking cookies to making gingerbread houses to checking out the holiday lights in a nearby neighborhood. She’s now in college and has good memories of what we did together, long after the toys, games and stuffed animals have gone to the nonprofit Goodwill.

We can’t wave a magic wand that unkinks supply chains, fills store shelves and ensures every wish is granted. Focusing on what we can control, though, helps us cope with what we can’t — at the holidays and at any time of year.

- This column was provided to The Associated Press by the personal finance website NerdWallet.

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/ Wednesday, November 3, 2021

The Top Trends in Women’s Wellness

For fitness, nutrition and self-care

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Women’s Wellness

he top trends in women’s wellness continue to have a dual focus: maintaining physical fitness and a healthy immune system through nutrition and exercise and cultivating a peaceful heart and mind through self-care and mindfulness. These wellness pillars will ensure a strong start to your fitness goals and keep you healthy in body, mind and soul for years to come.

1. Fit, Fabulous and Fierce

Physical fitness is instrumental in maintaining a healthy immune system, getting quality sleep, and feeling good about yourself. It may not surprise you to hear that the top workout trend is still Virtual Fitness. Not only are big-name virtual platforms seeing a boom in membership, but smaller gyms and clubs are also offering workouts and classes online, and trainers are offering personalized virtual coaching. In conjunction with wearable fitness trackers and devices, exercises have never been more accessible or connected.

2. Balanced Living

In addition to working out, eating well is the other side of the physical fitness coin. Many of us are still spending more time at home, and as a result, we’re eating at home more. This means, instead of grabbing a salad from the café across from the office or throwing together a quick lunch to take along, we’re trying to use the options in our pantry and refrigerator. With full work and family schedules, though, it’s still easiest to have your daytime meals ready to grab. Consider these quick nutrition ideas to help you stay balanced and meet your dietary goals: • Breakfast: Overnight oats or make-ahead breakfast scrambles can keep your early mornings on track and your blood sugar stable.

• Dinner: We’re flipping the order around here because dinner leads to lunch - make a larger, nutrient-packed recipe than you

The past two years have been full of challenges and victories for all of us. Set yourself up for success with these wellness tips and trends.

•

usually would for dinner to ensure you have enough lunch the next day. Instant Pot recipes are great for quick prep and tasty results!

Lunch: Store your dinner leftovers in individual servings so you can grab them quickly during your lunch break.

Alternatively, toss together some dark leafy greens, a lean protein like legumes or fish, and a splash of healthy fats like an olive oil dressing.

3. Skincare 365

Personalized skincare is the new standard. We’re done buying off-the-shelf serums and moisturizers because everyone’s skin is different, and the beauty industry is finally catching up. You’ll be able

to access these bespoke beauty products through everything from tailored online quizzes to personal skincare consultants. Neutrogena offers a customized face mask through their 3d MaskID mapping app, while Atolla creates a unique serum based on your answers to an online quiz and then refines it each month based on your feedback.

Whatever type of customization you’re looking for, there are tons of brands creating products just for you and your skin.

4. Mindfulness & Meditation

This year has seen even more emphasis on creating space and balance in your life through mindfulness and meditation to complete your wellness routine. Online mindfulness and meditation retreats will dominate for the foreseeable future. While you may not be able to join others for in-person hikes or yoga classes, the dedicated company of other participants and the compassionate guidance of a mindfulness teacher will undoubtedly help you stay grounded and get the most out of your intention to be more mindful this year. For a smaller, daily dose of mindfulness, there are more than a dozen apps available to give you a gentle reminder to breathe or a full guided meditation. Take a look at Insight Timer, Smiling Mind, or Headspace to get started.

The past two years have been full of challenges and victories for all of us. Set yourself up for success with these wellness tips and trends.

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/ Wednesday, November 3, 2021

>Courtesy

Panoteca San Miguel Becomes a Brick and Mortar Shop Local bakery finally opens its doors to loyal customers

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Claudia A. Guerrero Negrón, Collaborator

anoteca San Miguel, which used to be a ghost bakery that operated on an order-pickup basis, now has its very own spot in Avenida José de Diego, in the Monacillo Urbano area of San Juan. The bakery has opened its doors to greet customers with new offerings of wine, cheese, jams, freshly made sandwiches and pizzas, as well as quality coffee with a barista in house.

“The idea is to offer clients a baker’s breakfast.

Small pastries, fresh bread and coffee to start the day for early risers,” said owner Diego San Miguel.

Opening a locale was something San Miguel saw further down the line, but as production started growing and so did the need for more space and bigger ovens, the baker quickly found himself looking for the next place Panoteca San Miguel could call home.

The new space, with an investment of $200,000, has tall ceilings, ideal for a bakery, and a welcoming atmosphere that will entice neighboring wanderers with its delicious aromas. Freshly made, straight-out-of-the-oven croissants, doughnuts, mallorcas, “bobois” and more can be found early in the morning, as well as the classics: baguettes and Campesino bread, a Panoteca San Miguel

Diego San Miguel, perfecting his craft >Courtesy

signature item.

By 10:30 a.m., sandwiches and focaccias start rolling out of the back for those who are looking for a quick bite for lunch. The Jambon Beurre sandwich is a staple and a must-try with cornichons, Grana Padano cheese, Prosciutto Cotto and butter. Simple, yet delicious.

For San Miguel, using local and fresh ingredients is at the forefront of the bakery’s philosophy, teaming up with local delivery service PRoduce, to ensure only the freshest herbs, vegetables and fruits are used in his pizzas and sandwiches that are made fresh every day.

Following that philosophy, he also partnered

with local coffee roasters Baraka Coffee Co., a small batch roasting company that uses refined and locally grown coffee beans. From the breads, to the sandwiches and the coffee, all ingredients are locally sourced, meaning your visit also supports the local farming industry.

Sticking to his roots, San Miguel wants to offer simple yet flavorful bites. The baker recognizes the new space is an opportunity to hone down on the classics, but also experiment and try new things.

“For me, it has been a learning process and I’m excited to continue learning and trying new things.

Exploring opportunities with cheese is something I’ve always wanted to try as cheese and bread go well together, and the same thing happens with wine,” he said.

The entrepreneur is grateful to the many local restaurants and businesses that have supported his work from the start three years ago, giving him the space to explore and figure out what works.

He’s especially grateful to his loyal customers, who week after week, made the transition from a ghost kitchen into a brick-and-mortar business a reality that now employs 10 people. The baker realized being able to offer a more human experience, chatting with his customers and seeing their faces gave meaning to the whole process.

Before, customers would make their orders through the Panoteca San Miguel Instagram page and then pick their goods up at the ghost bakery on Paraná Street where it was located. Now, having a store where a little community of bread lovers can come and pick up some quality coffee to go with their purchases and other goods on the way is a priceless experience.

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