The FirstBank 401(k) Retirement Plan for Residents of the U.S. Virgin
Islands and the United States of America
Notes to the
Financial Statements
December 31, 2022 and 2021
As of December 31, 2022 and 2021, the Plans investments measured at fair value
consisted of the following instruments and classifications within the fair value hierarchy.
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As of December 31, 2022 |
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Fair Value Measurements Using |
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Assets |
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Level 1 |
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Level 2 |
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Level 3 |
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at Fair Value |
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Investments in mutual funds and money market funds |
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$ |
15,331,140 |
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$ |
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$ |
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$ |
15,331,140 |
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Money market deposit account |
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2,591,807 |
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2,591,807 |
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Investment in First BanCorp. |
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766,629 |
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766,629 |
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Self-directed brokerage account- (PCRA) |
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27,082 |
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27,082 |
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Total investments at fair value |
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$ |
18,716,658 |
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$ |
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$ |
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$ |
18,716,658 |
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As of December 31, 2021 |
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Fair Value Measurements Using |
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Assets |
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Level 1 |
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Level 2 |
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Level 3 |
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at Fair Value |
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Investments in mutual funds and money market funds |
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$ |
18,544,209 |
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$ |
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$ |
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$ |
18,544,209 |
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Money market deposit account |
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2,644,552 |
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2,644,552 |
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Investment in First BanCorp. |
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776,292 |
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776,292 |
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Total investments at fair value |
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$ |
21,965,053 |
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$ |
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$ |
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$ |
21,965,053 |
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Following is a description of the Plans valuation methodologies used for assets measured at fair value.
There have been no changes in the methodologies used at December 31, 2022 and 2021.
Mutual Funds and money market funds:
Mutual funds are valued at the daily closing price as reported by the funds. Investments in mutual funds consists of open-end mutual funds and the value is the net asset value of shares held by the Plan at the
reporting date. The net asset value is a quoted market price available in an active market.
Money market deposit account: The fair
value of money market deposit accounts is estimated to approximate deposit account balances, payable on demand, as no discount for credit quality or liquidity were determined to be applicable.
Investment in First BanCorp.: Investment in First BanCorp. consists of common stock of First BanCorp. and is valued based on the closing
price per the stock exchange on which they are traded.
Self-directed brokerage accounts: Investments held in a PCRA are valued
using quoted market prices at period end.
4. |
Party-In-Interest
Transactions |
Parties-in-interest are defined under the
provisions of ERISA as any fiduciary of the Plan, any party rendering service to the Plan, any employer (or any affiliate), any employee of such employer covered by the Plan, and certain others. Certain Plan investments consist of investment in a
money market deposit account at Charles Schwab, or affiliates, which is the provider of custodial services as defined by the Plan since April 1, 2005. In addition, as of December 31, 2022 and 2021, the First BanCorp. Unitized Stock Fund
held 60,270 and 56,335 shares, respectively, with a quoted market value of $766,629 and $776,292, respectively, of First BanCorp. common stock, the parent company of the Plan Sponsor. The First BanCorp. Unitized Stock Fund also has an investment in
a money market fund managed by State Street. State Street provides Charles Schwab with, among other things, custody services for the First BanCorp. Unitized Stock Fund. For the year ended December 31, 2022, the Plan received dividend income of
$26,598 related to the investment in First BanCorp. Unitized Stock Fund and recognized a net loss of $34,869, of which $40,821 relates to the net depreciation in the fair value of such investment. Plan assets include notes receivable from
participants of $593,719 and $644,515 as of December 31, 2022 and 2021, respectively. For the year ended December 31, 2022, interest income related to notes receivable from participants amounted to $33,002. These transactions qualify as
party in-interest transactions permitted under the provisions of ERISA.
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