130 years Celebrating Together

The Business of Commercial Banking: Building Relationships

At the beginning and middle of the 20th century, Puerto Rico was very different from what it is today. Back then, the scent of sugar cane and tobacco filled the air as one traveled through various towns on the island. This transformation was evident in every area where crops and the growth of more and more sugar industries were developing.

However, this did not happen in isolation, as there was a banking sector that supported these industries.

Several years into the 20th century, Banco Popular was in its early stages, and those first years were a challenge for those who laid the foundation for a new bank on the island. Establishing a formal banking system for businesses happened after various setbacks, with the guidance of Rafael Carrión Pacheco, known for his expertise in dealing with bankers, clients, and businesspeople. 

The trust that several companies and merchants placed in Banco Popular became evident. This, among other factors, prevented the bank from facing the same fate as others that had to close, and over time, it highlighted Popular's potential.

Like tobacco, sugar cane played a prominent role in the early 20th century, and the sugar cane industry saw better recovery and strength within Popular's commercial structure. Carrión Pacheco's vision led the institution to invest in some sugar mills with the help of US banks, such as Continental Bank & Trust Company of New York and Chemical Bank Trust Co., due to the limitations that existed at that time regarding what the bank could lend.

These and other commercial moves reshaped Popular to the extent that "in 1947 Banco Popular and its correspondents granted the Authority of Lands, a government entity, the sum of $6 million, marking the most significant loan operation ever conducted on the Island" (Tradition of Future Book).

These beginnings set the stage for the next 80 years to continue the tradition of a bank that drives the island's economic growth. And today, under the guidance of other bankers, that formula remains in effect.

This story repeats itself with Elí Sepúlveda, the current Vice President of Commercial Banking, who states that over his 37-year career as an executive at Popular, there has never been a moment when he stopped thinking about local economic development and the future of small, medium, and prominent entrepreneurs.

Above all, he recognizes that, in its 130 years of history, Popular's commitment has been focused on supporting the Puerto Rican economy, strengthening it, and making it more solid. "I know our role is to lend money, but the greatest satisfaction we derive from our financial management goes beyond that; it's about seeing how we are part of the growth of the commercial market in the country at all levels and the success of thousands of entrepreneurs with great business ideas," says Sepúlveda.

Popular is the leading financial institution in Puerto Rico, and since its inception, it has been instrumental in driving the island's economy, primarily as a driving force in commercial development. 

Since then, its goal has not only been to finance large companies and businesses, but also to provide support and backing to small and medium-sized merchants—those who establish the neighborhood store, the bakery, the emerging supermarket in the town center, the furniture store, the community pharmacy, and the gas station. This focus, among other things, has earned Popular the nickname "the people's bank" because it is close to the people, understands their needs, draws from their experiences, and accompanies its customers throughout their entrepreneurial journey. This was true in the past and remains true today.

In recent decades, Popular has pioneered the development of new technical tools that have significantly transformed commercial banking, improving efficiency, accessibility, and the security of financial transactions. Notably, online banking and process automation have allowed customers to access banking services from anywhere and at any time, such as applying for loans and credit lines or checking their account activity. This is more convenient for many customers because it reduces the need for branch visits. An example of this is popularbusinessplatform.com, a digital platform that streamlines the process of applying for loans and credit lines.

"Today, we have more resources compared to previous decades. An example is ATH Móvil, an application that has become an effective tool for businesses. It is undoubtedly one of the most important changes in our business culture because it offers digital payment methods, account transfers, and even electronic wallets. This makes transactions faster and more secure while reducing dependence on checks and cash."

-- Elí Sepúlveda

However, Sepúlveda clearly states that no technology can replace the importance of directly connecting with each customer. After each thought, Sepúlveda repeats, as if it were a mantra, "The commercial business is a business of contact; I can help you more as I get to know your needs." This is precisely what happens with small and medium-sized businesses, a market he defines as "the most dynamic and volatile" in the commercial market.

"These small and medium companies have become an important economic force. Their business culture is unique because they don't have time to hire consultants; they rely more on their intuition and are immersed in an environment that changes constantly, is faster, and less predictable," he explains.

In that sense, he maintains that technology cannot provide a quick understanding of all the changes that this commercial segment faces; what achieves this is the banker's closeness to his customer. There's a saying that “being attentive is effective.

”Popular is deeply committed to small and medium-sized businesses in Puerto Rico, with a vision focused on the progress of small merchants. That's why it offers services like Popular Business Solutions, specifically designed to meet business needs by providing comprehensive financial solutions.

Similarly, it has the StartUp Popular program, strategically designed to address various business financial needs that may arise in the early stages of small merchants. It also serves as a guide by offering business coaching and multiple areas of support that a business may need, along with networking events for the duration of the entrepreneur's participation in the program, providing the opportunity to create new business relationships.

The years since the banking resurgence in the early 20th century can be seen in how today's bankers continue placing customers at the center of progress, continually establishing contact to ensure better results. Without that closeness, there is no robust and future-oriented business.

While the scent of sugar cane is not as prevalent as before, the emergence of new and diverse forms of businesses, from delicious bread to coffee or simply a technology business, is on the rise. 

The sky's the limit, and Popular is the bank that makes it a reality.

As part of our 130th anniversary celebrations, we present our Stories of Impact, which highlight Popular's legacy in Puerto Rico's socioeconomic development through the following lenses: innovation, small business support, housing, financial inclusion, and human capital development.