Popular Inc.'s management deemed 2011 a "turnaround" year as the San Juan, Puerto Rico, while projecting an even better 2012.

The company on Wednesday reported fourth-quarter net income of $3 million, a reversal from the $227 million net loss from a year earlier. However, earnings fell 89% from the third quarter partly due to a 6.6% decline in net interest income and higher provisioning for a failed bank acquisition.

Like many banks, lower yielding loans and securities further compressed the $37 billion-asset company’s net interest margin. The margin shrank 15 basis points from a quarter earlier, to 4.3%. 

Still, Popular's chairman and chief executive, Richard Carrión called 2011 a "turnaround year" for the company. "We were able to achieve operational profitability for the first time since 2006 by maintaining strong margins, producing strong and stable top line revenue, and continuing to reduce credit costs," he said in a press release. Carrion said that Popular should earn $185 million to $200 million this year.

The low end of his projection would represent a 22% improvement from the $151.3 million Popular earned in 2011. That performance was 10% better than the company’s earnings in 2010.

The company remains well-capitalized with a 17.25% total risk-based capital ratio at Dec. 31.

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