Lerach Coughlin Stoia Geller Rudman & Robbins LLP Files Class Action Suit Against First BanCorp

If you wish to serve as lead plaintiff, you must move the Court nolater than 60 days from today. If you wish to discuss this action orhave any questions concerning this notice or your rights or interests,please contact plaintiff's counsel, William Lerach or Darren Robbinsof Lerach Coughlin at 800/449-4900 or 619/231-1058, or via e-mail atwsl@lerachlaw.com. If you are a member of this class, you can view acopy of the complaint as filed or join this class action online athttp://www.lerachlaw.com/cases/firstbancorp/. Any member of thepurported class may move the Court to serve as lead plaintiff throughcounsel of their choice, or may choose to do nothing and remain anabsent class member.

The complaint charges First BanCorp and certain of its officersand directors with violations of the Securities Exchange Act of 1934.First BanCorp operates as the holding company for First Bank PuertoRico, which provides various financial services in Puerto Rico, theU.S. Virgin Islands, and British Virgin Islands.

The complaint alleges that during the Class Period, defendantsissued false statements about First BanCorp's earnings, assets,capital and prospects causing the Company's stock to trade atartificially inflated levels. While the Company's stock price droppedsomewhat in the late spring of 2005 due to problems announced by FirstBanCorp's competitors in Puerto Rico, as well as an adverse interestrate environment, the stock soon recovered as defendants did not ownup to significant accounting issues, such as those disclosed earlierby its competitors, and the Company continued to report favorablefinancial results. Then on August 25, 2005, the Company issued a pressrelease announcing that the Company had "received a letter from the(SEC) in which the SEC indicated that it was conducting an informalinquiry into the Company. The inquiry pertains, among other things, tothe accounting for mortgage loans purchased by the Company from twoother financial institutions during the calendar years 2000 through2004." As a result of this disclosure, First BanCorp's stock droppedto $18.23 per share on August 26, 2005. Later, on September 30, 2005,both the Company's CEO and CFO suddenly announced they were resigning.

According to the complaint, during the Class Period defendantsconcealed the following adverse information from the investing public:(a) the Company's financial statements were materially false andmisleading in that the Company had manipulated its accounting formortgage loans purchased between 2000 and 2004; (b) the Company'sinternal controls were grossly weak, thereby allowing the Company'stop management to manipulate them at will; (c) the Company's "record"quarterly income reported during the Class Period was a product ofaccounting fraud, not synergies produced by effective fiscal andpersonnel management; and (d) as a result, the Company's publishedfinancial statements violated Generally Accepted AccountingPrinciples.

Plaintiff seeks to recover damages on behalf of all purchasers ofFirst BanCorp publicly traded securities during the Class Period (the"Class"). The plaintiff is represented by Lerach Coughlin, which hasexpertise in prosecuting investor class actions and extensiveexperience in actions involving financial fraud.

Lerach Coughlin, a 160-lawyer firm with offices in San Diego, SanFrancisco, Los Angeles, New York, Boca Raton, Washington, D.C.,Houston, Philadelphia and Seattle, is active in major litigationspending in federal and state courts throughout the United States andhas taken a leading role in many important actions on behalf ofdefrauded investors, consumers, and companies, as well as victims ofhuman rights violations. Lerach Coughlin lawyers have been responsiblefor more than $20 billion in aggregate recoveries. The Lerach CoughlinWeb site (http://www.lerachlaw.com) has more information about thefirm.