BankAmerica Earnings Increased 11% Last Year

Strong loan growth in the fourth quarter and a return to "basic banking" helped BankAmerica Corp. increase its 1994 net income by 11% over 1993's, to $2.1 billion.

The bank said Wednesday that net income for the fourth quarter rose to $591 million, compared with $496 million in the same period of 1993. The showing was up over this year's third quarter as well, by 8%.

Earnings per share for the full-year 1994 rose 12% to $5.36, from $4.79 in 1993. In the fourth quarter of 1994, BankAmerica reported earnings per share of $1.41, up from $1.21 in the same quarter of 1993.

Lewis Coleman, a BankAmerica vice chairman, characterized the fourth quarter as "the strongest we've had in a long time.

"It was a clean quarter. We didn't take any mammoth hits. We stuck to basic banking."

The bank said total loans at yearend were up $2.2 billion, to $140.9 billion, from $138.7 billion in the third quarter. Outstanding loans grew substantially from yearend 1993, when BankAmerica reported $126.5 billion.

BankAmerica, however, saw the assets of its trading account dwindle as a result of higher interest rates. Total trading assets in the fourth quarter fell to $6.9 billion, from $7.1 billion in the third quarter.

"We are very cautious about what type of risk we want to take on our balance sheet," said Mr. Coleman. "We like to be as immune as possible to rate changes. We have a very large, very diversified balance sheet. But trading is a relatively small portion of our business."

Although BankAmerica's net interest margin declined 10 basis points in the fourth quarter from the same period a year ago, the bank's margin remained relatively constant over the past three quarters. The net interest margin for the fourth quarter was 4.53%, up slightly from 4.51% in the third quarter, but down from 4.63% at yearend 1993.

Ronald I. Mandle, an analyst with Sanford C. Bernstein & Co., said BankAmerica's strong fourth quarter and yearend showing was not surprising.

The bank's net interest margin held up well, he said, in the face of its acquisition of Continental Bank Corp.

"It was a good showing considering they had the Continental acquisition in the third quarter," pointed out Mr. Mandle. "Their margin should have been down. Its holding flat was a good performance." +++ BankAmerica Corp. San Francisco, CA Dollar amounts in millions (except per share) Fourth Quarter 4Q94 4Q93 Net income $591 $496 Per share 1.41 1.21 ROA 1.09% 1.06% ROE 13.24% 12.48% Net interest margin 4.53% 4.63% Net interest income 2,012 1,865 Noninterest income 1,051 1,119 Noninterest expense 1,969 1,974 Loss provision 100 150 Net chargeoffs 36 212 Full Year 1994 1993 Net income $2,176 $1,954 Per share 5.36 4.79 ROA 1.08% 1.05% ROE 13.20% 12.88% Net interest margin 4.50% 4.69% Net interest income 7,452 7,441 Noninterest income 4,147 4,273 Noninterest expense 7,512 7,483 Loss provision 460 803 Net chargeoffs 470 1,115 Balance Sheet 12/94 12/93 Assets $215,475 $186,933 Deposits 154,394 141,618 Loans 140,912 126,556 Reserve/nonp. loans 177.45% 121.57% Nonperf. loans/loans 1.54% 2.39% Nonperf. assets/assets1.01% 1.62% Nonperf. assets/loans

+ OREO 1.54% 2.38% Leverage cap. ratio 6.73% 6.58% Tier 1 cap. ratio 7.30% 7.53% Tier 1+2 cap. ratio 11.70% 11.93% ===

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