Centura of N.C. Reports 15% Rise In Quarterly Profit Despite Margins

Centura Banks Inc.'s second-quarter earnings jumped 15%, to $13.8 million, from a year ago as loans and fees from brokerage and credit card operations grew briskly.

For the first six months of the year, net income grew 23%, to $27.7 million, at the Rocky Mount, N.C.-based company.

"We are continuing our strong financial performance of the past few years despite a compressed net interest margin," Robert R. Mauldin, Centura's chairman and chief executive said in a press release. "We continue to benefit from a high demand for loans along with a sustained increase in noninterest income."

Earnings remain strong primarily due to a sustained period of exceptional loan growth. During the second quarter, loans increased 27%, to $3.5 billion.

The net interest margin was significantly compressed, to 4.81%, from the first quarter's 4.99%.

This compression, along with stock issuance in connection with mergers completed during the first half of 1995, led to a slight decline in earnings per share from the first quarter.

Credit quality continued to be sound; net chargeoffs for the quarter totaled only 0.14% of average loans.

For the quarter, return on average assets was 1.21%, up from 1.19% in the second quarter of 1994. Return on average equity was 14.90%, down from 15.38%.

Noninterest income grew 14% from the second quarter of 1994, to $13.4 million. This increase was due to significant increases in fees from brokerage sales and other services such as Pocket Check, Cash Management, merchant credit card services, and trust services.

Centura, which has $4.9 billion of assets, completed mergers during the first half with First Southern Bank, Asheboro, N.C., and Cleveland Federal Bank, Shelby, N.C.

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