Bouncing back from a year of struggling to control expenses and trading
The nation's fifth-largest banking company turned in record earnings per
Speaking at the bank's annual meeting Wednesday, chairman and chief
"Our global markets business today is even stronger than a year ago,"
Morgan led a group of banking companies that notched double-digit gains
Fleet Financial Group, which plans to acquire BankBoston Corp. in the
"Sustained economic growth has countered what has historically been a
J.P. Morgan & Co.
Analysts underestimated the impact of strong capital markets on bank
At $269 billion-asset Morgan, last year's market turbulence hindered
The bank has been struggling to curtail expenses as it funnels
The strong showing in this quarter should take pressure off Morgan,
"There's no doubt that these are the kind of results that give them more
The bank stressed that core operating expenses were down $100 million.
Still, the bank said it was on target to reduce expenses by $400 million
Total revenues were $2.5 billion, up 25% from the first quarter last
Analysts said much of the gains in trading for clients came from
Analysts said Morgan was able to take advantage of a unique situation
Meanwhile, revenues from proprietary activities sank 67%, to $97
Fleet Financial Group
Fleet's earnings per share of 72 cents beat the consensus by 3 cents.
Analysts said $106 billion-asset Fleet showed strong revenue momentum
"They are positioning themselves for domination of a region that would
Fee income rose 38% to $959 million and represented 48% of total
Investment services revenues rose 23%, to $248 million. Record mortgage
During the quarter, Fleet closed its purchase of Sanwa Business Credit,
Nonperforming assets declined 25%, to $280 million. The provision for
U.S. Bancorp
Minneapolis-based U.S. Bancorp said quarterly earnings grew 12% from a
"Our first quarter results reflect both the challenges and opportunities
As a result, U.S. Bancorp's credit card business, traditionally a high
Noninterest income was $626 million, up 37%. Gains came largely from the
U.S. Bancorp's profits could continue to drag until the $76 billion-
"I don't think they have a revenue challenge," Ms. D'Arista said. "I
Catherine Murray, an analyst with J.P. Morgan Securities, said U.S.
Analysts said the commercial credit writeoff was related to U.S.
Wachovia Corp.
Fees from capital markets, electronic banking, and retail investment
Per-share earnings of $1.18 matched the analysts' consensus. Operating
"Wachovia delivered a real solid quarter," said David M. West, an
Fee income, which increased 18% to $333 million, accounted for 57% of
The net interest margin also showed improvement, jumping to 4.41%,
"That figure was surprisingly strong," Mr. Truslow said in an interview.
Wachovia increased its loan loss provision by 8.8%, to $81 million. Net
Growth in the bank's credit card portfolio accounted for the increase in
"While we expect to profit well from the purchased balances, credit card
While Wachovia did not reap any financial gains from its April 1
"We are already winning some business that Wachovia could not have
Acquisition charges of $15 million to $20 million will be split between
SouthTrust Corp.
Birmingham, Ala.-based SouthTrust beat per-share consensus estimates of
"We will continue to focus on consistently increasing earnings per share
Fees from mortgage banking operations jumped 71% to $15 million, the
Analysts said they were pleased to see an improvement in efficiency at
"Their expense line was lower than what we were looking for," said David
Total assets at the bank grew 19%. Deposits rose 20%, to $24.6 billion.
Wachovia Corp.
Winston-Salem, N.C.
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $243.2 $195.3
Per share 1.18 0.93
ROA 1.51% 1.24%
ROE 18.31% 15.29%
Net interest margin 4.41% 4.21%
Net interest income 618.2 580.9
Noninterest income 333.5 286.9
Noninterest expense 492.2 494.2
Loss provision 80.6 74.1
Net chargeoffs 80.6 74.1
Balance Sheet 3/31/99 3/31/98
Assets $65,319.0 $65,125.0
Deposits 40,288.0 39,857.0
Loans 46,393.0 44,498.0
Reserve/nonp. loans 378.76% 447.48%
Nonperf. loans/loans 0.31% 0.27%
Nonperf. assets/assets 0.26% 0.23%
Nonperf. assets/loans + OREO 0.37% 0.33%
Leverage cap. ratio NA 8.91%
Tier 1 cap. ratio 7.70%* 8.20%
Tier 1+2 cap. ratio 11.40%* 10.80%
* Estimated
U.S. Bancorp
Minneapolis, Minn.
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $366.8 $328.5
Per share 0.50 0.44
ROA 1.98% 1.91%
ROE 24.40% 22.10%
Net interest margin 4.82% 4.98%
Net interest income 793.4 768.0
Noninterest income 626.3 458.5
Noninterest expense 718.8 605.6
Loss provision 117.0 90.0
Net chargeoffs 139.6 103.2
Efficiency ratio 50.60% 49.90%
Balance Sheet 3/31/99 3/31/98
Assets $76,110.0 $70,949.0
Deposits 48,672.0 48,558.0
Loans 58,636.0 53,973.0
Reserve/nonp. loans 324% 340%
Nonperf. loans/loans 0.51% 0.53%
Nonperf. assets/assets 0.43% 0.46%
Nonperf. assets/loans + OREO 0.55% 0.59%
Leverage cap. ratio 7.00% 7.70%
Tier 1 cap. ratio 6.60% 7.80%
Tier 1+2 cap. ratio 11.20% 11.90%
SouthTrust Corp.
Birmingham, Ala.
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $104.5 $86.5
Per share 0.62 0.54
ROA 1.11% 1.11%
ROE 15.40% 14.72%
Net interest margin 3.71% 3.82%
Net interest income 320.3 275.5
Noninterest income 110.5 86.0
Noninterest expense 242.6 212.5
Loss provision 30.4 17.9
Net chargeoffs 15.4 13.1
Balance Sheet 3/31/99 3/31/98
Assets $39,016.1 $32,697.6
Deposits 24,552.5 20,532.9
Loans 28,261.8 23,548.9
Reserve/nonp. loans 300.99% 253.74%
Nonperf. loans/loans 0.46% 0.56%
Nonperf. assets/assets 0.49% 0.60%
Nonperf. assets/loans + OREO 0.68% 0.83%
Leverage cap. ratio 5.99% 7.01%
Tier 1 cap. ratio 6.63%* 8.15%
Tier 1+2 cap. ratio 10.59%* 13.06%
* Estimated
J.P. Morgan & Co.
New York
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $600.0 $237.0
Per share 3.01 1.15
ROA 0.90% 0.34%
ROE 22.30% 8.60%
Net interest margin 0.84% 0.68%
Net interest income 389.0 336.0
Noninterest income 2,102.0 1,661.0
Noninterest expense 1,567.0 1,632.0
Loss provision - -
Net chargeoffs 23.0 44.0
Balance Sheet 3/31/99 3/31/98
Assets $269,070.0 $259,942.0
Deposits 56,804.0 60,375.0
Loans 25,785.0 33,292.0
Reserve/nonp. loans 442.6% 551.2%
Nonperf. loans/loans 0.39% 0.24%
Nonperf. assets/assets 0.04% 0.03%
Nonperf. assets/loans + OREO - -
Leverage cap. ratio 4.40%* 4.00%
Tier 1 cap. ratio 8.10%* 7.50%
Tier 1+2 cap. ratio 12.10%* 11.10%
* Estimated
Fleet Financial Group
Boston
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $438.0 $323.0
Per share 0.72 0.53
ROA 1.63% 1.43%
ROE 19.28% 16.00%
Net interest margin 4.59% 4.75%
Net interest income 1,042.0 938.0
Noninterest income 959.0 695.0
Noninterest expense 1,125.0 997.0
Loss provision 149.0 92.0
Net chargeoffs 149.0 92.0
Balance Sheet 3/31/99 3/31/98
Assets $106,166.0 $97,687.0
Deposits 67,633.0 68,165.0
Loans 73,683.0 64,986.0
Reserve/nonp. loans 646% 441%
Nonperf. loans/loans 0.36% 0.54%
Nonperf. assets/assets 0.26% 0.38%
Nonperf. assets/loans + OREO 0.38% 0.57%
Leverage cap. ratio 7.08% 6.39%
Tier 1 cap. ratio 6.65% 6.39%
Tier 1+2 cap. ratio 10.97% 10.37%