Five of the largest U.S. banking companies reported strong profits
First Union Corp. exemplified the mixed picture. Restructuring and
Profits at National City Corp. soared 238%, to $351 million, from last
KeyCorp posted earnings of $293 million, up 25%, or an 11% jump without
Analysts said robust capital markets and a brisk economy helped hold
"Loan growth is relatively strong, fee income looks pretty good, and
Said David C. Stumpf, of A.G. Edwards in St. Louis: "This is a quarter
First Union Corp.
The Charlotte, N.C., company took a $398 million pretax charge, mostly
Earnings per share matched analysts' consensus estimates of 88 cents.
"Although we view 1999 as a challenging year, we continue to invest in
Fees from capital markets activities increased 71%, to $483 million, led
"The revenue coming from their growth areas was extremely strong," said
Thursday's report wrapped up what one analyst called a "roller coaster"
In March, First Union announced the restructuring charge, which will
Mr. Stumpf said the difficulties of the past three months have brought
Shares of $223 billion-asset First Union, the country's sixth-largest
National City Corp.
The Cleveland-based regional company cited gains in mortgage banking,
It also benefited from expense savings associated with last year's
Operating earnings per share of $1.07 exceeded analysts' estimates by 3
National City, the 11th-largest U.S. banking company, posted a first-
The $84 billion-asset company also posted a loss on the sale of portions
Net interest income reached $765 million, up 8%. Loan growth was
National City increased its provision for loan losses 21%, to $68
Shares of National City were up 87.5 cents, to $69.6875.
KeyCorp
Cleveland-based KeyCorp, with $80 billion of assets, said its revenues
Noninterest income rose 71% to $609 million. Operating earnings per
The country's 12th-largest bank also benefited from the sale of
Excluding one-time gains, noninterest income rose 36%.
The strongest revenue growth came from insurance, brokerage, asset
"I think they're doing very well with the acquisition of McDonald &
Net-interest income grew 5% to $693 million. The provision for loan
KeyCorp recorded net loan chargeoffs of $81 million, up 5%. The company
"We're not seeing an overall deterioration of credit quality, but there
KeyCorp's stock closed Thursday at $30.375, down $1.375.
BankBoston Corp.
Double-digit gains in investment banking and foreign operations helped
Profits from the year-earlier period included $25 million in gains on
Analysts said the $75.7 billion-asset banking company showed momentum in
"They had a nice rebound," said Thomas Theurkauf, an analyst at Keefe
The results also come on the heels of BankBoston's agreement last month
"It was a strong operating quarter," said Susannah M. Swihart,
The two companies are headed into their merger "with a strong platform,"
Noninterest revenues edged up 1%, to $595 million, dampened by sluggish
Total revenues grew almost 20%, to $1.23 million, driven by strong
BancBoston Robertson Stephens, an investment banking unit acquired from
Fees from underwriting, syndication, and brokerage rose 10-fold over the
In addition, BankBoston said it had a 40% gain in income from Brazilian
The bank has been aggressively expanding its presence in Latin America.
Shares of BankBoston, which ranks 15th among the nation's banks, closed
Comerica
Comerica, with $36 billion of assets, said its earnings were helped by
Net interest income of $369 million was up about 1%, slowed by the last
Over the past year, however, the company added nearly $3 billion in
Noninterest income reached $157 million, up 16%. Excluding the effect of
Comerica's provision for loan losses was $20 million, down 29%. Net
"Our first quarter financial performance reflects continued strong
Shares in the Detroit-based company, ranked 24th in asset size, declined
National City Corp.
Cleveland
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $351.0 $103.7
Per share 1.08 0.32
ROA 1.66% 0.56%
ROE 21.13% 6.70%
Net interest margin 4.02% 4.19%
Net interest income 764.7 708.3
Noninterest income 590.9 493.8
Noninterest expense 739.2 974.0
Loss provision 68.0 56.3
Net chargeoffs 68.0 52.4
Balance Sheet 3/31/99 3/31/98
Assets $84,094.0 $80,716.0
Deposits 52,051.0 55,387.0
Loans 56,342.0 53,343.0
Reserve/nonp. loans 400.14% 392.60%
Nonperf. loans/loans 0.42% 0.45%
Nonperf. assets/assets 0.32% 0.35%
Nonperf. assets/loans + OREO 0.47% 0.52%
Leverage cap. ratio 6.10% 7.64%
Tier 1 cap. ratio 7.50% 8.67%
Tier 1+2 cap. ratio 12.20% 12.75%
KeyCorp
Cleveland
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $293.0 $235.0
Per share 0.65 0.53
ROA 1.49% 1.32%
ROE 19.48% 18.25%
Net interest margin 3.95% 4.14%
Net interest income 693.0 659.0
Noninterest income 609.0 356.0
Noninterest expense 748.0 586.0
Loss provision 111.0 77.0
Net chargeoffs 81.0 77.0
Balance Sheet 3/31/99 3/31/98
Assets $79,992.0 $73,198.0
Deposits 41,323.0 41,661.0
Loans 61,045.0 54,900.0
Reserve/nonp. loans 235.44% 241.29%
Nonperf. loans/loans 0.65% 0.68%
Nonperf. assets/assets 0.54% 0.58%
Nonperf. assets/loans + OREO 0.70% 0.77%
Leverage cap. ratio 7.21% 6.61%
Tier 1 cap. ratio 7.30% 6.81%
Tier 1+2 cap. ratio 11.68% 11.38%
First Union Corp.
Charlotte, N.C.
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $706.0 $790.0
Per share 0.73 0.81
ROA 1.27% 1.52%
ROE 17.83% 20.74%
Net interest margin 3.74% 4.08%
Net interest income 1,811.0 1,859.0
Noninterest income 1,950.0 1,349.0
Noninterest expense 2,509.0 1,838.0
Loss provision 164.0 135.0
Net chargeoffs 164.0 129.0
Balance Sheet 3/31/99 3/31/98
Assets $222,955.0 $219,944.0
Deposits 134,224.0 137,935.0
Loans 133,416.0 133,814.0
Reserve/nonp. loans 217% 210%
Nonperf. loans/loans 0.63% 0.66%
Nonperf. assets/assets 0.43% 0.46%
Nonperf. assets/loans + OREO 0.71% 0.75%
Leverage cap. ratio 6.00% 6.97%
Tier 1 cap. ratio 7.08% 8.66%
Tier 1+2 cap. ratio 11.44% 13.09%
Comerica Inc.
Detroit
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $159.1 $144.4
Per share 0.98 0.88
ROA 1.76% 1.61%
ROE 21.90% 22.09%
Net interest margin 4.51% 4.50%
Net interest income 370.2 367.6
Noninterest income 156.9 134.9
Noninterest expense 263.4 249.9
Loss provision 20.0 28.0
Net chargeoffs 19.5 22.5
Balance Sheet 3/31/99 3/31/98
Assets $36,447.5 $36,492.4
Deposits 22,585.3 23,193.3
Loans 30,529.6 26,779.5
Reserve/nonp. loans 292.61% 526.19%
Nonperf. loans/loans 0.50% 0.30%
Nonperf. assets/assets 0.44% 0.24%
Nonperf. assets/loans + OREO 0.52% 0.32%
Leverage cap. ratio 7.87% 7.21%
Tier 1 cap. ratio 6.47% 6.26%
Tier 1+2 cap. ratio 10.46% 9.79%
BankBoston Corp.
Boston
Dollar amounts in millions (except per share)
First Quarter 1Q99 1Q98
Net income $223.0 $238.0
Per share 0.75 0.79
ROA 1.19% 1.39%
ROE 18.54% 21.31%
Net interest margin 4.03% 4.07%
Net interest income 639.0 607.0
Noninterest income 595.0 589.0
Noninterest expense 806.0 661.0
Loss provision 70.0 140.0
Net chargeoffs 66.0 141.0
Balance Sheet 3/31/99 3/31/98
Assets $75,708.0 $71,428.0
Deposits 48,468.0 46,397.0
Loans 42,775.0 43,822.0
Reserve/nonp. loans 212% 222%
Nonperf. loans/loans 0.80% 0.70%
Nonperf. assets/assets 0.50% 0.50%
Nonperf. assets/loans + OREO 0.90% 0.80%
Leverage cap. ratio 6.90%* 7.30%
Tier 1 cap. ratio 7.20%* 7.90%
Tier 1+2 cap. ratio 11.60%* 12.30%
* Estimated