Barnett Restates Earnings; Last Year's Net Falls 18%
Barnett Bank Inc. has revised its 1990 earnings downward by 18% to reflect a decline in the value of an equity security.
The revision, reported Wednesday in a filing with the Securities and Exchange Commission, also affected certain balance-sheet values for the 1991 first quarter but did not affect that quarter's earnings.
Barnett's 1990 net income was reduced to $83.1 million, or $1.32 a share, from $101.2 million, or $1.61 a share, because of what the Jacksonville, Fla., company termed "the nontemporary decline of a marketable equity security." Barnett said the issue of judging when a stock-value decline is "nontemporary" is affecting an increasing number of banks.
Shareholders' Equity Intact
Barnett said it originally took a $4 million writedown on the security, charged it to net income in the fourth quarter, and set up an equity reserve for an additional $20 million decline. The restatement will reflect the entire $24 million writedown as a charge against fourth-quarter 1990 income.
Barnett said the restatement would have no effect on shareholders' equity, which totaled $1.6 billion at the end of the first quarter, due to the equity reserve reserve created at yearend.
The $32 billion-asset holding company also announced that its second-quarter income will be in the range of $28 million to $30 million, or 40 cents to 43 cents a share - at the lower end of analysts' expectations.
Nonperforming Assets Decline
In an amendment to an SEC registration statement covering an issue of up to 2.875 million shares of common stock, the company said it expects to report nonperforming assets in the range of $935 million to $955 million, compared with $994 million at the end of the first quarter.
The company predicted that its loan-loss reserve, the ratio of reserves to total loans, would increase "modestly" from the first-quarter levels of $447.2 million and 1.86%.