Powered by loan growth and a strong net interest margin, Boston-based BayBanks Inc. posted $107.4 million in earnings for full-year 1994, a whopping 58% above the previous year, the company said Friday.
Down in Connecticut, loan growth helped boost full-year net income for People's Mutual Holdings to $56.3 million, 24% over 1993's earnings.
The $10.8 billion-asset BayBanks said income for the fourth quarter was $30.7 million, or $1.59 a share, up 35% over the same period a year ago. BayBanks beat the $1.53 per share consensus on Wall Street.
"They pummeled me," said Morgan Stanley analyst Dennis Shea, who predicted $1.50 a share for the fourth quarter.
The bank reported $6.8 million in outstanding loans in the fourth quarter, up $15.3% from the same period in 1993. Net interest margin in the fourth quarter remained flat, but high, at 5.08%.
Most banks saw net interest margins decline as the cost of deposit accounts rose this year, said Gerard Cassidy, an analyst at Hancock Institutional Equity Services.
BayBanks reported return on average assets at yearend was 1.04%, up from 0.71% in 1993. Return on shareholder equity jumped at yearend to 14.5% from 10.1% in 1993.
Meanwhile, the parent of Bridgeport's $6.4 billion-asset People's Bank reported profits of $14.1 million in the fourth quarter, a 25% jump over the year-earlier period.
People's earnings were fueled by increases in loans and the net interest margin. The 153-year-old bank also lowered its loan-loss provision by 37% from the year-earlier period, to $6.9 million.
People's managed credit card portfolio grew to $1.6 billion at Dec. 31, a 48% jump from the same period a year ago. Commercial mortgage loans grew to $727.5 million by the end of 1994, up 10% from yearend 1993.
Net interest income grew to $63 million in the fourth quarter, an 8% increase from the year-earlier period.
