The branches of Chase Manhattan Corp. flowered last month, booking pretax profit "a shade under $21 million, nearly $9 million over plan," regional bank executive Donald Boudreau told his troops in an internal memo last week.
For the first four months of 1992, Chase booked $82.3 million pretax, almost $30 million ahead of budget, Mr. Boudreau crowed. Key factors: deposits, which "exceed plan by $98 million"; deposit spreads "significantly better than anticipated"; and $5.2 million in one-time gains from mortgage sales, foreign exchange income and the unwinding of a fixed-rate swap - well above the $900,000 budgeted for such "nonfee-based income."
But he warned that the tables could turn "on us very quickly" citing doubts about low interest rates. "We face the real prospect of losing deposits to other investment alternatives," he said, "so let's be sure to sell our Vista and GNA [mutual fund and insurance] capabilities." He also noted that operating expenses of $244.6 million in the first four months were $300,000 more than planned.
"Our ROA and ROE over the first four months of the '92 season put us in the same league with some of the best regional banks," he concluded. "There's still a long way to go before we get into the playoffs."