Rounding out its return to respectability among investors, Citicorp laid claim to the top spot for banks in market capitalization during the first quarter.
The company's common stock was valued at $14.6 billion as of March 31, putting it ahead of San Francisco's Bank America Corp. and into first place for the first time in four years.
Citicorp's time at the top may be brief. The bank benefited from a momentary decline in the stock price of Bank America. But it underscores how far the New York banking company has come.
Analyst Vindicated
Since it last ranked first, Citicorp had fallen as low as 13th among the nation's banks in the overall value of its shares as it waged an ultimately successful campaign to overcome problem loans and bolster its capital.
"I suppose I could say I told you so," said Frank R. DeSantis Jr. of Donaldson, Lufkin & Jenrette Securities Corp., who has recommended Citicorp's stock as a "buy" since September 1991.
Mr. DeSantis acknowledged that it was sometimes rough going - especially when Citicorp shares sank to an 11-year low of $8.625 per share on Dec. 20, 1991. On Wednesday they were off 12.5 cents to $40.50.
Citicorp's stock, aided by the prospect of a restored dividend, enjoyed a positive first quarter, while the banking industry overall did not. Changing of The Guard Market capitalization, dollars in billionsMarch March1994 1993rank rank1 Citicorp $14.6 22 BankAmerica 13.8 13 Banc One 12.6 34 NationsBank 12.6 55 J.P. Morgan 12.0 4 Source: SNL Securities Inc.
According to an American Banker survey, the market capital of the nation's 100 largest banks was $270 billion on March 31, down 1.4% from $273.8 billion at yearend. It was off 5.75% from last Sept. 30, before the autumn selloff in bank shares. (A complete ranking of the top 100 banks in market capitalization appears on page 5.)
BankAmerica stock, rocked more than most other banks, was near its lowest price for the year at $39.37 per share on March 31, having plunged about 17% during the first quarter. Its total market capitalization had plummeted to $13.78 billion from $16.6 billion at yearend.
Since then, however, the California superregional's stock has recovered in a big way. It has gained 25% in value and is near its 52-week high. On Wednesday it was up 12.5 cents to $49.75 per share.
Moreover, BankAmerica's pending purchase of Continental Bank Corp., Chicago, should bolster its market cap later this year. On March 31, Continental ranked 41st in market cap with a total value of $1.68 billion.
BankAmerica had the largest percentage decline in maket capital during the first quarter. Analyst George M. Salem of Prudential Securities Inc. said the decline is probably best viewed as "the quirk of two dates" because the slippage was so pronounced at the end of the quarter.
"The stock has put on a show since then," said Mr. Salem. He rates the stock a "hold" because he regards the shares as fully valued and the bank's earnings growth prospects as "sluggish."
The largest gains in market cap in the first quarter were mostly chalked up by banks that are either involved in pending mergers or are regarded as strong takeover candidates.
The biggest gainer in the top 100 banks was Valley National Bancorp., Wayne, N.J., up 34.4% to $775 million. It ranked 75th in market cap on March 31, up from 85th at yearend.
While the $270 billion in market capitalization of the top 100 banks at March 31 was off from both yearend and a year earlier, it was 166% above the industry's market nadir of $101.4 billion at yearend 1990.
Citicorp's recovery had been even more dramatic. Its $14.6 billion value on March 31 was 307% above the low water level of $3.6 billion tallied at the end of 1991.
Citicorp's March 31 total market value was nearly double the $7.5 billion capitalization level it boasted four years earlier on March 31, 1990, when it previously ranked first in the industry.
WEDNESDAY'S MARKET
Bank stocks were mostly lower on wednesday as both the stock and bond markets endured another weak session.
First Chicago Corp. fell $1.25 to $53.625, despite assurances from chief executive officer Richard Thomas at the International Monetary Conference in London that trading revenues are improving over the poor first quarter.
Bankers trust New York Crop. was down 50 cents to $71.50, National City Corp. down 75 cents to $27.125, and Signet Banking Corp. Off 50 cents to $41.375.
