First Chicago Corp. on Wednesday posted second-quarter earnings of $168.7 million, flat from a year ago, while Huntington Baneshares boosted earnings by 15.8% to $67.5 million.
The $64 billion-asset First Chicago saw its profitability slip from earlier quarters, when profits were helped by record trading and investment gains.
But analysts said the bank further bolstered core operations, predicting it would sustain or even improve on current solid results.
Card Operations Strong
Huntington, a regional banking company that is not directly comparable with First Chicago, boosted its return on assets by 25 basis points, to a hearty 1.64%. It racked up a 14% increase in average loans from a year ago while slashing its loanloss provision by 87%.
Richard L. Thomas, First Chicago's chairman and chief executive, said credit card operations again figured strongly, with total receivables rising 22% from a year ago to $11 billion. Card fee revenues of $194 million were up 18.1%.
Though cautioning that card margins and receivables growth are softening, Mr. Thomas said the situation "is manageable," and that First Chicago could count on continued robust profits in its card unit.
Total loans were flat from the first quarter but up 9.5% from a year ago. Mr. Thomas indicated the company's middle-market and consumer banking units would outstrip the corporate division in generating balance sheet growth.
The executive indicated that current levels of profitability are sustainable, citing strong credit quality and solidity in First Chicago's core operations. At 0.28% of total assets, Mr. Thomas said, First Chicago's concentration of problem credits is at its lowest point for at least the last 18 years.
Further Gains Expected
Robert Albertson, a banking analyst with Goldman, Sachs & Co., said the performance outlook for First Chicago is positive for the remainder of the year. The analyst has tagged the stock as one that will outperform the market.
He predicted that growth, in tandem with tight expense controls, would boost First Chicago's profitability from second-quarter levels.
Rebounding from a first-quarter loss, First Chicago's trading unit earned $37 million in the second period. A $32 million pretax gain was booked on the receipt of Brazilian bonds obtained as part of a debt restructuring. And a $22 million after-tax gain was booked on the disposition of problem assets, reflecting a partial recapture of previous markdowns.
First Chicago's loss provision of $43 million was down 38.6% from a year ago.
Huntington's prior results were restated to reflect two 1993 acquisitions. Annualized, returns equaled 1.64% on assets, a 25-basis-point increase; and 19.43% on equity, off 13 basis points.
The $16.5 billion-asset banking company, based in Columbus, Ohio, cited loan growth and improving credit quality as key factors in its performance. But fee income fell by 6.8% as a dip in home loan originations cut mortgage banking revenues. Huntington late Tuesday announced the stock-swap purchase of Security National Corp., a $180 million-asset banking company operating six offices in suburban Orlando. Terms have not yet been disclosed.
[TABULAR DATA OMITTED]