First UnionCorp. expects to reap $235 million from merger-related cost savings during the next year and a half, according to its chairman and chief executive.

Speaking at an investors' conference last week, Edward E. Crutchfield Jr. for the first time calculated the total efficiencies that First Union expects from its string of recent purchases.

He said the North Carolina-based company would realize $105 million of the savings in 1993 and $130 million in 1994.

In less than 12 months First Union has purchased Dominion Bankshares Inc. in Roanoke, Va., with $8.8 billion in assets; First American Metro Corp. in McLean, Va., with $4.6 billion in assets; Georgia Federal Bank in Atlanta, with $4 billion; and Decatur Federal Savings and Loan Association in Atlanta, with $2.7 billion.

Earnings Forecast

Speaking at a Lehman Brothers conference in Bermuda, Mr. Crutchfield said the merger-related efficiencies give First Union "a great deal of confidence about our earnings momentum going forward."

Mr. Crutchfield repeated First Union's earlier projection that it will earn between $192 million and $200 million this of merchant banking gains. That translates to between $1.15 and $1.20 a share -- consistent with analysts' consensus estimates of $4.52 for all of 1993, as compiled by First Call.

Mr. Crutchfield said First Union's earnings estimates assume only 2% growth in average loans this year -- reflecting anticipated runoff in some acquired portfolios.

"To quantify that for your," Mr. Crutchfield told the investors, "for every percentage point increase in loan growth, we would realize about five cents in additional earnings."

5% Net Interest Margin

Mr. Crutchfield also predicted that First Union's net interest margin will remain at the first quarter's 5% level throughout the rest of the year -- no mater what course interest rates take.

Bank stocks have recently been under pressure due to investors fears that rates will rise later this year and compress bank margins.

"Right now, we are interest rate neutral for 1993 and within a 3% exposure to net income for 1994," Mr. Crutchfield said.

First Union stated in its 1992 annual report that its exposure to a 100 basis point rise in rates would be limited to less than 5% of projected net income over a 12-month period.

Mr. Crutchfield cited two reasons for First Union's continuing margin strength. It still has $3 billion of consumer certificates of deposit that will be repriced at lower rates before the end of the year.

And the bank has locked in profit margins through off-balance-sheet derivative transactions, such as swaps, floors, and options.

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