Boosted by improved net interest income and lower expenses, Marine Midland Banks Inc. reported second-quarter earnings of $68 million, compared with a loss of $90 million a year earlier.

Marine Midland restated its June 1994 quarter to include results from Concord Leasing Inc., a subsidiary acquired on Jan. 1. Excluding the restatement, the bank's net income rose 20% from $57 million in the 1994 quarter.

"The financial performance of Marine Midland has been strong this year as our core lending and deposit-gathering businesses registered solid growth while operating expenses declined," said president and CEO James H. Cleave.

Marine Midland's return on assets improved to 1.50% from negative 1.99% in the year-earlier quarter (restated) and the return on equity to 17.87% from negative 26.96%. Excluding the restatement, the bank earned 1.35% on assets and 16.48% on equity in last year's second quarter.

Second-quarter net income gained slightly from the $66 million reported in the first quarter. In both quarters, Marine Midland benefited from improved net interest income and lower operating expenses.

A bank spokesperson said growth in consumer and small business loans provided the lift to net interest income, while personnel, occupancy, real estate, and credit-related expenses fell.

Marine Midland's efficiency ratio, excluding the restatement, improved to 55% from 65% a year earlier.

For the first six months, Marine Midland earned $134 million, compared with a loss of $51.3 million in the prior period restated for Concord, and $109.7 million without the restatement.

During the first quarter, additional provisions for loan losses of $113 million were made relating to the liquidation of Concord's problem-asset portfolio. A tax benefit of $73.5 million for Concord's prior period loss carryforwards was also recognized.

At the end of the first half, Marine's Tier 1 risk-weighted asset ratio was 10.87%, compared with 10.51% in the first half of 1994.

Marine Midland, with $18.2 billion of assets, is the New York-based subsidiary of HSBC Holdings PLC, London, which has $300 billion of assets and more than 3,000 offices in 69 countries.

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