Delivering on their quests - and Wall Street demands - for improved revenues, several major banking companies came out with strong fourth- quarter earnings reports.

J.P. Morgan & Co. of New York showed a 14% profit jump, to $419 million, fueled by increases of 39% in trading revenues and 75% in investment banking fees.

At NationsBank Corp., fourth-quarter revenues were up 12.5%, to $2.57 billion. The Charlotte, N.C., company credited investment banking and strong consumer loan growth for a 24% increase in net income, to $632 million.

Barnett Banks Inc. of Jacksonville, Fla., had an 8% rise in quarterly revenues, which helped boost earnings by 13%, to $150 million.

Of the banks reporting Monday, only Cleveland-based National City Corp. came up short on the revenue side, reporting lackluster growth in fee income and modest increases in loans. Its fourth-quarter income of $191 million, up 48%, resulted mostly from cost cuts associated with last year's acquisition of Integra Financial Corp.

"The revenue challenge is clearly an issue going forward for banks," said Joseph Duwan, a banking analyst with Keefe Bruyette & Woods. "In the coming year, companies such as National City will have to identify ways to keep costs under control because of the possibility of slow revenue growth.

"The key is expense control, and hence wider margins," Mr. Duwan said.

J.P. Morgan, which depends more on trading and other Wall Street businesses than a typical money-center commercial bank, lifted its earnings on the strength of bond and stock market activity.

The nation's fourth-largest banking company, Morgan surprised analysts with better-than-expected revenues from trading, investment banking, money management, and other nonlending activities.

Trading revenues advanced to $512 million, while investment banking revenue hit $277 million, thanks to higher levels of advisory, syndication, and underwriting activities.

On a per-share basis, the bank earned $2.04, compared with $1.80 in the same quarter a year ago and an analysts consensus of $1.69, according to IBES International Inc. Morgan's share price went up $2.75 Monday, to $102.50.

"It was a very real and pleasant surprise," said Judah Kraushaar, an analyst with Merrill Lynch & Co. "These results bode well for trading at other big New York banks this quarter."

But analysts cautioned that the Morgan would be hard-pressed to duplicate the performance in this quarter. "We expect trading will tail off a bit, though investment banking will do quite well," said PaineWebber analyst Lawrence Cohn.

Fourth-quarter results were a far cry from those of the third quarter, when the bank reported a 23% drop in net income, due largely to some one- time technology investments and a slight decline in revenues.

NationsBank turned in a respectable performance, as fourth-quarter earnings per share rose to $2.19 from $1.87.

For the year, the company earned $2.45 billion before a merger-related after-tax charge of $77 million, which took net income down to $2.38 billion, or $8 a share. The company earned $1.95 billion in 1995.

"They came in pretty much on consensus," said R. Harold Schroeder, an analyst with Keefe, Bruyette & Woods. "All we saw in the fourth quarter was a rebound in investment banking and trading revenues, coming off a weak third quarter."

Analysts said real questions about NationsBank's performance will arise this year as the company absorbs its acquisition of Boatmen's Bancshares of St. Louis.

NationsBank officials faced questions at an analysts conference Monday about how quickly they can address the fact that 96% of Boatmen's shareholders elected to take stock rather than cash - far higher than the percentage NationsBank had projected in the buyout. To achieve its capital plan, NationsBank must now buy back nearly 60 million shares.

Susan Carr, senior vice president for investor relations, said NationsBank hopes to complete the buyback by yearend. She said the issue does not change the economics of the Boatmen's deal, though it may affect the timing of certain financial benchmarks.

NationsBank said it plans to shift about $50 million in expenses to 1997 that had been earmarked for 1998. But those expenses will be offset by accelerated cost-saving moves this year, Ms. Carr said.

"All in all it's good for the company, but there will be more expenses realized sooner than expected," said Michael J. Ancell, an analyst with Edward Jones.

NationsBank shares were down 37.5 cents, to $102.875.

Earnings per share at National City rose 49% to 85 cents, 2 cents better than analysts' consensus.

James M. Schutz, an analyst with ABN Amro Chicago Corp., said National City "knocked out so much on the expenses, I think that's where they're benefiting."

The $51 billion-asset National City also saw $26.9 million of securities gains, almost double the $13.9 million a year earlier.

Quarterly net interest income rose 6.7% to $493 million, while noninterest income rose 24.4% to $348.3 million.

National City, much like First Bank System Inc., the Minneapolis-based superregional that reported earnings last week - has benefited from the cost-cutting opportunities inherent in acquisitions.

The Integra acquisition helped National City bolster revenue from service charges and loans, the company said. While loans grew 6.7% from a year earlier, Mr. Schutz said the real story was National City Processing, the company's credit card and transaction servicing unit, where income jumped 15% to $101.6 million.

For the year, National City's income was up 24.5% to $736.6 million. The bank's stock price 12.5 cents, to $44.

Continuing its efforts to eliminate unprofitable lines of business, Barnett Banks reported fourth-quarter earnings per share of 76 cents, up from 67 cents in the 1995 quarter.

The $41 billion-asset company earned $564.5 million for all of 1996, up from $533.3 million.

Company officials cited both improved profitability and lower expenses as a percentage of revenues. Observers credited Barnett for using a strategic-alliance approach to strengthen its mortgage and credit card businesses. One payoff followed

Barnett's sale of $776 million of credit card outstandings to Household Credit Services Inc. in October. Net chargeoffs dropped in the fourth quarter by 22%, to $28.4 million.

Kathryn H. Bissette with Sterne, Agee & Leach Inc. said double-digit growth in commercial and installment loans demonstrated that Barnett is reducing its reliance on residential mortgages and credit cards.

She said the company's performance was in line with expectations and showed "no surprises." The stock price rose 25 cents, to $40.875.

This story was written by Jacqueline S. Gold, with contributions by Brett Chase in Chicago, Carey Gillam in Atlanta, and John Kimelman in New York. +++

NationsBank Corp. Charlotte, N.C. Dollar amounts in millions (except per share) Fourth Quarter 4Q96 4Q95 Net income $632.0 $510.0 Per share 2.19 1.87 ROA 1.29% 1.06% ROE 19.06% 16.98% Net interest margin 3.75% 3.38% Net interest income 1,612.0 1,438.0 Noninterest income 958.0 846.0 Noninterest expense 1,466.0 1,342.0 Loss provision 150.0 142.0 Net chargeoffs 151.0 156.0 Year to Date 1996 1995 Net income $2,452.0 $1,950.0 Per share 8.26 7.13 ROA 1.22% 1.03% ROE 18.53% 17.01% Net interest margin 3.62% 3.33% Net interest income 6,423.0 5,560.0 Noninterest income 3,646.0 3,078.0 Noninterest expense 5,665.0 5,163.0 Loss provision 605.0 382.0 Net chargeoffs 598.0 421.0 Balance Sheet 12/31/96 12/31/95 Assets $185,794.0 $187,298.0 Deposits 106,498.0 100,691.0 Loans 121,583.0 116,042.0 Reserve/nonp. loans 260% 306% Nonperf. loans/loans 0.73% 0.60% Nonperf. assets/assets 0.56% 0.46% Nonperf. assets/loans + OREO 0.85% 0.73% Leverage cap. ratio 7.09% 6.27% Tier 1 cap. ratio 7.76% 7.24% Tier 1+2 cap. ratio 12.66% 11.58%

National City Corp. Cleveland Dollar amounts in millions (except per share) Fourth Quarter 4Q96 4Q95 Net income $191.1 $129.1 Per share 0.85 0.57 ROA 1.55% 1.04% ROE 17.53% 13.12% Net interest margin 4.43% 4.11% Net interest income 493.2 462.1 Noninterest income 321.4 266.0 Noninterest expense 531.0 525.2 Loss provision 38.5 27.2 Net chargeoffs 42.4 43.6 Year to Date 1996 1995 Net income $736.6 $591.5 Per share 3.27 2.64 ROA 1.51% 1.23% ROE 17.69% 16.18% Net interest margin 4.44% 4.22% Net interest income 1,963.5 1,849.5 Noninterest income 1,164.9 1,026.9 Noninterest expense 2,010.7 1,939.0 Loss provision 146.5 113.5 Net chargeoffs 146.5 125.7 Balance Sheet 12/31/96 12/31/95 Assets $50,855.8 $50,541.8 Deposits 35,999.7 35,581.0 Loans 35,830.1 34,465.8 Reserve/nonp. loans 494% 368% Nonperf. loans/loans 0.40% 0.56% Nonperf. assets/assets 0.33% 0.42% Nonperf. assets/loans + OREO 0.47% 0.62% Leverage cap. ratio 8.16% 7.26% Tier 1 cap. ratio 9.84% 9.14% Tier 1+2 cap. ratio 14.79% 13.47%

J.P. Morgan & Co. Inc. New York Dollar amounts in millions (except per share) Fourth Quarter 4Q96 4Q95 Net income $419.0 $366.0 Per share 2.03 1.80 ROA 0.71% 0.77% ROE 15.30% 14.70% Net interest margin 1.08% 1.37% Net interest income 505.0 511.0 Noninterest income 1,321.0 1,030.0 Noninterest expense 1,197.0 990.0 Loss provision NA NA Net chargeoffs 3.0 (2.0) Year to Date 1996 1995 Net income $1,574.0 $1,296.0 Per share 7.63 6.42 ROA 0.73% 0.73% ROE 14.90% 13.60% Net interest margin 1.04% 1.55% Net interest income 1,787.0 2,109.0 Noninterest income 5,153.0 3,901.0 Noninterest expense 4,523.0 3,998.0 Loss provision NA NA Net chargeoffs (14.0) (1.0) Balance Sheet 12/31/96 12/31/95 Assets $222,026.0 $184,879.0 Deposits 52,724.0 46,438.0 Loans 28,120.0 23,453.0 Reserve/nonp. loans 930.0% 965.8% Nonperf. loans/loans 0.40% 0.50% Nonperf. assets/assets 0.05% 0.06% Nonperf. assets/loans + OREO NA NA Leverage cap. ratio 5.90% 6.10% Tier 1 cap. ratio 8.70% 8.80% Tier 1+2 cap. ratio 12.20% 13.00%

Barnett Banks, Inc. Jacksonville, Fla. Dollar amounts in millions (except per share) Fourth Quarter 4Q96 4Q95 Net income $149.8 $138.3 Per share 0.76 0.67 ROA 1.47% 1.34% ROE 17.77% 16.50% Net interest margin 5.18% 5.05% Net interest income 461.9 459.2 Noninterest income 205.9 190.4 Noninterest expense 399.7 393.9 Loss provision 28.6 37.2 Net chargeoffs 28.4 36.2 Year to Date 1996 1995 Net income $564.5 $533.3 Per share 2.86 2.56 ROA 1.42% 1.30% ROE 17.44% 16.08% Net interest margin 5.24% 4.88% Net interest income 1,886.5 1,772.2 Noninterest income 791.3 714.0 Noninterest expense 1,592.5 1,518.6 Loss provision 154.6 122.5 Net chargeoffs 154.4 122.0 Balance Sheet 12/31/96 12/31/95 Assets $41,231.0 $41,554.0 Deposits 33,820.0 34,234.0 Loans 30,253.0 30,486.0 Reserve/nonp. loans 250% 297% Nonperf. loans/loans 0.63% 0.56% Nonperf. assets/assets 0.57% 0.57% Nonperf. assets/loans + OREO 0.77% 0.78% Leverage cap. ratio 8.21% 6.16% Tier 1 cap. ratio NA NA Tier 1+2 cap. ratio NA NA ===

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