CHARLOTTE, N.C. - First Union Corp. this morning reported net income of $633 million for the second quarter, allowing the Charlotte-banking company to post operating earnings of 66 cents a share, comfortably beating analyst projections by three cents.
The bank had taken a $2.2 billion charge in the second quarter of 2000. Excluding the impact of charges last year, second quarter profit fell 9%.
Despite declining profits First Union's chief executive portrayed First Union's earnings as a revenue growth story and one that will end with the planned merger with Wachovia Corp. of Winston Salem, N.C.
Wall Street analysts surveyed by First Call/Thomson Financial had looked for First Union to post 63 cents a share -- though some had expected them to beat that -- which they said the bank need to quash the hostile bid by rival SunTrust Banks of Atlanta to undo the seven week old merger agreement between First Union and Wachovia.
The bank said it was helped during the quarter by rising deposits and an 8% cut in operating expenses over the same period a year ago.
"In a conference call this morning, chairman and chief executive G. Kennedy Thompson said the company is beginning to reap the benefits of that restructuring. "This enormous undertaking is behind us and you're seeing the results of that repositioning and we believe it gets better from here. ... You're witnessing our business model start to fire on all 8 cylinders," Mr. Thompson said.
