BankAmerica second quarter earnings.SAN FRANCISCO--(BUSINESS WIRE)--July 19, 1995--BankAmerica Corporation (NYSE NYSE See: New York Stock Exchange : BAC BAC abbr. blood alcohol concentration )(BAC) today reported second-quarter 1995 earnings per share of $1.56, an increase of 17 percent from $1.33 for the same period a year ago. Net income for the second quarter of 1995 was $645 million, up 23 percent from the second quarter of 1994. The return on average common equity for the second quarter of 1995 was 14.30 percent, an increase of 98 basis points from the same period in 1994. BAC's earnings per share for the first six months of 1995 were $3.03, based on year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. net income of $1,256 million, while earnings per share for the first six months of 1994 were $2.59, based on year-to-date net income of $1,038 million. "We're we're Contraction of we are. we're we are very pleased with second quarter results," Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a M. Rosenberg Rosenberg (rō`zənbərg), city (1990 pop. 20,183), Fort Bend co., S Tex., on the Brazos River, in an oil and natural gas area; inc. 1902. Rosenberg and its sister city of Richmond are physically one community. , Chairman and Chief Executive Officer said. "As with the first quarter, we continued to show earnings momentum and to increase both earnings per common share and return on common equity. The rate of loan growth also increased during the second quarter, reflecting continued strength in a number of our diverse businesses and geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. locations. Average loans were up 3.4 percent from the previous quarter." FINANCIAL HIGHLIGHTS - Net interest income was up $291 million, or 16 percent, from the amount reported for the second quarter of 1994. This increase resulted from growth in average loans, including the effects of the acquisition of Continental Bank Corporation, and from an improvement in the net interest margin. BAC's net interest margin for the second quarter of 1995 was 4.54 percent, up 5 basis points from the same period a year ago. - Noninterest income increased $123 million from the second quarter of 1994. Total fees and commissions increased $117 million from the comparable period in 1994 primarily due to higher loan syndication Loan Syndication The process of involving numerous different lenders in providing various portions of a loan. Notes: Mainly used in extremely large loan situations, syndication allows any one lender to provide a large loan while maintaining a more prudent and manageable volume, an increase in the number of commercial deposit accounts, and expanded mortgage servicing activities. In addition, venture capital activities and trading income increased $71 million and $42 million, respectively. These increases were partially offset by a $103 million decline in other income, which was largely due to a decrease in income from assets pending disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of and a reduction of BAC's investment in an equity affiliate Affiliate Relationship between two companies when one company owns substantial interest, but less than a majority of the voting stock of another company, or when two companies are both subsidiaries of a third company. See: Subsidiaries, parent company. . - Noninterest expense increased $64 million from the previous quarter primarily due to growth in performance-based pay, advertising expenses, occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy expenses, and contributions made to the BankAmerica Foundation. Noninterest expense increased $235 million from the same period a year ago. - In connection with its previously announced stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program, BAC repurchased 4.0 million shares of its common stock during the second quarter of 1995 at an average per-share price of $52.41. These shares were repurchased on the open market over 30 trading days In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. and represented approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 11 percent of the total volume of BAC common stock traded on those days. Year-to-date repurchases in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with this plan totaled 9.6 million shares at an average per-share price of $49.45. - During the second quarter of 1995, all outstanding shares of BAC's 6.5% Cumulative Convertible Preferred Stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". , Series G were redeemed re·deem tr.v. re·deemed, re·deem·ing, re·deems 1. To recover ownership of by paying a specified sum. 2. To pay off (a promissory note, for example). 3. or converted to common stock. Approximately 99 percent of the preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. outstanding were converted to 5.4 million shares of common stock, while the remaining shares were redeemed. Note: Look for quarterly earnings on BankAmerica's home page on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http:\\www.BankAmerica.com. -0-
BankAmerica Corporation and Subsidiaries
Financial Highlights
BankAmerica Corporation's (BAC) financial information set forth in the following tables reflects the effects of the merger with Continental Bank Corporation subsequent to its consummation on August 31, 1994.
Table 1
Summary of Results and Statistical Data
Second First Second
(dollar amounts in millions, Quarter Quarter Quarter
except per share data) 1995 1995 1994
1 Net income $ 645 $ 611 $ 525
2 Earnings per common and common
equivalent share 1.56 1.46 1.33
3 Earnings per common share -
assuming full dilution 1.55 1.45 1.32
Rate of return (based
on net income) on:
4 Average total assets 1.13% 1.14% 1.08%
5 Average common equity 14.30 13.86 13.32
6 Net interest margin(a) 4.54 4.55 4.49
7 Full-time-equivalent staff
at period end (in thousands) 80.3 81.2 77.1
8 Employees at period
end (in thousands) 95.8 97.5 93.6
Six Months Ended
June 30,
1995 1994
9 Net income $1,256 $1,038
10 Earnings per common and common
equivalent share 3.03 2.59
11 Earnings per common share -
assuming full dilution 3.00 2.58
Rate of return (based
on net income) on:
12 Average total assets 1.13% 1.07%
13 Average common equity 14.09 13.21
14 Net interest margin(a) 4.54 4.47
(a) The net interest margin is computed on a taxable-equivalent basis. The taxable-equivalent basis adjustments to net interest income were $7 million, $6 million, and $5 million for the second quarter of 1995, the first quarter of 1995, and the second quarter of 1994, respectively, and $13 million and $11 million for the six-month periods ended June 30, 1995 and 1994, respectively.
Table 2
Stock and Capital Data
(dollar amounts in millions, June 30 March 31 June 30 except per share data) 1995 1995 1994
1 Book value per common share $45.38 $43.72 $40.69
Common stock cash dividends:
2 Quarter ended 172 172 139
3 Year-to-date 344 172 282
Preferred stock cash dividends:
4 Quarter ended 56 62 61
5 Year-to-date 118 62 121
6 Number of common shares out-
standing (in thousands) 372,336 369,543 346,909
Average number of common and common
equivalent shares outstanding
(in thousands):
7 Quarter ended 376,213 375,084 349,721
8 Year-to-date 375,649 375,084 353,645
Average number of common shares
outstanding - assuming full
dilution (in thousands):
9 Quarter ended 379,182 381,141 355,201
10 Year-to-date 380,162 381,141 359,125
11 Common equity to total assets 7.46% 7.24% 7.14%
12 Total risk-based capital ratio(a) 11.40(b) 11.69 12.05
13 Tier 1 risk-based capital ratio(a) 7.20(b) 7.33 7.50
14 Total risk-based capital(a) $ 22,624(b)$ 22,265 $ 19,540
15 Risk weighted assets(a) 198,966(b) 190,402 162,216
16 Tier 1 risk-based capital(a) 14,280(b) 13,951 12,161
(a) The Federal Reserve has issued final capital regulations on the adoption of Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes," which became effective April 1, 1995. All periods presented reflect these new regulations. (b) Amounts are preliminary.
Table 3
Selected Average Balance Sheet Components
Second First Second
Quarter Quarter Quarter
(in millions) 1995 1995 1994
1 Loans $145,870 $141,050 $123,313 2 Earning assets 188,046 181,296 163,922 3 Total assets 228,771 217,744 195,619 4 Deposits 153,761 149,902 141,478 5 Interest-bearing liabilities 156,209 150,043 134,255 6 Common equity 16,523 16,070 13,984 7 Total equity 19,470 19,138 16,963
Table 4
Business Sectors
Six Months Ended June 30, 1995(a)
(dollar amounts Return
in billions except Average Average on Expense
for net income, which Net Total Total Common to
is in millions) Income Assets Deposits Equity Revenue(b)
1 Consumer banking $ 523 $ 69 $ 74 18.54% 57.38%
2 U.S. Corporate and
international banking 455 84 34 13.70 54.27
3 Commercial real estate 184 9 1 42.74 19.84
4 Middle market banking 147 17 7 30.61 45.63
5 Private banking and
investment services 28 4 6 17.12 76.75
6 Non-California banks(c) 56 24 23 6.43 79.33
7 Other (137) 16 7 (20.46) 203.05
8 Total $1,256 $223 $152 14.09% 59.73%
Six Months Ended June 30, 1994(a)
Return
Average Average on Expense
Net Total Total Common to
Income Assets Deposits Equity Revenue(b)
9 Consumer banking $ 345 $ 64 $ 77 12.52% 59.45%
10 U.S. Corporate and
international banking 352 63 24 13.88 53.56
11 Commercial real estate 198 9 2 42.93 19.02
12 Middle market banking 104 13 6 29.41 52.12
13 Private banking and
investment services (11) 3 5 (9.12) 106.17
14 Non-California banks(c) 14 24 24 0.24 84.64
15 Other 36 19 3 3.98 55.80
16 Total $1,038 $195 $141 13.21% 60.07% (a) Amounts are preliminary. For comparability purposes, both 1995 and 1994 amounts reflect BAC's business-sector allocation methodologies at June 30, 1995. (b) Excludes net other real estate owned expense and amortization of intangibles. (c) Excludes Seafirst Corporation and Bank of America Illinois, which are reflected within the applicable business sectors.
Table 5
Trading Income and Net Interest
Income by Function
Second First Second
Quarter Quarter Quarter
(in millions) 1995(a) 1995 1994
Trading income: 1 Interest rate $ 9 $ 25 $ 15 2 Foreign exchange 80 83 73 3 Debt instruments 62 21 21 4 Total trading income $151 $129 $109 Net interest income(b): 5 Interest rate $ 2 $ 3 $ (3) 6 Foreign exchange 7 2 3 7 Debt instruments 49 28 23 8 Total net interest income $ 58 $ 33 $ 23
Six Months Ended
June 30,
1995(a) 1994
Trading income: 9 Interest rate $ 34 $ 29 10 Foreign exchange 163 131 11 Debt instruments 83 23 12 Total trading income $280 $183 Net interest income(b): 13 Interest rate $ 5 $ (3) 14 Foreign exchange 9 3 15 Debt instruments 77 39 16 Total net interest income $ 91 $ 39 (a) Detailed breakouts of total amounts are preliminary. (b) Represents the net interest revenue and expense associated with these contracts.
Table 6
Loan Outstandings
June 30, March 31, June 30,
(in millions) 1995 1995 1994
Domestic Consumer: 1 Residential first mortgages $ 35,564 $ 34,791 $ 31,784 2 Residential junior mortgages 14,072 13,808 13,280 3 Other installment 11,819 10,989 9,439 4 Credit card 8,237 7,757 7,169 5 Other individual lines of credit 1,811 1,691 1,806 6 Other 305 409 224 7 Total consumer 71,808 69,445 63,702
Commercial:
8 Commercial and industrial 31,436 30,481 21,815
9 Loans secured by real estate 10,717 10,504 9,131
10 Construction and development
loans secured by real estate 3,308 3,526 3,742
11 Financial institutions 2,520 2,211 1,340
12 Agricultural 1,607 1,658 1,605
13 Lease financing 1,840 1,786 1,678
14 Loans for purchasing or carrying
securities 1,383 1,348 1,683
15 Other 1,569 1,639 1,465
16 Total commercial 54,380 53,153 42,459
17 Total domestic loans 126,188 122,598 106,161
Foreign
18 Commercial and industrial 14,948 14,417 12,388
19 Banks and other financial
institutions 2,941 2,871 2,206
20 Governments and official
institutions 1,131 866 862
21 Other 3,558 3,407 3,257
22 Total foreign loans 22,578 21,561 18,713
23 Total Loans $148,766 $144,159 $124,874
Table 7
Selected Credit Quality Data
June 30, March 31, June 30,
(dollar amounts in millions) 1995 1995 1994
Nonaccrual assets:
1 Construction and development
loans secured by real estate $ 418 $ 549 $ 724
2 Commercial and industrial 645 470 311
3 Commercial loans secured by real
estate 336 341 588
4 Consumer 381 386 424
5 Foreign 182 189 175
6 Total nonaccrual assets $1,962(a)$1,935(a) $2,222
7 Restructured loans $ 99 $ 109 $ 139
8 Loans past due 90 days or more
and still accruing interest(b) 459 369 498
9 Other real estate owned 485 559 472
10 Allowance for credit losses to
total loans 2.48% 2.58% 2.73%
11 Allowance for credit losses to
total nonaccrual assets 188.33 192.50 153.67
Annualized ratio of net credit
losses to average total loan
outstandings:
12 Quarter ended 0.36 0.22 0.50
13 Year-to-date 0.29 0.22 0.54
(a) Includes $1.6 billion and $1.5 billion at June 30, 1995 and March 31, 1995, respectively, of impaired loans that are accounted for in accordance with Statement of Financial Accounting Standards No. 114, "Accounting by Creditors for Impairment of a Loan," as amended, which BAC adopted effective January 1, 1995. (b) Includes consumer loans of $321 million, $289 million, and $260 million at June 30, 1995, March 31, 1995, and June 30, 1994, respectively.
Table 8
Analysis of Change in Nonaccrual Assets
Second First
Quarter Quarter
(in millions) 1995 1995
1 Balance, beginning of period $1,935 $2,080
Additions:
2 Loans placed on nonaccrual status 333 175
Deductions:
3 Sales (1) (5)
4 Restored to accrual status (86) (92)
5 Foreclosures (11) (15)
6 Charge-offs (42) (19)
7 Other, primarily payments (166) (189)
8 Balance, End of Period $1,962 $1,935
Table 9
Net Credit Losses (Recoveries)
Second First Second
Quarter Quarter Quarter
(in millions) 1995 1995 1994
Domestic consumer:
1 Residential first mortgages $ 10 $ 14 $ 13
2 Residential junior mortgages 14 13 18
3 Credit card 87 74 85
4 Other consumer 35 35 36
Domestic commercial:
5 Commercial and industrial 4 (14) (3)
6 Loans secured by real estate 20 6 14
7 Construction and development
loans secured by real estate (3) 3 (6)
8 Financial institutions, agricultural,
and lease financing (3) (2) (3)
9 Total domestic 164 129 154
10 Foreign (34) (52) ~
11 Total Net Credit Losses $130 $ 77 $154
BankAmerica Corporation and Subsidiaries
Consolidated Statement of Operations
Second First Second
Quarter Quarter Quarter
(in millions) 1995 1995 1994
Interest Income
1 Loans, including fees $3,172 $3,004 $2,294
2 Interest-bearing deposits in banks 120 112 74
3 Federal funds sold 9 8 15
4 Securities purchased under
resale agreements 176 135 89
5 Trading account assets 189 163 122
6 Available-for-sale and held-to-
maturity securities 323 314 345
7 Total interest income 3,989 3,736 2,939
Interest Expense
8 Deposits 1,240 1,114 753
9 Federal funds purchased 30 39 3
10 Securities sold under repurchase
agreements 150 130 97
11 Other short-term borrowings 168 132 59
12 Long-term debt 266 264 185
13 Subordinated capital notes 12 11 10
14 Total interest expense 1,866 1,690 1,107
15 Net interest income 2,123 2,046 1,832
16 Provision for credit losses 100 100 125
17 Net interest income after
provision for credit losses 2,023 1,946 1,707
Noninterest Income
18 Deposit account fees 323 317 290
19 Credit card fees 74 75 82
20 Trust fees 78 78 66
21 Other fees and commissions 342 300 262
22 Trading income 151 129 109
23 Net gain on available-for-sale
securities 9 1 7
24 Net gain on sales of assets 14 1 20
25 Venture capital activities 103 87 32
26 Other income 44 105 147
27 Total noninterest income 1,138 1,093 1,015
Noninterest Expense 28 Salaries 842 809 700 29 Employee benefits 183 193 180 30 Occupancy 182 173 167 31 Equipment 165 159 138 32 Amortization of intangibles 110 109 99 33 Communications 91 86 80 34 Regulatory fees and related expenses 74 72 72 35 Professional services 76 69 53 36 Other expense 330 319 329 37 Total noninterest expense 2,053 1,989 1,818 38 Income before income taxes 1,108 1,050 904 39 Provision for income taxes 463 439 379 40 Net Income $ 645 $ 611 $ 525
BankAmerica Corporation and Subsidiaries
Consolidated Statement of Operations
Six Months Ended
June 30
(in millions) 1995 1994
Interest Income
1 Loans, including fees $6,176 $4,500
2 Interest-bearing deposits in banks 232 130
3 Federal funds sold 17 28
4 Securities purchased under
resale agreements 311 161
5 Trading account assets 352 233
6 Available-for-sale and held-to-
maturity securities 637 700
7 Total interest income 7,725 5,752
Interest Expense
8 Deposits 2,354 1,450
9 Federal funds purchased 69 6
10 Securities sold under repurchase
agreements 280 176
11 Other short-term borrowings 300 120
12 Long-term debt 530 354
13 Subordinated capital notes 23 20
14 Total interest expense 3,556 2,126
15 Net interest income 4,169 3,626
16 Provision for credit losses 200 250
17 Net interest income after
provision for credit losses 3,969 3,376
Noninterest Income
18 Deposit account fees 640 584
19 Credit card fees 149 161
20 Trust fees 156 133
21 Other fees and commissions 642 528
22 Trading income 280 183
23 Net gain on available-for-sale
securities 10 27
24 Net gain on sales of assets 15 65
25 Venture capital activities 190 63
26 Other income 149 271
27 Total noninterest income 2,231 2,015
Noninterest Expense 28 Salaries 1,651 1,410 29 Employee benefits 376 338 30 Occupancy 355 332 31 Equipment 324 284 32 Amortization of intangibles 219 204 33 Communications 177 158 34 Regulatory fees and related expenses 146 142 35 Professional services 145 111 36 Other expense 649 620 37 Total noninterest expense 4,042 3,599 38 Income before income taxes 2,158 1,792 39 Provision for income taxes 902 754 40 Net Income $1,256 $1,038
BankAmerica Corporation and Subsidiaries
Consolidated Balance Sheet
June 30, March 31, June 30,
(in millions) 1995 1995 1994
Assets
1 Cash and due from banks $ 12,656 $ 12,404 $ 10,137
2 Interest-bearing deposits in banks 5,620 6,122 4,707
3 Federal funds sold 467 793 2,758
4 Securities purchased under resale
agreements 6,131 5,969 4,933
5 Trading account assets 8,133 7,941 5,714
6 Available-for-sale securities 9,868 9,268 8,938
7 Held-to-maturity securities 7,186 7,335 11,734
8 Loans 148,766 144,159 124,874
9 Less: Allowance for credit losses 3,695 3,725 3,414
10 Net loans 145,071 140,434 121,460
11 Customers' acceptance liability 2,076 1,977 935
12 Accrued interest receivable 1,335 1,371 1,097
13 Goodwill, net 4,303 4,323 3,886
14 Identifiable intangibles, net 2,172 2,176 2,078
15 Unrealized gains on off-balance-
sheet instruments 9,323 11,577 8,650
16 Premises and equipment, net 4,009 3,973 3,705
17 Other assets 8,249 7,525 6,811
18 Total Assets $226,599 $223,188 $197,543
Liabilities & Stockholders' Equity
Deposits in domestic offices:
19 Interest-bearing $ 85,573 $ 87,140 $ 86,568
20 Noninterest-bearing 34,458 32,712 31,009
Deposits in foreign offices:
21 Interest-bearing 33,985 30,718 22,898
22 Noninterest-bearing 1,764 1,698 1,560
23 Total deposits 155,780 152,268 142,035
24 Federal funds purchased 2,274 2,174 223
25 Securities sold under repurchase
agreements 5,833 6,570 6,332
26 Other short-term borrowings 9,730 8,500 3,537
27 Acceptances outstanding 2,076 1,977 935
28 Accrued interest payable 706 739 550
29 Unrealized losses on off-balance-
sheet instruments 9,939 11,848 8,727
30 Other liabilities 4,563 4,435 3,894
31 Long-term debt 15,473 14,846 13,611
32 Subordinated capital notes 605 605 606
33 Total liabilities 206,979 203,962 180,450
Stockholders' Equity
34 Preferred stock 2,723 3,068 2,979
35 Common stock 598 587 561
36 Additional paid-in capital 8,213 7,912 7,150
37 Retained earnings 8,663 8,230 7,131
38 Net unrealized loss on available-
for-sale securities (69) (275) (210)
39 Common stock in treasury, at cost (508) (296) (518)
40 Total stockholders' equity 19,620 19,226 17,093
41 Total Liabilities and
Stockholders' Equity $226,599 $223,188 $197,543
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CONTACT: BankAmerica Corp. Peter Magnani, 415/953-2418 |
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