BankBoston reports fourth quarter net income of $202 million or $1.24 per share 15% growth in EPS from prior year.

BOSTON--(BUSINESS WIRE)--Jan. 16, 1997--Bank of Boston Corporation ("BankBoston"; NYSE: "BKB") reported today fourth quarter net income of $202 million, or $1.24 per common share on a fully diluted basis compared with $180 million, or $1.08 per share, in the fourth quarter of 1995. Net income for the third quarter of 1996 was $197 million, or $1.21 per share, before restructuring and merger- related costs associated with the acquisition of BayBanks ($80 million, or $.45 per share, including these charges).

Net income for the full year 1996 was $773 million, or $4.71 per share before charges associated with the acquisition of BayBanks and items related to the sale of the mortgage banking subsidiary, compared with net income of $678 million, or $4.09 per share, for the full year 1995. Actual net income for the full year 1996 was $650 million, or $3.93 per share, compared with net income of $678 million, or $4.09 per share, for the full year 1995.

These results reflect the acquisition of BayBanks, which was consummated on July 29, 1996. The acquisition was accounted for under the pooling of interests method and, accordingly, all prior period results have been restated to include the historical results

of BayBanks.

Operating highlights were as follows (1996 amounts are before charges associated with the acquisition of BayBanks and items related to the sale of the mortgage banking subsidiary):

-- On a fully taxable equivalent basis, operating income was $410 million in the fourth quarter, compared with $405 million in the prior quarter and $380 million in the fourth quarter of 1995. For the full year 1996, operating income was $1,582 million, compared with $1,414 million for the full year 1995. Amounts for 1995 periods exclude income and charges related to the sale or reorganization of

businesses and the valuation or disposition of certain assets;

-- Return on average common equity ("ROE") improved to 17.71% in the fourth quarter, compared with 17.56% in the prior quarter and 16.66% in the fourth quarter of 1995. For the full year 1996, ROE was 17.36%, compared with 16.86% for 1995;

-- Return on average assets ("ROA") was 1.31% in the fourth and third quarters of 1996, compared with 1.24% in the fourth quarter of 1995. For the full year 1996, ROA was 1.30%, compared with 1.22% for 1995;

-- Nonaccrual loans and OREO totaled $452 million at December 31, 1996, compared with $496 million at September 30, 1996 and $442 million at December 31, 1995. Net credit losses, excluding those related to the transfer of commercial real estate loans into a held

for sale account as discussed below, were $60 million in the fourth

quarter, compared with $55 million in the prior quarter and $51 million in the fourth quarter of 1995. The provision for credit losses was $60 million in the fourth quarter, compared with $57 million in the third quarter and $81 million in the fourth quarter of 1995 (including a special provision of $25 million).

Included in the fourth quarter of 1996 results discussed above were the following items:

-- A gain of $47 million from the previously announced sale of twenty branches to US Trust Corp. ("US Trust"), which involved the transfer of approximately $700 million of deposits and $500 million

of loans;

-- A charge of $25 million from the transfer of approximately $400

million of commercial real estate loans into a held for sale account as part of the Corporation's balance sheet management program. In addition, credit losses of $15 million were also taken as part of this transfer;

-- A valuation-related charge of $11 million associated with certain investments;

-- A charge of $6 million related to the vesting of stock price performance-related restricted stock to certain employees.

Charles K. Gifford, Chief Executive Officer said, "The fourth quarter culminated a truly momentous year for our institution, marked by record earnings levels and major strides towards becoming a focused financial institution. Without question, the acquisition of BayBanks which closed six months ago is the most significant development of the past year. The integration is moving forward and we remain confident that this will create the premier consumer franchise in our home region. With Bill Crozier and his team, we fully intend to export BayBanks' expertise in electronic banking to

other parts of our franchise. Our corporate banking business remains a growing and vital part of our company, building on its profitable

relationship base and complemented very well by our private equity investing and capital markets segments. We expect to have our Section 20 subsidiary fully operational very shortly. Globally, our Latin American franchise continues to grow rapidly, particularly in

the fee-based arena. We will actively seek to expand our distribution network in this region and better leverage existing synergies with other domestic and global based businesses."

Gifford added, "We continue to concentrate on those markets where we can sustain competitive advantages and produce superior returns and earnings growth. Our decisions regarding our mortgage banking operations and Fidelity Acceptance's consumer finance business reflect this mindset by freeing up capital for other uses while retaining a valuable interest in the larger entities that were created. These actions reinforce the message that our commitment to managing for value is unwavering. With our new BankBoston brand identity, the arrival of Henrique Meirelles as President and Chief Operating Officer, the alignment of employee and shareholder interests via the issuance of performance-based stock options to every employee in 1996, and the momentum gained from our ongoing earnings improvement, we look forward to the challenges of 1997 with renewed vigor and optimism."

William J. Shea, Vice Chairman and Chief Financial Officer said, "We are encouraged by many of the operating trends shown in our 1996 core results. The 15% increase in earnings per share, along with the healthy improvement in ROE reflects our strong emphasis on these two measures. Of particular note was the double digit growth in non-interest income despite the divestiture of several businesses.

This increase was driven by businesses in which we invested heavily

over the past few years especially private equity investing, asset management, Latin America and capital markets. We will continue to

make the required investments in our high priority businesses. Balance sheet management remains a critical objective as we continue to dispose of low return assets while maintaining strong capital and reserve levels. We were especially pleased by the recognition of progress accorded us by S&P in their upgrade of our debt ratings in

December."

Noninterest income

The components of noninterest income are as follows:

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Third

Quarter                        Fourth Quarter       Twelve Months
1996 (in millions)             1996  1995  Change   1996   1995
Change

$140  Financial service fees   $147  $164  $(17)    $585   $628
$(43)
      Net equity and
  51   mezzanine profits         45    45     0      209    110
99
  24  Mutual fund fees           25    20     5       94     67
27
  32  Personal trust fees        34    28     6      131    112
19
      Other trust and
   6    agency fees               6     7    (1)      21     61
(40)
      Trading profits and
  21    commissions              17     9     8       76     25
51
      Foreign exchange trading
  13    profits                  17    15     2       54     60
(6)
      Securities portfolio
        gains, net (before
   7    valuation charges         7     2     5       31      9
22
      Gain on sale of mortgage
  13    servicing                 0     0     0       13     10
 3
  30  Other income               31    24     7      124     99
25
$337  Subtotal                 $329  $314  $ 15   $1,338  1,181
$157
      Other items, net (details
   0    on following page)       11    53   (42)       6    128
(122)
$337  Total                    $340  $367  $(27)  $1,344 $1,309
$35

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-- Changes in financial service fees are detailed below. The reduction from prior year periods was greatly influenced by the sale of the Corporation's mortgage banking subsidiary. Excluding the decline in net mortgage servicing fees, total financial service fees grew $33 million, or 6%, from full year 1995.

-- Equity and mezzanine profits continued strong in the fourth quarter. The higher level of realized profits compared with full year 1995 is primarily due to a seasoning of the portfolio and favorable market conditions. In addition, the portfolio grew over $200 million during 1996 as new investment activity was double the 1995 level.

-- The increase in mutual fund fees compared with all prior periods was mainly due to higher levels of funds under management in Brazil. These funds stood at $3.7 billion at December 31, 1996 compared with $2.5 billion at December 31, 1995.

-- Personal trust fees improved from all prior periods mainly due to a higher level of assets under management.

-- The comparison with full year 1995 for other trust and agency fees is mainly affected by the sale of the Corporation's corporate trust business and the movement of its stock transfer business into a joint venture.

-- Trading account profits and commissions declined from the third quarter due, in part, to a lower level of profits from Brazil. Compared with prior year periods, trading account profits and commissions improved significantly, mainly due to increases from the Corporation's capital markets areas and Brazil.

-- The improvement in foreign exchange profits from the prior quarter included increases from domestic and Asian operations. The

decline in the full year comparison mainly reflects lower profits from Asia.

-- The $13 million gain on the sale of mortgage servicing in the third quarter of 1996 resulted from the sale of BayBanks' $4 billion servicing portfolio to HomeSide Lending.

-- The increases in other income compared with prior year periods were due, in part, to higher profits from various joint ventures, including those related to HomeSide Lending (mortgage banking business), Boston EquiServe (stock transfer business), and the Argentine pension management business.

The components of financial service fees are as follows:

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Third

Quarter                        Fourth Quarter        Twelve Months
1996 (in millions)             1996  1995  Change    1996  1995
Change

      Deposit and ATM-related
$61    fees                     $ 59  $ 58    $  1    $238  $231
$  7
      Letters of credit and
 18    acceptance fees            17    17       0      68    72
 (4)
      Syndication and
 14    agent fees                 21    12       9      58    38
  20
  9   Other loan-related fees     10     9       1      38    34
   4
      Net mortgage servicing
       fees (before items
  3    detailed below)             0    29     (29)     29   105
(76)
 35   Other                       40    39       1     154   148
   6
$140  Total                     $147  $164    $(17)   $585  $628
$(43)

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-- The increases in syndication and agent fees from all prior periods reflect a higher volume of transactions generated by the Corporation's corporate finance business.

-- The declines in net mortgage servicing fees from prior year periods reflect the sale of the Corporation's mortgage banking subsidiary.

-- The increase in other financial service fees from the third quarter is mainly due to higher levels of advisory fees from the Corporation's capital markets business.

Other items included in noninterest income are composed of the following:

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Third

Quarter                        Fourth Quarter        Twelve Months
1996 (in millions)             1996  1995  Change    1996   1995
Change
     Gain on sale of
      branches/banking
$0    subsidiaries             $ 47  $  0   $ 47     $ 47   $ 75
$(28)
     Transfer of loans into
 0     held for sale            (25)  (17)    (8)     (25)   (17)
 (8)
     Valuation charges
       associated with
 0     investments              (11)  (17)     6      (11)   (17)
  6
     Mortgage banking-related
       gains/losses:
 0   Sale of mortgage subsidiary  0     0      0       106     0
106
     Contracts used to manage
 0     prepayment risk, net       0    67    (67)     (111)   67
(178)
 0   Total                        0    67    (67)       (5)   67
(72)
     Gain on sale of corporate
 0     trust business             0    20    (20)        0    20
(20)
$0   Total                     $ 11  $ 53   $(42)      $ 6  $128
$(122)

-0-

-- During the fourth quarter of 1996 the Corporation recorded: (1) a gain of $47 million from the previously announced sale of twenty branches to US Trust, which involved the transfer of approximately $700 million of deposits and $500 million of loans, (2) a charge of

$25 million from the transfer of approximately $400 million of commercial real estate loans into a held for sale account as part of the Corporation's balance sheet management program, and (3) valuation-related charges of $11 million associated with certain investments.

-- During the first half of 1996 the Corporation recorded a net pre-tax loss of $5 million from mortgage banking-related items. As a result of the first quarter's rising rate environment, a loss of $111 million (net of decreased servicing amortization) was recorded from

the change in market value of contracts used to manage prepayment risk in the mortgage servicing portfolio which, in turn, protected the economic value of the Corporation's mortgage banking subsidiary

pending the completion of its sale to Homeside Lending. The completion of this transaction resulted in the recognition of gains

totaling $106 million. The Corporation now owns a 33% interest in HomeSide Lending, which ranks among the country's largest mortgage banking companies.

-- During the fourth quarter of 1995, the Corporation recorded: (1)

$67 million of gains (net of increased servicing amortization) from

contracts used to manage prepayment risk in the mortgage servicing portfolio, (2) a net gain of $20 million from the previously announced sale of its corporate trust business, (3) a loss of $17 million from the transfer of $1.3 billion of low yielding residential mortgage loans into a held for sale account, and (4) $17 million of

valuation-related charges associated with certain investments and other assets, including assets being retained by the Corporation as a result of the mortgage banking sale. During the first quarter of 1995, the Corporation recognized a $75 million gain from the sale of its Maine and Vermont banking subsidiaries.

Net interest revenue

Net interest revenue, on a fully taxable equivalent basis, was $616 million for the fourth quarter of 1996, compared with $596 million in the prior quarter and $581 million in the fourth quarter

of 1995. Net interest margin was 4.47% for the fourth quarter, compared with 4.40% in the prior quarter and 4.50% in the fourth quarter of last year. For the full year 1996, net interest revenue, on a fully taxable equivalent basis, was $2,360 million, compared with $2,271 million for the full year 1995. On the same basis, net

interest margin was 4.42% in 1996 and 4.58% in 1995.

The $20 million increase in net interest revenue from the prior

quarter reflected a growth in average earning assets of approximately $900 million coupled with the 7 basis point improvement in net interest margin. The growth in average earning assets was mainly due to an overall increase of $600 million in average loans including growth in the domestic commercial and consumer portfolios and higher levels of Latin American loans, partially offset by a decline in average residential mortgages. The latter resulted from the sale of loans during the fourth quarter including those associated with the

sale of branches to US Trust. The 7 basis point improvement in net

interest margin included wider spreads from the credit card business, as the "promotional rate" period expired on additional loans in the

portfolio, and higher loan fees. Partially offsetting these increases was a decline in margin from the aforementioned sale of branches to

US Trust which included approximately $700 million of retail deposits.

Compared with the prior year periods, net interest revenue improved while net interest margin declined. These changes reflected a higher volume of average earning assets and a decline in the international margin. The full year comparison also reflected narrower domestic spreads which were caused, in part, by the aggressive marketing of a new higher rate savings deposit product during 1995 and competitive pricing pressures.

Noninterest expense

The components of noninterest expense are as follows:

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Third
Quarter                        Fourth Quarter       Twelve Months
1996 (in millions)             1996  1995  Change   1996   1995
Change
$293 Employee costs            $293  $289  $  4   $1,168 $1,146
$ 22
  85 Occupancy & equipment       87    82     5      341    324
 17
  15 Professional fees           14    16    (2)      56     65
 (9)
     Advertising and public
  26   relations                 24    27    (3)     108     87
 21
  24 Communications              27    24     3      101     90
 11
   7 Goodwill amortization        7     5     2       24     18
  6
  78 Other                       88    72    16      323    309
 14
     Subtotal before other
 528   items & OREO costs       540   515    25    2,121  2,039
 82
     Other items:
     Stock price performance-
   0   related restricted stock   6     0     6        6      0
  6
      BayBanks-related costs:
      Restructuring and merger-
 180    related costs             0     0     0      180      0
180
      Accelerated vesting of
   0    restricted stock          0     0     0        4      0
  4
      Reorganization and other
   0    costs                     0    28   (28)       0     28
(28)
      Subtotal before OREO
 708    costs                   546   543     3    2,311  2,067
244
   5  OREO costs                  2     2     0        9      9
  0
$713  Total                    $548  $545    $3   $2,320 $2,076
$244

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Noninterest expense before "other items" and OREO costs, was $540 million in the fourth quarter of 1996, compared with $528 million in the prior quarter and $515 million for the same quarter in 1995.

The $12 million increase from the third quarter was mainly due to growth in certain businesses including New England consumer, corporate banking and Latin America, as well as increased levels of

incentive compensation. These increases were partially offset by a decline associated with cost savings from the integration of BayBanks into the Corporation. The number of employees declined to 22,000 at December 31, 1996 from 22,600 at September 30, 1996 and 23,700 at December 31, 1995. The decline from the prior year also reflected the mortgage banking transaction.

Compared with prior year periods, the growth in noninterest expense reflected ongoing expansion and investment spending in several of the Corporation's growth businesses, mainly Latin America, capital markets, and consumer banking. Initiatives in the growth businesses included: branch expansion and growth in fee-based businesses in Latin America; start up of a high yield debt unit and

the hiring of sales and trading professionals in all the capital markets businesses and the acquisition of Boston Bancorp, as well as marketing campaigns related to credit card, home equity and other products in consumer banking. Current year expense levels also included higher incentive compensation costs related to improved business unit performance. The comparison of noninterest expense with prior year periods is also affected by the absence of operating expenses associated with the mortgage banking business, which was sold in March, 1996, and the elimination of FDIC insurance premiums. The full year comparison is also affected by the absence of expenses from the corporate trust and stock transfer businesses.

During the fourth quarter of 1996 the Corporation recorded a $6

million charge associated with a performance restricted stock plan for certain employees. Under the terms of the plan, 75% of the stock award vested with these employees during the fourth quarter when the Corporation's common stock price closed at $60 or above for two consecutive days. The remaining 25% of the award vested in January, 1997 when the stock price closed at $70 or above for two consecutive days.

Credit Profile Loan and Lease Portfolio

The segments of the lending portfolio are as follows:

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(in millions)              12-31-96  9-30-96  6-30-96  3-31-96
12-31-95
United States Operations:
  Commercial, industrial
    and financial          $13,162   $13,828  $12,915  $12,677
$12,809
  Commercial real estate
    Construction               284       323      410      383
 386
    Other commercial real
      estate                 3,240     3,228    3,326    3,242
3,393
  Consumer-related loans:
    Residential mortgages    3,184     4,156    4,133    4,218
4,141
    Home equity loans        2,878     2,842    2,775    2,644
2,556
    Credit card              1,395     1,320    1,223      810
 495
    Other                    5,503     5,349    5,218    5,200
5,059
  Lease financing            1,816     1,778    1,627    1,565
1,564
  Unearned income            (287)     (272)    (245)    (240)
(240)
                            31,175    32,552   31,382   30,499
30,163
International Operations:
  Loans and lease financing,
  net of unearned income     9,886     9,501    9,271    8,769
8,707
Total loans and lease
  financing                $41,061   $42,053  $40,653  $39,268
$38,870

-0-

Loans and leases declined approximately $1 billion from September 30, 1996 driven mainly by a $972 million decline in residential mortgages due to the sale of loans, including those associated with

the sale of branches to US Trust. In addition, domestic commercial

and industrial loans declined $666 million due, in part, to the outflow of loans carried at September 30 which were earmarked for syndication. These declines were partially offset by a $385 million increase in international loans reflecting ongoing growth from Latin America.

Nonaccrual Loans and OREO

Nonaccrual loans and OREO amounted to $452 million at December 31, 1996, compared with $496 million at September 30, 1996, and $442 million at December 31, 1995. Nonaccrual loans and OREO represented 1.1% of related assets at December 31, 1996, compared with 1.2% at September 30, 1996 and 1.1% at December 31, 1995.

The components of consolidated nonaccrual loans and OREO are as

follows:

-0-

(in millions)              12-31-96  9-30-96  6-30-96 3-31-96
12-31-95
Domestic nonaccrual loans:
  Commercial, industrial
   and financial             $82      $114     $140     $93
$88
Commercial real estate
    Construction               6         9       10      22
25
    Other commercial real
     estate                   67        84       86     102
103
  Consumer-related loans
    Residential mortgages     57        60       45      46
42
    Home equity loans         23        22       20      16
14
    Credit card               17         5        2       0
0
    Other                     44        44       38      42
35
                             296       338      341     321
307
International nonaccrual
  loans                      106       106       57      63
66
   Total nonaccrual loans    402       444      398     384
373
OREO                          50        52       62      65
69
   Total                    $452      $496     $460    $449
$442

-0-

Provision and Reserve for Credit Losses

The reserve for credit losses at December 31, 1996 was $883 million, or 2.15% of outstanding loans and leases, compared with $897 million, or 2.13% at September 30, 1996, and $890 million, or 2.29%

at December 31, 1995. The reserve for credit losses was 220% of nonaccrual loans at December 31, 1996, 202% at September 30, 1996, and 239% at December 31, 1995.

The provision for credit losses was $60 million in the fourth quarter of 1996, compared with $57 million in the third quarter of 1996 and $81 million in the fourth quarter of 1995, which included a special provision of $25 million. For the full year 1996, the provision for credit losses was $231 million, compared with $275 million for the full year 1995. Full year 1995 included special provisions of $75 million ($50 million recorded in the first quarter and $25 million recorded in the fourth quarter).

Net credit losses, excluding $15 million related to the transfer of commercial real estate loans into a held for sale account, were $60 million for the fourth quarter of 1996, compared with $55 million for the prior quarter and $51 million for the comparable period last year. Net credit losses as a percent of average loans and leases on an annualized basis were .57% in 1996's fourth quarter (excluding the aforementioned loans transferred into a held for sale account), compared with .53% for the third quarter of 1996 and .51% for the fourth quarter of 1995.

Net credit losses were as follows:

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Third
Quarter                        Fourth Quarter      Twelve Months
1996 (in millions)            1996       1995     1996       1995
     Domestic
     Commercial, industrial
$ 0   and financial           $ 3        $ 6      $ 8        $ 30
  1  Commercial real estate     1          8       16          35
     Consumer-related loans:
  2  Residential mortgages      2          5       11          19
  7  Credit card               13          3       27          11
  0  Home equity loans          3          2        7           6
 35  Other                     26         18      109          51
 45                            48         42      178         152
 10  International             12          9       37          44
$55  Subtotal                 $60        $51     $215        $196
     Commercial real estate
      loans transferred
      into a held for sale
  0   category                 15          0       15           0
$55   Total                   $75        $51     $230        $196

-0-

The Corporation

BankBoston, with assets of $62.3 billion, was founded in 1784.

BankBoston is engaged primarily in commercial and consumer banking in southern New England, providing financing and capital markets services to selected corporations nationally and internationally, and full-service banking in key Latin American markets. The Corporation and its subsidiaries operate through a network of 650 offices in the U.S. and through more than 100 offices in 24 countries in Latin America, Europe and Asia, the third largest overseas network of any

U.S. bank. The Corporation's common and preferred stocks are listed on the New York and Boston stock exchanges.

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                     Consolidated Balance Sheet
(dollars in millions)
September 30                                        December 31
   1996                                          1996         1995
         Assets
         Securities:
 $  685  Held to maturity                       $  692       $  660
  7,413  Available for sale                      7,792        7,582

 42,053  Loans and lease financing              41,061       38,870
   (897) Reserve for credit losses                (883)
(890)
 41,156  Net loans and lease financing          40,178       37,980

  4,513  Other earning assets                    4,729        4,973
  8,196  Cash and other nonearning assets        8,915        8,228
$61,963  Total Assets                          $62,306      $59,423

         Liabilities and Stockholders' Equity
$43,328  Deposits                              $42,831      $41,064
  9,250  Funds borrowed                          9,136        9,503
  2,846  Notes payable                           2,843        2,189
  1,785  Other liabilities                       2,062        1,965
         Guaranteed preferred interest in
           corporation's junior subordinated
           debt                                    500
 57,209  Total Liabilities                      57,372       54,721

         Stockholders' Equity
    508  Preferred equity                          508          508
  4,246  Common equity                           4,426        4,194
  4,754  Total Stockholders' Equity              4,934        4,702
         Total Liabilities and Stockholders'
$61,963    Equity                              $62,306      $59,423

-0-

Selected Average Balances

Quarter Ended Quarters Ended Twelve Months Ended September 30 December 31 December 31 1996 1996 1995 1996 1995

Assets

Loans and lease $41,223 financing $41,835 $39,357 $40,589 $38,283

8,249 Securities 8,029 7,823 8,122 7,463 53,924 Total earning assets 54,819 51,295 53,410 49,567 60,049 Total assets 61,056 57,801 59,523 55,744

Liabilities and

Stockholders' Equity 

Interest bearing 35,432 deposits 34,739 32,902 34,491 31,708

Noninterest bearing

7,185 deposits 7,292 7,001 7,112 6,698 42,617 Total deposits 42,031 39,903 41,603 38,406

2,674 Notes payable 2,983 2,159 2,666 2,142

Total interest bearing 46,407 liabilities 47,079 44,416 45,908 42,982

Common stockholders'

4,251 equity 4,317 4,070 4,236 3,796

Total stockholders'

4,759 equity 4,825 4,578 4,744 4,304

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Number of Employees

Dec 31 Sept 30 Dec 31

1996 1996 1995 Full time equivalent employees 22,000 22,600 23,700

Prior period results have been restated to give effect to the Corporation's acquisition of BayBanks, Inc., completed on July 29, 1996 and accounted for as a pooling of interests.

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Consolidated Statement of Income

(dollars in millions, except per share amounts) Quarters Ended Quarters Ended Twelve Months Ended September 30 December 31 December 31 1996 1996 1995 1996 1995 $1,199.5 Interest income $1,250.1 $1,278.7 $4,892.4 $5,118.9

608.1 Interest expense 638.9 705.8 2,552.8 2,870.2

591.4 Net interest revenue 611.2 572.9 2,339.6 2,248.7

Provision for credit

57.0 losses 60.0 81.0 231.0 275.0

Net interest revenue

after provision for

534.4 credit losses 551.2 491.9 2,108.6 1,973.7

Noninterest income:

Financial service

140.4 fees 146.6 230.6 473.8 695.5

61.6 Trust and agency fees 65.0 54.8 246.0 240.4

Trading profits and

20.7 commissions 17.2 9.1 75.8 24.9

Securities portfolio

7.1 gains, net (.8) 1.9 23.2 9.1

106.7 Other income 111.5 71.3 525.4 339.9

Total noninterest

336.5 income 339.5 367.7 1,344.2 1,309.8

Noninterest expense:

244.2 Salaries 254.5 243.2 983.4 946.8

49.1 Employee benefits 44.4 45.8 194.7 198.9

51.1 Occupancy expense 50.6 48.6 202.6 191.1

34.2 Equipment expense 36.2 33.8 138.6 133.1

149.0 Other expense 160.4 144.4 611.0 568.6

527.6 Subtotal  546.1 515.8 2,130.3 2,038.5

Acquisition and

reorganization-related

180.0 expenses 28.2 180.0 28.2

4.8 OREO costs 1.8 1.7 9.2 9.5

Total noninterest

712.4 expense 547.9 545.7 2,319.5 2,076.2

Income before

158.5 income taxes 342.8 313.9 1,133.3 1,207.3

Provision for

78.5 income taxes 141.3 133.6 483.1 529.0

$80.0 NET INCOME $201.5 $180.3 $650.2 $678.3

Net Income Per Common Share:

$.46 Primary $1.26 $1.09 $3.99 $4.17

$.45 Fully diluted $1.24 $1.08 $3.93 $4.09

Dividends Paid

$.44 Per Common Share $.44 $.37 $1.69 $1.28

Average number of common shares,

in thousands: 153,103 Primary 152,975 156,140 153,529 153,856 155,183 Fully diluted 155,157 157,959 156,112 156,768

Preferred

$9.4 dividends $9.4 $9.4 $37.4 $37.5

Prior period results have been restated to give effect to the Corporation's acquisition of BayBanks, Inc., completed on July 29, 1996 and accounted for as a pooling of interests.

-0-

Other Data

(dollars in millions, except per share amounts)

Twelve Months Quarter Ended Quarters Ended Ended September 30 December 31 December 31

1996 1996 1995 1996 1995

Earnings per

share before

certain items*:

$1.23 Primary $1.26 $1.09 $4.79 $4.17

$1.21 Fully diluted $1.24 $1.08 $4.71 $4.09

Return on average

total assets

(annualized):

.53% Net income 1.31% 1.24% 1.09% 1.22%

Net income before

1.31% certain items* 1.31% 1.24% 1.30% 1.22%

Return on average