CITICORP EARNS FIRST QUARTER RECORD OF $829 MILLION.NEW YORK--(BUSINESS WIRE)--April 18, 1995--Citicorp today reported net income of $829 million in the 1995 first quarter. This compares with 1994 first quarter operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before of $609 million or net income of $553 million. The percentage increases were 36% and 50% respectively. Per common share, fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. , the 1995 quarter net income was $1.53, compared with year-earlier operating earnings of $1.12, or net income of $1.01. (Net income figures for the 1994 first quarter reflect adoption of the accounting standard for postemployment benefits.) "The earnings were a record for a first quarter," said John S. Reed For other persons of the same name, see John Reed. John Shepard Reed (born 1939) is the former Chairman of the New York Stock Exchange. He previously served as Chairman and CEO of Citicorp, Citibank, and post-merger, Citigroup. , the company's chairman. "In a volatile With regard to computer memory, it means "temporary" and not "highly changeable," which is the usual meaning of the word. See volatile memory. 1. (programming) volatile - volatile variable. 2. (storage) volatile - See non-volatile storage. economic and capital markets environment, Citicorp's businesses achieved double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. revenue growth. We also continued strengthening our balance sheet, and our Tier 1 capital Tier 1 Capital A term used to describe the capital adequacy of a bank. Tier I capital is core capital, this includes equity capital and disclosed reserves. Notes: Equity capital includes instruments that can't be redeemed at the option of the holder. ratio reached 8%." RESULTS OF BUSINESS OPERATIONS Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets Global Consumer Worldwide consumer net income of $463 million represented 56% of earnings in the first quarter. Net income increased $37 million, or 9%, from the same 1994 quarter, resulting primarily from lower credit costs in developed economies and from business expansion in emerging markets. Net income from the consumer businesses in emerging markets of $189 million rose from $170 million in the 1994 first quarter because of higher volumes in Asia Pacific and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . Net income from the consumer businesses in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and
Japan also improved to $274 million from $256 million in the 1994 first
quarter because of better results from the U.S. branch business,
including mortgages, and from cards in North America and Europe.
Earnings from the Private Bank declined from the 1994 first quarter,
mainly reflecting market conditions.Worldwide consumer revenues (adjusted to exclude the effect of credit card securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. and credit-related costs) of $2.9 billion were higher by $167 million, or 6%, than in the same 1994 quarter. The increase was due mainly to the business expansion in emerging markets. Expenses grew 10%, or $153 million, to $1.6 billion to support the business expansion in emerging markets and growth in cards. Repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. strategies for U.S. bankcards, initiated in 1993 and taking effect in an improving economy, contributed to increases during the 12 months in managed receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed of $5.8 billion to $38.8 billion at March 31, 1995, up 18% from March 31, 1994 and total accounts of 3.2 million to 23.6 million, up 16%. Total charge volumes increased in the 1995 first quarter by $4.2 billion to $18.6 billion, up 29% from the same 1994 quarter. Credit costs (adjusted for card securitization) declined to $536 million, down 13% from the 1994 first quarter, because of improvements in cards and other consumer loans in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and improvements in the Private Bank. Consumer loans on the balance sheet that are delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. 90 days or more were 3.5% of total consumer loans, increased from 3.4% in the 1994 fourth quarter but below the 4.3% level at March 31, 1994. Global Finance Global Finance worldwide net income in the first quarter was $337 million, up from $261 million, an increase of 29%, reflecting higher trading revenues than in the weak 1994 first quarter. Net income from corporate banking in emerging markets increased to $208 million from $167 million in the 1994 first quarter. The increase included a gain on sale of certain real estate assets ($59 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern ). Net income from corporate banking activities in North America, Europe and Japan increased by $35 million to $129 million, as trading revenues strengthened. Worldwide corporate banking revenues (adjusted to exclude credit-related costs) amounted to $1.4 billion, a 20% rise from the year-earlier quarter. Expenses were $932 million, up 17% from the 1994 first quarter. A net credit recovery of $20 million in the 1995 quarter compared with a $58 million recovery in the 1994 first quarter. North America Commercial Real Estate The North America commercial real estate business reported break-even results, compared with a loss of $76 million in the 1994 first quarter. Improved credit costs and a gain from sale of an asset were factors in the 1995 results. Cash-basis loans and OREO of $2.3 billion at March 31, 1995 were down slightly from year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. and sharply from $3.8 billion at March 31, 1994. Cross-Border Refinancing Refinancing An extension and/or increase in amount of existing debt. Portfolio The cross-border refinancing portfolio reported net income of $66 million, compared with $49 million in the year-earlier first quarter. The results included a pretax gain of $26 million from the completion of Ecuador's refinancing package. CONSOLIDATED con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: RESULTS Revenues and Expenses Total adjusted revenues were up $530 million, or 13%, to $4.7 billion, a record for a first quarter. Trading revenues of $344 million in the quarter compared with $71 million in the 1994 first quarter. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. in the quarter, adjusted to exclude the cost of OREO, were $2.7 billion, up 11% from the 1994 first quarter but slightly lower than in the 1994 fourth quarter. The foreign currency translation effect of the weak U.S. dollar in European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. and Asian exchange markets resulted in an increase in revenues and expenses of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 2% each from the 1994 first quarter. Income Taxes The effective tax rate in the 1995 first quarter was 39%, the same as in the 1994 first quarter, compared with the 29% effective rate on current operations in the full year 1994, which included recognition of certain deferred tax benefits. The 39% represents a more normal rate. Loan Loss Reserves The loan loss reserves increased by $115 million since year- end to $5.3 billion. The reserves totaled $4.5 billion at March 31, 1994. Capital and Ratios Total regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. capital at March 31, 1995 was $26.9 billion, estimated to be 12.0% of risk-adjusted assets, and the Tier 1 capital ratio was estimated to be 8%, compared with 7.80% at the end of the 1994 fourth quarter. At March 31, 1994, the total capital ratio was 11.55% and the Tier 1 ratio was 6.86%. Accounting Change Effective January January: see month. 1, 1995, Citicorp adopted Statement of Financial Accounting Standards No. 114, "Accounting by Creditors for Impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. of a Loan," which establishes new rules for calculating certain components of the allowance for credit losses. Adoption of the new standard had no effect on the level of the overall allowance or on operating results. -0- Tables detailing key financial data, an analysis of operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: , pretax earnings, business results and credit indicators follow, along with financial statements. Further details concerning the financial results will be available in May in Citicorp's Form 10-Q Form 10-Q See 10-Q. .
KEY RATIOS & OTHER CONSOLIDATED FINANCIAL DATA
First Quarter
1995 1994
------ ------
NET INCOME ($M):
Before Cumulative Effect
of Accounting Change........... $ 829 $ 609
After Cumulative Effect
of Accounting Change(A)........ 829 553
NET INCOME PER COMMON SHARE: On Common & Common Equivalent Shares Before Cumulative Effect of Accounting Change........... $ 1.71 $ 1.24 After Cumulative Effect of Accounting Change(A)........ 1.71 1.11 Assuming Full Dilution Before Cumulative Effect of Accounting Change........... $ 1.53 $ 1.12 After Cumulative Effect of Accounting Change(A)........ 1.53 1.01 COMMON STOCKHOLDERS' EQUITY PER SHARE....................... $35.28 $27.90 CLOSING STOCK PRICE AT QUARTER END.................. $42.63 $37.50 PROFITABILITY RATIOS (Annualized): Return on Total Assets:.......... Before Accounting Change........ 1.25% 0.98% After Accounting Change(A)...... 1.25 0.95 Return on Common Stockholders' Equity: Before Accounting Change........ 21.8% 20.1% After Accounting Change(A)...... 21.8 19.5 Return on Total Stockholders' Equity: Before Accounting Change........ 18.8% 17.1% After Accounting Change(A)...... 18.8 16.7 CAPITAL: Tier 1 ($B)..................... $ 17.8 $ 14.0 Tier 1 & 2 ($B)(B).............. 26.9 23.5 Tier 1 Ratio(B)................. 8.0% 6.9% Tier 1 & 2 Ratio(B)............. 12.0 11.5 Common Equity as a % of Total Assets............. 5.2% 4.5% Total Equity as a % of Total Assets............. 6.8% 6.1% DIVIDENDS DECLARED ($M): Common........................ $ 119 $ - Preferred..................... 92 87
(A) First quarter 1994 reflects the cumulative effect of adopting
SFAS No. 112, "Employers' Accounting for Postemployment
Benefits," as of January 1, 1994.
(B) 1995 Estimated.
CONSOLIDATED STATEMENT OF INCOME CITICORP AND Subsidiaries (In Millions of Dollars, Except Per Share Amounts)
First Quarter %
1995 1994 Chg
------ ----- ---
Interest Revenue......... $ 5,597 $6,458 (13)
Interest Expense......... 3,272 4,373 (25)
------ -----
Net Interest Revenue...... 2,325 2,085 12
------ -----
Fees & Commissions....... 1,262 1,259 -
Trading Account.......... 39 5 NM
Foreign Exchange......... 305 66 NM
Securities Transactions.. 26 50 (48)
Other Revenue............ 486 396 23
------ -----
Total Fees, Commissions
and Other Revenue........ 2,118 1,776 19
------ -----
TOTAL REVENUE............. 4,443 3,861 15
------ -----
PROVISION FOR
CREDIT LOSSES............ 391 415 (6)
------ -----
Operating Expense:
Salaries................ 1,080 954 13
Employee Benefits....... 298 283 5
Net Premises &
Equipment Expense...... 410 390 5
Other Expense........... 905 820 10
------ -----
TOTAL OPERATING EXPENSE... 2,693 2,447 10
------ -----
INCOME BEFORE TAXES
AND CUMULATIVE EFFECT
OF ACCOUNTING CHANGE..... 1,359 999 36
Income Taxes............. 530 390 36
------ -----
INCOME BEFORE CUMULATIVE
EFFECT OF ACCTG CHANGE... 829 609 36
Cumulative Effect of
Accounting Change(A)..... - (56) NM
------ -----
NET INCOME................ $ 829 $ 553 50
====== =====
INCOME APPLICABLE
TO COMMON STOCK.......... $ 735 $ 466 58
====== =====
EARNINGS PER SHARE : On Common & Common Equiv. Shs Income Before Cumulative Effect of Acctg Chg..... $ 1.71 $ 1.24 Income After Cumulative Effect of Acctg Chg..... $ 1.71 $ 1.11 Assuming Full Dilution Income Before Cumulative Effect of Acctg Chg..... $ 1.53 $ 1.12 Income After Cumulative Effect of Acctg Chg..... $ 1.53 $ 1.01 (A)First quarter 1994 reflects the cumulative effect of adopting SFAS No. 112, "Employers' Accounting for Postemployment Benefits," as of January 1, 1994. NM Not meaningful as percentage exceeds 100%.
CONSOLIDATED BALANCE SHEET CITICORP and Subsidiaries
(In Millions of Dollars)
Mar. 31 Dec. 31 %
1995 1994 Chg
------- ------- ---
ASSETS
Cash and Due from Banks......... $ 6,575 $ 6,470 2
Deposits at Interest with Banks. 7,787 6,862 13
Securities:
Held to Maturity............... 5,132 5,092 1
Available for Sale............. 13,099 13,602 (4)
Venture Capital................ 1,669 2,009 (17)
Trading Account Assets.......... 51,771 38,875 33
Federal Funds Sold &
Securities Purchased
Under Resale Agreements........ 8,650 6,995 24
Loans, Net of Unearned Income
Consumer....................... 98,082 96,600 2
Commercial..................... 58,292 55,820 4
------- -------
Total Loans, Net............ 156,374 152,420 3
Allowance for Credit Losses..... (5,270) (5,155) (2)
Customers' Acceptance Liability. 1,558 1,420 10
Premises & Equipment, Net....... 4,294 4,062 6
Interest & Fees Receivable...... 2,740 2,654 3
Other Assets.................... 14,634 15,183 (4)
------- -------
Total........................... $269,013 $250,489 7
======= =======
LIABILITIES
Non-Int. Deposits (in the U.S.). $ 12,292 $ 13,648 (10)
Int. Deposits (in the U.S.)..... 35,891 35,699 1
Non-Int. Deposits (Outside the
U.S.).......................... 7,788 7,212 8
Int. Deposits(Outside the U.S.). 109,141 99,167 10
------- -------
Total Deposits.............. 165,112 155,726 6
Trading Account Liabilities..... 33,519 22,382 50 Purchased Funds & Other Borrowings............... 19,062 20,907 (9) Acceptances Outstanding......... 1,568 1,440 9 Accrued Taxes & Other Expenses.. 5,436 5,493 (1) Other Liabilities............... 8,460 8,878 (5) Long-Term Debt.................. 16,125 16,497 (2) Subordinated Capital Notes...... 1,370 1,397 (2)
STOCKHOLDERS' EQUITY
Preferred Stock
(Without Par Value)............ 4,337 4,187 4
Common Stock (Par value $1.00).. 423 421 -
Surplus......................... 4,287 4,194 2
Retained Earnings .............. 10,179 9,561 6
Net Unrealized (Losses) Gains...
Securities Available for Sale.. (58) 278 NM
Foreign Currency Translation.... (404) (471) 14
Common Stock in Treasury,
at Cost........................ (403) (401) -
------- -------
Total Stockholders' Equity.. 18,361 17,769 3
------- -------
Total........................... $269,013 $250,489 7
======= =======
NM Not meaningful as percentage exceeds 100%. ADDITIONAL FINANCIAL DATA
1Q 4Q 3Q 2Q 1Q
1995 1994 1994 1994 1994
------ ------ ------ ------ ------
NET INTEREST REVENUE(A)
Net Interest Revenue($M) $ 2,333 $ 2,328 $ 2,352 $ 2,170 $ 2,087 Net Interest Margin..... 4.23% 4.21% 4.37% 4.15% 4.01% ADJUSTED TO EXCLUDE THE EFFECT OF CREDIT CARD SECURITIZATION: Net Interest Revenue($M) $ 2,801 $ 2,798 $ 2,862 $ 2,710 $ 2,616 Net Interest Margin..... 4.61% 4.61% 4.80% 4.64% 4.52% CONSOLIDATED AVERAGE BALANCES
1Q 4Q 3Q 2Q 1Q
1995 1994 1994 1994 1994
------ ------ ------ ------ ------
Loans ($B):
Consumer............... $ 96 $ 93 $ 87 $ 84 $ 84
Commercial............. 56 56 56 55 54
------ ------ ------ ------ ------
Total Average Loans..... $ 152 $ 149 $ 143 $ 139 $ 138
====== ====== ====== ====== ======
Total Average Assets($B)............. $ 269 $ 267 $ 265 $ 258 $ 253 Avg. Interest Earning Assets($B)............. $ 224 $ 219 $ 214 $ 210 $ 211 Common Stockholders' Equity ($M)............ $13,653 $13,003 $12,023 $11,049 $10,562
Preferred Equity ($M)... 4,262 4,187 4,116 3,975 3,887
------ ------ ------ ------ ------
Total Average
Stockholders'
Equity ($M)............ $17,915 $17,190 $16,139 $15,024 $14,449
====== ====== ====== ====== ======
(A) Taxable Equivalent Basis. EARNINGS PER SHARE DATA(A) (Before Cumulative Effect of Accounting Change in 1994)
First Quarter
1995 1994
------- -------
On Common and Common
Equivalent Shares:
Earnings($ Millions).. $ 759 $ 546 Shares (in thousands). 444,489 441,894 Earnings Per Share.... $ 1.71 $ 1.24 Assuming Full Dilution: Earnings($ Millions).. $ 793 $ 580 Shares (in thousands). 517,928 517,717 Earnings Per Share.... $ 1.53 $ 1.12 COMMON SHARES OUTSTANDING (In Thousands) End-Of-Period.......... 397,468 389,280
(A) For earnings per share on common and common equivalent
shares, dividends on Conversion Preferred Stock, Series 15
($24 million in the first quarter of 1995 and 1994) are
added back to income applicable to common stock, and the
number of shares issuable on conversion (38 million shares
in the first quarter of 1995 and 43 million shares in
the first quarter of 1994) are added back to weighted
average shares outstanding. Also added to shares outstanding
are other common equivalent shares and, as to the
undistributed portion of earnings, book value shares issuable
under certain benefit plans. For earnings per share assuming
full dilution, the number of shares issuable on conversion of
the Preferred Stock, Series 15 are 38 million shares
in the first quarter of 1995 and 46 million shares in the
first quarter of 1994. Additionally, dividends on
Convertible Preferred Stock, Series 12 and 13 ($34 million
in the first quarter of 1995 and 1994) are also added back
to income applicable to common stock, and the shares
issuable on conversion (73 million shares) are added to
shares outstanding. The number of common equivalent and
book value shares are calculated on a fully diluted basis
as well.
CONTACT: Citicorp, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Press contact: John M. Morris, (212) 559-9425 Investor contact: Frederick Frederick, city, United States Frederick, city (1990 pop. 40,148), seat of Frederick co., NW Md.; settled 1745, inc. 1817. The processing center of a fertile farm and dairying area, it makes beer, household items, optical and glass products, leather goods, A. Roesch, (212) 559-2715 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion