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CULLEN/FROST REPORTS FOURTH QUARTER EARNINGS

 SAN ANTONIO, Texas, Jan. 14 /PRNewswire/ -- Cullen/Frost Bankers, Inc. (NASDAQ-NMS: CFBI), today reported net income of $8.0 million, or $.82 per common share, for the fourth quarter of 1992, compared with $7.4 million, or $.76 per common share, for the third quarter of 1992 and $2.1 million or $.23 per common share for the fourth quarter of 1991.
 Net income for the year is $24.1 million, or $2.48 per common share, compared with $205,000, or $.02 per common share, for 1991. Last year's results were negatively affected by a $5.4 million settlement on a nine- year-old lawsuit.
 "These results exceed annual earnings for every year since 1982. Profits for the fourth quarter reflect the highest quarterly earnings ever reported by the corporation," said T. C. Frost, chairman of the board. "Steady improvements in operating income and asset quality were realized."
 Comparing the year-end results of 1991 and 1992, the principal factors contributing to the increased earnings included increases in both net interest income and non-interest income, as well as lower combined provisions for loan losses and real estate valuations.
 At year-end 1992, non-performing assets were $51 million, down nearly 50 percent from the $101 million a year ago. Non-performing assets are at the lowest level since September 1982. During 1992, sales of foreclosed assets were $20.2 million, 42 percent ahead of sales for the previous year.
 Other financial highlights include:
 -- Capital ratios improved. At year-end 1992, equity to assets rose to 6.54 percent from 5.72 percent a year ago, and capital reached the highest level in the corporation's history at $206 million. The corporation is "well capitalized" as defined by regulatory guidelines, the highest rating.
 -- Net interest income on a non-taxable equivalent basis was $116.7 million for the year, compared with $108.5 million for 1991.
 -- Non-interest income for 1992 totaled $61.8 million compared with $57.5 million for 1991.
 -- The combined provision for possible loan losses and real estate valuations for 1992 was $18.5 million, down from $30.8 million last year.
 -- Net charge-offs for the year totaled $9.6 million, down from $13.2 million for the year ended 1991.
 -- The reserve for loan losses stood at $31.9 million at Dec. 31, 1992, and covered 138 percent of non-accrual and restructured loans. At the end of last year, reserves were $42.4 million and covered 116 percent of non-accrual and restructured loans.
 Cullen/Frost also announced that it is required to adopt Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" beginning with the first quarter of 1993. The one-time cumulative effect of adopting this statement will be to increase net income for the next reporting period (first quarter of 1993) by approximately $8 million or $.84 per common share based on shares outstanding at year end. The corporation may recognize additional deferred tax assets during 1993. The recognition of these deferred tax assets, which are reserved at Jan. 1, 1993, would result in an effective tax rate for 1993 that is substantially lower than statutory rates.
 Cullen/Frost Bankers, Inc., is a multi-bank holding company with assets of $3.2 billion at Dec. 31, 1992. The corporation has four member banks and 23 offices in the five major Texas banking markets -- San Antonio, Houston/Galveston, Austin, Corpus Christi and Dallas.
 Cullen/Frost Bankers' stock is traded in the over-the-counter (OTC) market under the NASDAQ symbol CFBI.
 CULLEN/FROST BANKERS, INC.
 Consolidated Financial Summary (Unaudited)
 ----------------1992----------------- 1991
 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
 CONDENSED INCOME
 STATEMENTS (in
 thousands of dollars)
 Net interest inc. $29,687 $29,251 $28,894 $28,825 $27,803
 Net int. inc. (A) 29,950 29,523 29,175 29,138 28,219
 Prov. for possible
 loan losses 200 1,000 418 (2,468) 225
 Non-interest income 16,250 15,911 15,549 14,103 14,157
 Provision for real
 estate losses 1,730 3,365 5,036 9,180 6,498
 Non-int. exp. (B) 34,547 33,200 33,600 32,840 32,776
 Net income 8,041 7,403 5,340 3,338 2,104
 PER COMMON SHARE DATA
 Net income-Primary $ .82 $ .76 $ .55 $ .36 $ .23
 Shareholders' equity 21.78 20.99 20.20 19.64 19.30
 Average common and
 common equivalent
 shares 10,052,327 9,960,498 9,276,990
 10,009,962 9,852,490
 BALANCE SHEET SUMMARY
 (in millions of dollars)
 Average Balance:
 Loans $1,009 $1,006 $1,031 $1,054 $1,073
 Earning assets 2,697 2,644 2,603 2,605 2,625
 Total assets 3,117 3,060 3,010 3,033 3,058
 Private deposits 2,637 2,585 2,569 2,597 2,619
 Public funds 114 117 113 111 105
 Total deposits 2,751 2,702 2,682 2,708 2,724
 Period-End Balance:
 Loans $1,011 $1,010 $1,009 $1,032 $1,073
 Earning assets 2,708 2,631 2,597 2,603 2,611
 Total assets 3,151 3,064 3,025 3,046 3,079
 Total deposits 2,769 2,718 2,692 2,727 2,766
 Shareholders' equity 206 195 186 180 176
 CAPITAL RATIOS - 1992 RULES
 (in percent)
 Tier 1 Capital Ratio 15.66 15.63 14.67 13.71 12.98
 Total Capital Ratio 17.52 17.57 16.61 15.79 15.04
 Leverage Ratio 6.43 6.19 5.99 5.74 5.56
 SELECTED FINANCIAL DATA
 (in thousands of dollars)
 Return on average
 assets (in pct) 1.03 .96 .71 .44 .27
 Return on average
 equity (in pct) 15.61 15.14 11.48 7.40 4.71
 Net interest income
 to average earning
 assets (A) (in pct) 4.43 4.45 4.49 4.48 4.29
 Allowance for possible
 loan losses $31,897 $33,678 $34,245 $36,864 $42,387
 As a percentage of
 period-end loans 3.15 3.33 3.39 3.57 3.95
 Net charge-offs:
 Real estate $ 2,142 $ 214 $ 2,444 $ (453) $ 1,990
 Commercial
 and industrial (164) 543 372 (328) (847)
 Energy (31) (14) (3) (97) 20
 Consumer 13 827 233 292 342
 Other 21 (3) (9) 3,641 47
 Total $ 1,981 $ 1,567 $ 3,037 $ 3,055 $ 1,552
 As a percentage of
 average loans .78 .62 1.18 1.17 .57
 Non-performing assets:
 Non-accrual loans $23,117 $33,224 $34,505 $38,699 $ 36,172
 Restructured loans 31 31 32 32 313
 Foreclosed assets,
 net of allowance 28,155 31,187 42,064 48,620 64,157
 Total $51,303 $64,442 $76,601 $87,351 $100,642
 As a percentage of:
 Total assets 1.63 2.10 2.53 2.87 3.27
 Total loans plus
 foreclosed assets 4.94 6.19 7.29 8.09 8.85
 (A) -- Taxable-equivalent basis assuming a 34 percent tax rate.
 (B) -- Excluding the provision for real estate losses.
 -------------Year Ended Dec. 31-------------
 1992 1991 1990 1989 1988
 CONDENSED INCOME
 STATEMENTS (in
 thousands of dollars)
 Net interest inc. $116,657 $108,514 $110,044 $106,960 $ 97,923
 Net int. inc. (A) 117,786 110,654 112,923 110,546 101,713
 Prov. for possible
 loan losses (850) 10,020 31,993 28,902 27,224
 Non-interest income 61,813 57,482 50,592 50,480 53,297
 Provision for real
 estat Net income (loss) 24,122 205 (8,220) 2,673 2,40


3
 PER COMMON SHARE DATA
 Net income (loss)-
 Primary $ 2.48 $ .02 $ (.94) $ .31 $ .28
 Shareholders' equity 21.78 19.30 19.57 20.81 20.69
 Cash dividends -0- -0- -0- -0- -0-
 Average common and
 common equivalent
 shares 9,976,663 8,774,493 8,452,351
 9,159,330 8,651,201
 BALANCE SHEET SUMMARY
 (in millions of dollars)
 Average Balance:
 Loans $1,025 $1,149 $1,315 $1,407 $1,567
 Earning assets 2,637 2,681 2,873 3,071 2,947
 Total assets 3,055 3,105 3,289 3,455 3,273
 Private deposits 2,597 2,619 2,714 2,713 2,527
 Public funds 114 139 154 150 150
 Total deposits 2,711 2,758 2,868 2,863 2,677
 Shareholders' equity 192 176 178 178 173
 Period-End Balance:
 Loans $1,011 $1,073 $1,268 $1,370 $1,565
 Earning assets 2,708 2,611 2,781 3,076 3,025
 Total assets 3,151 3,079 3,255 3,505 3,386
 Total deposits 2,769 2,766 2,878 2,980 2,851
 Shareholders' equity 206 176 173 179 175
 SELECTED FINANCIAL DATA
 (in thousands of dollars)
 Return on average
 assets (in pct) .79 .01 N/A .08 .07
 Return on average
 equity (in pct) 12.56 .12 N/A 1.51 1.39
 Net interest income
 to average earning
 assets (A) (in pct) 4.47 4.13 3.93 3.60 3.45
 Allowance for possible
 loan losses $31,897 $42,387 $45,604 $42,282 $40,702
 As a percentage of
 period-end loans 3.15 3.95 3.60 3.09 2.60
 Net charge-offs:
 Real estate $ 4,347 $ 8,057 $11,023 $16,039 $12,864
 Commercial
 and industrial 423 1,992 11,317 5,404 11,833
 Energy (145) (2) (722) 1,092 (5,296)
 Consumer 1,365 2,006 2,455 2,327 2,071
 Other 3,650 1,184 4,598 3,270 804
 Total $ 9,640 $13,237 $28,671 $28,132 $22,276
 As a percentage of
 average loans .94 1.15 2.18 2.00 1.42
 Non-performing assets:
 Non-accrual loans $23,117 $ 36,172 $ 52,557 $ 59,223 $62,774
 Restructured loans 31 313 178 17,170 6,768
 Foreclosed assets,
 net of
 allowance (C) 28,155 64,157 69,130 55,340 28,637
 Total $51,303 $100,642 $121,865 $131,733 $98,179
 As a percentage of:
 Total assets 1.63 3.27 3.74 3.76 2.90
 Total loans plus
 foreclosed assets 4.94 8.85 9.11 9.24 6.16
 (A) -- Taxable-equivalent basis assuming a 34 percent tax rate.
 (B) -- Excluding the provision for real estate losses.
 (C) -- Foreclosed assets include $18.7 million, $42.0 million, $31.2 million and $16.2 million of in-substance foreclosures at Dec. 31, 1992, 1991, 1990 and 1989, respectively.
 -0- 1/14/93
 /CONTACT: John D. Gellhausen of Cullen/Frost Bankers, 210-220-4878; or Tammy Valentine of Dublin-McCarter & Associates, 210-227-0221, for Cullen/Frost Bankers/
 (CFBI)


CO: Cullen/Frost Bankers, Inc. ST: Texas IN: FIN SU: ERN

GK -- NY012 -- 4778 01/14/93 10:17 EST
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