Chase Reports Second Quarter Operating EPS of $0.95; Cash Return On Equity of 23 Percent.Business Editors NEW YORK--(BUSINESS WIRE)--July 19, 2000 The Chase Manhattan Corporation The Chase Manhattan Corporation was a bank holding company formed as parent of the Chase Manhattan Bank. During its time as the parent company, it was led in succession by David Rockefeller, Willard C. Butcher, and Thomas G. Labrecque. (NYSE NYSE See: New York Stock Exchange :CMB Noun 1. CMB - (cosmology) the cooled remnant of the hot big bang that fills the entire universe and can be observed today with an average temperature of about 2. ) today announced 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. 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 per share of $0.95 for the second quarter of 2000, down eight percent from $1.03 per share for the same 1999 period. For the first six months of 2000, diluted operating earnings per share rose five percent to $2.01 from $1.91 in the first six months of 1999. Operating earnings in the 2000 second quarter were $1.22 billion, compared to $1.35 billion in the same 1999 quarter. For the first six months of 2000, operating earnings rose to $2.58 billion. Reported net income per share, which includes nonrecurring Non`re`cur´ring a. 1. Nonrecurrent; as, the costs of a layoff are considered as a nonrecurring expense s>. items, was $0.85 and $1.92 for the second quarter and first half of 2000, respectively, compared with $1.06 and $1.95 in the 1999 second quarter and first half, respectively. Reported net income in the 2000 second quarter was $1.09 billion compared with $1.39 billion in the 1999 second quarter; net income for the first half of 2000 was $2.45 billion and $2.57 billion in the same period of 1999. "Our cash return on equity of twenty-three percent this quarter demonstrates the resilience resilience (r  ·zilˑ·yens),n and strong competitive position of Chase's businesses," said William B. Harrison William Benjamin Harrison was mayor of Louisville, Kentucky from 1927 to 1933. He graduated from Louisville Male High School in 1907 and the University of Virginia School of Law in 1910. He served as a captain in the United States Army during World War I. , Jr., Chairman and Chief Executive Officer. "And with the acquisition of The Beacon Beacon, city (1990 pop. 13,243), Dutchess co., SE N.Y., on the E bank of the Hudson River; settled 1663, inc. in 1913 when Fishkill Landing and Matteawan villages were united. Group on July July: see month. 6 and the anticipated acquisition of Flemings on August 1, we are strengthening Chase's ability to benefit from the growth occurring in the global securities markets. We will continue to reposition and strengthen our franchises with a focus on financial discipline."
Financial Performance
THE CHASE MANHATTAN CORP Second Quarter Six Months
(dollars in millions,
except per share amounts) 2000 O(U)1999 2000 O(U)1999
---- -------- ---- --------
Operating Revenues $5,799 2% $11,978 8%
Cash Operating Earnings 1,299 (9) 2,744 3
Cash Operating Earnings
Per Share(a) 1.02 (6) 2.15 6
Shareholder Value Added 542 (22) 1,243 4
Cash Return on Common Equity 23% (320)bp 24% 20bp
(a) All per share results are on a diluted basis and reflect a
three-for-two stock split that became effective June 9, 2000.
Line-Of-Business Results
GLOBAL BANK(a) Second Quarter Six Months
(dollars
in millions) 2000 O(U)1999 O(U)1Q2000 2000 O(U) 1999
---- -------- ---------- ---- ---------
Operating Revenues $2,257 11% (12)% $4,833 $700 17%
Cash Operating
Earnings 559 (2) (22) 1,272 84 7
Shareholder Value
Added 246 (5) (38) 642 86 15
Cash Return on Common
Equity 23% (60)bp (610)bp 27% 180bp --
(a) excludes Chase Capital Partners
Operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. in the Global Bank, excluding Chase Capital Partners, were $2.26 billion in the second quarter of 2000, 11 percent higher than in the 1999 second quarter. On the same basis, cash operating earnings in the second quarter of 2000 were $559 million, compared with $571 million in the second quarter of 1999, reflecting increased cash expenses. -- Total assets at June 30, 2000 were $396 billion compared with $391 billion at March 31, 2000 and $357 billion from a year ago. Chase's Tier One capital ratio was 8.6 percent at June 30, 2000, compared with 8.6 percent on March 31, 2000. There were no repurchases of Chase common stock during the 2000 second quarter in anticipation of the acquisition of Robert Fleming Holdings Limited. -- On a managed basis, including securitizations, net credit losses were $574 million in the second quarter of 2000, down from $596 million in the first quarter of 2000 and down from $634 million from the second quarter of 1999. Consumer net charge-offs on a managed basis were $482 million, down from $524 million in the first quarter of 2000 and $523 million in the fourth quarter of 1999, primarily reflecting a decline in the second quarter of 2000 in the credit card net charge-off ratio to 5.09 percent. Commercial net charge-offs in the second quarter of 2000 were $92 million, compared with $72 million in the first quarter of 2000 and $86 million in the second quarter of 1999. For the second quarter of 2000, total net charge-offs on a reported basis were $332 million, and the provision for loan losses was $332 million. The allowance for loan losses was $3.46 billion at the end of the second quarter, unchanged from the prior quarter. Nonperforming assets at June 30, 2000 were $1.90 billion compared with $1.70 billion at March 31, 2000 and $1.63 billion at June 30, 1999. -- Global Private Bank revenues increased to $285 million, a 33 percent increase from the same period a year ago, due to broad-based broad-based Of or relating to an index or average that provides a good representation of the overall market. The S&P 500 and NYSE Composite are generally regarded as broad-based stock indexes, while the popular Dow Jones Industrial Average is biased growth globally and the inclusion of the revenues from the Executive Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Division at Chase H&Q. As of June June: see month. 30, the Global Private Bank had over $170 billion in client assets. -- Cash expenses of $1.32 billion in the second quarter of 2000 were up 26 percent from the second quarter of last year, but down $60 million from the first quarter of 2000. The principal reasons for the increase were higher incentives related to market sensitive revenue growth and the acquisition of Hambrecht & Quist.
CHASE CAPITAL PARTNERS Second Quarter Six Months
(dollars in millions) 2000 O(U)1999 O(U)1Q2000 2000 O(U) 1999
---- -------- ---------- ---- ----------
Operating Revenues(a) $249 (50)% (45)% $698 $(110) (14)%
Cash Operating Earnings 130 (56) (46) 370 (99) (21)
Shareholder Value Added (78) n/m n/m (35) (261) n/m
Cash Return on Common
Equity 8% (2300)bp (790)bp 12% (1350)bp --
(a)Operating revenues include private equity gains and other
income net of borrowing costs to fund the portfolio of investments
Net gains on private equity-related investments in the second quarter of 2000 were $298 million, down from $513 million in the same 1999 quarter and $500 million in the 2000 first quarter. Net gains include cash realized from the sale of both public and private securities that were held in the portfolio and unrealized changes in the market value of securities including, appreciation as a result of initial public offerings. Realized cash gains on the sale of securities in the second quarter of 2000 were $350 million, compared with $207 million in the same period a year ago and $341 million in the first quarter of 2000. Approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 75 percent of the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of the Chase Capital Partners portfolio consists of privately-held securities. Volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the in the financial markets during the second quarter principally affected the remaining 25 percent of the portfolio, which is publicly-held.
GLOBAL SERVICES Second Quarter Six Months
(dollars in millions) 2000 O(U)1999 O(U)1Q2000 2000 O(U)1999
---- -------- ---------- ---- --------
Operating Revenues $877 14% 3% $1,726 $231 15%
Cash Operating Earnings 163 20 9 313 69 28
Shareholder Value Added 75 83 25 135 82 155
Cash Return on Common
Equity 24% 540bp 230bp 23% 630bp --
In the second quarter of 2000, Global Services' operating revenues increased 14 percent over the prior-year quarter to $877 million, reflecting increased activity in all of its businesses. Operating revenues in Global Investor Services (custody The care, possession, and control of a thing or person. The retention, inspection, guarding, maintenance, or security of a thing within the immediate care and control of the person to whom it is committed. The detention of a person by lawful authority or process. ), Capital Markets Fiduciary fiduciary (fĭd  `shēĕ'rē), in law, a person who is obliged to discharge faithfully a responsibility of trust toward another. Services (institutional trust) and Chase Treasury
Solutions (cash management) were up 18 percent, 14 percent and eight
percent, respectively, compared with the 1999 second quarter. Cash
operating earnings for Global Services for the second quarter of 2000
were up 20 percent compared with the 1999 second quarter. Shareholder
value added Value AddedThe enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. increased to $75 million, an 83 percent increase over the prior-year quarter.
NATIONAL CONSUMER SERVICES Second Quarter Six Months
(dollars in millions) 2000 O(U)1999 O(U)1Q2000 2000 O(U)1999
---- -------- ---------- ---- ---------
Operating Revenues $2,507 1% 5% $4,899 $24 --%
Cash Operating Earnings 443 6 26 795 (15) (2)
Shareholder Value Added 175 8 106 260 (47) (15)
Cash Return on Common
Equity 22 20bp 450bp 19% (170)bp --
Operating revenues for National Consumer Services Consumer Services refers to the formulation, deformulation, technical consulting and testing of most consumer products, such as food, herbs, beverages, vitamins, pharmaceuticals, cosmetics, hair products, household cleaners, [paints, plastics, metals, waxes, coatings, minerals, increased to $2.5 billion, an increase of one percent over the second quarter of 1999. Cash operating earnings of $443 million increased by six percent. This increase was driven by regional banking, the retail investment businesses and middle market banking, partially offset by continuing weak auto origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real volumes and pressures on credit card margins due to rising interest rates. -- Total assets at June 30, 2000 were $396 billion compared with $391 billion at March 31, 2000 and $357 billion from a year ago. Chase's Tier One capital ratio was 8.6 percent at June 30, 2000, compared with 8.6 percent on March 31, 2000. There were no repurchases of Chase common stock during the 2000 second quarter in anticipation of the acquisition of Robert Fleming Holdings Limited. -- On a managed basis, including securitizations, net credit losses were $574 million in the second quarter of 2000, down from $596 million in the first quarter of 2000 and down from $634 million from the second quarter of 1999. Consumer net charge-offs on a managed basis were $482 million, down from $524 million in the first quarter of 2000 and $523 million in the fourth quarter of 1999, primarily reflecting a decline in the second quarter of 2000 in the credit card net charge-off ratio to 5.09 percent. Commercial net charge-offs in the second quarter of 2000 were $92 million, compared with $72 million in the first quarter of 2000 and $86 million in the second quarter of 1999. For the second quarter of 2000, total net charge-offs on a reported basis were $332 million, and the provision for loan losses was $332 million. The allowance for loan losses was $3.46 billion at the end of the second quarter, unchanged from the prior quarter. Nonperforming assets at June 30, 2000 were $1.90 billion compared with $1.70 billion at March 31, 2000 and $1.63 billion at June 30, 1999. -- Regional banking group revenues rose 11 percent from the second quarter of 1999 and cash operating earnings grew by 26 percent, reflecting higher deposit levels in the small business sector, the benefit from higher interest rates, growth in fees and disciplined expense management. -- Revenues from diversified diversified (di·verˑ·s consumer services were $281 million in the second quarter, down one percent from the same 1999 quarter. Continued growth in the investment businesses were partially offset by the effect of higher interest rates and weak auto lease origination activity. Brown & Co., Chase's online trading Online Trading Making trades via the Internet. Notes: The use of online trading increased dramatically in the mid to late 1990's with the advent of high-speed computers and Internet connections. Stocks, bonds, options, futures, and currencies can all be traded online. business, averaged over 46,000 trades per day during the second quarter of 2000 versus 33,000 trades per day during the same period in 1999. -- Middle Market revenues were $270 million, up four percent from the second quarter of 1999. Cash operating earnings increased 11 percent over the prior-year quarter. These results reflect disciplined expense management and continued strength in new business and financing activity. Additional Financial Information -- Total assets at June 30, 2000 were $396 billion compared with $391 billion at March 31, 2000 and $357 billion from a year ago. Chase's Tier One capital ratio was 8.6 percent at June 30, 2000, compared with 8.6 percent on March 31, 2000. There were no repurchases of Chase common stock during the 2000 second quarter in anticipation of the acquisition of Robert Fleming Holdings Limited. -- On a managed basis, including securitizations, net credit losses were $574 million in the second quarter of 2000, down from $596 million in the first quarter of 2000 and down from $634 million from the second quarter of 1999. Consumer net charge-offs on a managed basis were $482 million, down from $524 million in the first quarter of 2000 and $523 million in the fourth quarter of 1999, primarily reflecting a decline in the second quarter of 2000 in the credit card net charge-off ratio to 5.09 percent. Commercial net charge-offs in the second quarter of 2000 were $92 million, compared with $72 million in the first quarter of 2000 and $86 million in the second quarter of 1999. For the second quarter of 2000, total net charge-offs on a reported basis were $332 million, and the provision for loan losses was $332 million. The allowance for loan losses was $3.46 billion at the end of the second quarter, unchanged from the prior quarter. Nonperforming assets at June 30, 2000 were $1.90 billion compared with $1.70 billion at March 31, 2000 and $1.63 billion at June 30, 1999. -- Total operating noninterest expenses increased 13 percent to $3.36 billion in the second quarter of 2000, reflecting higher incentives related to increased business volumes, the impact of acquisitions and the build up of the investment banking business platform. -- Operating results (revenues, expenses and earnings) exclude the impact of credit card securitizations, restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). costs and special items. In the second quarter of 2000, special items include a loss of $92 million (after tax) resulting from the economic hedge of the purchase price of Fleming Flem·ing , Sir Alexander 1881-1955. British bacteriologist who discovered penicillin in 1928. He shared a 1945 Nobel Prize for this achievement. prior to its acquisition and $32 million (after tax) of restructuring costs associated with previously announced relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. initiatives. In the second quarter of 1999, special items included a $61 million (after tax) gain on the sale of a building, a $46 million (after tax) gain on the sale of branches in Texas, and a $65 million (after tax) special contribution to The Chase Manhattan Manhattan, indigenous people of North America Manhattan (mănhăt`ən), indigenous people of North America of the Algonquian-Wakashan linguistic stock (see Native American languages). Foundation. -- Chase's 2000 results include the results for Chase H&Q, which was acquired on December December: see month. 9, 1999 and the mortgage business of Mellon Bank N.A., which was acquired on September September: see month. 30, 1999. Chase's proposed acquisition of Robert Fleming Robert Fleming is the name of:
expected to be completed on August 1, 2000. The acquisition of The Beacon Group, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , a privately-held investment firm, closed on July 6. -- Shareholders approved a three-for-two stock split at the corporation's annual meeting on May 16, 2000. The record date for the split was May 17, 2000 and the additional shares issued as a result of the split were distributed on June 9, 2000. All per share results have been restated to reflect the three-for-two stock split. The Chase Manhattan Corporation (www.chase.com) is a premier global financial services firm with assets in excess of $396 billion. Chase combines the best of commercial and investment banking, offers world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. information and transaction processing Updating the appropriate database records as soon as a transaction (order, payment, etc.) is entered into the computer. It may also imply that confirmations are sent at the same time. Transaction processing systems are the backbone of an organization because they update constantly. services, and has a leading U.S. consumer franchise that serves over 30 million customers. Through its newly formed business unit Chase.com, Chase is successfully creating innovative business models for the New Economy. Chase, with offices in more than 45 countries, has a presence in all of the principal financial centers around the world. A live audio webcast of Chase's second quarter analyst presentation will be available in the investor relations Investor relations The process by which the corporation communicates with its investors. site of www.chase.com at 11 a.m. on July 19, 2000. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . Those statements are based on management's current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. For a discussion of certain factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to Chase's filings with the Securities and Exchange Commission, particularly the section entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: "Important Factors that May Affect Future Results" in Chase's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1999.
The Chase Manhattan Corporation
Summary of Selected Financial Highlights
(in millions, except per share and ratio data)
%
As of or for the period ended Second Quarter Over/(Under)
-------------------------
2000 1999 1999
---------- ----------- ---------
OPERATING BASIS (a)
Operating Revenue $ 5,799 $ 5,696 2%
Operating Noninterest Expense 3,357 2,968 13%
Credit Costs (b) 574 634 (9%)
Operating Earnings $ 1,215 $ 1,351 (10%)
Operating Earnings Per Share:
Basic $ 0.98 $ 1.07 (8%)
Diluted 0.95 1.03 (8%)
Cash Operating Earnings $ 1,299 $ 1,427 (9%)
Cash Operating Earnings Per Share
- Diluted 1.02 1.09 (6%)
Shareholder Value Added (SVA) 542 696 (22%)
Operating Performance Ratios:
Return on Average
Managed Assets (c) 1.18 % 1.43 %
Cash Return on
Average Common Equity (c) 22.5 25.7
Common Dividend Payout Ratio 33 26
Overhead Ratio (d) 58 52
----------------------------------------------------------------------
REPORTED BASIS
Revenue $ 5,416 $ 5,616 (4%)
Noninterest Expense
(Excluding Restructuring Costs) 3,357 3,068 9%
Restructuring Costs 50 - NM
Provision for Loan Losses 332 388 (14%)
Net Income $ 1,091 $ 1,393 (22%)
Net Income Per Share:
Basic $ 0.88 $ 1.10 (20%)
Diluted 0.85 1.06 (20%)
Cash Dividends Declared 0.32 0.27 19%
Common Shares Outstanding:
Average Common Shares:
Basic 1,217.8 1,249.3 (3%)
Diluted 1,259.5 1,292.0 (3%)
Performance Ratios:
Return on Average
Total Assets (c) 1.11 % 1.55 %
Return on Average
Common Equity (c) 18.9 25.1
%
%
As of or for the period ended Six Months Over/(Under)
---------------------------
2000 1999 1999
------------ ----------- ---------
OPERATING BASIS (a)
Operating Revenue $ 11,978 $ 11,109 8%
Operating Noninterest Expense 6,847 5,913 16%
Credit Costs (b) 1,170 1,284 (9%)
Operating Earnings $ 2,575 $ 2,524 2%
Operating Earnings Per Share:
Basic $ 2.08 $ 1.98 5%
Diluted 2.01 1.91 5%
Cash Operating Earnings $ 2,744 $ 2,673 3%
Cash Operating Earnings
Per Share - Diluted 2.15 2.03 6%
Shareholder Value Added (SVA) 1,243 1,197 4%
Operating Performance Ratios:
Return on Average
Managed Assets (c) 1.26 % 1.33 %
Cash Return on
Average Common Equity (c) 24.0 23.8
Common Dividend Payout Ratio 31 28
Overhead Ratio (d) 57 53
Selected Balance Sheet
Items at Period End: (e)
-----------------------
Managed Loans $ 200,033 $ 191,985 4%
Total Managed Assets 415,906 373,812 11%
----------------------------------------------------------------------
REPORTED BASIS
Revenue $ 11,341 $ 10,760 5%
Noninterest Expense
(Excluding Restructuring Costs) 6,847 6,013 14%
Restructuring Costs 50 - NM
Provision for Loan Losses 674 769 (12%)
Net Income $ 2,451 $ 2,566 (4%)
Net Income Per Share:
Basic $ 1.98 $ 2.01 (1%)
Diluted 1.92 1.95 (2%)
Cash Dividends Declared 0.64 0.54 19%
Share Price at Period End 46.06 57.67 (20%)
Book Value at Period End 19.43 17.36 12%
Common Shares Outstanding:
Average Common Shares:
Basic 1,219.2 1,257.3 (3%)
Diluted 1,262.6 1,299.9 (3%)
Common Shares at Period End 1,238.2 1,248.7 (1%)
Performance Ratios:
Return on Average
Total Assets (c) 1.25 % 1.42 %
Return on Average
Common Equity (c) 21.4 22.8
Selected Balance Sheet
Items at Period End:
Loans $ 180,172 $ 175,041 3%
Total Assets 396,045 356,868 11%
Deposits 224,405 209,502 7%
Total Stockholders' Equity 24,884 22,708 10%
Capital Ratios:
Tier I Capital Ratio 8.6 %(f) 8.4 %
Total Capital Ratio 12.3 (f) 12.0
Tier I Leverage 6.8 (f) 6.8
Note: On May 16, 2000, stockholders of Chase approved a 3-for-2 common
stock split. The additional shares issued as a result of the split
were distributed on June 9, 2000 to stockholders of record at the
close of business on May 17, 2000. Share-related data for all periods
have been restated.
(a) Excludes the impact of credit card securitizations, restructuring
costs and special items. For a reconciliation of Reported Results as
shown on the Consolidated Statement of Income to results on an
Operating Basis, see the OPERATING INCOME RECONCILIATION schedule.
(b) Includes provision for loan losses and credit costs related to the
securitized credit card portfolio.
(c) Based on annualized amounts.
(d) Noninterest expense as a percentage of the total of net interest
income and noninterest revenue (excluding restructuring costs, special
items and costs associated with the REIT).
(e) Excludes the impact of credit card securitizations.
(f) Estimated
NM - Not meaningful
Unaudited
THE CHASE MANHATTAN CORPORATION
LINES OF BUSINESS RESULTS
(in millions, except ratios)
Global Bank (a) Chase Capital Partners
---------------------- -----------------------
Second Quarter 2000 Over/(Under) 1999 2000 Over/(Under) 1999
-------------- ---------------------- -----------------------
Operating Revenue $ 2,257 $ 217 11% $ 249 $ (254) (50)%
Operating Earnings 540 (19) (3) 128 (169) (57)
Cash Operating
Earnings 559 (12) (2) 130 (167) (56)
Average Common Equity 9,485 66 1 6,297 2,492 65
Average Managed
Assets (b) 240,129 20,649 9 11,780 4,172 55
Shareholder Value
Added (SVA) 246 (12) (5) (78) (249) NM
Cash Return
on Common Equity 23.4% (60)bp 8.0% (2,300)bp
Cash Overhead Ratio 58 700 20 1,200
National Consumer Services Global Services
---------------------- -----------------------
Second Quarter 2000 Over/(Under)1999 2000 Over/(Under)1999
-------------- ---------------------- -----------------------
Operating Revenue $ 2,507 $ 34 1% $ 877 $ 106 14%
Operating Earnings 406 32 9 147 27 23
Cash Operating
Earnings 443 27 6 163 27 20
Average Common Equity 8,117 483 6 2,677 (176) (6)
Average Managed
Assets (b) 144,259 15,345 12 15,737 (767) (5)
Shareholder Value
Added (SVA) 175 13 8 75 34 83
Cash Return on
Common Equity 21.7% 20bp 24.2% 540bp
Cash Overhead Ratio 51 100 71 (100)
GLOBAL BANK - KEY FINANCIAL MEASURES (a)
Second Quarter 2000
--------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
------------------------------------------
Global Markets $ 996 $ 294 55%
Global Investment
Banking 650 121 68
Corporate Lending and
Portfolio Management 363 125 29
Global Private Bank 285 56 66
Other Global Bank (37) (37) NM
----------- ----------
Totals $ 2,257 $ 559 58%
=========== ==========
Over/(Under) 1999
-------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
--------------------------------------
Global Markets (1)% (10)% 600bp
Global Investment
Banking 37 5 1,000
Corporate Lending and
Portfolio Management (3) (3) 100
Global Private Bank 33 44 (200)
Other Global Bank NM NM NM
Totals 11% (2)% 700bp
NATIONAL CONSUMER SERVICES - KEY FINANCIAL MEASURES
Second Quarter 2000
--------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
---------------------------------------
Chase Cardmember Services $ 941 $ 133 36%
Regional Banking Group 647 123 65
Chase Home Finance 318 74 60
Diversified Consumer Services 281 40 60
Middle Markets 270 63 55
Other NCS 50 10 NM
----------- -----------
Totals $ 2,507 $ 443 51%
=========== ===========
Over/(Under) 1999
----------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
----------------------------------------
Chase Cardmember Services (6)% 3% 200bp
Regional Banking Group 11 26 (500)
Chase Home Finance 8 - 400
Diversified Consumer Services (1) (2) 300
Middle Markets 4 11 (100)
Other NCS NM NM NM
Totals 1% 6% 100bp
----------------------------------------------------------------------
Note: SVA is Chase's primary measure of business unit performance.
SVA represents operating earnings excluding the impact of
amortization of goodwill and certain other intangibles (i.e.,
cash operating earnings), minus preferred dividends and an
explicit charge for capital. Lines of business results are
subject to restatement as appropriate whenever there are
refinements to Chase's risk measurement methodology or in
management reporting policies or changes to the management
organization. For example, in the second quarter 2000 Chase
Capital Partners ("CCP") is disclosed separately from the
remainder of the Global Bank. In addition, the private equity
business of Chase H&Q has been moved to CCP from Global
Investment Banking. Prior periods have been restated to reflect
these changes.
(a) Excluding Chase Capital Partners.
(b) Excludes the impact of credit card securitizations.
NM - Not meaningful
bp - basis points
Unaudited
THE CHASE MANHATTAN CORPORATION
LINES OF BUSINESS RESULTS
(in millions, except ratios)
Global Bank (a) Chase Capital Partners
------------------------- ----------------------
Six Months 2000 Over/(Under) 1999 2000 Over/(Under) 1999
---------- ---- ----------------- ---- -----------------
Operating Revenue $ 4,833 $ 700 17% $ 698 $ (110) (14)%
Operating Earnings 1,235 69 6 367 (102) (22)
Cash Operating
Earnings 1,272 84 7 370 (99) (21)
Average Common
Equity 9,564 (12) - 6,154 2,473 67
Average Managed
Assets (b) 238,854 15,910 7 11,601 4,134 55
Shareholder Value
Added (SVA) 642 86 15 (35) (261) NM
Cash Return on
Common Equity 26.5% 180bp 11.9% (1,350)bp
Cash Overhead Ratio 56 600 18 900
National Consumer Services Global Services
-------------------------- -----------------
2000 Over/(Under) 1999 2000 Over/(Under) 1999
---- ----------------- ---- -----------------
Operating Revenue $ 4,899 $ 24 - % $ 1,726 $ 231 15%
Operating Earnings 721 (6) (1) 281 68 32
Cash Operating
Earnings 795 (15) (2) 313 69 28
Average Common
Equity 8,114 498 7 2,701 (196) (7)
Average Managed
Assets (b) 142,766 15,393 12 15,744 (982) (6)
Shareholder Value
Added (SVA) 260 (47) (15) 135 82 155
Cash Return on
Common Equity 19.4% (170)bp 23.0% 630bp
Cash Overhead Ratio 53 300 72 (200)
GLOBAL BANK - KEY FINANCIAL MEASURES (a)
Six Months 2000
---------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
---------------------------------------
Global Markets $ 2,233 $ 714 51%
Global Investment
Banking 1,312 243 68
Corporate Lending
and Portfolio Management 733 257 29
Global Private Bank 614 132 64
Other Global Bank (59) (74) NM
----------- ----------
Totals $ 4,833 $ 1,272 56%
=========== ==========
Over/(Under) 1999
-------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
-------------------------------------
Global Markets (3)% (11)% 700bp
Global Investment
Banking 86 106 (300)
Corporate Lending
and Portfolio Management (3) (3) 200
Global Private Bank 46 67 (300)
Other Global Bank NM NM NM
Totals 17% 7% 600bp
NATIONAL CONSUMER SERVICES - KEY FINANCIAL MEASURES
Six Months 2000
---------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
-----------------------------------------
Chase Cardmember Services $ 1,883 $ 238 36%
Regional Banking Group 1,268 240 66
Chase Home Finance 642 143 61
Diversified Consumer Services 479 28 69
Middle Markets 538 126 55
Other NCS 89 20 NM
----------- -----------
Totals $ 4,899 $ 795 53%
=========== ===========
Over/(Under) 1999
-----------------------------------------
Operating Cash Cash
Revenues Operating Overhead
Earnings Ratio
-----------------------------------------
Chase Cardmember Services (5)% (2)% 200bp
Regional Banking Group 10 25 (400)
Chase Home Finance 12 2 400
Diversified Consumer Services (12) (63) 1,200
Middle Markets 7 19 (300)
Other NCS NM NM NM
Totals - % (2)% 300bp
----------------------------------------------------------------------
Note: SVA is Chase's primary measure of business unit performance.
SVA represents operating earnings excluding the impact of
amortization of goodwill and certain other intangibles (i.e.,
cash operating earnings), minus preferred dividends and an
explicit charge for capital. Lines of business results are
subject to restatement as appropriate whenever there are
refinements to Chase's risk measurement methodology or in
management reporting policies or changes to the management
organization. For example, in the second quarter 2000 Chase
Capital Partners ("CCP") is disclosed separately from the
remainder of the Global Bank. In addition, the private equity
business of Chase H&Q has been moved to CCP from Global
Investment Banking. Prior periods have been restated to reflect
these changes.
(a) Excluding Chase Capital Partners.
(b) Excludes the impact of credit card securitizations.
NM - Not meaningful
bp - basis points
Unaudited
THE CHASE MANHATTAN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(in millions, except per share data)
% %
Second Quarter Over/ Six Months Over/
-------------- (Under) ---------- (Under)
2000 1999 1999 2000 1999 1999
---- ---- ---- ---- ---- ----
INTEREST INCOME
Loans $ 3,631 $ 3,165 $ 7,111 $ 6,374
Securities 952 747 1,885 1,582
Trading Assets 479 411 895 829
Federal Funds Sold
and Securities
Purchased Under
Resale
Agreements 451 389 897 770
Deposits with Banks 101 161 235 345
------ ------- ------ ------
Total Interest
Income 5,614 4,873 11,023 9,900
------ ------- ------ ------
INTEREST EXPENSE
Deposits 2,086 1,558 4,051 3,156
Short-Term and Other
Borrowings 1,216 851 2,345 1,765
Long-Term Debt 397 319 751 630
------ ------- ------ ------
Total Interest
Expense 3,699 2,728 7,147 5,551
------ ------- ------ ------
NET INTEREST INCOME 1,915 2,145 (11%) 3,876 4,349 (11%)
Provision for Loan
Losses 332 388 (14%) 674 769 (12%)
------ ------- ------ -------
NET INTEREST INCOME
AFTER PROVISION
FOR LOAN LOSSES 1,583 1,757 (10%) 3,202 3,580 (11%)
------ ------- ------ -------
NONINTEREST REVENUE
Investment Banking
Fees 639 585 9% 1,287 902 43%
Trust, Custody and
Investment Management
Fees 545 461 18% 1,054 875 20%
Credit Card Revenue 443 438 1% 840 817 3%
Fees for Other
Financial Services 695 587 18% 1,426 1,140 25%
Trading Revenue 824 526 57% 1,845 1,144 61%
Securities Gains 57 5 NM 71 161 (56%)
Private Equity Gains 298 513 (42%) 798 838 (5%)
Other Revenue -- 356 NM 144 534 (73%)
------ ------- ------- ------
Total Noninterest
Revenue 3,501 3,471 1% 7,465 6,411 16%
------ ------- ------- ------
NONINTEREST EXPENSE
Salaries 1,614 1,416 14% 3,367 2,800 20%
Employee Benefits 252 238 6% 539 493 9%
Occupancy Expense 216 206 5% 442 424 4%
Equipment Expense 274 239 15% 559 482 16%
Other Expense 1,001 969 3% 1,940 1,814 7%
------- ------ ------- ------
Total Noninterest
Expense Before
Restructuring
Costs 3,357 3,068 9% 6,847 6,013 14%
Restructuring Costs 50 -- NM 50 -- NM
------ ------ ------- ------
Total Noninterest
Expense 3,407 3,068 11% 6,897 6,013 15%
------ ------ ------- ------
INCOME BEFORE INCOME
TAX EXPENSE 1,677 2,160 (22%) 3,770 3,978 (5%)
Income Tax Expense 586 767 (24%) 1,319 1,412 (7%)
------ ------ ------- ------
NET INCOME $1,091 $1,393 (22%) $2,451 $2,566 (4%)
====== ====== ======= ======
NET INCOME
APPLICABLE TO
COMMON STOCK $1,074 $1,375 (22%) $2,418 $2,530 (4%)
====== ====== ======= ======
NET INCOME PER
COMMON SHARE:
Basic $0.88 $1.10 (20%) $1.98 $2.01 (1%)
Diluted $0.85 $1.06 (20%) $1.92 $1.95 (2%)
NM - Not meaningful
Unaudited
THE CHASE MANHATTAN CORPORATION
NONINTEREST REVENUE AND NONINTEREST EXPENSE DETAIL
(in millions)
%
Second Quarter Over/(Under)
--------------
NONINTEREST REVENUE 2000 1999 1999
------- ------- --------
Fees for Other Financial Services:
Mortgage Servicing Fees $ 131 $ 77 70%
Service Charges on Deposit
Accounts 103 96 7%
Fees in Lieu of Compensating
Balances 88 94 (6%)
Brokerage and Investment
Services 76 50 52%
Commissions on Letters of
Credit and Acceptances 61 69 (12%)
Insurance Fees 47 41 15%
Loan Commitment Fees 38 36 6%
Other Fees 151 124 22%
------- -------
Total $ 695 $ 587 18%
======= =======
Trading-Related Revenue: (a)
Interest Rate Contracts $ 231 $ 260 (11%)
Foreign Exchange Revenue 258 218 18%
Equities and Commodities 182 91 100%
Debt Instruments and Other 170 164 4%
--------- ---------
Total $ 841 $ 733 15%
========= =========
Other Revenue:
Residential Mortgage
Origination/Sales Activities $ 41 $ 88 (53%)
Loss on Economic Hedge of the
Flemings Purchase (b) (141) -- NM
Gains on Sales of Nonstrategic
Assets (c) -- 166 NM
All Other Revenue 100 102 (2%)
--------- ---------
Total -- $ 356 NM
========= =========
%
Six Months Over/(Under)
-----------
NONINTEREST REVENUE 2000 1999 1999
-------- -------- ---------
Fees for Other Financial Services:
Mortgage Servicing Fees $ 281 $ 142 98%
Service Charges on Deposit
Accounts 202 185 9%
Fees in Lieu of Compensating
Balances 175 181 (3%)
Brokerage and Investment
Services 183 93 97%
Commissions on Letters of
Credit and Acceptances 128 138 (7%)
Insurance Fees 96 80 20%
Loan Commitment Fees 72 67 7%
Other Fees 289 254 14%
-------- --------
Total $ 1,426 $ 1,140 25%
========= ========
Trading-Related Revenue: (a)
Interest Rate Contracts $ 537 $ 582 (8%)
Foreign Exchange Revenue 537 417 29%
Equities and Commodities 407 174 134%
Debt Instruments and Other 405 397 2%
--------- --------
Total $ 1,886 $ 1,570 20%
========= ========
Other Revenue:
Residential Mortgage
Origination/Sales Activities $ 85 $ 180 (53%)
Loss on Economic Hedge of the
Flemings Purchase (b) (141) -- NM
Gains on Sales of Nonstrategic
Assets (c) -- 166 NM
All Other Revenue 200 188 6%
--------- --------
Total $ 144 $ 534 (73%)
========= ========
----------------------------------------------------------------------
Second Quarter %
-------------- Over/(Under)
2000 1999 1999
------ ----- -------
NONINTEREST EXPENSE
Other Expense:
Professional Services $ 186 $ 178 4%
Marketing Expense 121 114 6%
Telecommunications 99 97 2%
Amortization of Intangibles 84 76 11%
Travel and Entertainment 81 59 37%
Minority Interest (d) 18 12 50%
Foreclosed Property Expense (3) 3 NM
Special Contribution to the
Foundation (e) -- 100 NM
All Other 415 330 26%
------ -------
Total $ 1,001 $ 969 3%
====== =======
Six Months %
----------- Over/(Under)
2000 1999 1999
------- ------- -------
NONINTEREST EXPENSE
Other Expense:
Professional Services $ 357 $ 340 5%
Marketing Expense 221 228 (3%)
Telecommunications 204 188 9%
Amortization of Intangibles 169 149 13%
Travel and Entertainment 143 109 31%
Minority Interest (d) 30 25 20%
Foreclosed Property Expense (3) 8 NM
Special Contribution to the
Foundation (e) -- 100 NM
All Other 819 667 23%
------- -------
Total $ 1,940 $ 1,814 7%
======= =======
(a) Trading-related revenue includes net interest income attributable
to trading activities.
(b) Loss is the result of the economic hedge of the purchase price of
Fleming prior to its acquisition.
(c) Includes a $95 million gain on the sale of One New York Plaza and
a $71 million gain on the sale of branches in Beaumont, Texas.
(d) Includes REIT minority interest of $11 million in each quarter and
$22 million in each six months.
(e) Represents a $100 million special contribution to The Chase
Manhattan Foundation.
NM - Not meaningful
Unaudited
THE CHASE MANHATTAN CORPORATION
OPERATING INCOME RECONCILIATION
(in millions, except per share data)
SECOND QUARTER 2000
--------------------------------------------
REPORTED CREDIT SPECIAL OPERATING
RESULTS CARD ITEMS BASIS
(a) (b) (c)
-------- -------- -------- --------
EARNINGS
Market-Sensitive
Revenue $ 1,835 $ - $ - $ 1,835
Less Market-Sensitive
Revenue 3,581 242 141 3,964
-------- -------- -------- --------
Total Revenue 5,416 242 141 5,799
Noninterest Expense 3,357 - - 3,357
-------- -------- -------- --------
Operating Margin 2,059 242 141 2,442
Credit Costs 332 242 - 574
-------- -------- -------- --------
Income Before
Restructuring Costs 1,727 - 141 1,868
Restructuring Costs 50 - (50) -
-------- -------- -------- --------
Income Before Income
Tax Expense 1,677 - 191 1,868
Tax Expense 586 - 67 653
-------- -------- -------- --------
Net Income $ 1,091 $ - $ 124 $ 1,215
-------- -------- -------- --------
NET INCOME PER
COMMON SHARE
Basic $ 0.88 $ 0.98
Diluted $ 0.85 $ 0.95
----------------------------------------------------------------------
SECOND QUARTER 1999
--------------------------------------------
REPORTED CREDIT SPECIAL OPERATING
RESULTS CARD ITEMS BASIS
(a) (b) (c)
-------- -------- -------- --------
EARNINGS
Market-Sensitive
Revenue $ 1,836 $ - $ - $ 1,836
Less Market-Sensitive
Revenue 3,780 246 (166) 3,860
-------- -------- -------- --------
Total Revenue 5,616 246 (166) 5,696
Noninterest Expense 3,068 - (100) 2,968
-------- -------- -------- --------
Operating Margin 2,548 246 (66) 2,728
Credit Costs 388 246 - 634
-------- -------- -------- --------
Income Before
Restructuring Costs 2,160 - (66) 2,094
Restructuring Costs - - - -
-------- -------- -------- --------
Income Before Income
Tax Expense 2,160 - (66) 2,094
Tax Expense 767 - (24) 743
-------- -------- -------- --------
Net Income $ 1,393 $ - $ (42) $ 1,351
-------- -------- -------- --------
NET INCOME PER
COMMON SHARE
Basic $ 1.10 $ 1.07
Diluted $ 1.06 $ 1.03
----------------------------------------------------------------------
SIX MONTHS 2000
-------------------------------------------
REPORTED CREDIT SPECIAL OPERATING
RESULTS CARD ITEMS BASIS
(a) (b) (c)
-------- -------- -------- --------
EARNINGS
Market-Sensitive
Revenue $ 4,042 $ - $ - $ 4,042
Less Market-Sensitive
Revenue 7,299 496 141 7,936
-------- -------- -------- --------
Total Revenue 11,341 496 141 11,978
Noninterest Expense 6,847 - - 6,847
-------- -------- -------- --------
Operating Margin 4,494 496 141 5,131
Credit Costs 674 496 - 1,170
-------- -------- -------- --------
Income Before
Restructuring Costs 3,820 - 141 3,961
Restructuring Costs 50 - (50) -
-------- -------- -------- --------
Income Before Income
Tax Expense 3,770 - 191 3,961
Tax Expense 1,319 - 67 1,386
-------- -------- -------- --------
Net Income $ 2,451 $ - $ 124 $ 2,575
-------- -------- -------- --------
NET INCOME PER
COMMON SHARE
Basic $ 1.98 $ 2.08
Diluted $ 1.92 $ 2.01
SIX MONTHS 1999
-------------------------------------------
REPORTED CREDIT SPECIAL OPERATING
RESULTS CARD ITEMS BASIS
(a) (b) (c)
-------- -------- -------- --------
EARNINGS
Market-Sensitive
Revenue $ 3,471 $ - $ - $ 3,471
Less Market-Sensitive
Revenue 7,289 515 (166) 7,638
-------- -------- -------- --------
Total Revenue 10,760 515 (166) 11,109
Noninterest Expense 6,013 - (100) 5,913
-------- -------- -------- --------
Operating Margin 4,747 515 (66) 5,196
Credit Costs 769 515 - 1,284
-------- -------- -------- --------
Income Before
Restructuring Costs 3,978 - (66) 3,912
Restructuring Costs - - - -
-------- -------- -------- --------
Income Before Income
Tax Expense 3,978 - (66) 3,912
Tax Expense 1,412 - (24) 1,388
-------- -------- -------- --------
Net Income $ 2,566 $ - $ (42) $ 2,524
-------- -------- -------- --------
NET INCOME PER
COMMON SHARE
Basic $ 2.01 $ 1.98
Diluted $ 1.95 $ 1.91
----------------------------------------------------------------------
(a) Represent results as reported in Chase's financial statements. The
only exception is that revenues are categorized between
market-sensitive and less market-sensitive revenues. Market-sensitive
revenue includes investment banking fees, trading-related revenue
(including trading-related net interest income), securities gains and
private equity gains.
(b) This column excludes the impact of credit card securitizations.
For securitized receivables, amounts that previously would have been
reported as net interest income and as provision for loan losses are
instead reported as components of noninterest revenue.
(c) Includes restructuring costs and special items. The 2000 second
quarter and six months include a $141 million loss resulting from the
economic hedge of the purchase price of Fleming prior to its
acquisition and $50 million of restructuring costs associated with
previously announced relocation initiatives. The 1999 second quarter
and six months included $166 million in gains from sales of
nonstrategic assets, of which $95 million was from the sale of a
building and $71 million was from the sale of branches in Texas, and a
special contribution to The Chase Manhattan Foundation of $100
million.
Unaudited
THE CHASE MANHATTAN CORPORATION
CONSOLIDATED BALANCE SHEET
(in millions)
June 30, %
--------------------- Over/(Under)
2000 1999 1999
--------------------- -----------
ASSETS
Cash and Due from Banks $ 18,361 $ 16,037 14%
Deposits with Banks 3,646 5,851 (38%)
Federal Funds Sold
and Securities
Purchased Under Resale Agreements 27,733 28,052 (1%)
Trading Assets:
Debt and Equity Instruments 30,454 26,232 16%
Risk Management Instruments 29,613 25,115 18%
Securities 65,130 49,190 32%
Loans (Net of Allowance for
Loan Losses of $3,459 in 2000
and $3,554 in 1999) 176,713 171,487 3%
Other Assets 44,395 34,904 27%
---------- ----------
TOTAL ASSETS $ 396,045 $ 356,868 11%
========== ==========
LIABILITIES
Deposits:
Domestic:
Noninterest-Bearing $ 49,583 $ 49,874 (1%)
Interest-Bearing 79,019 81,068 (3%)
Foreign:
Noninterest-Bearing 5,683 4,645 22%
Interest-Bearing 90,120 73,915 22%
---------- ----------
Total Deposits 224,405 209,502 7%
Federal Funds Purchased
and Securities
Sold Under Repurchase Agreements 57,637 40,899 41%
Commercial Paper 5,202 5,047 3%
Other Borrowed Funds 5,415 6,613 (18%)
Trading Liabilities 36,713 36,835 --
Accounts Payable, Accrued Expenses
and Other Liabilities, Including
the Allowance for Credit Losses
of $170 in 2000 and 1999 17,185 15,145 13%
Long-Term Debt 21,515 17,031 26%
Guaranteed Preferred Beneficial
Interests in Corporation's
Junior Subordinated Deferrable
Interest Debentures 2,539 2,538 --
---------- ----------
TOTAL LIABILITIES 370,611 333,610 11%
---------- ----------
PREFERRED STOCK OF SUBSIDIARY 550 550 --
---------- ----------
STOCKHOLDERS' EQUITY
Preferred Stock 828 1,028 (19%)
Common Stock 1,323 882 50%
Capital Surplus 9,065 9,628 (6%)
Retained Earnings 19,170 15,381 25%
Accumulated Other
Comprehensive Loss (1,320) (722) 83%
Treasury Stock, at Cost (4,182) (3,489) 20%
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 24,884 22,708 10%
---------- ----------
TOTAL LIABILITIES,
PREFERRED STOCK OF SUBSIDIARY
AND STOCKHOLDERS' EQUITY $ 396,045 $ 356,868 11%
========== ==========
Unaudited
THE CHASE MANHATTAN CORPORATION
CONSOLIDATED STATEMENT OF CHANGES
IN STOCKHOLDERS' EQUITY
(in millions)
Six Months
----------------------------------
2000 1999
------------ -------------
Preferred Stock
Balance at Beginning of Year $ 928 $ 1,028
Redemption of Stock (100) -
------------ -------------
Balance at End of Period $ 828 $ 1,028
------------ -------------
Common Stock
Balance at Beginning of Year $ 882 $ 882
Issuance of Common Stock
for a Three-for-Two Stock Split 441 -
------------ -------------
Balance at End of Period $ 1,323 $ 882
------------ -------------
Capital Surplus
Balance at Beginning of Year $ 9,714 $ 9,836
Issuance of Common Stock
for a Three-for-Two Stock Split (441) --
Shares Issued and Commitments
to Issue Common Stock for
Employee Stock-Based Awards
and Related Tax Effects (208) (208)
------------ -------------
Balance at End of Period $ 9,065 $ 9,628
------------ -------------
Retained Earnings
Balance at Beginning of Year $ 17,547 $ 13,544
Net Income 2,451 2,566
Cash Dividends Declared:
Preferred Stock (33) (36)
Common Stock (795) (693)
---------- -------------
Balance at End of Period $ 19,170 $ 15,381
---------- -------------
Accumulated Other Comprehensive Loss
Balance at Beginning of Year $(1,454) $ 392
Other Comprehensive Income (Loss) 134 (1,114)
---------- -------------
Balance at End of Period $(1,320) $ (722)
---------- -------------
Treasury Stock, at Cost
Balance at Beginning of Year $(4,000) $(1,844)
Purchase of Treasury Stock (1,072) (3,057)
Reissuance of Treasury Stock 890 1,412
---------- -------------
Balance at End of Period $(4,182) $(3,489)
---------- -------------
Total Stockholders' Equity $ 24,884 $ 22,708
========== =============
----------------------------------------------------------------------
Comprehensive Income
Net Income $ 2,451 $ 2,566
Other Comprehensive Income (Loss) 134 (1,114)
---------- -------------
Comprehensive Income $ 2,585 $ 1,452
========== =============
Unaudited
THE CHASE MANHATTAN CORPORATION
CREDIT RELATED INFORMATION
(in millions)
%
Credit-Related Assets Over/(Under)
---------------------------
JUNE 30, 2000 1999 1999
----------------------------------------------------------------------
CONSUMER LOANS
Domestic Consumer:
1-4 Family Residential
Mortgages $ 47,557 $42,003 13%
Credit Card - Reported 12,095 15,270 (21%)
Credit Card Securitizations (b) 19,861 16,944 17%
------------ ------------
Credit Card - Managed 31,956 32,214 (1%)
Auto Financings 18,788 18,301 3%
Other Consumer 6,399 6,299 2%
------------ ------------
Total Domestic Consumer 104,700 98,817 6%
Total Foreign Consumer 2,928 2,860 2%
------------ ------------
Total Consumer Loans 107,628 101,677 6%
------------ ------------
COMMERCIAL LOANS
Domestic Commercial:
Commercial and Industrial 56,824 52,037 9%
Commercial Real Estate 3,070 3,733 (18%)
------------ ------------
Total Domestic Commercial 59,894 55,770 7%
Total Foreign Commercial 32,511 34,538 (6%)
------------ ------------
Total Commercial Loans 92,405 90,308 2%
Derivative and FX Contracts (c) 29,915 25,558 17%
------------ ------------
Total Commercial
Credit-Related 122,320 115,866 6%
------------ ------------
Total Managed Credit-Related $229,948 $217,543 6%
============ ============
----------------------------------------------------------------------
%
Nonperforming Assets Over/(Under)
--------------------
JUNE 30, 2000 1999 1999
----------------------------------------------------------------------
CONSUMER LOANS
Domestic Consumer:
1-4 Family Residential Mortgages $ 269 $ 303 (11%)
Credit Card - Reported 33 (a) -- NM
Credit Card Securitizations (b) -- -- NM
------------ ------------
Credit Card - Managed 33 -- NM
Auto Financings 70 59 19%
Other Consumer 4 5 (20%)
------------ ------------
Total Domestic Consumer 376 367 2%
Total Foreign Consumer 25 27 (7%)
------------ ------------
Total Consumer Loans 401 394 2%
------------ ------------
COMMERCIAL LOANS
Domestic Commercial:
Commercial and Industrial 510 405 26%
Commercial Real Estate 42 52 (19%)
------------ ------------
Total Domestic Commercial 552 457 21%
Total Foreign Commercial 799 641 25%
------------ ------------
Total Commercial Loans 1,351 1,098 23%
Derivative and FX Contracts (c) 53 36 47%
------------ ------------
Total Commercial Credit-Related 1,404 1,134 24%
------------ ------------
Total Managed Credit-Related 1,805 1,528 18%
------------ ------------
Assets Acquired
as Loan Satisfactions 94 105 (10%)
------------ ------------
Total Nonperforming Assets $ 1,899 $ 1,633 16%
============ ============
----------------------------------------------------------------------
%
Second Quarter Over/(Under)
--------------
NET CHARGE-OFFS 2000 1999 1999
----------------------------------------------------------------------
CONSUMER LOANS
Domestic Consumer:
1-4 Family Residential Mortgages $ 10 $ 9 11%
Credit Card - Reported 166 218 (24%)
Credit Card Securitizations (b) 242 246 (2%)
------------ ------------
Credit Card - Managed (d) 408 464 (12%)
Auto Financings 22 19 16%
Other Consumer 32 47 (32%)
------------ ------------
Total Domestic Consumer 472 539 (12%)
Total Foreign Consumer 10 9 11%
------------ ------------
Total Consumer Loans 482 548 (12%)
------------ ------------
COMMERCIAL LOANS
Domestic Commercial:
Commercial and Industrial 75 32 134%
Commercial Real Estate (1) (2) NM
------------ ------------
Total Domestic Commercial 74 30 147%
Total Foreign Commercial 18 56 (68%)
------------ ------------
Total Commercial Loans 92 86 7%
------------ ------------
Total Managed Net Charge-offs $ 574 $ 634 (9%)
============ ============
%
Six Months Over/(Under)
--------------
NET CHARGE-OFFS 2000 1999 1999
----------------------------------------------------------------------
CONSUMER LOANS
Domestic Consumer:
1-4 Family Residential Mortgages $ 19 $ 10 90%
Credit Card - Reported 354 434 (18%)
Credit Card Securitizations (b) 496 515 (4%)
------------ ------------
Credit Card - Managed (d) 850 949 (10%)
Auto Financings 43 38 13%
Other Consumer 75 95 (21%)
------------ ------------
Total Domestic Consumer 987 1,092 (10%)
Total Foreign Consumer 19 18 6%
------------ ------------
Total Consumer Loans 1,006 1,110 (9%)
------------ ------------
COMMERCIAL LOANS
Domestic Commercial:
Commercial and Industrial 119 77 55%
Commercial Real Estate (3) (11) NM
------------ ------------
Total Domestic Commercial 116 66 76%
Total Foreign Commercial 48 107 (55%)
------------ ------------
Total Commercial Loans 164 173 (5%)
------------ ------------
Total Managed Net Charge-offs $ 1,170 $ 1,283 (9%)
============ ============
(a) Includes currently performing loans placed on a cash basis because
of concerns as to collectibility.
(b) Represents the portion of Chase's credit card receivables that
have been securitized.
(c) Charge-offs for risk management instruments are included in
trading revenue.
(d) Including domestic and international consumer and commercial
credit card activity, net charge-offs as a percentage of average
managed credit card receivables for the second quarter of 2000 and
1999 and first six months of 2000 and 1999 were 5.09%, 5.80%, 5.25%
and 5.95%, respectively.
NM - Not meaningful
Unaudited
THE CHASE MANHATTAN CORPORATION
CONDENSED AVERAGE CONSOLIDATED BALANCE SHEET, INTEREST AND RATES
(Taxable-Equivalent Interest and Rates; in millions)
Second Quarter 2000
-------------------------------------
Average Rate
Balance Interest (Annualized)
------- -------- ------------
ASSETS
Liquid Interest-Earning
Assets $ 69,269 $ 1,030 5.98%
Securities 63,293 959 6.09%
Loans 179,020 3,634 8.16%
-------- ------
Total Interest-Earning
Assets 311,582 5,623 7.26%
Noninterest-Earning Assets 84,502
--------
Total Assets $396,084
========
LIABILITIES
Interest-Bearing Deposits $170,691 2,086 4.92%
Short-Term and Long-Term Debt 108,100 1,613 6.00%
-------- ------
Total Interest-Bearing
Liabilities 278,791 3,699 5.34%
--------
Noninterest-Bearing Deposits 50,780
Other Noninterest-Bearing
Liabilities 42,129
--------
Total Liabilities 371,700
--------
PREFERRED STOCK OF SUBSIDIARY 550
--------
STOCKHOLDERS' EQUITY
Preferred Stock 926
Common Stockholders' Equity 22,908
--------
Total Stockholders' Equity 23,834
--------
Total Liabilities, Preferred
Stock of Subsidiary
and Stockholders' Equity $396,084
========
INTEREST RATE SPREAD 1.92%
=====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS $ 1,924 2.48%
======== =====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS (a) $ 2,273 2.76%
======== =====
Second Quarter 1999
-------------------------------------
Average Rate
Balance Interest (Annualized)
------- -------- ------------
ASSETS
Liquid Interest-Earning
Assets $ 63,168 $ 961 6.10%
Securities 52,767 749 5.70%
Loans 173,067 3,168 7.34%
-------- ------
Total Interest-Earning
Assets 289,002 4,878 6.77%
Noninterest-Earning Assets 72,055
--------
Total Assets $361,057
========
LIABILITIES
Interest-Bearing Deposits $158,656 1,558 3.94%
Short-Term and Long-Term Debt 90,516 1,170 5.18%
-------- ------
Total Interest-Bearing
Liabilities 249,172 2,728 4.39%
Noninterest-Bearing Deposits 47,652
Other Noninterest-Bearing
Liabilities 40,669
-------
Total Liabilities 337,493
-------
PREFERRED STOCK OF SUBSIDIARY 550
-------
STOCKHOLDERS' EQUITY
Preferred Stock 1,028
Common Stockholders' Equity 21,986
-------
Total Stockholders' Equit 23,014
-------
Total Liabilities, Preferred
Stock of Subsidiary
and Stockholders' Equity $361,057
=======
INTEREST RATE SPREAD 2.38%
=====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS $ 2,150 2.98%
======== =====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS (a) $ 2,491 3.26%
======== =====
---------------------------------------------------------------------
Six Months 2000
-------------------------------------
Average Rate
Balance Interest (Annualized)
------- -------- ------------
ASSETS
Liquid Interest-Earning
Assets $ 67,748 $ 2,027 6.02%
Securities 62,736 1,898 6.08%
Loans 178,029 7,114 8.04%
-------- ------
Total Interest-Earning
Assets 308,513 11,039 7.20%
Noninterest-Earning Assets 85,099
--------
Total Assets $393,612
========
LIABILITIES
Interest-Bearing Deposits $171,793 4,051 4.74%
Short-Term and Long-Term Debt 105,210 3,096 5.92%
-------- ------
Total Interest-Bearing
Liabilities 277,003 7,147 5.19%
------
Noninterest-Bearing Deposits 50,828
Other Noninterest-Bearing
Liabilities 41,591
--------
Total Liabilities 369,422
--------
PREFERRED STOCK OF
SUBSIDIARY 550
--------
STOCKHOLDERS' EQUITY
Preferred Stock 927
Common Stockholders' Equity 22,713
--------
Total Stockholders' Equity 23,640
--------
Total Liabilities, Preferred
Stock of Subsidiary
and Stockholders' Equity $393,612
========
INTEREST RATE SPREAD 2.01%
=====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS $ 3,892 2.54%
======== =====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS (a) $ 4,569 2.81%
======== =====
Six Months 1999
-------------------------------------
Average Rate
Balance Interest (Annualized)
------- -------- ------------
ASSETS
Liquid Interest-Earning
Assets $ 60,986 $ 1,944 6.43%
Securities 55,931 1,588 5.73%
Loans 172,993 6,377 7.43%
-------- -------- ------
Total Interest-Earning
Assets 289,910 9,909 6.89%
Noninterest-Earning Assets 74,067
--------
Total Assets $363,977
========
LIABILITIES
Interest-Bearing Deposits $160,804 3,156 3.96%
Short-Term and Long-Term Debt 89,387 2,395 5.40%
-------- ------- ------
Total Interest-Bearing
Liabilities 250,191 5,551 4.47%
------
Noninterest-Bearing Deposits 47,815
Other Noninterest-Bearing
Liabilities 42,056
--------
Total Liabilities 340,062
--------
PREFERRED STOCK OF
SUBSIDIARY 550
--------
STOCKHOLDERS' EQUITY
Preferred Stock 1,028
Common Stockholders' Equity 22,337
--------
Total Stockholders' Equity 23,365
--------
Total Liabilities, Preferred
Stock of Subsidiary
and Stockholders' Equity $363,977
========
INTEREST RATE SPREAD 2.42%
=====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS $ 4,358 3.03%
======== =====
NET INTEREST INCOME AND NET YIELD
ON INTEREST-EARNING ASSETS (a) $ 5,026 3.29%
======== =====
(a) Excludes the impact of the credit card securitizations.
Unaudited
THE CHASE MANHATTAN CORPORATION
Chase Capital Partners (including Chase H&Q)
Investment Portfolio
(in millions)
June 30, December 31,
2000 1999
--------------- --------------
Carrying Carrying
Value Cost Value Cost
--------- ---- -------- ----
Total Public Securities
(209 companies) $ 2,778 $ 789 $ 2,735 $ 741
Total Private Direct Investments
(867 companies) 5,764 5,736 4,275 4,406
Total Private Fund Investments
(373 funds) 2,353 2,337 1,881 1,899
------- ----- ------- -----
Total Investment Portfolio $ 10,895 $ 8,862 $ 8,891 $ 7,046
======== ======= ======= =======
Public Securities Investments at June 30, 2000 (a)
(dollars and shares in millions)
Quoted
Public
Symbol Shares Value Cost
------ ------ ------- ----
TRITON PCS HOLDING, INC. TPCS 11.7 $ 675 $ 50
TELECORP PCS TLCP 12.4 498 8
ONI SYSTEMS CORP ONIS 2.8 332 3
AMERICAN TOWER SYSTEMS AMT 5.8 240 15
STARMEDIA NETWORK, INC. STRM 11.1 210 27
SEAT - PATINE GIALLE SPA SPG IM (b) 208 12
PRAECIS PHARMACEUTICALS INC. PRCS 6.1 170 26
IXL ENTERPRISES, INC. IIXL 7.6 110 28
DIGITAL ISLAND ISLD 2.3 110 9
ITXC ITXC 2.9 104 5
----- -----
Top Ten Public Securities $ 2,657 $ 183
Other Public Securities (199 companies) 1,604 606
------- -----
Total Public Securities (209 companies) $ 4,261 $ 789
======= =====
(a) - Publicly traded positions only.
(b) - Owned through a limited partnership.
Policy: Public securities held by Chase Capital Partners are marked-to-market Marked-to-market An arrangement whereby the profits or losses on a futures contract are settled each day. at the quoted public value less liquidity discounts, with the resulting unrealized gains/losses included in the income statement. Chase's valuation policy for public securities incorporates the use of these liquidity discounts and price averaging methodologies in certain circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or to take into account the fact that Chase can not immediately realize such public quoted values due to the numerous 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. , corporate and contractual sales restrictions. Private investments are carried at cost, which is viewed as an approximation approximation /ap·prox·i·ma·tion/ (ah-prok?si-ma´shun) 1. the act or process of bringing into proximity or apposition. 2. a numerical value of limited accuracy. of fair value. The carrying value of private investments is adjusted for holdings in which a subsequent investment by an unaffiliated party indicates a valuation in excess of cost and holdings for which evidence of an other-than-temporary decline in value exists. |
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