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FIRST EMPIRE STATE CORP. REPORTS THIRD QUARTER EARNINGS

 FIRST EMPIRE STATE CORP. REPORTS THIRD QUARTER EARNINGS
 BUFFALO, N.Y., Oct. 8 /PRNewswire/ -- First Empire State Corporation ("First Empire") (AMEX: FES) today announced third quarter 1992 earnings of $21.0 million, or $2.85 per common share. These results are more than 20 percent improved from $17.4 million or $2.37 per common share earned in the comparable 1991 third quarter. Net income for the first nine months totaled $76.3 million, or $10.48 per common share. Excluding $16.5 million of after-tax gains on sales of bank investment securities realized in 1992, net income for the first nine months rose 22% to $59.8 million, or $8.13 per common share. First Empire earned $49.0 million, or $6.83 per common share, during the first nine months of 1991.
 Subsequent to July 1, 1992, First Empire's earnings include the operating results of the former Central Trust Company, Rochester, N.Y. and Endicott Trust Company, Endicott, N.Y. On that date, the two banks were purchased and merged into First Empire's principal banking subsidiary, Manufacturers and Traders Trust Company ("M&T Bank"), adding approximately $1.4 billion to assets and $1.3 billion to deposits.
 Growth in average earning assets caused by the third quarter acquisitions and a wider spread between the yield on earning assets and the rate paid on interest-bearing liabilities caused taxable-equivalent net interest income to increase 31 percent to $115.3 million in 1992's third quarter. Average earning assets grew 11 percent from a year earlier to $9.5 billion in this quarter. Net interest income, expressed as an annualized percentage of average earning assets, was 4.81 percent in 1992's third quarter, down slightly from the previous quarter but up from 4.08 percent in the similar 1991 period.
 The recent quarter's provision for possible credit losses was $21.7 million, compared with $22.0 million in 1991's third quarter. The provision, which exceeded net charge-offs by $8.3 million, together with the allowance acquired in the acquisitions lifted the allowance for possible credit losses to $148.7 million at the quarter end. The increase in the allowance for the quarter helped keep the ratio of the allowance to total loans at 2.09 percent, unchanged from June 30, 1992, despite a $991 million increase in loans outstanding. Net charge-offs were $13.5 million in the recent quarter and $10.0 million in 1991's third quarter. Nonperforming loans at quarter end, which included $18.9 million of loans acquired in the recent acquisitions, stood at $105.8 million, or 1.49 percent of loans outstanding. The ratio of the allowance to nonperforming loans at Sept. 30, 1992 was 140 percent compared with 111 percent a year earlier. Assets taken in foreclosure of defaulted loans were $21.9 million at the end of the third quarter, compared with $15.2 million a year ago.
 Other income in the third quarter of $26.5 million was slightly below the results attained in the corresponding 1991 quarter, which had benefitted from a one-time gain of $5.6 million on the sale of loans. Other expense for the quarter rose 35 percent to $84.2 million. Expenses associated with the recent acquisitions, systems upgrade costs and write-downs of mortgage servicing assets all contributed to the increase.
 The annualized rate of return on average total assets was .84 percent in the recent quarter, while the return on average common stockholders' equity was 14.46 percent. These rates of return were .77 percent and 13.81 percent, respectively, in 1991's third quarter.
 First Empire's Sept. 30, 1992 balance sheet reflected total assets of $10.3 billion, up from $8.8 billion a year earlier. Boosted by the acquisitions, loans and leases, net of unearned discount, reached $7.1 billion compared with $6.1 billion at Sept. 30, 1991, while deposits rose 7 percent from a year ago, to $8.2 billion at the recent quarter end. Total stockholders' equity increased to $602.7 million at Sept. 30, 1992 from $520.5 million a year earlier. Common stockholders' equity per share at the recent quarter end grew to $83.46, up 16 percent from $71.69 a year ago.
 First Empire State Corporation is a bank holding company whose subsidiaries include M&T Bank (Buffalo, N.Y.) and The East New York Savings Bank (New York City, N.Y.).
 FIRST EMPIRE STATE CORPORATION
 Condensed Consolidated Statement of Income
 Three months ended
 Dollars in thousands, September 30 Pct
 except per share 1992 1991 Change
 Net interest income $113,938 $86,152 32
 Less: Provision for
 possible credit losses 21,720 21,956 (1)
 Gains on sales of bank
 investment securities 780 313 149
 Other income 25,702 26,455 (3)
 Less:
 Salaries & employee benefits 37,483 29,248 28
 Other expenses 46,673 33,079 41
 Income before income taxes 34,544 28,637 21
 Applicable income taxes 13,532 11,283 20
 Net income $21,012 17,354 21
 Dividends on preferred stock $900 900
 Per common share:
 Net income
 Primary $2.85 2.37 20
 Fully diluted 2.78 2.32 20
 Net income excluding securities
 transactions
 Primary 2.80 2.34 20
 Fully diluted 2.73 2.30 19
 Cash dividends 0.40 0.35 14
 Common shares outstanding
 in thousands:
 Average (A) 7,044 6,957 1
 Period end 6,742 6,702 1
 PERFORMANCE RATIOS, annualized
 Net income to:
 Average total assets 0.84 pct 0.77 pct
 Average common
 stockholders' equity 14.46 pct 13.81 pct
 Net interest margin (B) 4.81 pct 4.08 pct
 Nine months ended
 Dollars in thousands, September 30 Pct
 except per share 1992 1991 Change
 Net interest income $318,622 $231,547 38
 Less: Provision for
 possible credit losses 63,565 44,212 44
 Gains on sales of bank
 investment securities 28,770 229 -
 Other income 72,873 59,972 22
 Less:
 Salaries & employee benefits 99,197 78,672 26
 Other expenses 130,162 86,099 51
 Income before income taxes 127,341 82,765 54
 Applicable income taxes 51,029 33,779 51
 Net income $76,312 48,986 56
 Dividends on preferred stock $2,700 1,960
 Per common share:
 Net income
 Primary $10.48 $6.83 53
 Fully diluted 10.11 6.71 51
 Net income excluding securities
 transactions
 Primary 8.13 6.81 19
 Fully diluted 7.92 6.69 18
 Cash dividends 1.20 1.05 14
 Common shares outstanding
 in thousands:
 Average (A) 7,026 6,888 2
 Period end 6,742 6,702 1
 PERFORMANCE RATIOS, annualized
 Net income to:
 Average total assets 1.10 pct 0.80 pct
 Average common
 stockholders' equity 18.46 pct 13.72 pct
 Net interest margin (B) 4.85 pct 4.07 pct
 (A) -- Includes common stock equivalents
 (B) -- On a fully taxable-equivalent basis.
 FIRST EMPIRE STATE CORPORATION
 Condensed Consolidated Balance Sheet
 September 30 Pct
 In thousands 1992 1991 Change
 ASSETS
 Cash and due from banks $ 273,753 225,682 21
 Money-market assets 940,953 251,067 275
 Investment securities 1,790,091 2,065,523 (13)
 Loans and leases, net of
 unearned discount 7,111,628 6,105,729 16
 Less: Allowance for possible
 credit losses 148,661 101,813 46
 Net loans and leases 6,962,967 6,003,916 16
 Other assets 297,902 259,240 15
 Total assets $10,265,666 8,805,428 17
 LIABILITIES AND EQUITY
 Demand deposits in U.S. offices $ 936,131 649,542 44
 Other deposits in U.S. offices 7,114,750 6,858,516 4
 Deposits in foreign offices 108,282 147,744 (27)
 Total deposits 8,159,163 7,655,802 7
 Short-term borrowings 1,342,862 467,807 187
 Accrued interest and other
 liabilities 158,867 151,043 5
 Long-term borrowings and
 capital leases 2,100 10,272 (80)
 Total liabilities 9,662,992 8,284,924 17
 Stockholders' equity 602,674 520,504 16
 Total liabilities and
 stockholders' equity $10,265,666 8,805,428 17
 -0- 10/8/92
 /CONTACT: Gary S. Paul of First Empire State Corporation, 716-842-5130/
 (FES) CO: First Empire State Corporation ST: New York IN: FIN SU: ERN


KK -- CL008 -- 7970 10/08/92 15:00 EDT
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Date:Oct 8, 1992
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