Printer Friendly

METROPOLITAN FINANCIAL REPORTS RECORD CORE EARNINGS IMPROVEMENTS IN CAPITAL LEVELS AND CREDIT QUALITY

 METROPOLITAN FINANCIAL REPORTS RECORD CORE EARNINGS
 IMPROVEMENTS IN CAPITAL LEVELS AND CREDIT QUALITY
 MINNEAPOLIS, Oct. 15 /PRNewswire/ -- Metropolitan Financial Corporation (NYSE: MFC) today reported record core earnings and improvement in capital levels and in credit quality for the third quarter ended September 30, 1992.
 Net income for the three month period ended September 30, 1992 was $12,211,000, compared to $12,194,000 for the third quarter last year. Record core earnings of $20,063,000 for the three months ended September 30, 1992 are up 94 percent from $10,339,000 reported for the third quarter in 1991 and eleven percent from the $18,041,000 for the quarter ended June 30, 1992. Core earnings represent income before income taxes, extraordinary item, and the cumulative effect of accounting change as well as non-recurring gains on sale of mortgage backed and other securities. On a per share basis, fully diluted earnings for the most recent quarter were $0.43, compared to $0.46 per share one year ago.
 Net income for the nine month period ended September 30, 1992 was $127,351,000, or $4.60 per fully diluted share, up from $33,999,000, or $1.28 per share one year ago. The 1992 total includes $76,333,000, or $2.78 per share, reported in the first quarter that resulted from the cumulative effect of an accounting change due to the implementation of Statement of Financial Accounting Standard Number 109, Accounting for Income Taxes (SFAS 109).
 Third quarter and year to date earnings reflect the acquisition of Security Financial Group, Inc., St. Cloud, Minnesota, which was accounted for as a pooling of interests. As a result, all the transaction expenses related to the acquisition are reflected in the third quarter earnings results. Because of the size of Security Financial relative to Metropolitan, prior year data do not reflect the acquisition. Per share totals have been adjusted to reflect the company's two-for-one stock split, distributed June 22, 1992.
 Regulatory capital levels at the company's insured savings bank subsidiary, Metropolitan Federal Bank, fsb, have been significantly enhanced through the first nine months of 1992. Tangible, core and risk based capital ratios stood at 7.45 percent, 8.12 percent, and 15.57 percent respectively at September 30, 1992, up sharply from the 1991 year end ratios of 4.58 percent, 5.36 percent and 12.35 percent, respectively.
 Norman M. Jones, chairman and chief executive officer of the company, said, "The Subordinated Notes offering the company completed in the third quarter and the quarter's record core earnings provide us with one of the strongest capital levels in our industry. This will go a long way to further our acquisition strategy and meet our future growth objectives."
 Net interest income before the provision for credit losses was $39,916,000, up over 43 percent from $27,854,000 for the same three month period in 1991. Through the first nine months of the year, net interest income before the provision for credit losses totalled $114,344,000, compared with $77,215,000 reported in the first nine months of 1991. The net in&erest &argin for the third quarter was 3.28 percent, up from 2.50 percent for the same quarter in 1991 and 3.18 percent for the second quarter of 1992.
 Jones commented, "The sale of long-term fixed rate mortgage backed securities in the second quarter reduced our base of earning assets. Nonetheless, during the third quarter we expanded margins and increased net interest income. Our strategy to sell 30-year fixed rate mortgage production while retaining&the servicing rights has significantly reduced exposure to interest rate risk."
 The net gain on sales of the 30-year fixed rate mortgage loan production into the secondary market was $3.9 million for the quarter ended September 30, 1992.
 Real estate sales commissions at Edina Realty, Inc. totalled $8,702,000 for the third quarter of 1992, up from $7,333,000 for the third quarter of 1991. Real estate sales commissions for the first nine months of 1992 were $24,570,000 compared to $20,396,000 for the first nine months of 1991. Title closing fees at the company's Equity Title Services, Inc. subsidiary were $2,984,000 for the quarter and $8,442,000 for the first nine month& of 1992, compared to $2,057,000 and $6,082,000 for the respective periods of 1991.
 Referring the Metropolitan Financial's real estate subsidiary, Jones commented, "The regional real estate market continues to be dynamic. Edina Realty's 1992 results are expected to exceed the outstanding record year they reported in 1991."
 The most recent quarter's results include nonrecurring expense items, related primarily to the acquisition of Security Financial Group, o& approximately $2 million in the quarter. Noninterest expense for the quarter was $38,487,000 compared to $30,746,000 a year ago. Increases in compensation and advertising due to the company's continuing growth through mergers and acquisitions are reflected in the total.
 Loan demand continued to be strong as Metropolitan Federal Bank originated mortgage loans of $120,093,000 for the quarter, and $893,804,000 for the first nine months of 1992, compared to $52,594,000 and $738,506,000 respectively in 1991. For the quarter and for the first nine months of 1992, the bank also originated, throughout its Heartland network, fully collateralized direct and indirect consumer loans of $163,977,000 and $433,917,000, respectively.
 For the quarter ended September 30, 1992, the company provided $7,852,000 for income taxes. Through the first nine months of the year the total provided was $37,794,000. This compares with a provision of just $46,000 in the first nine months of 1991. The large increase related to the implementation of SFAS 109 in the first quarter wherein the company recognized the tax benefits of its net operating loss carryforwards and certain temporary differences. As a result of this accounting change, the company recorded income tax expense of approximately 4 percent of pre-tax income in the third quarter, and anticipates a similar effective tax rate in future quarters.
 Credit quality continued to improve. Nonperforming assets continued to decline and were $77,853,000, down from $90,648,000 at June 30, 1992 and down over 27 percent from $108,083,000 reported at December 31, 1991. Nonperforming assets as a percent of total assets were 1.51 percent on September 30, 1992, down from 2.57 percent on September 30, 1991. Although the company dramatically reduced nonperforming assets, allowances for loan losses increased to $31,181,000 at September 30, 1992 from $26,272,000 at 1991 year end. Company officials expect the totals will continue to improve in the fourth quarter of 1992.
 Total assets of the company were $5.1 billion at September 30, 1992, compared to $5.5 billion at June 30, 1992 and up from $4.7 billion at December 31, 1991. Deposits at the end of the third quarter were $4.23 billion, compared to $4.26 at June 30, 1992 and up from $3.82 billion at December 31, 1991.
 During 1992, Metropolitan Federal Bank has significantly expanded its service area through acquisitions. In the first quarter, Metropolitan acquired five branches of Monycor Federal Savings Bank in central Wisconsin. In the second quarter, Metropolitan acquired twelve South Dakota branches of First Federal Savings Bank of Rapid City, South Dakota. And on September 30, 1992, Metropolitan completed the acquisition of Security Financial Group, Inc. of St. Cloud, with nine branches throughout central Minnesota.
 In the third quarter, Metropolitan signed a letter of intent to acquire American Charter Federal Savings and Loan of Lincoln, with 27 branches throughout Nebraska, and a definitive agreement to acquire Home Owners Savings Bank of Fergus Falls with five branches in west central Minnesota.
 Company officials expect these transaction to close in the fourth quarter of 1992. Once these transaction are completed, the company anticipates ending the year with over 180 offices in seven states, total assets of approximately $6.0 billion, consumer deposits of $5.2 billion and tangible capital well in excess of 6 percent.
 Metropolitan Financial Corporation is a regional financial services holding company. Its full service consumer savings bank, Metropolitan Federal Bank, Fargo, North Dakota, operates over 150 offices in 121 communities in the states of North Dakota, Minnesota, Iowa, South Dakota, Wisconsin and Arizona.
 Metropolitan is one of the Twin Cities' largest originators of residential mortgage loans. The corporation's real estate sales and brokerage subsidiary, Edina Realty, Inc. serves Minnesota and western Wisconsin with over 1750 sales associates in 39 locations.
 Metropolitan Financial Corporation's common stock trades on the New York Stock Exchange, under the symbol MFC. The Series B preferred stock and warrant trade on the NASDAQ System under the symbols MFCNP and MFCNW, respectively.
 METROPOLITAN FINANCIAL CORPORATION
 Selected Consolidated Operations Data and Ratios
 (Dollar amounts in thousands, except per share data)
 Three Months Ended Nine Months Ended
 Sept 30, Sept 30, Sept 30, Sept 30,
 1992 1991 1992 1991
 Operations Data
 Interest income 105,342 104,092 324,723 308,711
 Interest Expense 65,426 76,238 210,379 231,496
 Net interest income 39,916 27,854 114,344 77,215
 Prov for credit losses 1,651 2,000 6,716 6,000
 Net gain on sale of assets 3,867 1,868 48,773 14,668
 Other noninterest income 16,418 15,231 47,198 42,829
 Noninterest expense 38,487 30,746 108,458 94,667
 Income taxes 7,852 13 37,794 46
 Income before extraordinary
 item and accounting change 12,211 12,194 57,347 33,999
 Extraordinary item:
 Penalty for prepayment of
 FHLB advances (net of
 tax benefit of $4,064) 0 0 (6,329) 0
 Cumulative effect of
 accounting change 0 0 76,333 0
 Net Income $12,211 $12,194 $127,351 $33,999
 Net Income Per Share:
 Primary
 Income per share before
 extraordinary item and
 cumulative effect of
 accounting change $0.43 $0.55 $2.24 $1.56
 Extraordinary item 0.00 0.00 (0.25) 0.00
 Cumulative effect of
 accounting change 0.00 0.00 3.05 0.00
 Net Primary $0.43 $0.55 $5.04 $1.56
 Fully Diluted
 Income per share before
 extraordinary item and
 cumulative effect of
 accounting change $0.43 $0.46 $2.05 $1.28
 Extraordinary item 0.00 0.00 (0.23) 0.00
 Cumulative effect of
 accounting change 0.00 0.00 2.78 0.00
 Net Fully Diluted $0.43 $0.46 $4.60 $1.28
 Ratios
 Return on average assets
 before extraordinary item
 and accounting change(pct.) -- -- 1.48 --
 Return on average assets(pct.) 0.93 1.03 3.30 0.98
 Return on average equity
 before extraordinary item
 and accounting change -- -- 20.71 --
 Return on average equity 12.20 19.45 45.99 18.61
 Average equity to average 7.59 5.32 7.17 5.24
 Net interest margin 3.28 2.50 3.18 2.35
 Noninterest expense/
 average assets 2.92 2.61 2.81 2.72
 Nonperforming assets to
 total assets 1.51 2.57 1.51 2.57
 Sept 30, 1992 Dec 31, 1991
 Financial Condition
 Total assets $5,142,375 $4,667,680
 Loans 2,720,823 2,353,380
 Deposits 4,228,135 3,824,069
 Shareholders' equity 415,867 278,763
 Nonperforming assets 77,853 108,083
 Book value per comm share 15.42 11.56
 Tangible book value per
 common share 13.13 8.28
 Mkt value per comm share 13.00 10.44
 Capitalization Metropolitan Federal Bank, fsb (pct.)
 Tangible capital 7.45 4.58
 Core capital 8.12 5.36
 Risk based capital 15.57 12.35
 METROPOLITAN FINANCIAL CORPORATION
 Condensed Consolidated Statements of Condition
 (In thousands)
 Sept 30 Dec 31,
 1992 1991
 (Unaudited)
 Assets
 Cash and due from banks $63,738 $57,363
 Federal funds sold 105 105
 Short term interest bearing deposits 46,168 36,254
 Loans and mortgage backed securities
 held for sale (market: Sept 30, 1992-
 $244,423; December 31, 1991-$931,997) 239,650 882,527
 Investment securities (market:
 Sept 30, 1992-$506,363; December 31,
 1991-$105,679) 452,362 100,693
 Mortgage backed securities (market:
 Sept 30, 1992-$1,293,727
 December 31, 1991-$971,044) 1,257,387 936,929
 Loans 2,720,823 2,335,993
 FHLB stock 55,148 46,466
 Accrued interest 34,863 34,568
 Real estate owned 43,877 63,399
 Office properties and equipment 49,788 40,437
 Goodwill 59,859 62,720
 Deferred taxes 43,523 0
 Other assets 75,084 70,226
 Total Assets $5,142,375 $4,667,680
 Liabilities
 Transaction and passbook deposits $1,282,926 $953,830
 Certificates 2,945,209 2,870,239
 FHLB advances 316,392 462,230
 Borrowings 109,272 55,344
 Reverse repurchase agreements 0 0
 Accrued interest 48,642 27,323
 Other liabilities 24,067 19,951
 Total Liabilities 4,726,508 4,388,917
 Shareholders' Equity
 Preferred stock 5 23
 Common stock, par value $.01 per share;
 authorized 60,000,000 shares;
 issued Sept 30, 1992-26,270,538 shares
 December 31, 1991-20,270,552 shares 263 193
 Additional paid in capital 144,837 137,930
 Retained earnings 271,671 143,146
 Less cost of common stock in treasury-
 95,975 shares at September 30, 1992;
 249,987 shares at December 31, 1991 (909) (2,529)
 Total Shareholders' Equity 415,867 278,763
 Total Liabilities and Shareholders' Eq $5,142,375 $4,667,680
 METROPOLITAN FINANCIAL CORPORATION
 Condensed Consolidated Statements of Income
 (In thousands)
 (Unaudited)
 Three Months Ended Nine Months Ended
 9/30/92 9/30/91 9/30/92 9/30/91
 INTEREST INCOME
 Loans $67,381 $57,442 $200,253 $159,673
 Mortgage backed securities 32,110 34,606 111,282 109,008
 Investments 5,851 4,186 13,188 14,699
 FSLIC notes & covered assets 0 7,858 0 25,331
 -- 105,342 104,092 324,723 308,711
 INTEREST EXPENSE
 Trans and passbook deposits 9,638 11,289 28,921 33,033
 Certificates 47,877 53,356 150,348 160,763
 FHLB advances 7,414 10,311 28,459 31,209
 Borrowings 497 1,282 2,651 4,497
 Reverse repurchase agreements 0 0 0 1,994
 -- 65,426 76,238 210,379 231,496
 NET INTEREST INCOME 39,916 27,854 114,344 77,215
 Provision for credit losses 1,651 2,000 6,716 6,000
 NET INTEREST INC. AFTER
 PROVISION FOR CREDIT LOSSES 38,265 25,854 107,628 71,215
 NONINTEREST INCOME
 Gain on sale of investments,
 MBS, and mortgage loans 3,867 1,868 48,773 14,668
 Mortgage loan servicing fees 1,807 3,099 5,206 8,241
 Real estate sales commissions 8,702 7,333 24,570 20,396
 Title closing fees 2,984 2,057 8,442 6,082
 Service chgs on deposit accts 1,746 1,418 5,003 4,009
 Other 1,179 1,324 3,977 4,101
 -- 20,285 17,099 95,971 57,497
 NONINTEREST EXPENSE
 Compensation & related items 15,865 12,397 43,536 35,652
 Occupancy 4,437 3,795 12,701 11,354
 Data processing 1,892 1,654 5,333 5,025
 Advertising 3,650 2,568 9,297 7,416
 Deposit insurance premium 2,223 2,120 6,677 5,893
 Amortization of goodwill 998 1,339 3,001 4,017
 Real estate owned expense 883 1,044 4,318 6,332
 Other general & administrative 8,539 5,829 23,595 18,978
 -- 38,487 30,746 108,458 94,667
 INCOME BEFORE INCOME TAXES,
 EXTRAORDINARY ITEM, AND
 CUMULATIVE EFFECT OF
 ACCOUNTING CHANGE 20,063 12,207 95,141 34,045
 Income taxes 7,852 13 37,794 46
 INCOME BEFORE EXTRAORDINARY
 ITEM AND CUMULATIVE EFFECT
 OF ACCOUNTING CHANGE 12,211 12,194 57,347 33,999
 Extraordinary item: Penalty
 for prepayment of FHLB advances
 (net of tax benefit of $4,064 0 0 (6,329) 0
 Cumulative effect of
 accounting change 0 0 76,333 0
 NET INCOME $12,211 $12,194 $127,351 $33,999
 -0- 10/15/92
 /CONTACT: William P. Bartkowski of Metropolitan Financial Corporation, 612-928-5003/
 (MFC) CO: Metropolitan Financial Corporation ST: Minnesota IN: FIN SU: ERN


DS -- MN014 -- 0459 10/15/92 13:12 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Oct 15, 1992
Words:2732
Previous Article:BANK SOUTH REPORTS EARNINGS INCREASE, CONTINUED IMPROVEMENT IN CREDIT QUALITY
Next Article:FMS FINANCIAL REPORTS QUARTERLY EARNINGS
Topics:


Related Articles
METROPOLITAN FINANCIAL REPORTS STRONG FIRST QUARTER EARNINGS AND LARGE ONE TIME GAIN FROM ACCOUNTING CHANGE
METROPOLITAN FINANCIAL RECOMMENDED BY MARKET ANALYSTS
FITCH REVISES HOMES SAVINGS AND GREAT WESTERN CREDIT TRENDS -- FITCH FINANCIAL WIRE --
MERRILL LYNCH $300 MILLION NOTES RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
METROPOLITAN FINANCIAL CORPORATION REPORTS ALL TIME RECORD NET INTEREST INCOME
CITICORP REPORTS SECOND-QUARTER PROFIT AND FURTHER PROGRESS TOWARD PLAN GOALS
DUFF & PHELPS: DUFF & PHELPS UPGRADES SHAWMUT NATIONAL CORPORATION
DUFF & PHELPS: NORWEST CORPORATION $200 MILLION SENIOR NOTES RATED 'AA'
Metropolitan Financial Corp. Reports Record Third Quarter Earnings
JYSKE BANK A/S - PROFIT BEFORE TAX: DKK 1,054 MILLION.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters