Printer Friendly

MICHIGAN NATIONAL'S EARNINGS FOR THE FIRST QUARTER 1992 IMPROVED FROM THE SAME PERIOD LAST YEAR

 MICHIGAN NATIONAL'S EARNINGS FOR THE FIRST QUARTER 1992 IMPROVED
 FROM THE SAME PERIOD LAST YEAR
 FARMINGTON HILLS, Mich., April 28 /PRNewswire/ -- Michigan National Corporation (NASDAQ-NMS: MNCO) announced first-quarter 1992 earnings at its annual shareholders' meeting held today at corporate headquarters in Farmington Hills.
 Net income for the first quarter 1992 was $14.3 million, or $0.95 per share, $11.9 million higher than net income of $2.4 million, or $0.16 per share, for the same period last year.
 An $8.9 million reduction in the provision for possible loan losses contributed to the improvement in earnings for the first quarter 1992 compared to last year's first quarter. In addition, net interest income increased $12.5 million and non-interest income (excluding securities gains of $1.9 million in first quarter 1992) improved $6.9 million. Offsetting these improvements, non-interest expense increased $14.1 million, and the projected 1992 effective income tax rate increased to 25 percent from 19 percent for 1991.
 Commenting on loan quality performance for the first quarter 1992, Chairman and Chief Executive Officer Robert J. Mylod said, "Non- performing loans declined $8.9 million from Dec. 31, 1991, and total non-performing assets remained at a level equal to the Dec. 31, 1991, balance. The allowance for possible loan loss as a percentage of total loans was 2.37 percent at March 31, 1992, compared to 2.35 percent at Dec. 31, 1991, and as a percentage of non-performing loans was 90 percent, compared to 83 percent. The higher risk commercial construction loan portfolio decreased another $77 million during the first quarter 1992 and now stands at $259 million, or 3.8 percent of total loans. The corporation remains concerned about the possible future effects of a continued soft economy on its performing loan portfolios. Management identifies performing loans where the borrower's operating results are showing signs of current or possible future financial difficulties. These loans are subjected to closer and more frequent risk assessment reviews. During the first quarter, loans in this category increased 10 percent to $676 million. Such increases are not unusual during economic recessionary periods."
 Commenting further on earnings for the quarter, Mylod added, "Effective asset/liability management strategies and the wider spreads between the prime interest rate and money market rates that contributed to increases in net interest income throughout 1991 are the primary reasons for the improvement in net interest income for the first quarter 1992 compared to the same period a year ago. In addition, the corporation's core businesses continue to show improved earnings performance. Non-interest income for the first quarter 1992 was $51.7 million (excluding securities gains of $1.9 million), which represents a 15-percent increase over last year's first quarter. This increase was principally attributable to activity in the corporation's mortgage banking subsidiary, Independence One Mortgage Corporation (IOMC)."
 Commenting specifically on activity at IOMC, Mylod stated, "Starting in the fourth quarter 1991 and continuing through the first quarter 1992, IOMC experienced an unusually high volume of mortgage refinancing activity (both loan payoffs and new loan originations) as interest rates plummeted. This activity is, and will continue to be, positive both in terms of profits and servicing portfolio growth. IOMC was servicing $14.3 billion in residential mortgage loans at March 31, 1992, a net growth of 25 percent from March 31, 1991, and 1.4 percent from Dec. 31, 1991."
 The net growth in mortgage loans serviced by IOMC is reflected in a $4.4 million increase in non-interest income at IOMC in the first quarter 1992 compared to last year's first quarter; $3.0 million, or 24-percent, increase in mortgage servicing fees and $1.4 million, or 130-percent, increase in gains from the sale of originated loans. Also contributing to the increase in non-interest income for the first quarter 1992 compared to first quarter 1991 were the corporation's new subsidiaries acquired in the fourth quarter 1991, which earned non- interest income totaling $1.1 million in the first quarter 1992.
 The corporation's non-interest expenses for the first quarter 1992 were $112.6 million, $14.1 million higher than last year's first quarter. The corporation's newly acquired subsidiaries accounted for $2.4 million of the increase. Personnel-related expenses also increased approximately $3.1 million primarily due to the annual merit and promotion cycle. The net growth in servicing portfolios was the principal contributor to an approximate $9.0 million increase in total non-interest expenses at IOMC in the first quarter 1992 compared to last year. This increased expense base will decline as loan payoffs subside and will enhance future net servicing income.
 Net income for the first quarter 1992 was $4.3 million lower than the $18.6 million reported for the immediately preceding quarter. This decrease is principally attributable to the gains of $6.3 million from sales of servicing rights in the fourth quarter 1991, offset by securities gains in the first quarter 1992 of $1.9 million. Also contributing to the decrease in net income in the first quarter 1992 compared to the immediately preceding quarter is an increase in the projected effective income tax rate to 25 percent from 1991's effective tax rate of 19 percent. This increase is due to a reduction in the amount of deferred tax benefits that the corporation can recognize for financial reporting purposes.
 Election of the Board of Directors
 The following directors were elected to a one-year term by shareholders at the annual shareholders' meeting:
 Daniel T. Carroll William F. Pickard
 John S. Carton Edgar D. Prince
 Fred A. Erb Stanton Kinnie Smith Jr.
 Sidney E. Forbes Walter H. Teninga
 Sue Ling Gin Jay Van Andel
 Morton E. Harris Richard T. Walsh
 Gerald B. Mitchell James A. Williams
 Robert J. Mylod
 Michigan National Corporation is a diversified financial services corporation with total assets of $10.9 billion. It is a bank holding company and a savings and loan holding company. (Other key financial data are set forth in the following schedules.)
 MICHIGAN NATIONAL CORPORATION AND SUBSIDIARIES
 QUARTERLY FINANCIAL INFORMATION
 (Unaudited)
 1992 1991 1991
 First Fourth First
 Quarter Quarter Quarter
 Quarter to date
 (in thousands)
 Interest income $201,536 $216,600 $234,297
 Interest expense 105,045 121,533 150,354
 Net interest income 96,491 95,067 83,943
 Provision for possible credit
 losses 18,364 16,556 27,264
 Non-interest income 53,646 54,407 44,804
 Non-interest expense 112,624 109,995 98,507
 Income before income tax expense 19,149 22,923 2,976
 Income tax provision (benefit) 4,847 4,322 589
 Net income $14,302 $18,601 $2,387
 Per common share
 Net income-primary $0.95 $1.24 $0.16
 Net income-fully diluted $0.95 $1.24 $0.16
 Average shares outstanding-
 primary 14,997 14,915 14,760
 Average shares outstanding-
 fully diluted 15,048 14,953 14,795
 Cash dividends declared $0.50 $0.50 $0.50
 Book value end-of-period $51.92 $51.50 $49.58
 Market value end-of-period $51 1/4 $41 1/2 $21 3/4
 Market value: High $52 $42 $23 3/4
 Market value: Low $40 1/4 $32 3/4 $14 1/4
 Selected Quarter-end balances
 (in millions)
 Total assets $10,909 $10,650 $10,814
 Earning assets 9,813 9,548 9,824
 Total loans and lease financing 6,744 6,588 6,605
 Non-performing assets 329 329 348
 Deposits 8,936 8,655 8,784
 Long-term debt 90 92 98
 Shareholders' equity 768 760 731
 Selected average balances
 (in millions)
 Total assets $10,589 $10,570 $10,789
 Earning assets 9,547 9,565 9,812
 Total loans and lease financing 6,716 6,528 6,680
 Deposits 8,677 8,666 8,817
 Long-term debt 90 91 97
 Shareholders' equity 766 755 737
 Selected financial ratios
 Return on average shareholders'
 equity 7.47 pct 9.85 pct 1.29 pct
 Return on average total assets 0.54 0.70 0.09
 Average equity to average total
 assets 7.23 7.15 6.83
 Allowance to period-end loans 2.37 2.35 2.30
 Non-performing assets to period-
 end loans plus property from
 defaulted loans 4.89 4.93 5.17
 Net interest spread 3.69 3.58 3.23
 Net interest margin 4.45 4.42 4.11
 Equity to asset ratio 7.04 7.14 6.76
 Primary capital ratio 9.09 9.20 8.77
 Leverage ratio 7.10 7.01 6.63
 Tier 1 risk based capital ratio 9.56 9.39 8.84
 Total risk based capital ratio 11.83 11.60 11.08
 Dividend payout ratio 52.63 40.32 312.5
 -0- 4/28/92
 /CONTACT: Ariadne Magoulias, 313-473-3428, or Vernon Patterson, investor relations, 313-473-3076, both of Michigan National Corporation/
 (MNCO) CO: Michigan National Corporation ST: Michigan IN: FIN SU: ERN


JG-ML -- DE015 -- 3801 04/28/92 12:28 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:Apr 28, 1992
Words:1475
Previous Article:ROYCE LABORATORIES ANNOUNCES FILING OF SHAREHOLDER LAWSUITS
Next Article:MICHIGAN NATIONAL'S EARNINGS FOR THE FIRST QUARTER 1992 IMPROVED FROM THE SAME PERIOD LAST YEAR


Related Articles
PERRY REPORTS 75-PERCENT INCREASE IN NET EARNINGS FOR FIRST QUARTER
FIRSTFED MICHIGAN REPORTS STRONG FIRST-QUARTER EARNINGS
MANUFACTURERS NATIONAL CORPORATION REPORTS FIRST-QUARTER EARNINGS
MICHIGAN NATIONAL'S EARNINGS FOR THE FIRST QUARTER 1992 IMPROVED FROM THE SAME PERIOD LAST YEAR
NATIONAL-STANDARD COMPANY REPORTS RESULTS
MICHIGAN NATIONAL'S EARNINGS FOR THE SECOND QUARTER 1992 SIGNIFICANTLY IMPROVED FROM THE SAME PERIOD LAST YEAR
OLD KENT REPORTS 24-PERCENT INCREASE IN QUARTERLY EARNINGS
MICHIGAN NATIONAL CORPORATION ANNOUNCES HIGHER EARNINGS FOR FIRST NINE MONTHS OF 1992; LOWER EARNINGS FOR THIRD QUARTER
SOUTHEASTERN MICHIGAN GAS ENTERPRISES REPORTS THIRD-QUARTER RESULTS
PERRY REPORTS ON THIRD QUARTER

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