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NATWEST BANCORP POSTS RECORD PROFITS IN FOURTH QUARTER AND FULL-YEAR

 /NOTE TO EDITORS: National Westminster Bancorp is the holding company for New York-based National Westminster Bank USA and New Jersey-based National Westminster Bank NJ/
 JERSEY CITY, N.J., Jan. 14 /PRNewswire/ -- National Westminster Bancorp (NatWest Bancorp) today reported record net income of $50.1 million for the fourth quarter of 1992 compared with a loss of $29.8 million in the fourth quarter of 1991. For the year ended Dec. 31, 1992, net income was $155.7 million compared with a loss of $371.5 million in 1991.
 John Tugwell, chairman and chief executive, attributed the turnaround of more than $500 million to improving asset quality as well as the diversification of revenue streams, specifically from new products such as annuities, mutual funds, and private banking services, and the organization's cost management efforts. "We are delighted with our results and what we have accomplished in the past year, but more important, I believe we have set a firm foundation for the future," he said.
 Return on average equity for the quarter and 12 months ended Dec. 31, 1992 was 10.87 percent and 8.76 percent, respectively, due in part to the low effective tax rate. Net income before goodwill amortization totalled $59.4 million for the fourth quarter and $192.7 million for the full year, which equates to a return on average tangible equity of 19.02 percent for the quarter and 16.45 percent for the year.
 In addition to improving asset quality, the quarter and year benefited from growth in non-interest income, containment of operating expenses and improvement in net interest income.
 Mr. Tugwell expanded on the steady improvement in credit quality. "We saw a further $120 million reduction in non-accruing loans this quarter. Much of this came from repayments and restructurings as the economy improved. While charge-offs continue to be high, we have previously established the necessary reserves and loan losses are well within projected levels."
 Provisions for loan losses were $30.5 million for the fourth quarter and $122.0 million for the year ended Dec. 31, 1992, down from the high levels of $88.0 million and $567.7 million in the comparable 1991 periods. Net charge-offs totalled $60.2 million in the fourth quarter and $201.6 million for the year ended Dec. 31, 1992, again substantially down from $74.9 million and $407.3 million in the comparable 1991 periods. NatWest Bancorp's allowance for loan losses was $609.9 million, or 4.31 percent of total loans outstanding at Dec. 31, 1992, compared with $689.5 million, or 4.88 percent at Dec. 31, 1991.
 Non-accrual loans totalled $1,008.9 million at Dec. 31, 1992, down from $1,153.9 million at Dec. 31, 1991. Non-accrual loans amounted to 7.14 percent of total loans at Dec. 31, 1992, down from 8.16 percent at Dec. 31, 1991. Foreclosed assets (including other real estate owned) amounted to $279.9 million at Dec. 31, 1992, compared with $354.4 million at Dec. 31, 1991. Combined, non-accrual loans and foreclosed assets have declined $219.5 million or 15 percent from the year-end 1991 level, and $395.9 million or 23 percent from the high point at Sept. 30, 1991.
 Net interest income for the fourth quarter was $197.2 million, up from $181.0 million in the fourth quarter of 1991. Full-year net interest income was $744.1 million, up from $706.8 million in 1991. Reduced interest lost on non-accrual loans and foreclosed assets (net of interest income recognized) and a steady growth in demand deposits were the major contributors to this increase. Partially offsetting these factors was the impact of a decline in average loan volume, reflecting both the recession and efforts to manage down the size of the relatively higher risk sectors of NatWest Bancorp's portfolio.
 Net interest income, on a tax-equivalent basis and as a percentage of average interest earning assets (net interest margin), was 3.79 percent in the fourth quarter and 3.76 percent for the full-year 1992, compared with 3.83 percent and 3.71 percent in the respective 1991 periods.
 Non-interest income totalled $88.8 million for the quarter, an increase of $7.1 million from the 1991 period. For the year, non- interest income was $330.9 million, up from $284.0 million in 1991. The 1992 and 1991 12-month figures included gains of $42.1 million and $32.8 million, respectively, on the sale of securities. At Dec. 31, 1992, $1.6 billion in securities were transferred from the investment portfolio to the held-for-sale portfolio, which is carried at the lower of cost or market value.
 Excluding securities gains, non-interest income increased over 1991 by $12.4 million in the quarter and $37.7 million in the 12-month period ending Dec. 31, 1992. In part, the increase reflects a $9.0 million gain on the sale of the credit card merchant servicing business in October. In addition, improvement has resulted from growth in deposit and loan-related fees as well as expanded income from newly introduced products such as annuities, mutual funds and private banking services. This reflects successful efforts to develop these additional fee-based businesses and establish a foundation for future earnings growth.
 Operating expenses were $197.9 million in the fourth quarter of 1992, compared with $204.4 million in the 1991 period. For the year ended Dec. 31, 1992, operating expenses declined to $782.5 million, from $790.8 million in 1991. Both 1992 periods were positively impacted by a decline in the cost of foreclosed assets. While the remainder of operating expenses rose modestly in the aggregate (less than 2 percent for the full year), this was due principally to costs associated with the introduction of the new products noted above and other expenditures necessary to expand the consumer banking infrastructure. Benefits continue to be derived from the consolidation of operations and staff functions which have yielded a 3.5 percent reduction in personnel in the past year, following larger reductions in 1991.
 The provision for income taxes was $28.0 million in the fourth quarter of 1992, compared with $0.2 million in the fourth quarter of 1991. For the year, the provision was $78.7 million in 1992, compared with $3.8 million in 1991.
 With the improved earnings, however, NatWest Bancorp was able to record an extraordinary tax credit of $20.5 million and $63.8 million for the quarter and year, respectively. This gave recognition to a portion of previously unrecorded federal tax benefits arising from losses incurred in earlier periods. These benefits could not be recognized until NatWest Bancorp had achieved sufficient taxable income to realize them.
 Equity capital at Dec. 31, 1992 was $1,861.3 million. Risk-based capital ratios were strong, with a Tier I ratio of 7.32 percent and a total capital ratio of 12.01 percent.
 NatWest Bancorp is a wholly owned subsidiary of National Westminster Bank Plc (NYSE: NW), the London-based international banking and financial services organization.
 NATIONAL WESTMINSTER BANCORP INC. AND SUBSIDIARIES
 Financial Highlights
 (Dollar amounts in thousands)
 For the Quarter Ended Dec. 31 1992 1991
 Net interest income $197,173 $181,001
 Provision for loan losses 30,500 88,000
 Non-interest income 88,824 81,726
 Operating expenses:
 Foreclosed assets 7,998 27,465
 Other 189,929 176,899
 Net income (loss) 50,122 (29,837)
 Net interest margin 3.79pct. 3.83pct.
 Return on average equity 10.87pct.
 Return on average tangible equity 19.02pct.
 Return on average assets .86pct.
 For the Year Ended Dec. 31 1992 1991
 Net interest income $744,069 $706,761
 Provision for loan losses 122,000 567, 46,175


67,709
 Other 736,276 723,052
 Net income (loss) 155,665 (371,514)
 Net interest margin 3.76pct. 3.71pct.
 Return on average equity 8.76pct.
 Return on average tangible equity 16.45pct.
 Return on average assets .70pct.
 At Dec. 31 1992 1991
 Total assets $22,714,634 $21,459,094
 Total loans 14,139,321 14,138,656
 Total core deposits 13,841,113 13,569,769
 Total equity capital 1,861,331 1,705,666
 Allowance for loan losses as
 a percentage of total loans 4.31pct. 4.88pct.
 Non-accrual loans as a percentage
 of total loans 7.14pct. 8.16pct.
 Capital ratios:
 Risk-based capital ratios
 (Per 1992 rules):
 Tier I 7.32pct. 6.33pct.
 Total 12.01pct. 10.79pct.
 Leverage ratio 5.52pct. 5.20pct.
 -0- 1/14/93
 /CONTACT: Chris Cameris, 212-602-2505, or Tim Connolly, 201-547-7533, both of National Westminster Bancorp/
 (NW)


CO: National Westminster Bancorp Inc. ST: New Jersey IN: FIN SU: ERN

TS-PS -- NY006 -- 4740 01/14/93 09:42 EST
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