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NORTHERN TRUST REPORTS RECORD QUARTERLY NET INCOME UP 15 PERCENT

 NORTHERN TRUST REPORTS RECORD QUARTERLY NET INCOME UP 15 PERCENT
 CHICAGO, April 20 /PRNewswire/ -- Northern Trust Corp. (NASDAQ-NMS: NTRS) today reported record unaudited net income of $35.8 million for the first quarter of 1992, up 15 percent from $31.0 million reported a year ago. On a fully diluted basis, net income per share was $.95 compared with $.83 a year ago, also up 15 percent. The annualized return on average common equity was 19.3 percent versus 19.9 percent in 1991 and the return on average assets was 1.12 percent compared with 1.04 percent last year.
 Performance Highlights.
 Commenting on the quarter, David W. Fox, chairman, president and chief executive officer, stated, "Our record first quarter earnings reflect continued strong performance in both the trust and banking business. Fees from our trust activities, including revenues generated from the acquisition of trust assets from Trust Services of America, Inc. (TSA), reached a new high and exceeded net interest income, which was also at a record level. This performance, coupled with strong growth in the fee portion of cash management revenues and foreign exchange trading profits, contributed to the strong earnings. Partially offsetting these positive factors were increases in noninterest expenses related to Chicago-area commercial real estate properties previously acquired in foreclosures and the operating expenses associated with the trust assets acquired from TSA. The corporation's capital structure remains strong with significant growth in common equity. Asset quality, income diversification and capital growth remain strengths of Northern."
 Revenues.
 Noninterest income of $122.1 million for the quarter accounted for 59 percent of total taxable equivalent revenue and was 24 percent above last year's $98.3 million. Trust fees (including fees of 4.0 million associated with the Jan. 31 TSA acquisition), representing 74 percent of noninterest income and 43 percent of total taxable equivalent revenue, totaled $89.7 million, up 23 percent from $73.0 million in 1991. Security distribution commissions and trading income totaled $5.0 million against $3.8 million a year ago. Other operating income amounted to $26.1 million, up 20 percent, from $21.7 million reported in 1991. The majority of the increase in other operating income is attributable to the fee portion of cash management revenues and foreign exchange trading profits. Net gains from sales of investment securities totaled $1.3 million in 1992 versus a net loss of $.2 million last year.
 Net interest income on a fully taxable equivalent basis totaled a record $85.8 million for the first quarter, a 7 percent increase from $80.3 million a year ago. The growth in net interest income was primarily attributable to a 5 percent increase in average earning assets and an improvement in the interest rate spread to 2.55 percent from 2.30 percent. However, the net interest margin at 3.10 percent was comparable with the 3.09 percent achieved a year ago, because of the lower rate of return on noninterst-related funds.
 Provision/Reserve for Credit Losses.
 The provision for credit losses for the first quarter of 1992 totaled $7.0 million, unchanged from a year ago but down from $8.0 million in the fourth quarter 1991. Net charge-offs for the quarter totaled $6.9 million in 1992 (.44 percent of average loans) compared with $7.9 million (.50 percent of average loans) in the fourth quarter and $6.9 million (.46 percent of average loans) for the first quarter of 1991. The reserve for credit losses at March 31, 1992 was $145.8 million or 2.27 percent of outstanding loans. Nonperforming assets declined to $92.9 million (including $37.8 million of other real estate owned "OREO") at March 31, 1992, compared with $94.2 million (including $40.4 million of OREO) at Dec. 31, 1991. At March 31, 1991, nonperforming assets totaled $89.8 million (including $48.3 million of OREO).
 Noninterest Expenses.
 Noninterest expenses totaled $143.5 million for the quarter, $20.9 million or 17 percent higher than $122.6 million reported in 1991. The higher rate of growth in operating expenses essentially resulted from 2.9 million of expenses associated with trust assets acquired from TSA earlier this year, and a $3.6 million write-down to reflect declining values of Chicago-area commercial real estate properties previously acquired in foreclosures. In addition, planned increases in certain operating expenses such as salaries, benefits and Federal Deposit Insurance Corp. premiums contributed to the expense growth. Despite the increased level of expenses, the first quarter productivity ratio was 145 percent versus 146 percent last year. The productivity ratio is noninterest income plus net interest income on a taxable equivalent basis before the provision for credit losses divided by noninterest expenses.
 Balance Sheet.
 Total assets as of March 31, 1992, were $13.2 billion and averaged $12.8 billion for the first quarter of 1992, up 6 percent from the 1991 first quarter average. Loans and leases totaled $6.4 billion at March 31, 1991 and averaged $6.3 billion for the first quarter, 5 percent higher than the prior year's first quarter average. Common stockholders' equity at March 31, 1991, increased 19 percent to $735.5 million from $616.1 million at March 31, 1992. Reflecting retained earnings growth and the issuance of $50 million of 6.25 percent cumulative convertible preferred stock in February 1992, total stockholders' equity increased 23 percent to $905.5 million at March 31, 1992, from $736.1 million at March 31, 1991. The corporation's risk-based capital ratios at March 31, 1992, were 7.4 percent for Tier 1 and 11.3 percent for total capital, both well in excess of the regulatory capital guidelines of 4 percent for Tier 1 and 8 percent for total capital.
 -0- 4/20/92
 /CONTACT: Sue A. Rageas of Northern Trust, 312-444-4279/
 (NTRS) CO: Northern Trust Corp. ST: Illinois IN: FIN SU: ERN


SH -- NY061 -- 0111 04/20/92 13:22 EDT
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Date:Apr 20, 1992
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