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SOUTHERN NATIONAL REPORTS RECORD 1993 EARNINGS

 WINSTON-SALEM, N.C., Jan. 13 /PRNewswire/ -- Southern National Corporation (NYSE: SNB) today announced its earnings for 1993.
 FINANCIAL HIGHLIGHTS
 Net income for the year was $72.0 million
 -- Compared to $47.2 million in 1992
 Fully-diluted 1993 EPS was $2.03
 -- Compared to $1.39 in 1992
 -- A 14% compound growth rate for the period 1987 - 1993
 Fully-diluted EPS for 4th Qtr. was $.51
 -- Compared to $.51 for 3rd Qtr.
 Return on assets was 1.30% for 4th Qtr. 1993 and 1.35% for the full
 year
 -- Compared to 1.00% for the full year 1992
 Return on common equity was 16.62% for 4th Qtr. 1993 and 17.32% for
 the full year
 -- Compared to 12.61% for the full year 1992
 Net yield on earning assets for 1993 was 4.71%
 -- Compared to 4.89% for 1992
 Net yield on earning assets for 4th Qtr. was 4.64%
 -- Compared to 4.69% for 3rd Qtr.
 Average loan growth in 1993 over 1992 was $319 million, or 11%,
 including mergers
 -- Approximate internal growth rate of 8%
 Average loan growth in 4th Qtr. over 3rd Qtr. 1993 was $228 million,
 or 29% annualized, including $200 million in loans added from
 acquisition of East Coast
 -- Approximate internal growth rate of 3%
 Nonperforming assets at December 31 were $21.8 million
 -- .63% of loan-related assets, compared to .99% a year ago
 -- Have declined every quarter since 1st Qtr. 1991
 Net charge-offs for 1993 were $6.4 million
 -- Compared to $12.8 million in 1992
 -- A .20% rate in 1993, compared to .45% for 1992
 -- $1.0 million of 1993 charge-offs were related to a bulk asset
 sale
 Allowance for loan losses at December 31, 1993 was 1.15% of loans
 and leases
 -- Equals 203% of nonaccrual loans at year-end
 Capital ratios at December 31, 1993
 -- Risk-based Tier 1 capital was approximately 14.4%
 -- Risk-based total capital was approximately 15.5%
 -- Leverage ratio was approximately 8.6%
 -- Equity-to-assets ratio was 8.5%
 Additional financial data are contained in accompanying tables
 During 1993, Southern National completed the acquisitions of East Coast Savings Bank, SSB, of Goldsboro, N.C. and FedFirst Bancshares, Inc., headquartered in Winston-Salem, N.C. On Oct. 7, Southern National completed the conversion/merger of East Coast in a transaction accounted for as a purchase. At merger date, East Coast had $271 million in total assets and $201 million in deposits. The FedFirst transaction, consummated on Jan. 29, 1993, added $396 million in assets and $328 million in deposits and was accounted for as a pooling-of-interests. This pooling transaction resulted in the restatement of all prior-period financial information, including originally reported 1992 net income of $50.1 million and fully-diluted earnings per share of $1.73.
 "In 1993 we merged in $700 million in assets through two excellent mergers. At the same time we earned 1.35% on assets and 17.32% on equity. This record makes me very confident that our 1994 mergers will also be very successful," said Chairman Glenn Orr.
 During the fourth quarter of 1993, special meetings of shareholders were held by Regency Bancshares Inc., headquartered in Hickory, N.C., Home Federal Savings Bank of Statesville, N.C., The First Savings Bank, FSB, of Greenville, S.C. and Southern National, at which each of the respective mergers received shareholder approval. The acquisitions of Regency and The First are expected to be completed at the end of January and the closing date for Home is scheduled for the end of February.
 In a related move, an agreement was reached by which $109 million of loan-related assets will be sold following the merger with The First, which owns the majority of the assets. The assets include nonperforming loans, foreclosed properties and loans which are inconsistent with Southern National's portfolio strategy. This sale is part of the implementation strategy designed to reduce the amount of problem assets assumed by Southern National upon completion of its merger with The First. Southern National expects that its nonperforming assets will be approximately $50 million upon the completion of the three pending mergers. This estimate would equate to approximately 1% of proforma loan-related assets.
 The merger-related accounting entries that are anticipated to be recorded by The First as of Dec. 31 in connection with the consummation of the merger are estimated to be $93 million after taxes. This amount is larger than the original estimate at the time of the merger announcement primarily as a result of a change in the composition of the assets offered for sale and a resulting lower than expected sales price. After the elimination of all goodwill and core deposit intangibles associated with The First, the intangible assets at Southern National after the mergers are estimated to be less than $14 million. Negative goodwill resulting from the acquisition of East Coast was $17 million at Dec. 31, 1993.
 Southern National uses various interest rate-related contracts ("derivatives") as part of its overall process of managing interest rate risk. At Dec. 31, the contracts outstanding had a total notional value of $613 million. During the year certain derivatives made a positive contribution to net interest income while others had a net cost to carry. Overall the derivatives had a net cost to carry of $463,000 in 1993.
 On Jan. 1, 1994, Southern National adopted Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities" ("SFAS 115"). At that date, $794 million of securities, with a market value of $803 million, were classified as "available for sale." In preparation for the adoption of SFAS 115, Southern National classified these same securities as "held for sale" at Dec. 31, 1993. This classification at year-end had no effect on income or shareholders' equity.
 Southern National operates 170 offices in 88 cities and towns in the Carolinas.
 SOUTHERN NATIONAL CORPORATION
 FINANCIAL SUMMARY
 (Unaudited)
 Years Ended
 December 31,
 (Dollars in thousands, except per share data)
 Percent
 1993 1992 Change
 RESULTS OF OPERATIONS
 Interest income:
 Interest and fees on
 loans and leases $266,510 $264,459 (1)%
 Interest and dividends
 on securities 114,489 112,310 (2)
 Interest on temporary
 investments 1,223 2,482 51
 Total interest income 382,222 379,251 (1)
 Total interest expense 146,972 163,033 10
 Net interest income 235,250 $216,218 (9)
 Provision for loan
 and lease losses 5,574 14,775 62
 Noninterest income:
 Service charges on
 deposit accounts 25,844 24,595 (5)
 Nondeposit fees and
 commissions 5,992 5,618 (7)
 Securities gains, net 13,631 (99) NM
 Other income 20,817 13,466 (55)
 Total noninterest income 66,284 43,580 (52)
 Noninterest expense:
 Personnel expense 85,276 79,207 (8)
 Occupancy and
 equipment expense 23,898 20,727 (15)
 Federal deposit
 insurance expense 9,222 8,439 (9)
 Foreclosed property expense 5,617 7,694 27
 Other expense 47,850 40,745 (17)
 Total noninterest expense 171,863 156,812 (10)
 Provision for income taxes 37,938 32,723 (16)
 Net income $ 86,159 $ 55,488 (55)%
 FTE adjustment 10,595 8,249 (28)
 Net income available
 to common shares 66,797 42,634 (57)
 PER SHARE
 Net income
 Primary $ 2.16 $ 1.43 (51)%
 Fully-diluted 2.03 1.39 (46)
 Weighted average
 shares outstanding
 Primary 30,957,509 29,887,627
 Fully-diluted 35,512,096 34,091,384
 Cash dividends $ .64 $ .50 (28)%
 PERFORMANCE RATIOS
 Return on average assets 1.35 % 1.00 %
 Return on average common
 shareholders' equity 17.32 12.61
 Net yield on earning assets
 (fully taxable equivalents) 4.71 4.89
 Three Months Ended
 December 31,
 (Dollars in thousands except per share data)
 Percent
 1993 1992 Change
 RESULTS OF OPERATIONS
 Interest income:
 Interest and fees on
 loans and leases $ 69,836 $ 66,358 (5)%
 Interest and dividends
 on securities 29,339 29,023 (1)
 Interest on temporary
 investments 169 388 56
 Total interest income 99,344 95,769 (4)
 Total interest expense 36,879 38,197 3
 Net interest income 62,465 $ 57,572 (8)
 Provision for loan
 and lease losses 1,299 3,125 58
 Noninterest income:
 Service charges on
 deposit accounts 6,743 6,427 (5)
 Nondeposit fees and
 commissions 1,709 1,565 (9)
 Securities gains (loss) 71 (167) 143
 Other income 5,885 3,345 (76)
 Total noninterest
 income 14,408 11,170 (29)
 Noninterest expense:
 Personnel expense 21,810 22,731 4
 Occupancy and
 equipment expense 5,931 5,146 (15)
 Federal deposit
 insurance expense 2,432 2,162 (12)
 Foreclosed property
 expense 912 1,092 16
 Other expense 14,256 12,873 (11)
 Total noninterest
 expense 45,341 44,004 (3)
 Provision for income tax 8,836 12,100 27
 Net income $ 21,397 $ 9,513 (125)%
 FTE adjustment 2,767 2,392 (16)
 Net income available
 to common shares 17,331 5,822 (198)
 PER SHARE
 Net income
 Primary $ .54 $ .19 (184)%
 Fully-diluted .51 .20 (155)
 Weighted average
 shares outstanding
 Primary 31,945,044 30,440,544
 Fully-diluted 36,493,280 35,035,445
 Cash dividends $ .17 $ .13 (31)%
 PERFORMANCE RATIOS
 Return on average
 assets 1.30 % 0.58 %
 Return on average common
 shareholders' equity 16.62 6.49
 Net yield on earning assets
 (fully taxable equivalent) 4.64 4.96
 As of/For the
 Quarter Ended
 (Dollars in thousands except per share data)
 Percent
 12/31/1993 12/31/1992 Change
 ASSET QUALITY RATIOS
 Nonaccrual loans and leases as
 percent of loans and l .56 % .57 %
 Nonperforming assets as
 percent of:
 Total assets .37 .59
 Loans and leases plus
 foreclosed property .63 .99
 Net charge-offs as percent of
 average loans and leas .35 .41
 Allowance for losses as percent
 of loans and leases 1.15 1.26
 Ratio of allowance for losses to:
 Net charge-offs 3.29 x 3.06 x
 Nonaccrual loans and loans 2.03 2.22
 AVERAGE BALANCES
 Securities $1,905,195 $1,582,743 20 %
 Loans and leases 3,410,422 2,997,763 14
 Earning assets 5,390,597 4,640,759 16
 Total assets 5,754,123 4,949,342 16
 Deposits 4,502,706 4,047,890 11
 Short-term borrowings 601,738 397,363 51
 Interest-bearing liabilities 4,600,377 4,017,226 15
 Shareholders' equity 491,378 432,762 14
 NOTE: All line items referring to loans and leases reflect loans and leases, net of unearned income.
 -0- 1/13/94
 /CONTACT: (Media) Bob Denham, Public Relations, 910-773-7363, (Analysts) John R. Spruill, chief financial officer, 910-773-7221, or (FAX Assistance) Melissa Glendenning, 910-773-7223 or FAX 910-607-7049, all of Southern National/
 (SNB)


CO: Southern National Corporation ST: North Carolina IN: FIN SU: ERN

CM -- CH001 -- 1643 01/13/94 07:38 EST
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Date:Jan 13, 1994
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