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 BUENOS AIRES, Argentina, Aug. 25 /PRNewswire/ -- Banco de Galicia y Buenos Aires, one of the two largest private commercial banks in Argentina, listed on the Buenos Aires Stock Exchange (BASE) and with ADSs quoted on NASDAQ under "BGALY," has presented to the BASE its Annual Report and General Balance Sheet and Income Statement for its 88th fiscal year ended June 30, 1993.
 As announced, net income for the period amounted to Ps. 57.1 million, equivalent to Ps. 1.94 per ADS, showing a 23.9 percent increase from the Ps. 46.1 million or Ps. 1.57 per ADS obtained in fiscal 1992. All figures are reported in accordance with Argentine GAAP. Data for prior periods are restated in constant pesos as of June 30, 1993.
 Net income growth has resulted mainly from the significant increase in earning assets and in the income from non-financial services, together with an improvement in the efficiency ratios of the bank.
 Level of Activity
 -- Total assets reached Ps. 3,231.1 million with a 69.2 percent increase over the Ps. 1,910.1 million level of the previous fiscal year.
 -- Deposits amounted to Ps. 2,027.2 million, up by 61.7 percent from Ps. 1,253.5 million in the 1992 fiscal period.
 -- Loans grew by 70.9 percent to Ps. 2,217.9 million in fiscal 1993 from Ps. 1,298.1 million as of June 30, 1992.
 -- Negotiable Obligations (Bonds and Commercial Paper) outstanding as of June 30,1993 reached Ps. 290.4 million, with a 65.7 percent increase over the Ps. 175.3 million reached at the close of the previous fiscal year.
 -- As of April 30, 1993, the bank's market shares in deposits and loans were 4.29 percent and 3.79 percent respectively, up from the 4.08 percent and 3.24 percent figures in the previous fiscal year.
 Income Performance
 -- Net income obtained for the 1993 fiscal year represents a 2.3 percent return on average assets and a 19.2 percent return on average shareholders' equity. This performance was achieved in spite of the decrease in financial margins which was over-compensated by the increase in earning assets' volume and in income from non-financial services.
 -- The improvement of efficiency ratios is shown by the growth in the ratio of income per administrative expense unit which increased from a 123.6 percent figure in fiscal 1992 to 136.5 percent for fiscal 1993.
 -- Financial net income amounted to Ps. 198.9 million, up by 38.8 percent from Ps. 143.3 million in the previous fiscal year.
 -- Net income from non-financial services increased by 26.6 percent reaching Ps. 148.4 million in 1993 as compared to Ps. 117.2 million in fiscal 1992.
 -- Administrative expenses reached Ps. 254.4 million with a 20.7 percent increase with respect to the Ps. 210.8 million in fiscal 1992 -- less than the growth of income, both from financial and non-financial services.
 Asset Quality
 -- The allowance for loan losses as a percentage of classified loans increased from an 84.6 percent coverage as of June 30, 1992 to a 90.0 percent ratio at the end of fiscal 1993 (a 6.4 percent improvement).
 -- Allowances for loan losses when related to the total loan portfolio show a 17.1 percent increase from a ratio of 1.99 percent to 2.33 percent between 1992 and 1993.
 -- Classified loans as a percentage of credit excluding interbank loans reached a 2.58 percent figure, up by 9.8 percent from 1992.
 Business Strategy
 -- During the 1993 fiscal year, Banco de Galicia has consolidated its position in the retail banking segment and its business with small and medium-sized companies, while maintaining a good presence in the corporate segment.
 -- It has also become one of the most active players in the growth of the residential mortgage lending activity.
 -- The bank has also strengthened its presence in the Argentine capital markets through its subsidiary Galicia Capital Markets, given the current process of privatization and investment expansion.
 -- Continuing a trend initiated in previous years, the bank has gained market share in the credit and debit card business during 1993.
 -- Through the satisfactory level of profits achieved in fiscal 1993 and the fully registered stock offering completed during the same period, Banco de Galicia has consolidated its position as one of the most capitalized banks in the Argentine financial system.
 -- This circumstance allows Banco de Galicia to continue on its business expansion course and to take advantage of the opportunities for growth in the Argentine banking industry, both in its traditional commercial banking activities as well as in the investment banking and capital markets segments.
 -- As usual, the bank is facing these growth opportunities with special emphasis on the control of its credit and liquidity risks, as well as with a prudent management of its administrative expenses.
 Selected Financial Information Consolidated Data (A)
 (In thousands of constant pesos as of June 30, 1993)
 Fiscal Years Ended Percent
 as of June 30 Growth
 1993 1992 1991 1992-1993
 Net financial income 198,898 143,281 108,683 38.8
 Provision for loan losses 35,145 20,357 8,812 72.6
 Income from services, net 148,449 117,244 68,168 26.6
 Admin. expenses 254,387 210,830 173,543 20.7
 Net income 57,109 46,086 5,146 23.9
 Net income per share (1) $0.49 $0.39 $0.04 23.9
 Net income per ADS (1) $1.94 $1.57 $0.17 23.9
 Government securities 124,388 135,569 207,356 (8.2)
 Loans, net 2,217,860 1,298,115 538,608 70.9
 Total assets 3,231,111 1,910,070 1,141,591 69.2
 Deposits 2,027,190 1,253,459 693,481 61.7
 Total shareholders' equity 403,841 251,228 250,145 60.7
 TOTAL DEPOSITS 4.29 pct(3) 4.08 pct 3.22 pct 5.1
 In pesos 3.29 pct(3) 2.99 pct 2.70 pct 10
 In U.S. dollars 5.58 pct(3) 5.36 pct 3.80 pct 4.1
 Financial margin(4) 9.09 pct 12.27 pct 17.66 pct (25.9)
 Return on avg. assets 2.31 pct 3.07 pct 0.62 pct (24.8)
 Return on avg. shareholders'
 equity 19.20 pct 20.20 pct 2.57 pct (5.0)
 Net fee income as a pct
 of oper. income (5) 42.74 pct 45.00 pct 38.54 pct (5.0)
 Net fee income as a pct
 of admin. expenses 58.36 pct 55.61 pct 39.28 pct 4.9
 Total income as of pct
 of admin. expenses(6) 136.54 pct 123.57 pct 101.92 pct 10.5
 Shareholders' equity as a
 pct. of total assets 12.50 pct 13.15 pct 17.97 pct (4.9)
 Total liabilities as a
 multiple of shareholders'
 equity 7.00 6.60 4.56 6.1
 Cash and due from banks as
 a pct. of deposits 21.37 pct 18.80 pct 21.92 pct 13.7
 Liquid assets as pct.
 of deposits (7) 27.51 pct 29.73 pct 52.43 pct (7.5)
 Loans as a pct. of total
 assets 68.64 pct 67.96 pct 47.18 pct 1.0
 Allowance for loan losses
 as a pct. of loans
 (excluding interbank
 loans) 2.33 pct 1.99 pct 2.15 pct 17.1
 Classified loans as a pct.
 of loans (8) (excluding
 interbank loans) 2.58 pct 2.35 pct 3.40 pct 9.8
 Allowance for loan losses
 as a pct of classified
 loans 90.02 pct 84.60 pct 63.11 pct 6.4
 PERSONNEL 4,192 3,827 3,932 9.5
 Banco de Galicia 4,141 3,782 3,891 9.5
 Casa Bancaria 51 45 41 13.3
 BRANCHES 175 171 177 2.3
 Banco de Galicia 170 166 172 2.4
 Casa Bancaria 5 5 5 ---
 CUSTOMER ACCOUNTS 337,472 309,918 271,418 8.9
 Banco de Galicia 326,630 299,906 261,191 8.9
 Casa Bancaria 10,842 10,012 10,227 8.3
 Retail price index 12.27 pct 19.62 pct 200.5 pct (37.5)
 Wholesale price index 1.96 pct 2.55 pct 117.49 pct (23.1)
 Exchange rate (peso/US$) 0.8 pct (0.8) pct 89.6 pct (200.0)
 (A) Banco de Galicia y Buenos Aires and Galicia y Buenos Aires Casa Bancaria
 (1) According to the number of shares outstanding before the stock offering of June 1993.
 (2) Banco de Galicia only in relation with the Argentine market. Source: Central Bank of the Argentine Republic.
 (3) As of April 30, 1993, latest information available on total activity at the financial system.
 (4) Net financial income less provision for loan losses divided by average earning assets.
 (5) Income from services, net, divided by the sum of Net financial income plus income from services, net.
 (6) Net financial income plus income from services, net, divided by administrative expenses.
 (7) Liquid assets include cash, due from banks and government securities.
 (8) Classified loans are defined as those loans in the categories of "risk of insolvency," "judicial proceeding" and "bankrupt or in liquidation."
 (9) Sources: National Bureau of Statistic and Census and Central Bank of the Argentine Republic.
 -0- 8/25/93
 /CONTACT: Sergio Grinenco, 011-541-329-6253/6254, or Hector Arzeno, 212-906-3701, both of Banco de Galicia y Buenos Aires; or Felicia Vonella of Dewe Rogerson Inc., 212-688-6840/

CO: Banco de Galicia y Buenos Aires ST: IN: FIN SU: ERN

WB-LG -- NY015 -- 5782 08/25/93 11:06 EDT
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Date:Aug 25, 1993

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