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CHEMICAL BANKING REPORTS RESULTS

 NEW YORK, April 20 /PRNewswire/ -- Chemical Banking Corporation (NYSE: CHL) today reported first quarter net income of $374 million, a 44 percent increase from $260 million in the same period a year ago. Net income per common share in the first quarter was $1.35, up from $1.00 in the first quarter a year ago.
 "The earnings momentum generated by Chemical in 1992 continued apace and resulted in a record quarter," said John F. McGillicuddy, chairman and chief executive officer. "Strong net interest revenue, record total trading revenues and increases in several fee-based services, such as corporate finance and trust activities, underscored this performance. Our underlying expenses remained in line with our operating plan and merger-related expense savings continue on track."
 "While credit costs remain at high levels, the trends in the corporation's credit quality continued to improve," said Walter V. Shipley, president. "Nonperforming assets declined by $386 million during the first quarter and have been reduced by $881 million since peaking in the third quarter of 1992. We expect further improvements in nonperforming assets during the course of 1993."
 The corporation's estimated Tier I risk-based capital ratio was 7.4 percent at March 31, compared with 6.6 percent a year ago. At March 31, the estimated total risk-based capital ratio was 11.7 percent, up from 10.7 percent a year ago.
 Total stockholders' equity at March 31 was $10.5 billion, up $1.5 billion from $9.0 billion a year ago. The increase included $738 million in retained earnings generated over the past twelve months.
 The 1993 first quarter results included a one-time restructuring charge of $43 million ($30 million after-tax) related to the federally assisted acquisition in February of major components of First City Bancorporation of Texas, Inc. by Chemical's affiliate, Texas Commerce Bancshares.
 Accounting Changes
 The 1993 first quarter results included the impact of two significant accounting changes.
 On Jan. 1, 1993, the corporation adopted Statement No. 106 (SFAS 106) of the Financial Accounting Standards Board which requires recognition, during the years of employees' active service, of the employer's expected cost and obligation of providing postretirement benefits other than pensions (OPEB) to employees, their spouses and covered dependents. The corporation's entire unrecognized accumulated OPEB obligation as of the date of adoption was recognized in the first quarter of 1993 via a one-time charge of $415 million. Annual periodic pre-tax expense will be approximately $40 million in 1993, versus a cash-basis expense of $22 million in 1992.
 The corporation also adopted Statement No. 109 (SFAS 109), which allows for the possible earlier recognition of tax benefits. As a result, the corporation recognized a favorable impact of $450 million in the first quarter of 1993.
 The net favorable impact of the adoption of these new accounting standards was $35 million in the first quarter of 1993. Income before the effect of the accounting changes was $339 million ($1.21 per share), up 30 percent from the 1992 first quarter.
 Net Interest Income
 Net interest income for the first quarter was $1,149 million, up from $1,115 million in the same year-ago period. The net yield on interest-earning assets was 3.82 percent in the first quarter, compared with 3.72 percent in the year-ago first quarter.
 The increases in both net interest income and the net yield reflected a lower interest rate environment, decreased funding costs and effective asset/liabilities management.
 Average interest-earning assets for the first quarter were $122.6 billion, compared with $121.4 billion in the year-go period.
 Noninterest Revenue
 Noninterest revenue for the first quarter was $925 million, an increase of 15 percent from $805 million in the same period a year ago.
 The results reflected increases in revenues from trading activities, corporate finance and loan syndication fees and trust fees and commissions.
 Combined revenues from all trading activities were $252 million in the first quarter, up 11 percent from $228 million in the same year-ago period. Corporate finance and loan syndication fees were $71 million, up 31 percent from $54 million in the first quarter a year ago. Trust fees and commissions in the quarter were $98 million, compared with $89 million in the 1992 first quarter.
 Other noninterest revenue in the first quarter was $116 million, compared with $77 million in the first quarter a year ago. The 1993 first quarter included $56 million in revenue from the sale of a portion of the interest due and unpaid (IDU) bonds received from Brazil in connection with the country's past due interest agreement.
 Securities gains in first quarter were $70 million, compared with $32 million in the first quarter of 1992.
 Noninterest Expense
 Noninterest expense in the first quarter was $1,276 million, compared with $1,194 million in the first quarter of 1992.
 The 1993 first quarter results included $67 million of expenses (including the one-time restructuring charge of $43 million) associated with the previously mentioned First City acquisition. Foreclosed property expense in the first quarter increased $25 million from the same year-ago period. As a result of an accounting change, first quarter expenses related to providing postretirement benefits other than pensions were $5 million higher than in the same period of 1992. Excluding these costs, noninterest expense in the first quarter of 1993 was down 1.3 percent from the comparable 1992 period.
 Noninterest expense in the first quarter reflected approximately $110 million in expense savings related to the Dec. 31, 1991 merger of Chemical Banking Corporation and Manufacturers Hanover Corporation, up from $50 million in the first quarter a year ago.
 For the first quarter, the ration of noninterest expense (excluding the $43 million restructuring charge) to total revenue improved to 59.9 percent, from 62.2 percent in the first quarter a year ago.
 Merger-related staff reductions total 5,533 since July 15, 1991, when the merger was first announced.
 Provision and Allowance for Losses
 The provision for losses was $312 million in the first quarter, compared with $315 million in the fourth quarter of 1992 and $375 million in the first quarter of 1992.
 Non-LDC net charge-offs were $312 million in the first quarter, compared with $315 million in the fourth quarter of 1992 and $375 million in the first quarter a year ago. LDC net charge-offs, including losses on sales and swaps, were $51 million in the first quarter, compared with $1 million in the same period a year ago.
 At March 31, the non-LDC allowance for losses was $2,220 million, compared with $2,012 million on the same date a year ago.
 The LDC allowance at March 31 was $768 million, compared with $1,262 million on the same date a year ago. Total LDC medium and long- term outstanding at March 31, were $3.2 billion, versus $3.9 billion on the same date a year ago.
 Nonperforming Assets
 At March 31, total nonperforming assets were $5,706 million, down $386 million, or 6 percent, from $6,092 million at Dec. 31 and down $535 million, or 9 percent, from $6,241 million on March 31 a year ago. Over the past six months, nonperforming assets have declined by $881 million, or 13 percent.
 Total non-LDC nonperforming assets at March 31 were $4,476 million, down from $4,744 million at Dec. 31 and from $5,005 million a year ago. Non-LDC nonperforming loans at March 31, were $3,218 million, down from $3,468 million at Dec. 31 and down from $3,421 million at March 31, 1992. Assets acquired as loan satisfactions were $1,258 million at March 31, down from $1,276 million at Dec. 31 and down $326 million from $1,584 million on March 31 a year ago.
 The nonperforming commercial loans of the acquired First City Bancorporation units that are covered by a loss-sharing agreement with the Federal Deposit Insurance Corporation are not included in the corporation's non-LDC nonperforming loans at March 31, 1993. The corporation did not acquire any foreclosed commercial real estate properties as part of the First City transaction.
 LDC nonperforming loans were $1,230 million at March 31, compared with $1,236 million on the same date a year ago. On April 7, Argentina completed its financing plan with its creditor banks, which will result in a reduction of approximately $279 million in the corporation's Argentine nonperforming loans beginning in the second quarter of 1993.
 CHEMICAL BANKING CORPORATION
 Nonperforming Assets
 (dollars in millions)
 3/31/93 12/31/92 3/31/92
 Non-LDC nonperforming loans $3,218 $3,468 $3,421
 Assets acquired as loan
 satisfactions 1,258 1,276 1,584
 Total non-LDC nonperforming
 assets 4,476 4,744 5,005
 LDC nonperforming loans:
 Brazil 594 713 737
 Argentina 316 316 317
 Other LDC nonperforming loans 320 319 182
 Total LDC nonperforming loans 1,230 1,348 1,236
 Total nonperforming assets 5,706 6,092 6,241
 Allowance for losses ($ in million)
 Periods ended March 31, 1993 1992
 Total allowance for losses $2,988 $3,274
 As a percent of total loans 3.7 4.0
 Non-LDC allowance for losses 2,220 2,012
 As a percent of non LDC loans 2.9 2.6
 LDC allowance for losses 768 1,262
 As a percent of term outstandings including
 previous charge-offs with claims retained 56(A) 59
 (A) -- 24 percent excluding previous charge-offs with claims retained.
 Stockholder's Equity and Capital Ratios
 ($ in billions)
 3/31/93 3/31/92
 Total stockholders' equity $10.5 $9.0
 Common stockholders' equity 8.4 7.4
 Tangible equity 9.0 7.8
 Ratios:
 Total equity to assets 7.1 pct. 6.6 pct.
 Common equity to assets 5.7 pct. 5.4 pct.
 Tangible equity to assets 6.2 pct. 5.8 pct.
 Tier I leverage 6.7 pct. 6.0 pct.
 Risk based capital:
 Tier I (4.0 percent required) 7.4 pct. (A) 6.6 pct.
 Total (8.0 percent required) 11.7 pct. (A) 10.7 pct.
 (A) -- Estimated
 Other Financial Data
 The corporation's effective tax rate was 30.3 percent and 25.9 percent in the first quarter of 1993 and 1992, respectively. Tax expense for the first quarter of 1993 included an income tax benefit of approximately $63 million, bringing the corporation's unrecognized tax benefits (valuation reserve) to approximately $250 million at March 31, 1993. Tax expense for the first quarter of 1992 included an income tax benefit of $55 million.
 Total assets of March 31 were $147.5 billion, versus $136.2 billion on the same date a year ago. Total loans at March 31 were $81.2 billion, compared with $82.8 billion a year ago. At the end of the first quarter, total deposits were $93.2 billion, compared with $92.8 billion at March 31, 1992.
 The return on average total assets for the first quarter was 1.06 percent, compared with .75 percent in the same year-ago period. The return on average common stockholder's equity was 16.47 percent of the first quarter, compared with 13.24 percent in the first quarter of 1992.
 Book value per common share was $33.50 at March 31, versus $30.52 per share on the same date a year ago.
 Texas Commerce Bancshares
 Texas Commerce Bancshares (TCB) earned $29 million in the first quarter, versus $44 million in the year-ago first quarter. Excluding the one-time restructuring charge of $43 million ($30 million after-tax) and net benefits of $14 million resulting from the previously mentioned accounting changes, income for the first quarter of 1993 would have been $45 million.
 Nonperforming assets at TCB were reduced for the 19th consecutive quarter, to a total of $414 million at March 31, 1993.
 The net yield on interest-earning assets was 4.18 percent in the first quarter, versus 4.11 percent in the 1992 first quarter.
 At March 31, total assets of TCB were $21.0 billion, versus $17.1 billion a year ago. The latest total includes approximately $3.8 billion of First City assets.
 -0- 4/20/93
 /CONTACT: John Meyers, 212-270-7454, John Stefans, 212-270-7438, or (investors) John Borden, 212-270-7318, all of Chemical Banking Corporation/
 (CHL)


CO: Chemical Banking Corporation ST: New York IN: FIN SU: ERN

TS-AH -- NY070 -- 8146 04/20/93 13:54 EDT
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