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COLORADO NATIONAL BANKSHARES REPORTS RECORD QUARTERLY EARNINGS

 DENVER, April 15 /PRNewswire/ -- Colorado National Bankshares Inc. (NASDAQ: COLC) announced today net income of $13,736,000 ($1.11 per share) for the first quarter of 1993, compared with $9,818,000 (82 cents per share) in the first quarter last year. First quarter earnings last year included $5,365,000 (45 cents per share) related to the adoption of Statement of Financial Accounting Standards No. 109, Accounting for Income Taxes.
 Will F. Nicholson, Jr., chairman, president and chief executive officer, commented, "The company's record earnings this quarter are the result of:
 -- A reduced provision for loan losses, which totaled
 $2.9 million for the three months just ended, down 67 percent
 from the $8.5 million recorded in 1992. The reduced provision
 is due to the company's continued improvement in asset quality.
 -- The realization of $1.1 million of net income on foreclosed
 assets in the first quarter of 1993, compared with a net
 expense of $2.0 million in 1992. The income in 1993 was
 principally from gains realized on the sale of foreclosed
 real estate.
 -- Higher net interest income - up $2.4 million from the first
 quarter of 1992, primarily the result of lower levels of
 interest-bearing deposits and borrowed funds. The net yield
 on interest-earning assets increased as well, from 5.57 percent
 in the first quarter of 1992 to 6.08 percent in the most recent
 quarter.
 -- Lower noninterest expenses. Reflecting the company's
 emphasis on cost control, noninterest expenses (other than
 net foreclosed asset expense), decreased $1.8 million from
 the first quarter of 1992."
 Problem assets at March 31, 1993, totaled $47.6 million, down $45.0 million from March 31, 1992, and down $8.4 million from Dec. 31, 1992. "Other than bankcard loans," noted Nicholson, "recoveries of loans previously charged off exceeded loan chargeoffs by $2.7 million in the first three months of 1993."
 As previously announced, the company has agreed to merge with First Bank System Inc. (NYSE: FBS), whereby each share of Colorado National common stock would be exchanged for 1.71206 shares of FBS common stock. The merger is conditioned upon the approvals of the shareholders of both companies and is expected to be completed in May. It was approved by the Federal Reserve Board on March 29, 1993.
 Colorado National Bankshares, is a bank holding company headquartered in Denver. The company is comprised of 8 commercial banks providing 24 banking offices throughout Colorado as well as several other bank-related subsidiaries including a mortgage banking company, a leasing company and an insurance agency. It is also manager and 50 percent owner of Rocky Mountain BankCard System Inc., a national credit card issuer and one of the largest processors of credit card transactions in the country.
 COLORADO NATIONAL BANKSHARES INC.
 Results of Operations
 For the Three Months Ended March 31, 1993 and 1992
 (dollars in thousands, except per share data)
 Percent
 Increase
 1993 1992 (Decrease)
 Total interest income $54,242 $59,785 (9.3)
 Total interest expense 15,478 23,416 (33.9)
 Net interest income 38,764 36,369 6.6
 Provision for loan losses 2,853 8,541 (66.6)
 Net interest income after
 provision for loan losses 35,911 27,828 29.0
 Investment securities gains 138 42 228.6
 Other income 33,461 32,080 4.3
 Net expense (income)
 of foreclosed assets (1,057) 1,959 (154.0)
 Other expense 47,619 49,459 (3.7)
 Income before income taxes
 and minority interest 22,948 8,532 169.0
 Income tax expense 8,228 3,486 136.0
 Income before minority interest 14,720 5,046 191.7
 Minority interest in net income
 of consolidated subsidiary 984 593 65.9
 Income before cumulative effect
 of change in accounting
 principle 13,736 4,453 208.5
 Cumulative effect of change
 in accounting principle -- 5,365 (100.0)
 Net income $13,736 $ 9,818 39.9
 Primary earnings per share:
 Before cumulative effect
 of change in
 accounting principle $1.11 $.37 200.0
 Cumulative effect of change
 in accounting principle -- .45 (100.0)
 Net income per share $1.11 $.82 35.4
 Fully-diluted earnings per share:
 Before cumulative effect
 of change in
 accounting principle $1.04 $.37 181.1
 Cumulative effect of change
 in accounting principle -- .44 (100.0)
 Net income per share $1.04 $.81 28.4
 Cash dividends declared
 and paid $2,639 $463 470.0
 Dividends per share .22 .04 450.0
 Loan Losses
 (dollars in thousands)
 (percentages are annualized percentages of net chargeoffs
 or loan loss provision to related average loans)
 Net Chargeoffs (Recoveries) Loan Loss
 Bankcard Other Total Provision
 Quarter $ Pct. $ Pct. $ Pct. $ Pct.
 1991-1st 3,923 3.79 1,150 .34 5,073 1.15 9,237 2.09
 -2nd 4,055 3.90 2,658 .78 6,713 1.51 8,319 1.87
 -3rd 4,073 3.70 14,170 4.21 18,243 4.08 11,633 2.60
 -4th 4,439 3.99 5,643 1.75 10,082 2.33 14,158 3.27
 1992-1st 4,245 3.93 1,773 .59 6,018 1.47 8,541 2.08
 -2nd 3,889 3.67 2,497 .84 6,386 1.59 4,195 1.04
 -3rd 3,428 3.13 908 .32 4,336 1.09 4,690 1.18
 -4th 3,133 2.78 457 .16 3,590 .91 1,610 .41
 1993-1st 2,935 2.62 (2,697) (.99) 238 .06 2,853 .74
 Statement of Condition Summary
 (dollars in thousands, except per share data)
 March 31, Pct. Inc.
 1993 1992 (Dec.)
 Total assets $2,976,193 $3,120,968 (4.6)
 Total deposits 2,520,854 2,653,390 (5.0)
 Total loans 1,578,833 1,629,576 (3.1)
 Allowance for loan losses 63,162 64,337 (1.8)
 Shareholders' equity 270,803 221,224 22.4
 Book value per share 22.26 19.11 16.5
 Problem assets (in millions)
 Nonaccrual loans $26.2 $ 43.6 (39.9)
 Restructured loans 3.1 4.2 (26.2)
 Past-due loans 1.9 4.8 (60.4)
 Total problem loans 31.2 52.6 (40.7)
 Foreclosed assets:
 Real estate 9.3 14.4 (35.4)
 In-substance foreclosures 6.9 25.1 (72.5)
 Other foreclosed assets .2 .5 (60.0)
 Total problem assets $47.6 $92.6 (48.6)
 Total problem loans as a
 percentage of total loans 2.0pct. 3.2pct. --
 Allowance for loan losses as a
 percentage of total loans 4.0pct. 3.9pct. --
 Reserve coverage of problem loans 202.7pct. 122.3pct. --
 Average Statement of Condition
 Three Months Ended
 (dollars in thousands) March 31, Pct. Inc.
 1993 1992 (Dec.)
 Interest-earning assets:
 Loans $1,556,570 $1,650,997 (5.7)
 Securities 861,783 664,715 29.6
 Trading account securities 291 683 (57.4)
 Short-term investments 180,820 330,814 (45.3)
 Total interest-earning assets 2,599,464 2,647,209 (1.8)
 Noninterest-earning assets:
 Allowance for loan losses (61,177) (62,768) (2.5)
 Cash and due from banks 239,345 256,193 (6.6)
 Other assets 159,042 183,467 (13.3)
 Total assets $2,936,674 $3,024,101 (2.9)
 Interest-bearing liabilities:
 Interest-bearing deposits $1,797,183 $1,924,340 (6.6)
 Short-term borrowings 119,046 156,777 (24.1)
 Long-term debt -- 23,779 (100.0)
 Total interest-bearing
 liabilities 1,916,229 2,104,896 (9.0)
 Noninterest-bearing liabilities:
 Noninterest-bearing deposits 699,368 651,055 7.4
 Other liabilities 62,869 53,773 16.9
 Shareholders' equity 258,208 214,377 20.4
 Total liabilities and
 shareholders' equity $2,936,674 $3,024,101 (2.9)
 Net yield on
 interest-earning assets 6.08pct. 5.57pct. --
 Interest rate spread 5.21pct. 4.66pct. --
 Net Income Comparison
 (dollars in millions)
 First Fourth Qtr. First Qtr.
 Quarter 1992 1992
 1993 Change Amount Change Amount
 Net interest income $38.8 $0.1 $38.7 $2.5 $36.3
 Provision for loan losses 2.9 1.3 1.6 (5.6) 8.5
 Net interest income after
 provision for loan
 losses 35.9 (1.2) 37.1 8.1 27.8
 Noninterest income:
 Trust income 3.3 0.3 3.0 0.5 2.8
 Service charges on
 deposit accounts 5.1 (0.1) 5.2 (0.3) 5.4
 Bankcard sales discount 9.4 (1.1) 10.5 0.3 9.1
 Bankcard fees 6.8 0.1 6.7 0.1 6.7
 Bankcard servicing fee 3.0 (0.5) 3.5 (0.4) 3.4
 Investment security gains 0.1 0.1 -- 0.1 --
 Miscellaneous income 5.9 0.7 5.2 1.2 4.7
 Total noninterest
 income 33.6 (0.5) 34.1 1.5 32.1
 Noninterest expense:
 Salaries and payroll tax 18.7 (2.1) 20.8 (0.3) 19.0
 Employee benefits 2.9 (0.3) 3.2 (0.1) 3.0
 Severance expense 1.8 (1.7) 3.5 1.8 --
 Total personnel expense 23.4 (4.1) 27.5 1.4 22.0
 Writedowns of
 foreclosed assets .9 0.7 .2 (0.7) 1.6
 Net loss (gain) on sale
 of foreclosed assets (1.7) (0.5) (1.2) (1.9) .2
 Other net expense (income)
 of foreclosed assets (.3) (1.0) .7 (0.5) .2
 FDIC insurance 1.7 0.2 1.5 -- 1.7
 Other fixed and overhead
 expenses 22.6 (4.6) 27.2 (3.1) 25.7
 Total noninterest
 expense 46.6 (9.3) 55.9 (4.8) 51.4
 Income before income taxes
 and minority interest 22.9 7.6 15.3 14.4 8.5
 Income tax expense 8.2 2.1 6.1 4.7 3.5
 Income before minority
 interest 14.7 5.5 9.2 9.7 5.0
 Minority interest in net
 income of consolidated
 subsidiary 1.0 0.3 .7 0.4 .6
 Income before cumulative
 effect of change in
 accounting principle 13.7 5.2 8.5 9.3 4.4
 Cumulative effect of change
 in accounting principle -- -- -- (5.4) 5.4
 Net income $13.7 $5.2 $ 8.5 $3.9 $ 9.8
 -0- 4/15/93
 /CONTACT: James L. Basey of Colorado National Bankshares, 303-629-1968/
 (COLC FBS)


CO: Colorado National Bankshares Inc.; First Bank System Inc. ST: Colorado IN: FIN SU: ERN

BB -- DV001 -- 0876 04/15/93 13:32 EDT
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Date:Apr 15, 1993
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