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CONTINENTAL BANK POSITIONED TO IMPROVE PROFITABILITY; BANK CAN ACHIEVE LONGER-TERM GOAL OF 15 PERCENT ROE: THEOBALD

 CONTINENTAL BANK POSITIONED TO IMPROVE PROFITABILITY;
 BANK CAN ACHIEVE LONGER-TERM GOAL OF 15 PERCENT ROE: THEOBALD
 CHICAGO, April 27 /PRNewswire/ -- Continental Bank Corporation (NYSE: CBK) intends to improve on the strong performance achieved in the past two quarters, Chairman Thomas C. Theobald told stockholders at the company's annual meeting today.
 "We're confident we have jettisoned the significant drags on our profitability," he said. "With the economy emerging from a recession, we expect our credit costs to settle back to a more reasonable level."
 Expenses continue to decline, and revenue per employee -- a key measure of productivity -- now stands at nearly $220,000 a year. "There is ample room between revenue and expenses to make money even in a lackluster environment," Theobald said.
 As the industry consolidates, "pricing will continue to improve and there will be fewer direct competitors for the business," he said.
 If revenue and expense trends hold, he said, "we believe we will be able to continue earning our 15 percent return-on-common-equity target even a few years down the road, when our tax rate will rise as loss carryforwards are used up."
 Theobald said: "We believe we are in a good position for the future -- and our current stock price tells me that investors agree."
 Another important factor in Continental's performance has been the establishment of an entrepreneurial culture of owner/managers, Theobald said. "Our entire management philosophy is based on making sure that everyone at Continental has a direct interest in the company's long-term success," he said.
 The program's elements include Continental's employee stock ownership plan, which now holds nearly 4 percent of outstanding shares; substituting stock for cash in making incentive payments to key managers; and requiring the purchase of substantial ownership positions in Continental stock by the bank's executive managers.
 Theobald said: "As an example, in my case the required amount is equal to two times base pay; other members of the management committee are expected to meet a one- to a one-and-a-half-times ratio; and for others, the minimum is 10,000 shares. Our directors are also demonstrating their commitment.
 "We will continue in every way to emphasize linking personal reward to corporate performance," he said. "From my experience, there is no better way to ensure the long-term success of a company than by aligning the interests of shareholders and employees."
 Continental Bank Corporation is a bank holding company that focuses on meeting the capital and financial management needs of publicly and privately held businesses nationwide. Through its subsidiaries, the company provides business financing, specialized financial and operating services and private banking services. Continental also engages in equity finance and investing, as both principal and arranger, and international trading, for customers and its own account.
 -0- 4/27/92
 /CONTACT: Jane Crowley Griffin, 312-923-5122, or William C. Murschel, 312-923-5130, or Edgar P. McDougal, 312-923-5200, all for Continental Bank/
 (CBK) CO: Continental Bank Corporation ST: Illinois IN: FIN SU:


CK -- NY080 -- 3160 04/27/92 12:29 EDT
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Publication:PR Newswire
Date:Apr 27, 1992
Words:492
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