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 PHILADELPHIA, Oct. 20 /PRNewswire/ -- CoreStates Financial Corp (NASDAQ-NMS: CSFN) today reported third quarter net income of $86,010,000 or 73 cents per share, up more than 26 percent from $67,895,000 or 59 cents per share in 1992. Net income for the first nine months was $242,615,000 or $2.07 per share, up from $193,297,000 or $1.68 per share in 1992 before the cumulative effect of an accounting change. Per-share figures reflect the Oct. 15, 1993, 2-for-1 stock split.
 These results represent record quarterly operating earnings. CoreStates reported a return on average assets of 1.49 percent and a return on average equity of 18.57 percent for the quarter.
 Terrence A. Larsen, chairman, said the improvement from 1992 reflected growth both in net interest income and (excluding the effects of a restructuring of the company's electronic payment services business last December) in non-interest revenues from fee-based services.
 "In contrast to general industry trends, CoreStates has generated increases in average loan outstandings for the past two quarters," Larsen said. "This loan growth represents solid expansion of business across the broad customer base."
 The combination of higher average loan outstandings and a stronger net financial margin resulted in net interest income growth of 10 percent year-to-year, he said. The net financial margin was up 33 basis points from a year ago to a very strong 5.85 percent.
 Excluding the category affected by the corporate restructuring of the electronic payment services, revenues from fee-based services also grew, with strong contributions in particular from service charges on deposit accounts and from international service fees. Other operating income included a gain of $11 million on the sale of five branches in the Virgin Islands.
 Total non-financial expenses were flat compared to a year ago, though they included a $10 million restructuring charge related to the creation of CoreStates' new stand-alone check processing business, Transys. Without the Transys charge, total expenses would have been down 3.4 percent, in large part because of the electronic payment services restructuring.
 "We are continuing to emphasize careful expense management in the current slow-growth economic environment," Larsen said.
 Non-performing assets declined for the fifth consecutive quarter and at Sept. 30 were $295.4 million or 1.9 percent of loans and other real estate and 1.3 percent of total assets. Non-performing assets a year ago were $442 million.
 The consolidated provision for loan losses was $25 million for the quarter and $75 million for the first nine months, compared to $27 million and $92.3 million, respectively, in 1992. Net charge-offs were $22.3 million for the quarter and $55.9 million for the nine months, compared to $31.7 million and $98.0 million, respectively, a year ago.
 The reserve for loan losses at Sept. 30 was $341.2 million, or 141.5 percent of non-performing loans and 2.15 percent of total loans.
 CoreStates' consolidated total assets at Sept. 30 were $22.8 billion, including $15.9 billion of consolidated net loans. Consolidated total deposits were $16.2 billion.
 Shareholders' equity was $1.86 billion, or 8.1 percent of total assets. The Tier 1 leverage ratio (Tier 1 or core capital as a percentage of quarterly average assets) was 8.1 percent for the quarter. Tier 1 capital at Sept. 30 was 9.5 percent of risk-adjusted assets and total capital was 13.1 percent of risk-adjusted assets, compared to regulatory requirements of 4 percent and 8 percent respectively.
 The comparisons with last year's first nine months were before the cumulative effect of a change in accounting treatment of anticipated retiree benefits. CoreStates elected to take a single after-tax non-cash charge of $81 million in the first quarter of 1992 to account for benefits earned by employees in prior years.
 (in thousands, except per share amounts)
 Three Months Ended Sept. 30 1993 1992
 Net income $ 86,010 $ 67,895
 Per Share(A):
 Net income $0.73 $0.59
 Average number of
 shares outstanding 117,530 115,884
 Nine Months Ended Sept. 30 1993 1992
 Income before cumulative effect of
 a change in accounting principle $242,615 $193,297
 Net income 242,615 112,311(B)
 Per Share(A):
 Income before cumulative effect of
 a change in accounting principle $2.07 $1.68
 Net income 2.07 0.97(B)
 Average number of
 shares outstanding 117,335 115,322
 (A) Reflects the impact of CoreStates' 100 percent stock dividend declared on Aug. 17, 1993, payable on Oct. 15, 1993, to shareholders of record on Sept. 15, 1993.
 (B) Reflects the adoption of Statement of Financial Accounting Standards No. 106, "Employer's Accounting for Postretirement Benefits Other Than Pensions" (FAS 106). As permitted under FAS 106, CoreStates elected to recognize immediately the Jan. 1, 1992, transitional liability of $122.7 million pre-tax, $81.0 million after-tax, as the cumulative effect of a change in accounting principle in the first quarter of 1992.
 -0- 10/20/93
 /CONTACT: Gary Brooten or Gregg Feistman of CoreStates Financial, 215-973-3546/

CO: CoreStates Financial Corp ST: Pennsylvania IN: FIN SU: ERN

LJ -- PH005 -- 4385 10/20/93 08:41 EDT
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Publication:PR Newswire
Date:Oct 20, 1993

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