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CULLEN/FROST EARNINGS FOR 1993 SET NEW RECORD HIGH

 SAN ANTONIO, Jan. 13 /PRNewswire/ -- Cullen/Frost Bankers, Inc. (NASDAQ-NMS: CFBI), today reported net income for 1993 of $47.2 million, or $4.24 per common share, up from $24.1 million, or $2.26 per common share, for the year ended Dec. 31, 1992. The 1993 earnings level is the highest yearly net income ever attained by Cullen/Frost.
 Net income for the fourth quarter of 1993 was $8.3 million, or $.74 per common share, compared with $8.0 million, also $.74 per common share, for the comparable period of 1992.
 "These significantly improved results are most encouraging," said T.C. Frost, chairman. "They reflect not only better internal operating results but also the continued growth in new jobs in the Texas markets where our presence is concentrated."
 Loans were $1.248 billion at year end 1993, up 6.3 percent in three months from $1.174 billion at Sept. 30, 1993. "This substantial loan growth is driven by more positive economic activity, and our outlook is for expansion to continue during 1994," Frost added.
 Fourth quarter results were impacted by several non-recurring items. Excluding non-recurring items, pre-tax income was $11.2 million compared to $10.7 million for the previous quarter of 1993 and $9.7 million for the fourth quarter of 1992.
 The non-recurring items include a $7.7 million restructuring charge primarily related to downsizing office space used to provide banking services. This charge was partially offset by a credit to the provision for possible loan losses of $3.2 million, a reflection of improved credit quality and better market conditions. Additionally, recasting portions of the investment portfolio resulted in a gain of $1.4 million.
 The restructure of banking offices reflects the conversion to branching which has been put in place over the last several years following changes in Texas banking law. This will not change the number of offices or the level of services provided to customers. The net occupancy restructuring and other efficiencies put into place are currently expected to result in savings in 1994 of approximately $4 million compared to 1993.
 Financial highlights for the quarter were:
 -- Net interest income on a taxable-equivalent basis increased to $32.3 million for the fourth quarter of 1993, compared to $32.1 million for the previous quarter.
 -- Non-interest income for the fourth quarter excluding securities gains was $19.5 million, up from $18.8 million for the third quarter.
 -- Non-interest expense excluding the provision for real estate losses and the restructuring costs was $41.5 million, compared to $40.0 million for the previous quarter.
 -- At Dec. 31, 1993, the corporation adopted SFAS 115 "Accounting for Certain Investments in Debt and Equity Securities." Conforming to this accounting standard did not impact earnings but had the effect of increasing shareholders' equity by $9.1 million.
 Cullen/Frost Bankers, Inc., is a multi-bank holding company with assets of $3.6 billion at Dec. 31, 1993. The corporation has three member banks and 27 offices in the five major Texas banking markets -- San Antonio, Austin, Corpus Christi, Houston/Galveston and Dallas.
 Cullen/Frost Bankers' stock is traded in the over-the-counter (OTC) market under the NASDAQ symbol CFBI.
 CULLEN/FROST BANKERS, INC.
 CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
 1993 1992
 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
 CONDENSED INCOME
 STATEMENTS
 (in thousands of dollars)
 Net interest income $32,122 $31,890 $32,834 $30,980 $29,687
 Net interest income(A) 32,312 32,107 33,074 31,216 29,950
 Provision (credit) for
 possible loan losses (3,244) (2,251) --- (590) 200
 Non-interest income 20,878 18,846 18,822 17,683 16,250
 Provision for real estate
 losses 15 266 251 913 1,730
 Non-interest expense(B) 49,194 40,584 40,460 40,395 34,547
 Net income 8,308 11,977 10,727 16,224(C) 8,041
 PER COMMON SHARE DATA
 Net income-Primary $.74 $1.07 $.96 $1.47(C) $.74
 Cash dividends .15 --- --- --- ---
 Shareholders' Equity 24.85 23.39 22.28 21.29 19.80
 Average common and
 common equivalent
 shares (in thousands) 11,183 11,166 11,149 11,102 11,058
 BALANCE SHEET SUMMARY
 (in millions of dollars)
 Average Balance:
 Loans $1,187 $1,173 $1,178 $1,092 $1,009
 Earning assets 3,068 3,019 3,065 2,834 2,697
 Total assets 3,601 3,549 3,579 3,316 3,117
 Private deposits 2,988 3,017 3,040 2,819 2,637
 Public funds 140 124 110 93 114
 Total deposits 3,128 3,141 3,150 2,912 2,751
 Period-End Balance:
 Loans $1,248 $1,174 $1,181 $1,176 $1,011
 Earning assets 3,110 2,961 2,964 2,979 2,708
 Total assets 3,639 3,508 3,494 3,537 3,151
 Total deposits 3,149 3,102 3,102 3,126 2,769
 Shareholders' equity 274 257 244 233 206
 CAPITAL RATIOS
 Tier 1 Capital Ratio 14.23% 15.08% 13.79% 12.78% 15.66%
 Total Capital Ratio 15.49 16.45 15.16 14.15 17.52
 Equity to Assets Ratio 7.52 7.33 6.99 6.69 6.54
 Leverage Ratio 6.24 6.05 5.52 5.56 6.43
 (A) Taxable-equivalent basis assuming a 35% tax rate for 1993 and a 34% tax rate for 1992.
 (B) Excluding the provision for real estate losses. Includes transition costs of approximately $2.0 million and $3.0 million related to the New First City acquisition for the second and first quarters of 1993, respectively and $7.7 million of restructuring costs in the fourth quarter of 1993.
 (C) Includes the one-time benefit of $8,439,000 related to a change in accounting for income taxes.
 CULLEN/FROST BANKERS, INC.
 CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
 1993 1992
 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
 SELECTED FINANCIAL DATA
 (in thousands of dollars)
 Return on average assets .92% 1.34% 1.20% 1.98% 1.03%
 Return on average equity 12.44 18.87 17.87 27.86 15.61
 Net interest income to
 average earning
 assets(A) 4.19 4.24 4.32 4.43 4.43
 Allowance for possible
 loan losses $26,298 $28,559 $31,050 $31,389 $31,897
 As a percentage of
 period-end loans 2.11% 2.43% 2.63% 2.67% 3.15%
 Net charge-offs (recoveries):
 Real estate $202 $307 $76 $484 $2,142
 Commercial
 and industrial (1,292) (329) (22) (637) (164)
 Energy (1) (2) (2) (5) (31)
 Consumer 110 285 297 440 13
 Other (2) (21) (10) (364) 21
 Total $(983) $240 $339 $(82) $1,981
 As a percentage of
 average loans (.33)% .08% .12% (.03)% .78%
 Non-performing assets:
 Non-accrual loans $17,171 $19,650 $20,073 $23,742 $23,117
 Restructured loans 556 635 647 712 31
 Foreclosed assets,
 net of allowance 13,383 19,506 21,427 26,175 28,155
 Total $31,110 $39,791 $42,147 $50,629 $51,303
 As a percentage of:
 Total assets .85% 1.13% 1.21% 1.43% 1.63%
 Total loans plus
 foreclosed assets 2.47 3.33 3.50 4.21 4.94
 (A) Taxable-equivalent basis assuming a 35% tax rate in 1993 and a 34% tax rate in 1992.
 CULLEN/FROST BANKERS, INC.
 CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
 Year Ended December 31
 1993 1992 1991 1990 1989
 CONDENSED INCOME
 STATEMENTS
 (in thousands of dollars)
 Net interest
 income $127,826 $116,657 $108,514 $110,044 $106,960
 Net interest
 income(A) 128,709 117,786 110,654 112,923 110,546
 Provision (credit)
 for possible
 loan losses (6,085) (850) 10,020 31,993 28,902
 Non-interest
 income 76,229 61,813 57,482 50,592 50,480
 Provision for
 real estate
 losses 1,445 19,311 20,799 11,172 8,131
 Non-interest
 expense(B) 170,633 134,187 134,339 125,455 117,534
 Net income
 (loss) 47,236(C) 24,122 205 (8,220) 2,673
 PER COMMON SHARE DATA
 Net income
 (loss)
 -Primary $4.24(C) $2.26 $.02 $(.85) $.28
 Shareholders'
 equity 24.85 19.80 17.55 17.79 18.92
 Cash dividends .15 --- --- --- ---
 Average common and
 common equivalent
 shares
 (in thousands) 11,151 10,974 10,075 9,652 9,516
 BALANCE SHEET SUMMARY
 (in millions of dollars)
 Average Balance:
 Loans $1,158 $1,025 $1,149 $1,315 $1,407
 Earning assets 2,997 2,637 2,681 2,873 3,071
 Total assets 3,512 3,055 3,105 3,289 3,455
 Private deposits 2,967 2,597 2,619 2,714 2,713
 Public funds 117 114 139 154 150
 Total deposits 3,084 2,711 2,758 2,868 2,863
 Shareholders'
 equity 249 192 176 178 178
 Period-End Balance:
 Loans ? $1,248 $1,011 $1,073 $1,268 $1,370
 Earning assets 3,110 2,708 2,611 2,781 3,076
 Total assets 3,639 3,151 3,079 3,255 3,505
 Total deposits 3,149 2,769 2,766 2,878 2,980
 Shareholders'
 equity 274 206 176 173 179
 (A) Taxable-equivalent basis assuming a 35% tax rate for 1993 and a 34% tax rate for 1989 through 1992.
 (B) Excluding the provision for real estate losses. 1993 includes approximately $5.0 million in transition costs related to the New First City acquisition and $7.7 million in restructuring costs.
 (C) 1993 net income includes the one-time benefit of $8,439,000 related to a change in accounting for income taxes.
 CULLEN/FROST BANKERS, INC.
 CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
 Year Ended December 31
 1993 1992 1991 1990 1989
 SELECTED FINANCIAL DATA
 (in thousands of dollars)
 Return on average
 assets 1.34% .79% .01% N/A .08%
 Return on average
 equity 19.00 12.56 .12 N/A 1.51
 Net interest income
 to average
 earning
 assets(A) 4.29 4.47 4.13 3.93% 3.60
 Allowance for
 possible
 loan losses $26,298 $31,897 $42,387 $45,604 $42,282
 As a percentage
 of period-end
 loans 2.11% 3.15% 3.95% 3.60% 3.09%
 Net charge-offs
 (recoveries):
 Real estate $1,069 $4,347 $8,057 $11,023 $16,039
 Commercial
 and
 industrial (2,280) 423 1,992 11,317 5,404
 Energy (10) (145) (2) (722) 1,092
 Consumer 1,132 1,365 2,006 2,455 2,327
 Other (397) 3,650 1,184 4,598 3,270
 Total $(486) $9,640 $13,237 $28,671 $28,132
 As a percentage of
 average loans (.04)% .94% 1.15% 2.18% 2.00%
 Non-performing assets:
 Non-accrual
 loans $17,171 $23,117 $36,172 $52,557 $59,223
 Restructured
 loans 556 31 313 178 17,170
 Foreclosed assets,
 net of
 allowance 13,383 28,155 64,157 69,130 55,340
 Total $31,110 $51,303 $100,642 $121,865 $131,733
 As a percentage of:
 Total assets .85% 1.63% 3.27% 3.74% 3.76%
 Total loans plus
 foreclosed
 assets 2.47 4.94 8.85 9.11 9.24
 (A) Taxable-equivalent basis assuming a 35% tax rate for 1993 and a 34% tax rate for 1989-1992.
 -0- 1/13/94
 /CONTACT: John D. Gellhausen of Cullen/Frost Bankers, 210-220-4878, or Tammy Valentine of Dublin-McCarter & Associates, 210-227-0221/
 (CFBI)


CO: Cullen/Frost Bankers, Inc. ST: Texas IN: FIN SU: ERN

TW-JG -- NY020 -- 1743 01/13/94 10:03 EST
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