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ESSEX FINANCIAL PARTNERS, L.P., ANNOUNCES FIRST QUARTER RESULTS

 VIRGINIA BEACH, Va., May 14 /PRNewswire/ -- Essex Financial Partners, L.P. (AMEX: ESX), today announced a $1.8 million loss for the first quarter of 1993. The loss was attributable to a $1.4 million operating loss incurred at Essex Mortgage Corporation (EMC), the Partnership's non-bank mortgage subsidiary, and a $583,000 consolidated operating loss incurred at Essex Savings Bank, F.S.B. - North Carolina (ESB-NC). The Partnership' net loss for the quarter ended March 31, 1993, resulted in a net loss of 87 cents per Class A limited partnership unit as compared to a net loss of $1.33 per unit for the quarter ended March 31, 1992. Furthermore, Partners' capital decreased from approximately $3.5 million at Dec. 31, 1992, to approximately $1.7 million at March 31, 1993.
 Despite the first quarter loss, however, the Partnership's non-performing assets, net of specific reserves, decreased from $24.3 million at Dec. 31, 1992, to $22.9 million at March 31, 1993. Furthermore, loans in the 30-59 day and 60-89 day delinquency categories at the savings banks continue to decline, as delinquent loans in these categories decreased from $6.7 million at Dec. 31, 1992, to $4.9 million at March 31, 1993.
 The operating losses at EMC continue to result from the accelerated amortization of purchased mortgage servicing rights (PMSRs) owned by EMC and the high amount of interest expense on EMC's debt securities (the Essex 11's), in addition to substantial expenses for professional fees incurred in connection with the recently completed restructuring of the Essex 11's, which was described in the Partnership's May 7, 1993, press release. Because EMC's PMSRs are expected to be sold in the second quarter of 1993 to a third-party purchaser as part of the restructuring of the Essex 11's, and because all the Essex 11's are expected to be canceled in due course, the restructuring should mitigate the further adverse impact on EMC's and the Partnership's operations resulting from the amortization of the PMSRs and the recognition of interest expense. However, the results of EMC's and the Partnership's operations for the second quarter of 1993 will be impacted by further amortization of PMSR's, Essex 11's interest expense, and approximately $900,000 of professional fees and other transaction expenses incurred in connection with the restructuring.
 The $583,000 operating loss at ESB-NC for the first quarter of 1993 reflects the impact of a narrowing interest rate spread, as well as a reduction in loan servicing income, which resulted from ESB-NC's sale of mortgage loans. The loans sold were primarily high-yielding second mortgages and the proceeds from this sale were reinvested in lower- yielding, but higher-quality first mortgage loans and investments. The loan sale was consummated to provide improved long-term interest rate protection, to enhance ESB-NC's risk-based capital position, and to reduce the balance of unamortized loan premiums. Furthermore, ESB-NC's net interest income was adversely impacted by a $8.2 million decrease in consolidated total assets, which was attributable to a $7.3 million combined decrease in ESB-NC's deposits and Federal Home Loan Bank advances. ESB-NC's consolidated operating loss was also affected by impairment adjustments to loan premiums and PMSRs of $106,000 and $75,000, respectively, related to the unanticipated prepayment of mortgage loans underlying these assets.
 As announced in the Partnership's May 7, 1993, press release, the restructuring of the Partnership and the merger of its savings banks have been consummated. As a result, the post-merger savings bank (ESB) is now in compliance with all regulatory capital standards. Management believes that the merger will enable ESB to realize substantial reductions in operating costs, among other benefits.
 -0- 5/14/93
 /CONTACT: Essex Financial Partners, L.P., Investor Relations, 804-431-5612/
 (ESX)


CO: Essex Financial Partners, L.P. ST: Virginia, North Carolina IN: FIN SU: ERN

KD-TW -- DC022 -- 8795 05/14/93 16:42 EDT
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Publication:PR Newswire
Date:May 14, 1993
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