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HARRIS BANCORP REPORTS RESULTS

 HARRIS BANCORP REPORTS RESULTS
 CHICAGO, Oct. 22 /PRNewswire/ -- Harris Bancorp today announced


record net income of $32,803,000 for its third quarter, an increase of 13 percent from 1991 third quarter earnings of $29,002,000. B. Kenneth West, chairman and chief executive officer, attributed this increase primarily to higher levels of trust and foreign exchange revenue along with a reduction in the corporation's provision for credit losses.
 Third quarter net interest income on a fully taxable equivalent basis was $116.1 million, down 2 percent from $119.0 million in 1991's third quarter. Average earning assets fell 5 percent from $11.45 billion a year ago to $10.94 billion, with domestic loans and money market assets showing the greatest declines. Net interest margin, the other principal determinant of net interest income, increased to 4.24 percent from 4.14 percent in the same quarter last year, reflecting wider market spreads and a relative decline in lower-yielding earning assets.
 Noninterest income advanced 7 percent over the same quarter last year to $79.7 million. Trust and investment management fees, foreign exchange revenue and service charges all increased from the prior year while charge card fees and profits from bond and financial instrument trading activities were down period to period. During the year-ago quarter, the corporation realized a net gain of $736,000 from the elective sale of certain investment portfolio securities compared to virtually no net gains or losses for the 1992 third quarter.
 Noninterest expenses rose 1 percent in the quarter to $132.7 million. Higher compensation and other employee benefit costs were partially offset by declines in occupancy costs, primarily from reversals of prior real estate tax accruals.
 Income tax expense increased by $6.9 million during the current quarter reflecting both higher pretax income and the recognition in 1991 of previously unrecorded income tax benefits. Tax expense was reduced during the current quarter by recording benefits from prior year AMT credit carryforwards.
 The third quarter 1992 provision for credit losses was $15.4 million compared to $21.6 million for the prior year's quarter. Net loan charge-offs during the current quarter were $17.7 million, down from $23.0 million one year ago. This decrease resulted from lower write- offs in both the charge card and domestic commercial portfolios and from recoveries on certain LDC credits.
 On Sept. 30, 1992, the allowance for possible credit losses was $134.5 million, equal to 1.86 percent of total loans outstanding, compared with $126.5 million or 1.65 percent of loans at the end of the 1991 third quarter.
 Nonperforming assets on Sept. 30, 1992, totaled $158.8 million, or 2.2 percent of total loans, down from $184.5 million or 2.4 percent of loans one year earlier and also down from $184.4 million or 2.5 percent, at June 30, 1992. The decline in nonperforming assets from this year's second quarter primarily resulted from repayments and other reductions in the carrying value of one large commercial credit currently classified as nonperforming.
 At Sept. 30, 1992, equity capital of Harris Bancorp amounted to $919 million compared to $838 million one year earlier. The increase resulted from earnings for the prior twelve months, reduced by dividends of $29 million. Harris Bancorp's regulatory capital leverage ratio was 6.99 percent for the third quarter of 1992 compared to 6.19 percent in the same quarter of 1991. Banking regulators generally require most banking institutions to maintain leverage capital ratios of not less than 4 percent.
 The annualized returns on average stockholder's equity and assets were 14.50 percent and 1.02 percent, respectively, in the current quarter compared to returns of 13.96 percent and .88 percent a year earlier.
 For the first nine months of the year, net income was $82,487,000, up 8 percent from $76,205,000 in the comparable 1991 period. Factors contributing to 1992 earnings growth included higher levels of both net interest income and noninterest sources of revenue, including realized net gains of $15.8 million from the sale of the corporation's claims in Mexico and Brazil.
 Fully taxable equivalent net interest income increased by $14.8 million or 4 percent from the same nine-month period in 1991, reflecting both an expansion in net interest margin from 4.12 percent to 4.18 percent, and 3 percent growth in average earning assets. Noninterest income advanced $27.2 million or 12 percent. Aside from the aforementioned LDC gains, revenues from trust and investment management fees, service charges, and foreign exchange all rose substantially compared to the year-ago period.
 Year-to-date noninterest expenses were up $38.3 million or 10 percent compared to the same period last year. Current year expenses included a special $11.8 million charge for the writedown of land and related pre-construction expenditures originally capitalized in connection with the previously planned construction of a new operations center. Management determined that a writedown was necessary because of the uncertainty of proceeding with the proj ?in the near future. Excluding the effect of this charge, total expenses would have increased by approximately 7 percent.
 HARRIS BANCORP, INC.
 CONSOLIDATED EARNINGS HIGHLIGHTS
 (in thousands, except ratios and per share data)
 Nine months ended Sept. 30
 1992 1991 Pct. Change
 Net interest income $ 334,387 316,336 6
 Net interest income (fully
 taxable equivalent) 360,904 346,140 4
 Provision for credit
 losses 58,965 60,725 - 3
 Noninterest income 247,091 219,887 12
 Noninterest expenses 422,961 384,622 10
 Net income 82,487 76,205 8
 Net income per share 12.37 11.43 8
 Return on average assets .83 pct. .79 pct.
 Return on average equity 12.50 pct. 12.56 pct.
 Quarter ended Sept. 30
 1992 1991 Pct. Change
 Net interest income $ 109,471 108,863 1
 Net interest income (fully
 taxable equivalent) 116,100 118,998 - 2
 Provision for credit
 losses 15,410 21,610 -29
 Noninterest income 79,715 74,226 7
 Noninterest expenses 132,711 131,113 1
 Net income 32,803 29,002 13
 Net income per share 4.92 4.35 13
 Return on average assets 1.02 pct. .88 pct.
 Return on average equity 14.50 pct. 13.96 pct.
 CONSOLIDATED STATISTICS
 (in millions)
 At Sept. 30 Percent
 1992 1991 Change
 Money Market assets $ 817 1,336 -39
 Loans, net of
 unearned income 7,210 7,652 -6
 Investment securities 2,645 2,511 5
 Deposits 8,516 9,645 -12
 Stockholders' equity 919 838 10
 Total assets 12,468 13,696 -9
 Year to date
 Daily average balances Percent
 1992 1991 Change
 Money Market assets 1,005 1,258 -20
 Loans, net of
 unearned income 7,371 7,399 -
 Investment securities 2,843 2,428 17
 Deposits 8,871 9,069 -2
 Stockholders' equity 881 811 9
 Total assets 13,342 12,950 3
 -0- 10/22/92
 /CONTACT: Paul Skubic, 312-461-2220, or Mary Ullrich, 312-461-6905, both of Harris Bancorp/ CO: Harris Bancorp ST: Illinois IN: FIN SU: ERN


PS -- NY054 -- 3443 10/22/92 10:36 EDT
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Date:Oct 22, 1992
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