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METROPOLITAN FINANCIAL REPORTS RECORD RESULTS FOR 1992

 MINNEAPOLIS, Jan. 19 /PRNewswire/ -- Metropolitan Financial Corporation (NYSE: MFC) today reported record results for the year ended Dec. 31, 1992. Net income was $137,131,000, or $4.88 per share on a fully diluted basis, compared with $57,439,000, or $2.16 per fully diluted share for the twelve months ended Dec. 31, 1991. The total reported for 1992 includes $75,941,000 resulting from an accounting change related to the implementation of Statement of Financial Accounting Standard No. 109, "Accounting for Income Taxes" (SFAS 109). The adoption of SFAS 109 resulted in an effective tax rate of nearly 39 percent in 1992 compared to 7 percent in 1991. Income before income taxes, extraordinary items, and the accounting change totaled $110,062,000 for the year, up 78 percent from the $61,866,000 earned in 1991.
 For the quarter ended Dec. 31, 1992, net income was $9,779,000, or $0.34 per share, compared to $23,440,000, or $0.88 per fully diluted share for the same period one year ago. The fourth quarter of last year included $18,923,000 of one time gains related to sales of fixed rate mortgage backed securities. Without those gains, income for the fourth quarter of 1991 before income taxes was $8,898,000 compared to $14,929,000 for the most recent quarter.
 Net interest income before the provision for credit losses totaled $152,557,000 for the year, a 45 percent increase over the $105,112,000 reported for 1991. For the year, the net interest margin was 3.13 percent, compared to 2.44 percent for the previous year. For the fourth quarter, net interest income before the provision was $38,729,000, a nearly 39 percent increase over the $27,897,000 reported for the same period one year ago. The net interest margin for the quarter was 3.11 percent, up from the 2.64 percent reported for the same period in 1991. Management of the company noted that they expect the net interest margin to expand in the first half of 1993 as the cost of funds continues to decline and asset yields increase as the liquidity resulting from the proceeds of the asset sales undertaken earlier in the year was reinvested.
 Noninterest income for 1992 totaled $114,402,000, compared to $89,441,000 for 1991. Gains on asset sales taken in the second quarter of 1992 made the most significant contribution to the current year's total, accounting for nearly $44,000,000 of the total reported that quarter.
 Noninterest income for the quarter ended Dec. 31, 1992 was $18,400,000, compared to $31,944,000 for the last three months of 1991. As previously noted, the level of asset sale gains in the fourth quarter of 1991 was the most significant reason for a higher level of noninterest income reported for that quarter, when compared to the three months just completed. However, adjustments recorded to reflect the effect of the accelerated mortgage payments in the company's mortgage loan servicing portfolio reduced mortgage loan servicing fees from $2,464,000 in the fourth quarter of 1991, to a loss of $99,000 in the most recently completed three month period. Management noted that the prepayments seem to have peaked in the middle of the fourth quarter and that a return to the normalized stream of mortgage loan servicing fees should be expected going forward.
 The fourth quarter saw the corporation's real estate sales and brokerage subsidiary, Edina Realty, Inc. and its title company, Equity Title, continue to post strong results. Real estate sales commissions at Edina Realty were $7,543,000, and title closing fees at Equity Title were $3,052,000 for the quarter, compared to 1991 fourth quarter total of $5,776,000 and $1,919,000 for each of the respective companies. For the year, Edina Realty's sales commissions were $32,113,000, up nearly 23 percent from the $26,172,000 reported for 1991; and Equity Title's closing fees were $11,494,000, up nearly 44 percent from last year's total of $8,001,000.
 For the year, noninterest expense totaled $148,581,000, a 19 percent increase over the total reported for the twelve months ended Dec. 31, 1991. Compensation, occupancy, advertising, federal deposit insurance premiums, and other general and administrative expenses all saw increases due primarily to the company's significant acquisition activity throughout all of 1992. On March 13, Metropolitan acquired five brances of Monycor Savings Bank, formerly known as Barron Federal Savings and Loan Association of Barron, Wis. On April 24, Metropolitan acquired the deposits of twelve branches of First Federal Savings Bank of Rapid City, S.D. On Sept. 30, the company completed a merger with Security Financial Group, Inc., St. Cloud, Minn. and its subsidiary Security Financial Banking and Savings, fsb. On Dec. 1, Metropolitan completed the acquisition of Home Owners Savings Bank of Fergus Falls, Minn. And on Dec. 16, Metropolitan merged with American Charter Federal Savings and Loan Association of Lincoln, Neb.
 For the quarter noninterest expense was $40,600,000 compared to $30,020,000 reported for the same period in 1991. Again, acquisition activity is primarily responsible for the 35 percent increase, although management characterized nearly $1.4 million of the quarter's total as nonrecurring expense related to one time costs associated with acquisition activity.
 Nonperforming assets at Dec. 31, 1992 stood at $98,418,000, compared to $108,083,000 one year ago, but up from the $77,853,000 reported at Sept. 30, 1992. The increase from quarter to quarter is attributable to the American Charter acquisition. Without the nonperforming assets that were added through the 1992 acquisitions, the nonperforming asset total at Dec. 31, 1992 would have been $65,974,000, a decrease of 39 percent for the year. Nonperforming assets as a percent of total assets declined to 1.60 percent for the most recent quarter, down from 2.32 percent for the same period in 1991.
 Norman Jones, chairman and chief executive officer of the company, stated, "The past year has been an extremely eventful year for Metropolitan Financial Corporation. The steps undertaken throughout the year have served to reduce interest rate risk and further reduce credit risk. Additionally, the strong earnings and capital raised late in the third quarter significantly enhanced the regulatory capital of our insured savings bank subsidiary, Metropolitan Federal Bank, fsb. Tangible capital to assets is now 6.33 percent, core capital is 6.88 percent, and risk based capital is 13.53 percent."
 Jones continued, "Our challenge going forward will be to reduce the levels of noninterest expense added as a result of acquisitions, becoming more efficient and cost effective in the process, and to fully realize the value of the acquisitions through a lower cost of funds, a higher level of fee income, and greater lending opportunities now available to us as a result of broader markets, a larger delivery system, and a significantly expanded customer base."
 The 1992 acquisition activity enabled Metropolitan Financial Corporation to report assets at Dec. 31, 1992 of $6.147 billion, a 32 percent increase over the $4.668 billion reported at Dec. 31, 1991. The activity also increased deposits from $3.824 billion at Dec. 31, 1991 to $5.207 billion at year end 1992.
 Metropolitan Financial Corporation is a regional financial services holding company. Its full service consumer savings bank, Metropolitan Federal Bank, fsb, Fargo, N.D., operates 183 offices throughout the states of North Dakota, Minnesota, Iowa, Nebraska, South Dakota, Wisconsin and Arizona. And on Nov. 16, Metropolitan Financial signed a definitive agreement acquire Western Financial Corporation, Overland Park, Kan., and merge its savings bank subsidiary, Columbia Savings Association, F.A., into Metropolitan Federal Bank. Western Financial is a $650 million thrift holding company and Columbia Savings operates 24 savings bank branches throughout the state of Kansas.
 Metropolitan is one of the Twin Cities' largest originators of residential mortgage loans. The corporation's real estate sales and brokerage subsidiary, Edina Realty, Inc., serves Minnesota and western Wisconsin with over 1750 sales associates in 39 locations.
 Metropolitan Financial Corporation's common stock trades on the New York Stock Exchange under the symbol MFC. The series B preferred stock and warrant trade on the NASDAQ System under the symbols MFCNP and MFCNW, respectively.
 -0- 1/19/93
 /CONTACT: William P. Bartkowski of Metropolitan Financial, 612-928-5003/
 /FIRST ADD -- TABULAR MATERIAL -- TO FOLLOW/
 (MFC)


CO: Metropolitan Financial Corporation ST: Minnesota IN: FIN SU: ERN

KH -- MN015 -- 6613 01/19/93 18:24 EST
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Date:Jan 19, 1993
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