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NATWEST BANCORP TURNAROUND CONTINUES

 NATWEST BANCORP TURNAROUND CONTINUES
 NEW YORK, Jan. 16 /PRNewswire/ -- National Westminster Bancorp


(NASDAQ: NWLIA) (NatWest Bancorp) today reported a consolidated net loss of $29.8 million for the fourth quarter of 1991 and $371.5 million for the year (1990: $228.8 million loss and $352.4 million loss, respectively). This fourth quarter result represents a significant improvement over this third quarter and continues the sharp turnaround evidenced during the year. Also, in the fourth quarter, the company achieved a material reduction in nonperforming loans, lower charge-offs and flat expenses compared to the prior quarter.
 Commenting on the results, John Tugwell, who took over as chairman and chief executive of NatWest Bancorp in April 1991, said, "We ended a very difficult year on a more positive note, with a further large decline in our losses. Our ability to improve operating profit while we continue to absorb the impact of real estate problems, shows the underlying strength of our institution. We continue to show steady improvement in net operating profit (net income before loan loss provision and OREO writedowns), which rose in each quarter of 1991."
 "I am very pleased with the progress we've made," said Tugwell. "Not only did we spend considerable time getting our loan portfolio in better shape, but we also restructured the Bank to better position ourselves for the future." He added that although there is continuing uncertainty with respect to economic conditions, he fully expects Bancorp's momentum of late 1991 to carry forward.
 "We have strong capital ratios and are in the unique position of being a part of one of the best capitalized banks in the world. Our sound core businesses, along with continued cost control and the strength and support of our parent organization, are the key ingredients that will position us for growth and a return to profitability in 1992," said Tugwell.
 The 1991 fourth quarter and year results included provisions for loan losses of $88.0 million and $567.7 million, respectively, down from $292.6 million and $597.7 million in the respective 1990 periods, again reflecting a positive trend over recent quarters. Net charge-offs totalled $74.9 million in the fourth quarter compared with $195.8 million in the fourth quarter of 1990.
 Over the year, the company further strengthened its allowance for loan losses which increased to $689.5 million, or 4.88 percent of total loans outstanding at Dec. 31, 1991, compared with $529.1 million, or 3.30 percent of total loans outstanding at Dec. 31, 1990.
 Of particular significance is the lower level of non-accrual loans which totalled $1,153.9 million at Dec. 31, 1991, compared with $1,304.5 million at Sept. 30, 1991. At Dec. 31, 1990, non-accrual loans totalled $969.9 million. Non-accrual loans amounted to 8.16 percent of total loans at Dec. 31, 1991, compared to 8.92 percent at Sept. 30, 1991 and 6.04 percent at Dec. 31, 1990.
 Foreclosed assets (including other real estate owned) also declined to $354.4 million at Dec. 31, 1991, compared with $380.2 million at Sept. 30, 1991. At Dec. 31, 1990, the figures stood at $320.8 million.
 Equity capital at Dec. 31, 1991 was $1,705.7 million, a $91.1 million increase from Dec. 31, 1990. The reported loss in the twelve months ended Dec. 31, 1991 was offset by capital contributions from NatWest Plc of $150.0 million in March 1991 and $300.0 million in June 1991. Risk based capital ratios at year end under the 1992 rules were strong with a Tier 1 ratio of 6.33 percent and total capital of 10.79 percent.
 Fourth quarter net interest income was $181.0 million compared with $183.2 million in the fourth quarter of 1990. For the year ended Dec. 31, 1991, net interest income was $706.8 million compared with $737.5 million for 1990. In part, the decrease reflects a decline in loan volume as the size of relatively higher risk portfolios was managed down and lost interest on non-accrual loans and foreclosed assets increased. Partially offsetting this was the impact of improved interest rate spreads. Interest lost on non-accrual loans and foreclosed assets (net of interest income recognized) for the twelve months ended Dec. 31, 1991, was $147.0 million compared with $99.0 million for the same period in 1990.
 Net interest income, on a tax equivalent basis as a percentage of average interest earning assets (net interest margin), increased to 3.83 percent in the fourth quarter and for the year ended Dec. 31, 1991 was 3.71 percent, compared with 3.68 percent in the fourth quarter and 3.80 percent for the year 1990. These figures are after lost interest on non-accrual loans and foreclosed assets, which reduced the net interest margin by 0.75 percent in the year 1991 and 0.49 percent in 1990.
 Non-interest income totalled $81.7 million in the fourth quarter of 1991, an increase of $27.5 million from the fourth quarter of 1990. The fourth quarter 1991 level included $15.4 million in gains on the sale of investment securities realized in conjunction with a restructuring of the maturity profile of the portfolio. For the year, non-interest income was $284.0 million compared with $243.6 million in 1990. Within these annual figures, gains on the sale of investment portfolio securities increased $32.5 million and income from deposit services increased $9.6 million.
 Operating expenses were $204.4 million in the fourth quarter of 1991, compared with $172.1 million during the fourth quarter of 1990. For the year ended Dec. 31, 1991, operating expenses were $790.8 million and $746.0 million in 1990.
 However, excluding the increases in foreclosed asset expense ($28.6 million) and FDIC premium expense ($14.1 million), operating expenses for the year were virtually unchanged from 1990.
 The costs associated with maintaining foreclosed assets, increased to $27.5 million in the 1991 fourth quarter from $4.2 million in the comparable 1990 period. For the year ending Dec. 31, 1991, foreclosed asset expenses increased to $67.7 million from $39.2 million in 1990, and within these figures valuation adjustments amounted to $44.8 million and $30.0 million, respectively.
 During 1991, the company successfully consolidated further businesses, operations and staff functions which had been duplicated in the subsidiary banks. These reorganizations contributed to a 6 percent decline in the number of employees which by year end totalled approximately 7,300.
 The provision for income taxes was $200,000 in the fourth quarter of 1991 compared with $1.6 million in the fourth quarter of 1990. For the year, the provision was $3.8 million in 1991 compared with $9.8 million in 1990 (without considering the extraordinary tax credits).
 NatWest Bancorp is a wholly-owned subsidiary Of National Westminster Bank Plc, the London-based international banking and financial services organization.
 NATIONAL WESTMINSTER BANCORP INC. AND SUBSIDIARIES
 Financial Highlights
 (Dollar amounts in thousands)
 Fourth quarter ended: 1991 1990
 Net interest income $181,001 $183,231
 Provision for loan losses 88,000 292,590
 Non-interest income 81,726 54,186
 Operating expenses 204,364 172,078
 Net loss (29,837) (228,814)
 Net interest margin (as a percent) 3.83 3.68
 Year ended: 1991 1990
 Net interest income $706,761 $737,501
 Provision for loan losses 567,674 597,670
 Non-interest income 283,989 243,585
 Operating expenses 790,761 745,967
 Net loss (371,514) (352,358)
 Net interest margin (as a percent) 3.71 3.80
 At Dec. 31: 1991 1990
 Total assets $21,459,094 $23,322,836
 Total loans 14,138,656 16,050,225
 Total core deposits 13,569,769 13,885,248
 Total equity capital 1,705,666 1,614,529
 Allowance for loan losses as
 a percentage of total loans 4.88 percent 3.30 percent
 Non-accrual loans as a percentage
 of total loans 8.16 percent 6.04 percent
 Capital ratios:
 Risk based capital ratios
 (per 1992 rules):
 Tier 1 6.33 percent 4.76 percent
 Total 10.79 percent 8.40 percent
 Leverage ratio 5.20 percent 4.23 percent
 -0- 1/16/92
 /CONTACT: Tim Connolly of National Westminster Bancorp, 212-602-2511/
 (NWLIA) CO: National Westminster Bancorp Inc. ST: New York IN: FIN SU: ERN SH-TS -- NY006 -- 0377 01/16/92 09:42 EST
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Date:Jan 16, 1992
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