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NATWEST BANCORP TURNAROUND CONTINUES

 NATWEST BANCORP TURNAROUND CONTINUES
 NEW YORK, April 8 /PRNewswire/ -- National Westminster Bancorp


("NatWest Bancorp") returned to profitability in the first quarter of 1992, today reporting net income of $30.3 million compared with a net loss of $190.9 million for the first quarter of 1991, and steadily declining losses of $85.1 million, $65.7 million, and $29.8 million in the second, third and fourth quarters of 1991, respectively. The momentum of this turnaround performance is expected to continue in 1992.
 John Tugwell, who took over as chairman and chief executive of NatWest Bancorp in April 1991, said, "We are greatly encouraged as we see profitable results, reaffirming our conviction that we have a strong core business and that our organization can, with continued improvement in asset quality, generate a strong return on the investment of our parent."
 Commenting on the credit quality concerns, Tugwell stated: "While non-accrual loans and foreclosed assets have declined slightly from the fourth quarter of 1991, costs associated with these credits have decreased considerably. There has been a further reduction in the level of charge-offs, continuing the trend of the past several quarters. We expect to see continued improvement in asset quality in the coming months, including a further reduction in non-accrual loans and foreclosed assets."
 In addition to the positive developments since the fourth quarter of 1991 associated with asset quality, first quarter performance was further enhanced by growth in fee income and continued tight control of operating expenses. Operating expenses declined $13.0 million from the fourth quarter as the costs associated with managing problem real estate decreased substantially. Other operating expenses were relatively unchanged.
 Provisions for loan losses were $30.5 million for the first quarter of 1992, down from $221.9 million in the comparative 1991 period. Net charge-offs totaled $61.7 million in the first quarter compared with $151.5 million in the first quarter of 1991. NatWest Bancorp's allowance for loan losses was $658.3 million, or 4.68 percent of total loans outstanding at March 31, 1992, compared with $599.6 million, or 3.80 percent at March 31, 1991.
 Non-accrual loans totaled $1,143.4 million at March 31, 1992, compared with $1,153.9 million at Dec. 31, 1991, and $1,225.8 million at March 31, 1991. Non-accrual loans amounted to 8.12 percent of total loans at March 31, 1992, compared with 8.16 percent at Dec. 31, 1991, and 7.76 percent at March 31, 1991. Foreclosed assets (including other real estate owned) amounted to $337.0 million at March 31, 1992, compared with $354.4 million at Dec. 31, 1991, and $243.0 million at March 31, 1991.
 First quarter net interest income was $176.9 million, compared with $164.9 million in the first quarter of 1991. The increase reflects improved interest rate spreads along with a substantial improvement in interest lost on non-accrual loans and foreclosed assets (net of interest income recognized), which declined from $43.0 million for the first quarter of 1991 to $29.1 million in the 1992 period. Partially offsetting these factors was the impact of a decline in loan volume, reflecting both the recession as well as efforts to manage down the size of the relatively higher risk sectors of NatWest Bancorp's portfolio.
 Net interest income, on a tax-equivalent basis as a percentage of average interest earning assets (net interest margin), increased to 3.69 percent in the first quarter of 1992 compared with 3.45 percent for the corresponding 1991 period.
 Non-interest income totaled $78.5 million for the three months ended March 31, 1992, an increase of $18.5 million from the three months ended March 31, 1991. The first quarter 1992 level included gains on the sale of investment portfolio securities of $9.6 million. The balance of the increase represents steady growth in both loan and deposit related fees.
 Operating expenses were $191.4 million in the first quarter of 1992, essentially equivalent to the $192.5 million reported in the first quarter of 1991. Foreclosed asset expenses increased $3.2 million while most other expense categories remained relatively unchanged, reflecting the continued benefits derived from the consolidation of operations and staff functions. These reorganizations contributed to a 6 percent decline in the number of employees in the past year.
 The provision for income taxes was $17.5 million in the first quarter of 1992 compared with $1.5 million in the first quarter of 1991. The 1992 results also include an extraordinary item of $14.3 million, which represents the recognition of previously unrecorded federal tax benefits.
 Equity capital at March 31, 1992, was $1,735.9 million, a $156.4 million increase from March 31, 1991. Risk-based capital ratios at March 31, 1992, were strong, with a Tier 1 ratio of 6.53 percent and total capital ratio of 11.07 percent.
 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)
 First quarter 1992 1991
 Net interest income $ 176,851 $ 164,897
 Provision for loan losses 30,500 221,907
 Non-interest income 78,547 60,053
 Operating expenses 191,414 192,457
 Net income (loss) $ 30,264 $(190,912)
 Net interest margin (as a percent) 3.69 3.45
 At March 31 1992 1991
 Total assets $22,506,551 $22,461,954
 Total loans 14,077,548 15,792,720
 Total core deposits 13,097,450 13,155,648
 Total equity capital $ 1,735,929 $ 1,579,521
 Allowance for loan losses as a
 percentage of total loans 4.68 3.80
 Non-accrual loans as a percentage
 of total loans 8.12 7.76
 Capital ratios (in pct):
 Risk-based Capital ratios (per 1992
 rules)
 Tier 1 6.53 4.76
 Total 11.07 8.42
 Leverage ratio 5.30 4.23
 -0- 4/8/92
 /CONTACT: Chris Cameris, 212-602-2505, or Tim Connolly, 212-602-2511, both of NatWest Bancorp/
 (NW) CO: National Westminster Bancorp ST: New York IN: FIN SU: ERN


GK-TS -- NY012 -- 6108 04/08/92 09:30 EDT
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