NCNB's profits jumped 130% in 3rd quarter

October 15, 1991|By Peter H. Frank

NCNB Corp., as it nears the completion of its merger with C&S/Sovran Corp., said yesterday that its earnings more than doubled during the third quarter as the cost of souring loans declined and income from investments soared.

The banking company, which has its headquarters in Charlotte, N.C., said that its earnings rose 130 percent, to $131.1 million, or $1.07 a share fully diluted.

In the same period last year, NCNB had earnings of $57 million, or 51 cents a share.

Yesterday's announcement was greeted by analysts as a positive sign for both NCNB and the banking industry, but they said it indicated little about what to expect this week as many banks with operations in Maryland prepare to report third-quarter earnings.

NCNB's stock, traded on the New York Stock Exchange, closed up $1.75 yesterday at $36.125.

NCNB has nearly $70 billion in assets and 906 banking offices in seven states. But it has only seven offices in Maryland.

Its presence in the region will grow significantly after its merger with C&S/Sovran. Many analysts worry, though, that the latter company's heavy lending in the devastated Washington-area real estate market would hurt the new company.

NCNB had only $67 million in commercial real estate loans outstanding in the Washington metropolitan region as of June 30, according to a recent report from Prudential Securities.

C&S/Sovran, however, had $1.9 billion in loans outstanding, with about 20 percent labeled non-performing.

The two banking companies announced in July that they had agreed to merge in an all-stock transaction that would form a giant called NationsBank with nearly $120 billion in assets. The merger, expected to be complete by the end of the year, would result in a bank with 1,900 offices, including about 92 in Maryland.

Overall, NCNB said, income earned on deposits and other assets increased 10 percent in the third quarter, compared with the same portion of last year.

Three months ended 9/30/91

Income ... ... ... ... ... ... ... Share

'91 ... 131,077,000 .. ... ... .. 1.07

'90 ... 56,973,000 ... ... ... .. 0.51

% change ... +130.1 ... ... ... .. +109.8

Assets ... ... ... ... ... ... ... Deposits

'91 ... 69.887* .. ... ... ... .. 50.745*

'90 ... 69.224* .. ... ... ... .. 48.505*

% change ... +1.0 .. .. ... ... .. +4.6

Nine months ended 9/30/91

Income ... ... ... ... ... ... ... Share

'91 ... 401,668,000 .. ... ... .. 3.44

'90 ... 334,459,000 .. ... ... .. 3.06

% change ... +20.1 ... ... ... ... +12.4

Portfolio (Three months ended 9/30/91)

Loans outstanding ... ... ... ... ... Net charge-offs

'91 ... 38.061* .. ... ... ... ... .. 86.100*

'90 ... 36.660* .. ... ... ... ... .. 79.100*

% change ... +3.8 ... ... ... .. .. .. +8.8

Addition to allowance ... ... .. .. .. Allowance

for loan losses ... ... ... ... .. ... for loan losses

'91 ... 125,000,000 .. ... ... .. ... 801,300,000

'90 ... 146,381,000 .. ... ... .. ... 592,900,000

% change ... -14.6 .. ... ... ... ... .. +35.1

*Figures in billions

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