NEW YORK -- Bankers Trust New York Corp.'s first-quarter earnings rose 22 percent, as revenue from securities trading, derivatives and other businesses surged, the company reported yesterday.
The nation's seventh largest bank said first-quarter net income rose to $169 million, or $1.89 a share, from $138 million, or $1.52, in the same period last year.
The results exceeded analysts' expectations of $1.84 a share, according to a survey of 12 analysts by IBES International Inc. Bankers Trust shares rose 38 cents to $75.38.
"They showed strength across the board in all business lines," said Bradley Ball, a Credit Suisse First Boston banking analyst. "Bankers Trust benefited from a healthy environment in the first quarter."
The earnings come after Bankers Trust last week announced plans to buy the Baltimore brokerage Alex. Brown Inc. for $1.7 billion, capping a series of changes engineered by Chairman Frank Newman. Alex. Brown first-quarter profit fell 23 percent to $31.2 million because of banking and trading revenue.
Even with that decline, analysts said that combining Alex. Brown's first-quarter results with Bankers Trust's wouldn't eat into the bank's earnings, as some investors feared after the takeover was announced.
"It shows you can take a whack at Alex. Brown's earnings and still not hurt Bankers Trust's bottom line," said PaineWebber banking analyst Lawrence Cohn.
In a year, Bankers Trust reversed losses in its derivatives business, and boosted earnings, securities trading, investment management and the other non-lending businesses that account for much of the strength of its bottom line.
Revenue rose 23 percent to $1.18 billion in the quarter, helped by increases in every major business. Net interest revenue from loans and other investments rose 45 percent to $308 million, while noninterest revenue rose 16 percent to $868 million.
Bankers Trust got its biggest boost from securities trading, and trading-related revenue, which rose 49 percent to $413 million, analysts said.
Profit from derivatives was $11 million, reversing a $4 million loss a year earlier, as revenue from Eastern Europe, the Middle East and Africa grew.
Investment banking profit rose 17 percent to $96 million, from higher corporate finance and equity transactions fees.
Securities trading profit rose 79 percent to $43 million. Investment management profit tripled to $9 million, as assets under management grew.