First Maryland Bancorp Scores 13% Increase In Net Income

`Great Start' Offset By Drop Of 51% In Credit-card Profit

April 24, 1997|By Bill Atkinson | Bill Atkinson,SUN STAFF

First Maryland Bancorp's net income rose 13 percent in the first quarter, propelled by strong consumer loan growth and higher sales of banking products and services.

The banking company, which is a wholly owned subsidiary of Dublin-based Allied Irish Banks PLC, said yesterday it had across-the-board gains in the quarter that ended March 31. Loans grew 9 percent to $6.8 billion, deposits rose 10 percent to $7.6 billion, and assets were up 6 percent to $11.2 billion.

"It was a great start for the year," said Jeremiah E. Casey, chairman of the Baltimore-based banking company.

First Maryland's noninterest income, which is generated from the sale of products and services, soared 23.6 percent to $61.3 million.

Service charges on deposit accounts jumped 6.9 percent to $21.8 million in the quarter, trust and investment advisory fees rose 22 percent to $8.4 million, and mortgage banking income was up 15.4 percent to $6 million.

Income from credit cards, however, fell 51 percent to $2 million from the same period a year earlier. Banks nationwide are finding that more consumers are falling behind on credit card payments. Many have filed for bankruptcy protection because they have amassed so much debt.

To that end, First Maryland more than doubled its provision for credit losses to $9.9 million, up from $4 million in the same period a year ago, largely because of problem credit cards.

Casey said he was "not startled" by the $9.9 million level. "We are getting back to a much more normal level of provisioning," he said.

First Maryland had $16 million in its provision for loan losses in 1995 and nearly $23 million in 1994.

In January, First Maryland reached a definitive agreement to acquire Harrisburg-based Dauphin Deposit Corp. -- Pennsylvania's fourth largest commercial banking company -- for $1.36 billion.

Combined, the companies will become the largest financial institution in the Baltimore-Harrisburg corridor. The deal will add about $6 billion in assets, 98 branches, 92 ATMs and 2,700 employees to First Maryland.

Pub Date: 4/24/97

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