First Citizens Reports Earnings for First Quarter 1999

April 26, 1999

RALEIGH, N.C. — First Citizens BancShares, Inc. (Nasdaq: FCNCA) reports earnings of $19.0 million for the quarter ending March 31, 1999, a 21.6 percent increase over net income of $15.7 million for the corresponding period of 1998, according to Lewis R. Holding, chairman of the board.

Per share income for the first quarter of 1999 totaled $1.79, compared to $1.39 for 1998. Holding attributed the higher net income during 1999 to the increases in net interest income and noninterest income. During the first quarter of 1999, net interest income was $85.7 million, compared to $78.0 million during the same period of 1998, an increase of 9.9 percent. This increase reflects both the benefit of balance sheet growth as well as an improved interest-rate margin. During 1999, interest-earning assets averaged $8.56 billion, compared to $8.07 billion during the same period of 1998, an increase of $490.5 million or 6.1 percent. The interest-rate margin, which was 3.95 percent during the first quarter of 1998, increased to 4.09 percent during the same period of 1999. The improved margin was the result of a $706 million increase in average loans.

Noninterest income totaled $38.2 million during the first quarter of 1999, compared to $31.8 million during the first quarter of 1998, an increase of 20.3 percent. The $6.4 million increase in noninterest income included a $1.5 million increase in other service charges and fees, a $1.0 million increase in credit card income and increases resulting from higher insurance commission income and gains recognized on the sale of a branch office during the first quarter of 1999.

Noninterest expense totaled $91.2 million during the first quarter of 1999, an increase of $10.3 million or 12.8 percent over the same period of 1998. This increase includes the impact of branch expansion, which contributed to a $5.4 million increase in salaries and wages, as well as increases in occupancy and equipment expenses. Other expenses contributing to the higher total noninterest expense include increased consultant expense primarily related to Year 2000 readiness, legal expense and credit card processing expenses. Total assets of First Citizens as of March 31, 1999, were $9.70 billion, compared to $9.25 billion at March 31, 1998.

Two of First Citizens BancShares' major subsidiaries are Raleigh, N.C.-based First Citizens Bank with more than 360 branches in 208 communities in North Carolina, Virginia and West Virginia, and Fort Myers, Fla.-based Atlantic States Bank with 18 branches in North Metro Atlanta and six branches in Southwest Florida.

CONDENSED STATEMENTS OF INCOME
(thousand, except share data; unaudited)		Three Months Ended March 31 1999	1998
Interest Income	$129,568	$155,456	$149,470
Interest expense	62,424	69,713	71,447
Net interest Income	67,144	85,743	78,023
Provision for loan losses	1,544	2,662	4,395
Net interest income after provision for loan losses	65,600	83,081	73,628
Noninterest Income	23,885	38,195	31,758
Noninterest expense	63,285	91,218	80,882
Income before income taxes	26,200	30,058	24,504
Income taxes	9,374	11,010	8,844
Net Income	$16,826	$19,048	$15,660
Taxable-equivalent net interest income		$86,338	$78,541
Net income per share	$1.52	$1.79	$1.39
Cash dividends per share		0.25	0.25
Profitability Information (annualized)
Return on average assets		0.81%	0.71%
Return on average equity		11.56	10.45
Taxable-equivalent net yield on interest-earning assets		4.09	3.95

SELECTED AVERAGE BALANCES
(thousand, except shares outstanding; unaudited)		Three Months Ended March 31 1999	1998
Total assets	7462755.92	$9,517,513	$8,927,355
Investment securities	1984027.33	2,091,575	2,442,962
Loans	4679691.67	6,180,106	5,474,570
Interest-earning assets	6779461.36	8,558,123	8,067,590
Deposits	6477794.877	8,018,971	7,619,330
Interest-bearing liabilities	5934179.977	7,495,945	7,096,124
Shareholder's equity	545774.392	$668,087	$607,608
Shares Outstanding	11072395	10,625,559	10,627,453

For more information, contact:
Barbara Thompson
(919) 716-2716
First Citizens Bank