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Navigation Path: Home > About Us > First Citizens News > July 26, 1999 - First Citizens Reports Record Earnings Larger Type|Smaller Type|Print

First Citizens Reports Record Earnings


July 26, 1999

RALEIGH, N.C. — First Citizens BancShares, Inc. (Nasdaq: FCNCA) reports record earnings for the quarter ending June 30, 1999, of $20.3 million compared to $17.5 million for the corresponding period of 1998, an increase of 15.7 percent, according to Lewis R. Holding, chairman of the board.

Per share income for the second quarter 1999 totaled $1.91 compared to $1.68 for the same period a year ago. First Citizens' current quarter results generated an annualized return on average assets of 0.85 percent and a return on average equity of 11.91 percent.

For the six months ending June 30, 1999, net income was $39.4 million, or $3.70 per share, up 18.5 percent and 20.5 percent, respectively, from the $33.2 million, or $3.07 per share, earned during the first six months of 1998. The year to date 1999 earnings yielded an annualized return on assets of 0.83 percent and a return on equity of 11.74 percent.

Holding attributed the higher net income during 1999 to improvements in both net interest income and noninterest income as well as a lower provision for loan losses. Net interest income increased as a result of balance sheet growth as well as an improved net yield on interest earning assets. For the six-month period ending June 30, 1999, the net yield on interest-earning assets equaled 4.10 percent, up 15 basis points from the same period in 1998.

Noninterest income benefited from higher levels of service charges, credit card income, insurance commissions, and trust revenues.

Noninterest expense totaled $93.4 million for the second quarter and $184.6 million for the six-month period ending June 30, 1999. These amounts reflect increases of 11.2 percent and 12.0 percent, respectively, over the corresponding periods of 1998. Branch expansion, marketing expenses, legal costs and credit card processing expenses contributed to higher noninterest expenses.

Two of First Citizens BancShares' major subsidiaries are Raleigh, N.C.-based First Citizens Bank with 366 branches in 211 communities in North Carolina, Virginia and West Virginia, and Fort Myers, Fla.-based Atlantic States Bank with 19 branches in North Metro Atlanta and six branches in Southwest Florida. Headquartered in Raleigh, First Citizens BancShares has $9.63 billion in assets and is committed to providing superior financial services to individual customers and small to mid-sized businesses. The company has had its Year 2000 (Y2K) preparedness strategy in place since 1996 and is ready for the date change. For more information, visit the First Citizens website at www.firstcitizens.com.

CONDENSED STATEMENTS OF INCOME
(thousand, except share data; unaudited) Three Months Ended
June 30 1999		 1998 Six Months Ended
June 30 1999		 1998
Interest Income $156,960 $154,535 $312,416 $304,005
Interest expense 68,821 73,643 138,534 145,090
Net interest Income 88,139 80,892 173,882 158,915
Provision for loan losses 2,178 5,267 4,840 9,662
Net interest income after provision for loan losses 85,961 75,625 169,042 149,253
Noninterest Income 39,271 35,220 77,466 66,978
Noninterest expense 93,387 83,991 184,605 164,873
Income before income taxes 31,845 26,854 61,903 51,358
Income taxes 11,542 9,309 22,552 18,153
Net Income $20,303 $17,545 $39,351 $33,205
Taxable-equivalent net interest income $88,703 $81,397 $175,041 $159,938
Net income per share $1.91 $1.68 $3.70 $3.07
Cash dividends per share 0.25 0.25 0.50 0.50
Profitability Information (annualized)
Return on average assets 0.85% 0.77% 0.83% 0.74%
Return on average equity 11.91 11.32 11.74 10.90
Taxable-equivalent net yield on interest-earning assets 4.11 3.95 4.10 3.95


CONDENSED BALANCE SHEETS
(thousand, except share data; unaudited) June 30 1999 December 31 1998 June 30 1998
Cash and due from banks $453,646 $502,955 $485,905
Investment securities 1,975,476 2,160,329 2,348,771
Loans 6,376,372 6,195,591 5,886,315
Reserve for loan losses (96,765) (96,115) (90,240)
Other assets 919,748 843,027 594,097
Total assets $9,628,477 $9,605,787 $9,224,848
Deposits $8,170,433 $8,112,408 $7,798,918
Other liabilities 765,474 832,630 797,228
Shareholder's equity 692,570 660,749 628,702
Total liabilities and shareholder's equity $9,628,477 $9,605,787 $9,224,848
Book value per shared $65.18 $62.18 $72.05
Tangible book value per share 69.65 65.76 59.17


SELECTED AVERAGE BALANCES
(thousand, except shares outstanding; unaudited) Three Months Ended
June 30 1999		 1998 Six Months Ended
June 30 1999		 1998
Total assets $9,605,512 $9,142,981 $9,561,845 $9,035,770
Investment securities 2,066,519 2,461,590 2,078,978 2,452,339
Loans 6,289,714 5,711,599 6,235,303 5,593,736
Interest-earning assets 8,659,199 8,269,008 8,618,671 8,168,864
Deposits 8,139,147 7,755,945 8,079,391 7,688,015
Interest-bearing liabilities 7,490,958 7,241,686 7,508,518 7,169,308
Shareholder's equity $683,771 $621,605 $675,883 $614,545
Shares Outstanding 10,625,559 10,626,702 10,625,559 10,627,076


ASSET QUALITY
(dollars in thousand, unaudited) June 30 1999 December 31 1998 June 30 1988
Nonaccrual loans $11,465 $12,489 $12,335
Other real estate 2,030 1,529 1,170
Total nonperforming assets $13,495 $14,018 $13,505
Accuring loans 90 days or more past due $5,181 $5,721 $4,168
Nonperforming assets to gross loans plus other real estate 0.21% 0.23% 0.23%
Reserve for loan losses to gross loans 1.52 1.55 1.53
Net charge-offs to average total loans (annualized) 0.14 0.14 0.14


CAPITAL INFORMATION
(dollars in thousands, unaudited) June 30 1999 December 31 1998 June 30 1998
Tier 1 capital $717,448 $679,987 $640,070
Total capital 811,511 772,171 719,889
Risk-weighted assets 7,164,617 6,878,932 6,430,148
Tier 1 capital ratio 10.01% 9.89% 9.95%
Total capital ratio 11.33 11.23 11.20
Leverage capital ratio 7.56 7.31 7.10
First Citizens BancShare, Inc. and Subsidiaries