ROCKY MOUNT, N.C., April 6 /PRNewswire/ -- Centura Banks Inc. (NYSE: CBC)
today reported first quarter 1998 net income of $22.5 million, an increase of
25.8% over the first quarter of 1997. Diluted earnings per share in the first
quarter rose to $0.85, an increase of 25.0% over the comparable quarter of
1997.
Return on average equity increased 145 basis points from the prior year
same quarter to 16.29%, and return on average assets was 1.27%, a 10 basis
point improvement from the same period in 1997. The efficiency ratio declined
137 basis points to 63.10% from the comparable period in 1997, although
increasing marginally from the prior quarter. The ratio of net charge-offs to
average total loans was 25 basis points for the first quarter in 1998.
"We are pleased with the first quarter results which reflect the
continuing successful implementation of the strategy we adopted in 1993," said
Cecil W. Sewell, Centura's chairman and chief executive officer. "We have
expanded our insurance, securities, online banking, call center, and in-store
capabilities and are pleased with the growth of these businesses and their
contribution to first quarter earnings."
During the quarter Centura completed the acquisition of Pee Dee State Bank
in South Carolina and opened two full-service financial offices in Hannaford
supermarkets. Centura plans to open an additional five Hannaford supermarket
offices in North Carolina and Virginia by the end of the year. Centura also
finalized its acquisition of the Moore & Johnson insurance agency in January,
making Centura Insurance Services one of the largest independent insurance
agencies in North Carolina.
With assets of $7.5 billion, Centura provides a complete line of banking,
investment, leasing, insurance and trust services to individuals and
businesses in North Carolina, South Carolina and the Hampton Roads region of
Virginia. Services are provided through 199 financial service centers; more
than 300 ATMs at financial centers, Wal-Mart stores and Sam's outlets; Centura
Highway; Centura's Internet site; and through Quicken(R), Quickbooks(R),
Microsoft(R) Money and BankNow(TM), the leading online money management
software packages. Additional information about Centura is available on its
website at http://www.centura.com.
FINANCIAL HIGHLIGHTS
CENTURA BANKS, INC. AND SUBSIDIARIES
3 Months 3 Months
Ended Mar 31 Ended Mar 31
(In thousands, except share
and per share data) 1998 1997 Change
EARNINGS
Interest income $ 136,721 $ 119,843 14.1 %
Interest expense 66,099 55,958 18.1
Net interest income 70,622 63,885 10.5
Provision for loan losses 3,393 2,894 17.2
Noninterest income 34,077 25,985 31.1
Noninterest expense 67,206 59,033 13.8
Income taxes 11,623 10,069 15.4
Net income $ 22,477 $ 17,874 25.8 %
Net interest income, taxable
equivalent $ 72,422 $ 65,577 10.4 %
PER COMMON SHARE
Earnings per share-basic $ 0.87 $ 0.69 26.1%
Earnings per share-diluted 0.85 0.68 25.0
Cash dividends paid 0.27 0.25 8.0
Book value 21.62 19.08 13.3
Closing market price 71.25 39.00 82.7
FINANCIAL RATIOS
Return on average assets 1.27 % 1.17 % 10bp
Return on average
shareholders' equity 16.29 14.84 145
Average equity to average assets 7.80 7.90 (10)
AVERAGE BALANCES
Assets $ 7,171,199 6,184,718 16.0%
Earning assets 6,538,033 5,692,783 14.8
Loans 4,659,863 4,107,133 13.5
Investment securities 1,847,024 1,552,675 19.0
Noninterest-bearing deposits 775,665 657,971 17.9
Core deposits 4,833,928 4,310,475 12.1
Total deposits 5,328,216 4,657,405 14.4
Interest-bearing liabilities 5,730,250 4,955,541 15.6
Shareholders' equity 559,568 488,609 14.5
PERIOD END BALANCES
Assets $ 7,517,103 6,376,713 17.9%
Earning assets 6,837,615 5,825,818 17.4
Loans 4,849,441 4,140,583 17.1
Investment securities 1,964,362 1,663,427 18.1
Noninterest-bearing deposits 871,249 711,467 22.5
Core deposits 5,011,584 4,407,852 13.7
Total deposits 5,497,716 4,748,245 15.8
Shareholders' equity 574,224 491,367 16.9
bp Change is measured as difference in basis points.
OTHER FINANCIAL DATA
CENTURA BANKS, INC. AND SUBSIDIARIES
3 Months 3 Months
Ended Mar 31 Ended Mar 31
(In thousands, except share data) 1998 1997 Change
SHARES OUTSTANDING
Average basic 25,982,304 25,728,556 1.0 %
Average diluted 26,522,065 26,240,592 1.1
Outstanding at period end 26,559,747 25,752,174 3.1
COMPOSITION RATIOS*
Earning assets to assets 91.17 % 92.05 % (88)bp
Loans to earning assets 71.27 72.15 (88)
Interest-bearing liabilities
to earning assets 87.64 87.05 59
Loans to total deposits 87.46 88.19 (73)
Noninterest-bearing deposits
to total deposits 14.56 14.13 43
ALLOWANCE FOR LOAN LOSSES
Beginning balance $ 64,279 $ 58,715 9.5 %
Provision for loan losses 3,393 2,894 17.2
Allowance of acquired
financial institutions 2,068 -- --
Charge-offs (3,844) (3,617) 6.3
Recoveries 932 770 21.0
Net charge-offs (2,912) (2,847) 2.3
Ending balance $ 66,828 $ 58,762 13.7 %
Net charge-offs to
average loans 0.25 % 0.28 % (3)bp
COMPOSITION OF RISK ASSETS
Nonperforming loans $ 29,570 $ 22,767 29.9 %
Foreclosed property 3,629 4,001 (9.3)
Nonperforming assets $ 33,199 $ 26,768 24.0 %
ASSET QUALITY RATIOS**
Nonperforming assets to:
Loans and foreclosed
property 0.68 0.65 3 bp
Total assets 0.44 0.42 2
Nonperforming loans
to total loans 0.61 0.55 6
Allowance for loan
losses to total loans 1.38 1.42 (4)
Allowance for loan losses
to nonperforming loans 2.26 2.58 (32)
bp Change is measured as difference in basis points.
*Balance sheet amounts used in calculations are based on average balances.
**Balance sheet amounts used in calculations are based on period end
balances.
OTHER FINANCIAL DATA, continued
CENTURA BANKS, INC. AND SUBSIDIARIES
3 Months 3 Months As a Percent of
Ended Mar 31 Ended Mar 31 Average Assets#
(Dollars in thousands) 1998 1997 Change 1998 1997
NONINTEREST INCOME
Service charges on
deposit accounts $10,586 $9,212 14.9 % 0.60 % 0.60 %
Credit card and
related fees 1,832 1,294 41.6 0.10 0.08
Insurance & brokerage
commissions 5,415 3,244 66.9 0.31 0.21
Other service charges,
commissions
and fees 2,167 1,699 27.6 0.12 0.11
Fees for trust
services 2,100 1,950 7.7 0.12 0.13
Mortgage income 3,217 2,673 20.4 0.18 0.18
Negative goodwill
amortization 334 334 0.0 0.02 0.02
Operating lease fees 4,199 3,037 38.3 0.24 0.20
Other noninterest
income 3,925 2,636 48.9 0.22 0.18
Noninterest income,
excluding securities
transactions 33,775 26,079 29.5 1.91 1.71
Securities gains
(losses), net 302 (94) (421.3) 0.02 (0.01)
Total noninterest
income $ 34,077 $ 25,985 31.1 % 1.93 % 1.70 %
NONINTEREST EXPENSE
Salaries and
overtime $ 25,223 $ 21,576 16.9 % 1.43 % 1.41 %
Fringe benefits and
other personnel
costs 6,011 6,181 (2.8) 0.34 0.41
Occupancy 3,822 3,338 14.5 0.22 0.22
Equipment 5,228 5,165 1.2 0.30 0.34
Foreclosed real estate
losses and related
operating expense 428 324 32.1 0.02 0.02
Marketing 2,325 2,023 14.9 0.13 0.13
Fees for outsourced
services 2,895 1,532 89.0 0.16 0.10
Professional fees 3,337 3,094 7.9 0.19 0.20
Other administrative 2,457 2,041 20.4 0.14 0.13
FDIC insurance 361 316 14.2 0.02 0.02
Deposit intangible and
goodwill amortization 2,213 1,418 56.1 0.13 0.09
Office supplies,
postage and telephone 4,361 4,506 (3.2) 0.25 0.30
Depreciation on leased
equipment 2,494 1,918 30.0 0.14 0.13
Other operating 6,051 5,601 8.0 0.33 0.37
Total noninterest
expense $ 67,206 $ 59,033 13.8 % 3.80 % 3.87 %
OTHER PERFORMANCE RATIOS
Pretax operating
profit margin + 33.71 % 32.37 % 134 bp
Efficiency ratio*** 63.10 % 64.47 % (137)bp
Net interest income analysis-taxable equivalent:
Selected average yields/rates:
Loans 9.26 % 9.32 % (6)bp
Taxable
securities 6.67 6.58 9
Tax-exempt
securities 8.89 8.81 8
Short-term
investments 4.75 5.40 (65)
Interest-earning
assets 8.52 8.57 (5)
Total interest-
bearing
deposits 4.37 4.38 (1)
Borrowed funds 5.28 5.00 28
Long-term debt 6.83 6.28 55
Total interest-
bearing
liabilities 4.66 4.58 8
Interest rate
spread 3.86 3.99 (13)
Net interest
margin 4.43 4.58 (15)
bp Change is measured as difference in basis points.
***Noninterest expense divided by sum of taxable equivalent net interest
income plus noninterest income.
+ Sum of income before taxes plus the taxable equivalent adjustment divided
by the sum of taxable equivalent
net interest income plus noninterest income.
# Data presented is annualized.
QUARTERLY FINANCIAL TRENDS
CENTURA BANKS, INC. AND SUBSIDIARIES
1998 1997 1st Qtr 98
First Fourth Third Second First vs.
(Dollars in Quarter Quarter Quarter Quarter Quarter 4th Qtr 97
thousands)
FINANCIAL SUMMARY *
Assets $7,171,199 $7,016,355 $6,738,633 $6,453,981 $6,184,718 2.2 %
Earning
assets 6,538,033 6,416,636 6,177,675 5,926,035 5,692,783 1.9
Loans 4,659,863 4,562,210 4,372,404 4,188,811 4,107,133 2.1
Investment
secur-
ities 1,847,024 1,824,878 1,771,094 1,710,960 1,552,675 1.2
Total
deposits 5,328,216 5,240,681 4,967,064 4,725,511 4,657,405 1.7
Interest-bearing
liabil-
ities 5,730,250 5,603,768 5,391,079 5,185,562 4,955,541 2.3
Stockholders'
equity 559,568 531,935 519,175 501,027 488,609 5.2
Total market capitalization
(period
end) 1,892,382 1,784,504 1,425,753 1,183,788 1,004,335 6.0
Net income 22,477 23,504 21,700 19,980 17,874 (4.4)
PROFITABILITY/PERFORMANCE SUMMARY *
Pretax operating profit
margin + 33.71 % 33.83 % 35.03 % 34.31 % 32.37 % (12)bp
Efficiency
ratio *** 63.10 62.58 61.47 62.32 64.47 52
Net interest
margin # 4.43 4.51 4.46 4.52 4.58 (8)
Return on average
assets # 1.27 1.33 1.28 1.24 1.17 (6)
Return on average
equity # 16.29 17.53 16.58 16.00 14.84 (124)
Equity to assets
(average) 7.80 7.58 7.70 7.76 7.90 22
PER SHARE SUMMARY
Earnings per share -
basic $0.87 $0.91 $0.84 $0.78 $0.69 (4.4)%
Earnings per share -
diluted 0.85 0.89 0.82 0.76 0.68 (4.5)
Cash dividends
paid 0.27 0.27 0.27 0.27 0.25 0.0
Book value
per share 21.62 20.82 20.45 19.46 19.08 3.8
Closing market
price 71.2500 69.0000 55.0625 45.8750 39.0000 3.3
KEY INTANGIBLE ASSETS **
Goodwill $107,293 $106,108 $97,027 $63,976 $65,394 1.1 %
Mortgage servicing
rights 28,147 28,238 28,275 23,028 21,481 (0.3)
ASSET QUALITY SUMMARY **
Nonperforming
assets $33,199 $27,877 $28,633 $27,740 $26,768 19.1 %
Allowance for loan
losses 66,828 64,279 62,282 59,206 58,762 4.0
Nonperforming assets
to total
assets 0.44 % 0.39 % 0.42 % 0.42 % 0.42 % 5 bp
Allowance for loan
losses to
loans 1.38 1.40 1.38 1.40 1.42 (2)
Net charge-offs to
average
loans # 0.25 0.22 0.26 0.26 0.28 3
bp Change is measured as difference in basis points.
* Balance sheet amounts are based on average balances unless otherwise
noted.
** Balance sheet amounts are based on period end balances unless
otherwise noted.
*** Noninterest expense divided by sum of noninterest income plus net
interest income, taxable equivalent basis.
+ Sum of income before taxes plus the taxable equivalent adjustment
divided by the sum of taxable equivalent net interest income plus
noninterest income.
# Data presented is annualized.
Company News On-Call: http://www.prnewswire.com or
fax, 800-758-5804, ext. 870954
Related links:
http://www.centura.com
CONTACT:
Steven J. Goldstein, Centura Bank,
919-977-8356 or sgoldstein@centura.com
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