ROCKY MOUNT, N.C., July 6 /PRNewswire/ -- Centura Banks Inc. (NYSE: CBC)
today announced that net income for the second quarter of 1998 increased
20.4 percent to $24.1 million, compared to $20.0 million for the comparable
quarter in 1997. Diluted earnings per share increased to $0.89 in the second
quarter of 1998 compared to $0.76 in the same quarter last year.
Centura's strong results for the second quarter of 1998 produced a return
on average equity of 16.50 percent and a return on average assets of
1.28 percent, compared to prior year ratios of 16.00 percent and 1.24 percent,
respectively.
For the first half of 1998, net income increased 22.9 percent to
$46.5 million, or $1.74 per diluted share from $1.44 for the same period last
year. Also, return on average assets was 1.28 percent, while return on
average equity rose 97 basis points to 16.40 percent.
Centura maintained momentum in the second quarter of 1998, increasing
earnings by 7.0 percent over first quarter. These results were led by a
6.1 percent increase in noninterest revenue, principally in fees from
financial services business lines, mortgage income and deposit fees.
"Second quarter results reflect the continuing successful implementation
of Centura's strategic plan," said Cecil W. Sewell, Centura chairman and chief
executive officer. "Higher loan volumes and the substantial increase in
noninterest income are the direct result of the development of targeted
financial services and alternative delivery channels that address the needs of
our customers."
Since year end 1997, loans have grown 7.8 percent to $4.9 billion which,
when coupled with a stable net interest margin, have contributed to total
revenue growth for the first half of 1998. Without loans acquired through
Centura's merger in March with Pee Dee State Bank, loans have grown an
annualized 11.6 percent this year, principally in commercial loans.
During the quarter Centura opened an additional five financial offices in
Hannaford supermarkets, bringing the total number of supermarket offices to
30. Also during this period Centura agreed to purchase four in-store
financial offices in Kroger supermarkets in Winston-Salem and Kernersville.
With assets of $7.6 billion, Centura provides a complete line of banking,
investment, leasing, insurance and trust services to individuals and
businesses throughout North Carolina, South Carolina and the Hampton Roads
region of Virginia. Centura offers its customers a variety of delivery
channels, including over 200 financial services offices; more than 300 ATMs;
its Centura Highway telephone banking center; Centura's Internet site; and
through leading online money management software packages.
Additional information about Centura's financial performance, products and
services is available on its website at http://www.centura.com.
FINANCIAL HIGHLIGHTS
CENTURA BANKS, INC. AND SUBSIDIARIES
(Dollars in Three Months Ended June 30, Six Months Ended June 30,
thousands, except 1998 1997 Change 1998 1997 Change
per share data)
EARNINGS
Interest income $ 144,042 $ 126,266 14.1% $ 280,763 $ 246,109 14.1%
Interest expense 69,624 60,800 14.5 135,723 116,758 16.2
Net interest income 74,418 65,466 13.7 145,040 129,351 12.1
Provision for loan
losses 3,635 3,189 14.0 7,028 6,083 15.5
Noninterest income 33,500 25,307 32.4 65,083 49,374 31.8
Noninterest expense 68,061 57,107 19.2 132,773 114,221 16.2
Income taxes 12,168 10,497 15.9 23,791 20,567 15.7
Net income $ 24,054 $ 19,980 20.4% $ 46,531 $ 37,854 22.9%
Net interest income, taxable
equivalent $ 76,235 $ 67,470 13.0% $ 148,657 $ 133,047 11.7%
PER COMMON SHARE
Earnings per
share-basic $ 0.91 $ 0.78 16.7% $ 1.77 $ 1.47 20.4%
Earnings per
share-diluted 0.89 0.76 17.1 1.74 1.44 20.8
Cash dividends paid 0.29 0.27 7.4 0.56 0.52 7.7
Book value 22.22 19.46 14.2 22.22 19.46 14.2
Closing market
price 62.500 45.875 36.2 62.500 45.875 36.2
FINANCIAL RATIOS
Return on average
assets # 1.28% 1.24% 4bp 1.28% 1.21% 7bp
Return on average
shareholders'
equity 16.50 16.00 50 16.40 15.43 97
Average equity to
average assets 7.77 7.76 1 7.78 7.83 (5)
AVERAGE BALANCES
Assets $7,530,503 $6,453,981 16.7% $7,351,843 $6,320,093 16.3%
Earning assets 6,839,222 5,926,035 15.4 6,689,460 5,810,053 15.1
Loans 4,905,005 4,188,811 17.1 4,783,111 4,148,198 15.3
Investment
securities 1,909,105 1,710,960 11.6 1,878,236 1,632,254 15.1
Noninterest-bearing
deposits 829,482 684,472 21.2 802,722 671,295 19.6
Core deposits 4,956,388 4,364,613 13.6 4,895,496 4,337,694 12.9
Total deposits 5,439,886 4,725,511 15.1 5,384,360 4,691,646 14.8
Interest-bearing
liabilities 6,000,169 5,185,562 15.7 5,865,955 5,071,187 15.7
Shareholders'
equity 584,778 501,027 16.7 572,243 494,852 15.6
PERIOD END BALANCES
Assets $7,599,722 $6,669,028 14.0% $7,599,722 $6,669,028 14.0%
Earning assets 6,883,098 6,092,168 13.0 6,883,098 6,092,168 13.0
Loans 4,943,174 4,243,868 16.5 4,943,174 4,243,868 16.5
Investment
securities 1,914,486 1,806,095 6.0 1,914,486 1,806,095 6.0
Noninterest-bearing
deposits 922,050 764,390 20.6 922,050 764,390 20.6
Core deposits 5,069,962 4,460,541 13.7 5,069,962 4,460,541 13.7
Total deposits 5,550,183 4,821,036 15.1 5,550,183 4,821,036 15.1
Shareholders'
equity 589,530 502,049 17.4 589,530 502,049 17.4
bp Change is measured as difference in basis points.
# Data presented is annualized.
OTHER FINANCIAL DATA
CENTURA BANKS, INC. AND SUBSIDIARIES
(Dollars in thousands)
Three Months Ended June 30, Six Months Ended June 30,
1998 1997 Change 1998 1997 Change
SHARES OUTSTANDING
Average basic 26,557,371 25,764,988 3.1% 26,271,426 25,746,872 2.0%
Average diluted 27,066,440 26,254,773 3.1 26,794,923 26,247,782 2.1
Outstanding at
period end 26,536,602 25,804,633 2.8 26,536,602 25,804,633 2.8
COMPOSITION RATIOS *
Earning assets
to assets 90.82% 91.82% (100)bp 90.99% 91.93% (94)bp
Loans to earning
assets 71.72 70.68 104 71.50 71.40 10
Interest-bearing liabilities
to earnings assets 87.73 87.50 23 87.69 87.28 41
Loans to total
deposits 90.17 88.64 153 88.83 88.42 41
Noninterest-bearing
deposits to total
deposits 15.25 14.48 77 14.91 14.31 60
ALLOWANCE FOR LOAN LOSSES
Beginning balance $ 66,828 $ 58,762 13.7% $ 64,279 $ 58,715 9.5%
Provision for loan
losses 3,635 3,189 14.0 7,028 6,083 15.5
Allowance of acquired
financial institutions -- -- -- 2,068 -- --
Charge-offs (4,554) (3,639) 25.1 (8,398) (7,256) 15.7
Recoveries 1,082 894 21.0 2,014 1,664 21.0
Net charge-offs (3,472) (2,745) 26.5 (6,384) (5,592) 14.2
Ending balance $ 66,991 $ 59,206 13.1% $ 66,991 $ 59,206 13.1%
Net charge-offs to
average loans 0.28% 0.26% 2 bp 0.27% 0.27% --bp
COMPOSITION OF RISK ASSETS
Nonperforming loans $30,022 $ 24,001 25.1%
Foreclosed property 3,396 3,739 (9.2)
Nonperforming assets $33,418 $ 27,740 20.5%
ASSET QUALITY RATIOS **
Nonperforming assets to:
Loans and foreclosed property 0.68% 0.65% 3bp
Total assets 0.44 0.42 2
Nonperforming loans to total loans 0.61 0.57 4
Allowance for loan losses to total loans 1.36 1.40 (4)
Allowance for loan losses to nonperforming loans 2.23 x 2.47 x (24)
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.
# Data presented is annualized.
OTHER FINANCIAL DATA
CENTURA BANKS, INC. AND SUBSIDIARIES
Three Months Ended June 30,
As a Percent of
Average Assets #
1998 1997 Change 1998 1997
NONINTEREST INCOME
Service charges on
deposit accounts $ 11,537 $ 9,632 19.8% 0.61% 0.60%
Credit card and
related fees 1,762 1,476 19.4 0.09 0.09
Insurance and brokerage
commission 4,849 3,537 37.1 0.26 0.22
Other service charges,
commission and fees 2,590 1,862 39.1 0.14 0.12
Fees for trust services 2,400 1,950 23.1 0.13 0.12
Mortgage income 4,608 2,794 64.9 0.24 0.17
Negative goodwill
amortization 335 335 0.0 0.02 0.02
Operating lease fees,
net 2,005 847 136.7 0.11 0.05
Other noninterest
income 3,487 2,906 20.0 0.18 0.18
Noninterest income, excluding
securities
transactions 33,573 25,339 32.5 1.78 1.57
Securities gains (losses),
net (73) (32) 128.1 -- --
Total noninterest
income $ 33,500 $ 25,307 32.4% 1.78% 1.57%
NONINTEREST EXPENSE
Salaries and
overtime $ 27,187 $ 22,017 23.5% 1.45% 1.37%
Fringe benefits and
other personnel 6,098 5,139 18.7 0.32 0.32
Occupancy 3,888 3,443 12.9 0.21 0.21
Equipment 5,292 5,300 (0.2) 0.28 0.33
Foreclosed real estate
losses and related
operating expense 166 398 (58.3) 0.01 0.02
Marketing 2,325 2,123 9.5 0.12 0.13
Fees for outsourced
services 3,176 2,141 48.3 0.17 0.13
Professional fees 2,787 3,459 (19.4) 0.15 0.22
Other administrative 2,433 1,976 23.1 0.13 0.12
FDIC insurance 342 323 5.9 0.02 0.02
Deposit intangible
and goodwill amort 2,228 1,418 57.1 0.12 0.09
Office supplies, postage
and telephone 5,283 4,065 30.0 0.28 0.25
Other operating 6,856 5,305 29.2 0.37 0.34
Total noninterest
expense $ 68,061 $ 57,107 19.2% 3.63% 3.55%
OTHER PERFORMANCE RATIOS
Pretax operating profit
margin + 34.66% 35.01% (35)bp
Efficiency ratio *** 62.02% 61.55% 47 bp
Net interest income analysis-taxable equivalent:
Selected average yields/rates:
Loans 9.24% 9.41% (17)bp
Taxable securities 6.61 6.67 (6)
Tax-exempt securities 8.97 8.91 6
Short-term investments 5.43 5.56 (13)
Interest-earning
assets 8.51 8.62 (11)
Total interest-bearing
deposits 4.32 4.43 (11)
Borrowed funds 5.25 5.21 4
Long-term debt 6.51 6.51 --
Total interest-bearing
liabilities 4.64 4.69 (5)
Interest rate spread 3.87 3.93 (6)
Net interest margin 4.43 4.52 (9)
Six Months Ended June 30,
As a Percent of
Average Assets #
1998 1997 Change 1998 1997
Service charges on
deposit accounts $ 22,123 $ 18,844 17.4% 0.61% 0.60%
Credit card and
related fees 3,594 2,770 29.7 0.10 0.09
Insurance and brokerage
commission 10,264 6,781 51.4 0.28 0.22
Other service charges,
commission and fees 4,757 3,561 33.6 0.13 0.11
Fees for trust services 4,500 3,900 15.4 0.12 0.12
Mortgage income 7,825 5,467 43.1 0.22 0.17
Negative goodwill
amortization 669 669 0.0 0.02 0.02
Operating lease fees,
net 3,710 1,966 88.7 0.10 0.06
Other noninterest income 7,412 5,542 33.7 0.20 0.19
Noninterest income, excluding
securities
transactions 64,854 49,500 31.0 1.78 1.58
Securities gains (losses),
net 229 (126) (281.7) 0.01 --
Total noninterest
income $65,083 $ 49,374 31.8% 1.79% 1.58%
NONINTEREST EXPENSE
Salaries and overtime $52,410 $ 43,593 20.2% 1.44% 1.39%
Fringe benefits and
other personnel 12,109 11,320 7.0 0.33 0.36
Occupancy 7,710 6,781 13.7 0.21 0.22
Equipment 10,520 10,465 0.5 0.29 0.33
Foreclosed real estate
losses and related
operating expense 594 722 (17.7) 0.02 0.02
Marketing 4,650 4,146 12.2 0.13 0.13
Fees for outsourced
services 6,071 3,673 65.3 0.17 0.12
Professional fees 6,124 6,553 (6.6) 0.17 0.21
Other administrative 4,890 4,017 21.7 0.13 0.13
FDIC insurance 703 639 10.0 0.02 0.02
Deposit intangible
and goodwill amort 4,441 2,836 56.6 0.12 0.09
Office supplies, postage
and telephone 9,644 8,571 12.5 0.26 0.27
Other operating 12,907 10,905 18.4 0.35 0.35
Total noninterest
expense $132,773 $114,221 16.2% 3.64% 3.64%
OTHER PERFORMANCE RATIOS
Pretax operating profit
margin + 34.59% 34.05% 54bp
Efficiency ratio *** 62.12% 62.61% (49)bp
Net interest income analysis-taxable equivalent:
Selected average yields/rates:
Loans 9.25% 9.36% (11)bp
Taxable securities 6.64 6.62 2
Tax-exempt securities 8.93 8.86 7
Short-term investments 5.23 5.47 (24)
Interest-earning assets 8.51 8.59 (8)
Total interest-bearing
deposits 4.35 4.40 (5)
Borrowed funds 5.27 5.09 18
Long-term debt 6.65 6.36 29
Total interest-bearing
liabilities 4.65 4.63 2
Interest rate spread 3.86 3.96 (10)
Net interest margin 4.43 4.55 (12)
bpChange 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
(Dollars in thousands, except per share data)
1998 1997 2nd Qtr 98
Second First Fourth Third Second vs.
Quarter Quarter Quarter Quarter Quarter 1st Qtr 98
FINANCIAL SUMMARY *
Assets $7,530,503 $7,171,199 $7,016,355 $6,738,633 $6,453,981 5.0%
Earning
assets 6,839,222 6,538,033 6,416,636 6,177,675 5,926,035 4.6
Loans 4,905,005 4,659,863 4,562,210 4,372,404 4,188,811 5.3
Investment
securities 1,909,105 1,847,024 1,824,878 1,771,094 1,710,960 3.4
Total
deposits 5,439,886 5,328,216 5,240,681 4,967,064 4,725,511 2.1
Interest-bearing
liabilities 6,000,169 5,730,250 5,603,768 5,391,079 5,185,562 4.7
Shareholders'
equity 584,778 559,568 531,935 519,175 501,027 4.5
Total market capitalization
(period end)1,658,538 1,892,382 1,784,504 1,425,753 1,183,788(12.4)
Net income 24,054 22,477 23,504 21,700 19,980 7.0
PROFITABILITY/PERFORMANCE SUMMARY *
Pretax operating profit
margin + 34.66% 34.52% 34.44% 35.58% 35.01% 14bp
Efficiency
ratio *** 62.02 62.22 61.90 60.87 61.55 (20)
Net interest
margin # 4.43 4.43 4.51 4.46 4.52 --
Return on average
assets # 1.28 1.27 1.33 1.28 1.24 1
Return on average
equity # 16.50 16.29 17.53 16.58 16.00 21
Equity to assets
(average) 7.77 7.80 7.58 7.70 7.76 (3)
PER SHARE SUMMARY
Earnings per share -
basic $0.91 $0.87 $0.91 $0.84 $0.78 4.6%
Earnings per share -
diluted 0.89 0.85 0.89 0.82 0.76 4.7
Cash dividends
paid 0.29 0.27 0.27 0.27 0.27 7.4
Book value per
share 22.22 21.62 20.82 20.45 19.46 2.8
Closing market
price 62.5000 71.2500 69.0000 55.0625 45.8750 (12.3)
KEY INTANGIBLE ASSETS **
Goodwill $105,204 $107,293 $106,108 $97,027 $63,976 (1.9)%
Mortgage servicing
rights 29,917 28,147 28,238 28,275 23,028 6.3
ASSET QUALITY SUMMARY **
Nonperforming
assets $33,418 $33,199 $27,877 $28,633 $27,740 0.7%
Allowance for loan
losses 66,991 66,828 64,279 62,282 59,206 0.2
Nonperforming assets to
total assets 0.44% 0.44% 0.39% 0.42% 0.42% --bp
Allowance for loan losses
to total loans 1.36 1.38 1.40 1.38 1.40 (2)
Net charge-offs to
average loans # 0.28 0.25 0.22 0.26 0.26 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 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.
SOURCE Centura Banks Inc.
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Company News On-Call: http://www.prnewswire.com or
fax, 800-758-5804, ext. 870954
Related links:
http://www.centura.com
CONTACT:
Steven Goldstein, Chief Financial Officer,
Centura Banks Inc., 252-454-8356 or sgoldstein@centura.com
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