ROCKY MOUNT, N.C., July 7 /PRNewswire/ -- Centura Banks, Inc. (NYSE: CBC)
today announced record second-quarter 1999 earnings of $28.8 million, or $1.00
per diluted share. Earnings per diluted share increased 14.9% over the
$0.87 cents earned in the comparable prior year quarter and 11.1% over the
$0.90 earned in the first quarter of 1999 excluding nonrecurring charges.
These results produced a return on average assets of 1.32% and a return on
average equity of 16.58%, compared with first-quarter 1999 ratios of 1.20% and
15.25%, respectively, excluding nonrecurring charges.
"Our second-quarter performance reflects the successful integration of our
merger with First Coastal Bankshares, Inc., which was completed
March 26, 1999," said Cecil W. Sewell, Centura chairman and chief executive
officer. "Noninterest expense savings related to the First Coastal merger
exceeded our expectations, while core banking revenue growth continued as
projected, making the acquisition accretive to earnings in the quarter
immediately following the merger."
"The efficient integration of First Coastal demonstrates Centura's ability
to execute on its stated objectives," Sewell said. "We remain solidly on
track with our strategy of creating shareholder value by conducting business
as a full-line retailer of financial services. We are executing on our
commitment to provide our customers a broad range of banking, investment and
insurance solutions in a way that adds value for our shareholders."
When compared with the first quarter of 1999, the net interest margin
improved four basis points principally due to changes in deposit pricing
resulting in a 10 basis point reduction in funding costs. Average commercial
loans increased $107 million, representing an annualized rate of 12.5%, while
the retail loan portfolio grew at an annualized rate of 12.2%. The mortgage
portfolio was reduced by $96 million from the first quarter in response to
balance-sheet repositioning in anticipation of higher interest rates and the
decrease in the mortgage pipeline. As expected, the leasing portfolio
declined $28 million, principally due to the decreased emphasis on the auto
leasing product line, which had failed to meet EVA(TM) objectives.
At June 30, 1999, nonperforming assets totaled $60.0 million, representing
0.68% of total assets compared with $42 million and 0.48%, respectively, at
March 31, 1999. The increase is due to Centura's decision to place on
nonperforming status $23 million of loans outstanding to Pluma, Inc., an Eden,
N.C.-based manufacturer and distributor of fleece and jersey sportswear.
"Pluma is an isolated incident," Sewell said. "While $23 million is certainly
substantial, Centura's total textile-related lending represents less than 2%
of our loan portfolio." Centura is continuing to review and evaluate Pluma
and although Centura has made provisions for this credit, it is possible that
additional provision for losses may be required in the third or fourth
quarter.
Excluding $8.4 million of nonrecurring charges related to the First
Coastal merger, Centura earned $54.8 million, or $1.90 per diluted share, for
the first six months of 1999. These earnings represent an increase of 12.9%
and 11.8%, respectively, over the same period a year ago.
With assets of $8.8 billion, Centura provides a complete line of banking,
investment, insurance, leasing and trust services to individuals and
businesses in North Carolina, South Carolina and Virginia. Centura's broad
range of financial services are provided through a variety of delivery
channels, including 226 full-service financial offices, more than 240 ATMs,
the Centura Highway telephone banking center, Centura's Internet site, and
through leading online money management packages. Additional information may
be found on Centura's website at http://www.centura.com .
FINANCIAL HIGHLIGHTS
CENTURA BANKS, INC. AND SUBSIDIARIES
Three Months Ended June 30, Six Months Ended June 30,
(Dollars in thousands, except
per share data) 1999 1998 Change 1999 1998 Change
EARNINGS
Interest income $ 157,982 $ 156,045 1.2 % $ 315,554 $ 305,021 3.5%
Interest expense 73,877 76,758 (3.8) 148,662 150,256 (1.1)
Net interest
income 84,105 79,287 6.1 166,892 154,765 7.8
Provision for loan
losses 6,411 3,635 76.4 12,677 7,028 80.4
Noninterest income 38,758 34,625 11.9 76,990 66,939 15.0
Noninterest expense 73,968 72,425 2.1 156,784 141,087 11.1
Income taxes 13,695 12,770 7.2 25,055 25,019 0.1
Net income $ 28,789 $ 25,082 14.8 % $ 49,366 $ 48,570 1.6%
Net interest income,
taxable
equivalent $ 85,971 $ 81,104 6.0 % $ 170,484 $ 158,382 7.6%
PER COMMON SHARE
Earnings per
share - basic $ 1.01 $ 0.89 13.5 % $ 1.73 $ 1.74 (0.6)%
Earnings per
share - diluted 1.00 0.87 14.9 1.71 1.70 0.5
Cash dividends paid 0.32 0.29 10.3 0.61 0.56 8.9
Book value per share 24.16 22.49 7.4 24.16 22.49 7.4
Closing market
price 56.375 62.500 (9.8) 56.375 62.500 (9.8)
FINANCIAL RATIOS
Return on average
assets 1.32 % 1.23 % 9 bp 1.13 % 1.23 % (10)bp
Return on average
equity 16.58 15.98 60 14.33 15.89 (156)
Average equity to
average assets 7.94 7.73 21 7.92 7.73 19
AVERAGE BALANCES
Assets $ 8,774,091 $8,148,591 7.7% $8,772,187 $7,974,296 10.0%
Earning assets 8,022,462 7,433,697 7.9 8,015,585 7,290,999 9.9
Loans 5,872,026 5,372,738 9.3 5,861,025 5,252,490 11.6
Investment
securities 2,101,580 2,032,376 3.4 2,104,675 2,006,116 4.9
Noninterest-
bearing
deposits 928,753 853,748 8.8 916,224 825,868 10.9
Core deposits 5,436,079 5,370,210 1.2 5,456,277 5,305,863 2.8
Total deposits 6,014,766 5,860,150 2.6 6,010,635 5,801,571 3.6
Interest-bearing
liabilities 7,015,157 6,544,009 7.2 7,025,195 6,416,270 9.5
Shareholders'
equity 696,366 629,539 10.6 694,482 616,528 12.6
PERIOD END BALANCES
Assets $ 8,756,753 $8,203,475 6.7% $8,756,753 $8,203,475 6.7%
Earning assets 8,013,228 7,462,508 7.4 8,013,228 7,462,508 7.4
Loans 5,841,585 5,405,440 8.1 5,841,585 5,405,440 8.1
Investment
securities 2,139,312 2,031,266 5.3 2,139,312 2,031,266 5.3
Noninterest-
bearing
deposits 982,066 949,476 3.4 982,066 949,476 3.4
Core deposits 5,387,401 5,473,647 (1.6) 5,387,401 5,473,647 (1.6)
Total deposits 6,024,439 5,959,505 1.1 6,024,439 5,959,505 1.1
Shareholders'
equity 687,643 634,798 8.3 687,643 634,798 8.3
bp Change is measured as difference in basis points.
All prior period financial data has been restated for the "pooling" with
First Coastal Bankshares, Inc.
OTHER FINANCIAL DATA
CENTURA BANKS, INC. AND SUBSIDIARIES
Three Months Ended June 30, Six Months Ended June 30,
1999 1998 Change 1999 1998 Change
(Dollars in thousands)
SHARES OUTSTANDING
Average
basic 28,462,854 28,251,597 0.7% 28,463,663 27,965,344 1.8%
Average
diluted 28,872,807 28,816,180 0.2 28,918,942 28,545,349 1.3
Outstanding
at period
end 28,465,362 28,231,305 0.8 28,465,362 28,231,305 0.8
COMPOSITION RATIOS (A)
Earning assets to
total assets 91.43% 91.23% 20bp 91.37% 91.43% (6)bp
Loans to earning
assets 73.19 72.28 91 73.12 72.04 108
Interest-bearing
liabilities to
earning assets 87.44 88.03 (59) 87.64 88.00 (36)
Loans to total
deposits 97.63 91.68 595 97.51 90.54 697
Noninterest-bearing
deposits to
total deposits 15.44 14.57 87 15.24 14.24 100
ALLOWANCE FOR LOAN LOSSES (AFLL)
Beginning
balance $ 74,139 $ 71,121 4.2% $ 72,310 $ 68,576 5.4%
Transfer of
AFLL for
loans sold (100) -- -- (100) -- --
Provision for
loan losses 6,411 3,635 76.4 12,677 7,028 80.4
Allowance of
acquired
financial
institutions -- -- -- 605 2,068 (70.7)
Charge-offs (5,625) (4,579) 22.8 (11,491) (8,430) 36.3
Recoveries 694 1,085 (36.0) 1,518 2,020 (24.9)
Net
charge-offs (4,931) (3,494) 41.1 (9,973) (6,410) 55.6
Ending
balance $ 75,519 $ 71,262 6.0% $ 75,519 $ 71,262 6 %
Net charge-offs
to average
loans(C) 0.34% 0.27% 7bp 0.35% 0.25% 10bp
COMPOSITION OF RISK ASSETS
Nonperforming loans $ 56,085 $ 34,295 63.5%
Foreclosed property 3,867 6,174 (37.4)
Nonperforming assets $ 59,952 $ 40,469 48.1%
ASSET QUALITY RATIOS (D)
Nonperforming assets to:
Loans and foreclosed property(B) 1.04% 0.76% 28bp
Total assets 0.68 0.49 19
Nonperforming loans to total loans(B) 0.97 0.65 32
Allowance for loan losses to total loans(B) 1.31 1.34 (3)
Allowance for loan losses
to nonperforming loans 1.35 x 2.08 x (73)
bp Change is measured as difference in basis points.
(A) Balance sheet amounts used in calculations are based on average
balances.
(B) Excludes mortgage loans held-for-sale of $81.0 million and $100.2
million at June 30, 1999 and 1998, respectively.
(C) Excludes mortgage loans held-for-sale, on average, of $108.0 and
$104.1 for the three months ended June 30, 1999 and 1998,
respectively and $116.4 and $85.8 for the six months ended
June 30, 1999 and 1998, respectively.
(D) Balance sheet amounts used in calculations are based on period end
balances.
All prior period financial data has been restated for the "pooling" with
First Coastal Bankshares, Inc.
CENTURA BANKS, INC. AND SUBSIDIARIES
Three Months Ended June 30,
As a Percent of
Average Assets (A)
(Dollars in thousands) 1999 1998 Change 1999 1998
NONINTEREST INCOME
Service charges on
deposit accounts $ 13,527 $ 11,775 14.9 % 0.62 % 0.58 %
Credit card and
related fees 1,762 1,328 32.7 0.08 0.07
Insurance and brokerage
commissions 5,643 4,849 16.4 0.26 0.24
Other service charges,
commissions and fees 3,213 2,884 11.4 0.15 0.14
Fees for trust services 2,743 2,400 14.3 0.13 0.12
Mortgage income 5,774 6,014 (4.0) 0.26 0.30
Negative goodwill
amortization 335 335 -- 0.02 0.02
Operating lease fees,
net 1,814 2,005 (9.5) 0.08 0.10
Other noninterest income 3,953 3,108 27.2 0.17 0.14
Noninterest income,
excluding securities
transactions 38,764 34,698 11.7 1.77 1.71
Securities gains, net (5) (73) 93.2 -- (0.01)
Total noninterest
income $ 38,759 $ 34,625 11.9 % 1.77 % 1.70 %
NONINTEREST EXPENSE
Salaries and
overtime $ 29,293 $ 29,100 0.7 % 1.34 % 1.43 %
Fringe benefits
and other personnel
costs 7,026 6,612 6.3 0.32 0.33
Occupancy 4,863 4,509 7.9 0.22 0.22
Equipment 5,392 5,608 (3.9) 0.25 0.28
Foreclosed real estate
losses and related
operating expense 251 232 8.2 0.01 0.01
Marketing 2,154 2,516 (14.4) 0.10 0.12
Fees for outsourced
services 3,943 3,176 24.2 0.18 0.16
Professional fees 3,664 2,917 25.6 0.17 0.14
Other administrative 2,532 2,534 (0.1) 0.12 0.12
FDIC insurance 403 406 (0.7) 0.02 0.02
Deposit intangible and
goodwill amortization 2,617 2,228 17.5 0.12 0.11
Office supplies, postage
and telephone 5,469 5,515 (0.8) 0.25 0.27
Merger-related expenses -- -- -- -- --
Other operating 6,361 7,072 (10.1) 0.28 0.35
Total noninterest
expense $ 73,968 $ 72,425 2.1 % 3.38 % 3.56 %
OTHER PERFORMANCE RATIOS
Pretax operating profit
margin, excluding
merger-related
expenses(B) 35.56 % 34.28 % 128 bp
Efficiency ratio,
excluding merger-
related expenses(C) 59.30 % 62.58 % (328) bp
Net interest income analysis-taxable equivalent:
Selected average yields/rates:
Loans 8.51 % 9.20 % (69) bp
Taxable securities 6.37 6.62 (25)
Tax-exempt securities 8.65 8.97 (32)
Short-term investments 5.29 5.16 13
Interest-earning assets 7.94 8.49 (55)
Total interest-bearing
deposits 3.88 4.38 (50)
Borrowed funds 4.56 5.60 (104)
Long-term debt 5.84 5.86 (2)
Total interest-bearing
liabilities 4.20 4.69 (49)
Interest rate spread 3.74 3.80 (6)
Net interest margin 4.26 4.35 (9)
bp Change is measured as difference in basis points.
(A) Data presented is annualized.
(B) Sum of income before taxes plus the taxable equivalent adjustment
divided by the sum of taxable equivalent net interest income plus
noninterest income.
(C) Noninterest expense divided by sum of taxable equivalent net interest
income plus noninterest income.
All prior period financial data has been restated for the "pooling" with
First Coastal Bankshares, Inc.
Six Months Ended June 30,
As a Percent of
Average Assets (A)
(Dollars in thousands) 1999 1998 Change 1999 1998
NONINTEREST INCOME
Service charges on deposit
accounts $ 26,415 $ 22,564 17.1 % 0.61 % 0.57 %
Credit card and
related fees 3,531 2,758 28.0 0.08 0.07
Insurance and
brokerage commissions 11,461 10,264 11.7 0.26 0.26
Other service charges,
commissions and fees 5,999 5,241 14.5 0.14 0.13
Fees for trust services 5,182 4,500 15.2 0.12 0.11
Mortgage income 12,810 10,141 26.3 0.29 0.26
Negative goodwill
amortization 669 669 -- 0.02 0.02
Operating lease fees,
net 3,628 3,710 (2.2) 0.08 0.09
Other noninterest
income 6,817 6,863 (0.7) 0.16 0.18
Noninterest income,
excluding securities
transactions 76,512 66,710 14.7 1.76 1.69
Securities gains, net 478 229 108.7 0.01 --
Total noninterest
income $ 76,990 $ 66,939 15.0 % 1.77 % 1.69 %
NONINTEREST EXPENSE
Salaries and
overtime $ 61,156 $ 56,098 9.0 % 1.41 % 1.42 %
Fringe benefits and
other personnel costs 14,488 13,060 10.9 0.33 0.33
Occupancy 9,958 8,904 11.8 0.23 0.23
Equipment 10,567 11,136 (5.1) 0.24 0.28
Foreclosed real estate
losses and related
operating expense 679 725 (6.3) 0.02 0.02
Marketing 4,047 5,034 (19.6) 0.09 0.13
Fees for outsourced
services 7,465 6,071 23.0 0.17 0.15
Professional fees 7,057 6,388 10.5 0.16 0.16
Other administrative 4,923 5,092 (3.3) 0.11 0.13
FDIC insurance 745 826 (9.8) 0.02 0.02
Deposit intangible and
goodwill amortization 5,177 4,441 16.6 0.12 0.11
Office supplies, postage
and telephone 10,587 10,037 5.5 0.24 0.25
Merger-related
expenses 6,858 -- -- 0.16 --
Other operating 13,077 13,275 (1.5) 0.30 0.34
Total noninterest
expense $ 156,784 $ 141,087 11.1 % 3.60 % 3.57 %
OTHER PERFORMANCE RATIOS
Pretax operating profit
margin, excluding
merger-related
expenses(B) 34.29 % 34.26 % 3 bp
Efficiency ratio,
excluding merger-
related expenses(C) 60.58 % 62.62 % (204)bp
Net interest income analysis-taxable equivalent:
Selected average yields/rates:
Loans 8.55 % 9.20 % (65)bp
Taxable securities 6.36 6.64 (28)
Tax-exempt securities 8.92 8.93 (1)
Short-term investments 5.27 4.84 43
Interest-earning
assets 7.97 8.49 (52)
Total interest-bearing
deposits 3.93 4.40 (47)
Borrowed funds 4.72 5.65 (93)
Long-term debt 5.74 5.93 (19)
Total interest-bearing
liabilities 4.25 4.70 (45)
Interest rate spread 3.72 3.79 (7)
Net interest margin 4.24 4.34 (10)
bp Change is measured as difference in basis points.
(A) Data presented is annualized.
(B) Sum of income before taxes plus the taxable equivalent adjustment
divided by the sum of taxable equivalent net interest income plus
noninterest income.
(C) Noninterest expense divided by sum of taxable equivalent net interest
income plus noninterest income.
All prior period financial data has been restated for the "pooling" with
First Coastal Bankshares, Inc.
QUARTERLY FINANCIAL TRENDS
CENTURA BANKS, INC. AND SUBSIDIARIES
1999 1998 2nd Qtr 99
Second First Fourth Third Second vs.
Quarter Quarter Quarter Quarter Quarter 1st Qtr 99
(Dollars in thousands, except per share data)
FINANCIAL SUMMARY (A)
Assets $8,774,091 $8,770,262 $8,561,203 $8,225,607 $8,148,591 --%
Earning
assets 8,022,462 8,008,631 7,833,188 7,520,744 7,433,697 0.2
Loans 5,872,026 5,849,901 5,611,039 5,446,908 5,372,738 0.4
Investment
securities 2,101,580 2,107,805 2,179,818 2,043,215 2,032,376 (0.3)
Total
deposits 6,014,766 6,006,459 5,984,683 5,965,263 5,860,150 0.1
Interest-bearing
liabilities 7,015,157 7,035,344 6,826,099 6,559,422 6,544,009 (0.3)
Shareholders'
equity 696,366 692,576 673,130 652,202 629,539 0.5
Total market
capitalization
(period end)1,604,735 1,658,039 2,106,168 1,780,108 1,764,457 (3.2)
Net income 28,789 20,577 25,397 26,347 25,082 39.9
PROFITABILITY/PERFORMANCE SUMMARY(A)
Pretax operating
profit
margin(B) 35.56% 33.01% 33.95% 34.77% 34.28% 255bp
Efficiency
ratio(B) 59.30 61.88 62.25 61.87 62.58 (258)
Net interest
margin 4.26 4.22 4.26 4.40 4.35 4
Return on
average assets 1.32 0.95 1.18 1.27 1.23 37
Return on
average equity 16.58 12.05 14.97 16.03 15.98 453
Average equity
to average
assets 7.94 7.90 7.86 7.93 7.73 4
PER SHARE SUMMARY
Earnings per
share - basic $1.01 $0.72 $0.90 $0.93 $0.89 40.3 %
Earnings per
share - diluted 1.00 0.71 0.88 0.92 0.87 40.8
Cash
dividends paid 0.32 0.29 0.29 0.29 0.29 10.3
Book value
per share 24.16 24.30 23.88 23.52 22.49 (0.6)
Closing market
price 56.3750 58.1875 74.3750 63.0000 62.5000 (3.1)
KEY INTANGIBLE ASSETS (C)
Goodwill $119,651 $121,162 $102,858 $104,671 $105,204 (1.2)%
Mortgage
servicing
rights 39,673 37,467 33,464 31,473 30,179 5.9
ASSET QUALITY SUMMARY(C)
Nonperforming
assets $59,952 $41,979 $38,105 $37,538 $40,469 42.8 %
Allowance for
loan losses 75,519 74,139 72,310 71,390 71,262 1.9
Nonperforming
assets to
total assets 0.68% 0.48% 0.43% 0.45% 0.49% 20bp
Allowance for
loan losses
to total
loans(D) 1.31 1.30 1.27 1.33 1.34 1
Net charge-offs
to average
loans (D) 0.34 0.36 0.26 0.29 0.27 (2)
bp Change is measured as difference in basis points.
(A) Balance sheet amounts are based on average balances unless otherwise
noted.
(B) Excludes merger-related expenses.
(C) Balance sheet amounts are based on period end balances unless
otherwise noted.
(D) Excludes mortgage loans held-for-sale.
All prior period financial data has been restated for the "pooling" with
First Coastal Bankshares, Inc.
SOURCE Centura Banks Inc.
 back to top
Related links:
http://www.centura.com
Company News On-Call:
http://www.prnewswire.com/comp/870954.html or fax,
800-758-5804, ext. 870954
CONTACT:
Steven J. Goldstein, Chief Financial Officer
of Centura Banks, Inc., 252-454-8356, or sgoldstein@centura.com
|
