Philip M. Hanley
Sr. Vice President & Chief Financial Officer
American General Finance Corporation
812-468-5420
AMERICAN GENERAL FINANCE CORPORATION
EARNINGS AND ASSET GROWTH CONTINUE
HIGHLIGHTS
- Record second quarter net income of $64 million
- Real estate leads receivables growth
- Higher finance receivable yields
- Insurance revenues up 30%
EVANSVILLE, IN July 25, 1995.--American General Finance Corporation continued
its strong performance in earnings and asset growth during the second quarter
of 1995. Net income for the second quarter was $64 million, compared to 1994
second quarter net income of $58 million. For the first six months of 1995,
net income was a record $126 million, compared with $110 million during the
same period of 1994, a 15% improvement.
Net finance receivables increased over $160 million during the second quarter
led by growth in real estate secured loans. At June 30, 1995, net finance
receivables were $8.3 billion, an increase over year-end 1994 of more than
$400 million. Year-over-year portfolio growth and yield benefited from the
December 31, 1994 transfer of $1.3 billion in revolving retail and credit card
receivables from the direct parent, American General Finance, Inc. The
increased yield on finance receivables for the second quarter of 1995 offset
higher borrowing cost during the period to maintain the net lending spread at
its 1994 level of 10.8%. Delinquent receivables were 3.05% at June 30
compared to 2.89% at year-end, while net charge offs were 2.94% for the second
quarter compared to 2.00% for the second quarter of 1994. The higher level of
receivables also resulted in increased insurance performance. Insurance
revenues for the second quarter were $57 million, a 30% increase over the
second quarter of 1994.
Daniel Leitch III, Chairman and Chief Executive Officer, said in commenting on
the results, "Our asset growth, higher yields and insurance results have
continued to support our record earnings by offsetting increased borrowing and
credit costs. We are focused on managing the balance between continued asset
growth and credit quality to further strengthen our earnings."
FINANCIAL HIGHLIGHTS:
(Dollars in Millions, Annualized Percents)
For the Quarter Ended June 30, 1995 1994
- ------------------------------ ---- ----
Revenues:
Finance Charges $369 $261
Insurance $ 57 $ 44
Other $ 30 $ 30
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Total Revenues $456 $335
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Net Income $ 64 $ 58
Yield 17.94% 17.42%
Charge-Off Ratio 2.94% 2.00%
For the Six Months Ended June 30, 1995 1994
- --------------------------------- ---- ----
Total Revenues $886 $649
Net Income $126 $110
Yield 17.94% 17.25%
Charge-Off Ratio 2.88% 2.02%
Return on Assets 2.72% 2.86%
Return on Equity 18.09% 18.06%
At: 6/30/95 12/31/94
- --- ------- --------
Total Assets $9,464 $8,919
Net Finance Receivables $8,322 $7,907
Delinquency Ratio 3.05% 2.89%
American General Finance Corporation and its subsidiaries are engaged in the
consumer finance and related credit insurance business. The company,
headquartered in Evansville, Indiana, has assets of $9.5 billion and operates
over 1,300 offices in 40 states, Puerto Rico, and the U.S. Virgin Islands.
Products and services are provided to more than 3 million low-to-middle income
American families. The company offers consumer and home equity loans; retail
sales financing; credit cards; and credit and non-credit related insurance.