FOR IMMEDIATE RELEASE EXHIBIT 99.1
NATIONSBANK THIRD-QUARTER EARNINGS UP 23 PERCENT
CHARLOTTE NC, October 16, 1995 -- NationsBank Corporation today reported record
quarterly earnings of $530 million for the third quarter of 1995, a 23-percent
increase over the $431 million earned in the third quarter of 1994. Earnings
per common share for the third quarter of 1995 rose 26 percent to $1.95,
compared to $1.55 per share in the third quarter 1994. Return on average
common shareholders' equity was 18.3 percent for the current quarter.
Net income for the first nine months of 1995 rose 12 percent to $1.44 billion,
or $5.26 per common share. This compared to net income of $1.29 billion, or
$4.66 per common share, in the first nine months of 1994.
"The earnings momentum of our company is obvious in this quarter's outstanding
results," said Hugh McColl, chairman and chief executive officer. "Strong
revenue growth and excellent expense control are driving the profitability and
efficiency improvements that this company is capable of producing."
Average loans and leases of $111 billion in the third quarter of 1995 were 16
percent greater than year-earlier levels. This growth was led by a significant
increase in consumer loans and solid non-real estate commercial lending.
Average loans and leases grew $3.5 billion during the third quarter, a
13-percent annualized rate, compared to the second quarter of 1995.
This loan growth led to a $90-million increase in taxable-equivalent net
interest income to $1.42 billion in the third quarter of 1995, compared to the
year-ago quarter. The net interest yield for the third quarter of 1995 was
3.35 percent, down from a yield of 3.54 percent a year ago. The decline in the
net interest yield was driven by a number of factors including the funding of
incremental loan growth largely with wholesale funds and a higher level of
minimal-spread trading-related assets. Compared to the second quarter of this
year, the net interest yield improved 16 basis points reflecting reduced levels
of lower-yielding investment securities and trading assets.
Average deposits in this year's third quarter were $98.7 billion versus $94.7
billion in the year-ago quarter. Core customer-based deposits of $83.4 billion
in the most recent quarter made up 85 percent of total average deposits.
Noninterest income rose 20 percent to $776 million in the third quarter of
1995, compared to the year-ago quarter, driven by growth in capital markets
revenues, deposit fees and acquisition-related mortgage servicing fees.
Noninterest expense in the third quarter of 1995 was $1.25 billion, an increase
of one percent compared to the year-ago quarter, reflecting acquisitions and
increased personnel and marketing spending, offset by a decrease in FDIC
insurance expense. FDIC insurance expense in the third quarter of 1995
reflected quarterly pretax savings of $37 million due to a reduction in
insurance rates charged by the FDIC and an additional refund of $11 million
relating to insurance payments in the second quarter of 1995. Excluding the
impact of these FDIC savings, noninterest expense has been virtually flat for
each of the three 1995 quarters.
The efficiency ratio in the third quarter was 56.7 percent, a 572-basis-point
improvement over the third quarter of 1994. This improvement was a result of
revenue growth of 11 percent with expense growth of only one percent from the
third quarter of 1994.
Total nonperforming assets fell by $238 million, or 19 percent, versus levels
at September 30, 1994. Total nonperforming assets stood at $1.04 billion on
September 30, 1995, or .90 percent of net loans, leases and factored
receivables, and other real estate owned. This compared to nonperforming
assets of $1.28 billion on September 30, 1994, or 1.29 percent of net levels.
Net charge-offs were $99 million, or .35 percent of average net loans, leases
and factored receivables, in the most recent quarter, versus $64 million, or
.27 percent of average levels, in last year's third quarter. The allowance for
credit losses totaled $2.17 billion at September 30, 1995 and equaled 1.89
percent of net loans, leases and factored receivables. The allowance
represented 256 percent of nonperforming loans on both September 30, 1995 and
September 30, 1994.
Provision expense in the third quarter of 1995 was $100 million, $30 million
more than the level one year ago. Other real estate owned expense was $7
million in the third quarter of 1995, compared to a net recovery of $6 million
in the year-ago quarter.
Total shareholders' equity rose 12 percent from year-ago levels to $11.9
billion on September 30, 1995. This represented 6.56 percent of period-end
assets. Book value per common share increased 13.5 percent to $44.00 on
September 30, 1995, compared to September 30, 1994. Common shares outstanding
at September 30, 1995 were 270.5 million compared to 275.6 million one year
ago, due to common share repurchases. Total market capitalization was $18.2
billion at September 30, 1995. Quarterly common dividends paid per share
increased nine percent in the third quarter to $.50 from $.46 per share in the
third quarter of 1994.
Tier 1 and total risk-based capital ratios of 7.16 percent and 11.23 percent,
respectively, and a leverage ratio of 5.96 percent all compared favorably with
regulatory guidelines at September 30, 1995.
NationsBank Corporation is a bank holding company that provides financial
products and services nationally and internationally to individuals,
businesses, corporations, institutional investors and government agencies.
Headquartered in Charlotte, N.C., NationsBank has a retail banking franchise in
nine states and the District of Columbia. As of September 30, 1995,
NationsBank had total assets of $182 billion.
NATIONSBANK CORPORATION FINANCIAL HIGHLIGHTS
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
------------------ ------------------
1995 1994 1995 1994
-------- -------- -------- --------
FINANCIAL SUMMARY
-----------------
(In millions except per-share data)
Net income $530 $431 $1,440 $1,285
Earnings per common share 1.95 1.55 5.26 4.66
Fully diluted earnings
per common share 1.93 1.54 5.19 4.62
Average common shares issued 270.306 275.868 272.790 274.292
Average fully diluted common
shares issued 274.994 279.899 277.505 278.284
Price per share of common
stock at period end $67.25 $49.00 $67.25 $49.00
Common dividends paid 135 126 409 379
Common dividends paid per share .50 .46 1.50 1.38
Preferred dividends paid 2 3 6 8
EARNINGS SUMMARY
----------------
(Taxable-equivalent in millions)
Net interest income $1,420 $1,330 $4,122 $3,979
Provision for credit losses (100) (70) (240) (240)
Gains (losses) on sales
of securities 3 (4) 8 15
Noninterest income 776 649 2,232 1,958
Other real estate owned (expense)
income (7) 6 (10) 4
Noninterest expense (1,245) (1,234) (3,821) (3,681)
-------- -------- -------- --------
Income before income taxes 847 677 2,291 2,035
Income taxes - including
FTE adjustment* (317) (246) (851) (750)
-------- -------- -------- --------
Net income $530 $431 $1,440 $1,285
======== ======== ======== ========
*FTE adjustment $29 $24 $88 $68
AVERAGE BALANCE SHEET SUMMARY
-----------------------------
(In billions)
Loans and leases, net $111.455 $95.947 $107.763 $93.402
Securities held for investment 14.101 15.443 16.389 14.065
Securities available for sale 11.891 11.683 10.132 13.675
Total securities 25.992 27.126 26.521 27.740
Earning assets 168.452 149.455 166.219 146.114
Total assets 190.501 167.283 187.487 163.544
Noninterest-bearing deposits 21.519 19.796 20.866 19.978
Interest-bearing deposits 77.152 74.860 78.641 72.129
Total deposits 98.671 94.656 99.507 92.107
Shareholders' equity 11.487 10.665 11.299 10.341
Common shareholders' equity 11.450 10.635 11.263 10.287
OTHER FINANCIAL DATA
--------------------
Net interest yield 3.35% 3.54% 3.31% 3.64%
Return on average assets 1.10 1.02 1.03 1.05
Return on average common
shareholders' equity 18.29 16.00 17.02 16.61
Gross charge-offs (in millions) $151 $115 $425 $378
Net charge-offs (in millions) 99 64 265 218
% of average loans, leases and
factored accounts receivable, net .35% .27% .33% .31%
Efficiency Ratio 56.67 62.39 60.14 62.00
SEPTEMBER 30
--------------------
1995 1994
-------- --------
BALANCE SHEET SUMMARY
---------------------
(In billions)
Loans and leases, net $113.343 $97.330
Securities held for investment 13.674 17.638
Securities available for sale 9.782 9.921
Total securities 23.456 27.559
Factored accounts receivable 1.258 1.226
Mortgage servicing rights .718 .192
Goodwill, core deposit and
other intangibles 1.451 1.443
Total assets 182.138 170.912
Noninterest-bearing deposits 21.472 20.077
Interest-bearing deposits 76.398 76.658
Total deposits 97.870 96.735
Shareholders' equity 11.941 10.709
Common shareholders' equity 11.903 10.680
Per common share (not in billions) 44.00 38.76
RISK-BASED CAPITAL
Tier 1 capital $10.232 $9.333
Tier 1 capital ratio 7.16% 7.48%
Total capital $16.048 $14.439
Total capital ratio 11.23% 11.57%
Leverage ratio 5.96% 6.32%
Common shares issued (in millions) 270.544 275.568
Allowance for credit losses $2.166 $2.202
Allowance as % of net loans, leases
and factored accounts receivable 1.89% 2.23%
Allowance for credit losses
as % of nonperforming loans 255.57 255.52
Nonperforming loans $.848 $.862
Nonperforming assets 1.038 1.276
Nonperforming assets as % of:
Total assets .57% .75%
Net loans, leases, factored accounts
receivable and other real estate owned .90 1.29
OTHER DATA
----------
Full-time equivalent headcount 58,370 59,600
Banking centers 1,821 1,926
ATMs 2,211 2,134
BUSINESS UNIT RESULTS - Three months ended September 30, 1995
(in millions)
Return on Average Loans
Total Revenue Net Income Equity and Leases,net
------------- ---------- --------- --------------
General Bank $1,485 68% $324 61% 21% $70,290 63%
Global Finance 551 25 166 31 17 34,422 31
Financial Services 153 7 34 6 14 7,353 7
3