SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1994
Commission File No. 1-4114
FIRST INTERSTATE BANCORP
(Exact name of registrant as specified in its charter)
DELAWARE 95-1418530
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
633 WEST FIFTH STREET
LOS ANGELES, CALIFORNIA 90071
(Address of principal executive offices) (Zip Code)
(213) 614-3001
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE
ON WHICH REGISTERED
Common Stock, $2 par value New York and Pacific
Stock Exchanges
Series F Preferred Stock New York Stock
Exchange
Series G Preferred Stock New York Stock
Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Senior Medium Term Notes, Series A
Subordinated Medium Term Notes, Series C
10.5% Notes Due March 1, 1996
12.75% Subordinated Notes Due May 1, 1997
Floating Rate Subordinated Notes Due June 1997
11.0% Notes Due March 5, 1998
8.625% Subordinated Capital Notes Due April 1, 1999
9.125% Notes Due February 1, 2004
9.00% Notes Due November 15, 2004
8.15% Notes Due March 15, 2002
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceeding 12 months (or
for such shorter period that the registrant has been required to
file such (reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No _
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment to this Form 10-K [ ].
State the aggregate market value of the voting stock held by
nonaffiliates of the registrant:
CLASS MARKET VALUE AT FEBRUARY 28, 1995
Common Stock, $2 par value $6,167,071,021
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
CLASS OUTSTANDING AT FEBRUARY 28, 1995
Common stock, $2 par value 75,785,819
shares
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to Stockholders for the year ended
December 31, 1994 are incorporated by reference into Part II.
Portions of the definitive Proxy Statement for the 1995 annual
meeting of stockholders are incorporated by reference into Part III.
PART I
ITEM 1. BUSINESS
The Corporation was incorporated under the laws of the State of
Delaware and began operations in 1958 under the name
"Firstamerica Corporation". The name Western Bancorporation was
adopted in 1961 and changed to First Interstate Bancorp in 1981.
The Corporation is a bank holding company registered under the
Bank Holding Company Act of 1956, as amended. At December 31,
1994, it owned directly all of the shares of capital stock of 16
banks (the "Subsidiary Banks") which operated approximately 1,100
banking offices in 13 states. Ranked according to assets, the
Corporation was the fourteenth largest commercial banking
organization in the United States at December 31, 1994, having
total deposits of $48.4 billion and total assets of $55.8
billion. During December 1994, the average number of full-time
equivalent persons employed by the Corporation and its
subsidiaries was 27,394.
The Subsidiary Banks accept checking, savings and other time
deposit accounts and employ these funds principally by making
consumer, real estate and commercial loans and investing in
securities and other interest bearing assets. All Subsidiary
Banks are members of the Federal Deposit Insurance Corporation,
all but three exercise trust powers, and the thirteen national
banks and one of the three state banks are members of the Federal
Reserve System.
The Corporation also provides banking-related financial services
and products. These include asset-based commercial financing,
asset management and investment counseling, bank card operations,
mortgage banking, venture capital and investment products. It
engages in these activities both through non-bank subsidiaries of
the Corporation and through the Subsidiary Banks and their
subsidiaries.
The larger Subsidiary Banks provide international banking
services on a limited basis through the international departments
of their domestic offices and through a business development
agreement with Standard Chartered PLC. They also maintain
correspondent relationships with major banks throughout the
world. International banking is subject to special risks such as
fluctuating exchange rates, currency revaluations and the
policies of foreign governments. United States governmental
guarantees and insurance against political risks are sometimes
available and are used in certain circumstances to minimize the
impact of such factors.
The Subsidiary Banks are responsible to the Corporation for
achieving mutually agreed upon goals under the management of
their own officers and directors. The Corporation retains a
staff of specialists who provide assistance and advice to
subsidiaries in the areas of investments, credit, accounting,
personnel, business development, operations, asset and liability
management, budgeting and planning, loan participations,
protective controls and compliance with government regulations.
Internal audits and reviews are performed to determine the
adequacy of internal control systems, compliance with general
corporate policy and consistency of accounting practices in
accordance with the Corporation's accounting policies. The
Corporation monitors the Subsidiary Banks' credit policy,
procedures and administration by reviewing portfolio quality,
balance and mix.
The Corporation and the Subsidiary Banks on a continuous basis
identify and evaluate possible acquisitions of banks and savings
and loan associations within the geographic territory served by
the Corporation and its Subsidiary Banks. During 1993 and 1994
the Corporation completed five transactions resulting in the
acquisition of deposits from both the Resolution Trust
Corporation and the Federal Deposit Insurance Corporation. In
addition, the Corporation was party to business combinations with
various operating entities located within the territory. These
transactions resulted in the acquisition of $8.4 billion of
deposits and $9.7 billion of assets. Additional details of these
transactions are included in the Consolidated Financial
Statements and Notes to the Financial Statements attached as an
exhibit to this document.
COMPETITION
The commercial banking business is highly competitive.
Subsidiary Banks compete with other commercial banks and with
other financial and non-financial institutions, including savings
and loan associations, finance companies, credit unions, money
market mutual funds and credit card issuers.
SUPERVISION AND REGULATION
The Corporation, as a bank holding company, is subject to
regulation under the Bank Holding Company Act of 1956, as amended
(BHCA) and is registered with the Federal Reserve Board under the
BHCA. The acquisition of more than 5% of the voting shares of
any bank (not already majority owned) requires the prior approval
of the Federal Reserve Board. The BHCA also prohibits the
Federal Reserve Board from approving an application which would
result in the Corporation or any non-bank subsidiary thereof
acquiring all or substantially all the assets or more than 5% of
the voting shares of any bank (not already majority owned)
located outside of California unless an acquisition of such bank
by a California-based bank holding company is specifically
authorized by the laws of the state in which the bank is located.
The laws of several states permit such acquisitions. The BHCA
also prohibits the Corporation, with certain exceptions, from
acquiring direct or indirect ownership or control of more than 5%
of the voting shares of any company which is not a bank and from
engaging in any business other than that of banking, managing and
controlling banks or furnishing services to its Subsidiary Banks,
except that the Corporation may engage in, and may own shares of
companies engaged in, certain businesses found by the Federal
Reserve Board to be so closely related to banking "as to be a
proper incident thereto." The BHCA does not place territorial
restrictions on the activities of non-bank subsidiaries of bank
holding companies. The Corporation is required by the BHCA to
file annual reports of its operations with the Federal Reserve
Board and is subject to examination by the Federal Reserve Board.
Under legislation enacted in 1974, the Federal Reserve Board was
given jurisdiction to regulate the terms of certain debt issues
of bank holding companies including the authority to impose
reserve requirements on such debt.
The Subsidiary Banks, as subsidiaries of the Corporation within
the meaning of Section 23A of the Federal Reserve Act, are
subject to certain restrictions on loans to the Corporation or
its non-bank subsidiaries, or investments in the stock or other
securities of the Corporation or its non-bank subsidiaries and on
advances to any borrower collateralized by such stock or other
securities. Further, the Subsidiary Banks are also subject to
certain restrictions on most types of transactions with the
Corporation or its non-bank subsidiaries, requiring that the
terms of such transactions be substantially equivalent to terms
of similar transactions with non-affiliated firms.
Each of the 16 Subsidiary Banks is either a state or national
bank. Three Subsidiary Banks are state-chartered and are subject
to supervision and regular examination by the bank supervisory
authorities of the respective states in which they are chartered.
The remaining Subsidiary Banks are national banks and are
subject to supervision and regular examination by the Office of
the Comptroller of the Currency. Those Subsidiary Banks which
are members of the Federal Reserve System are subject to
applicable provisions of the Federal Reserve Act, and First
Interstate Bank of California, the Corporation's only state-
chartered member bank subsidiary, is subject to regular
examination by the Federal Reserve Bank of San Francisco. The
deposit accounts held by all of the Subsidiary Banks are insured
by the FDIC; as such they are subject to the provisions of the
Federal Deposit Insurance Act and, in the case of insured banks
not members of the Federal Reserve System, to regular examination
by the FDIC. The federal and state laws and regulations of
general application to banks regulate, among other things, the
scope of their business, their investments, their reserves
against deposits, the timing of the availability of deposited
funds, and numerous other aspects of their business.
The Corporation, as the holder of common stock of Subsidiary
Banks which are national banks, may be subject to assessment for
the restoration of impaired capital of such banks, as and to the
extent provided in Section 5205 of the Revised Statutes of the
United States (12 U.S.C. Section 55). Similarly, First Interstate
Bank of California may be subject to assessment for the
restoration of impaired capital, as and to the extent provided in
Section 662 of the California Financial Code. These statutes
provide for the restoration of impaired capital by the sale of
bank stock, but impose no personal liability upon the
stockholder.
The Corporation is a legal entity separate and distinct from the
Subsidiary Banks. The principal source of the Corporation's
revenues is dividends received from the Subsidiary Banks.
Another source of revenue, not presently utilized, would be
charges to the Subsidiary Banks for administrative services
provided by the Corporation. Various statutory provisions limit
the amount of dividends the Subsidiary Banks and certain non-bank
subsidiaries can pay without regulatory approval, and various
regulations also restrict the payment of dividends.
In 1989, Congress enacted a law that purports to make banks
liable to the FDIC for expenses the FDIC incurs in the case of
either its provision of financial assistance to, or the failure
of, any affiliated bank. Under that law, the Subsidiary Banks
could theoretically be held liable to the FDIC in the event of
financial assistance to, or failure of, any other Subsidiary
Bank, and theoretically that liability could be substantial
enough to cause the surviving Subsidiary Banks either to require
financial assistance from the FDIC or to cause the failure of
such Subsidiary Banks.
On December 19, 1991, comprehensive legislation was enacted that
reforms the regulation and supervision of banks and bank holding
companies. Among the more significant aspects of the legislation
is a requirement that federal regulators prescribe standards
relating to internal controls, information systems, internal
audit systems, loan documentation, credit underwriting, interest
rate exposure, asset growth, employee, director and principal
shareholder compensation, fees and benefits, standards specifying
a maximum ratio of classified assets to capital, minimum earnings
sufficient to absorb losses without impairing capital, and to the
extent possible, a minimum ratio of market value to book value of
publicly traded shares of bank holding companies, such as the
Corporation. The legislation also provides for a system of early
intervention by the regulators and prompt corrective action at
troubled banks. Under that system, a bank may not pay dividends
if its capital fails to meet any required minimum and will be
expected to submit to its regulator an acceptable plan to restore
its capital to adequate levels. While a bank is
undercapitalized, its regulator may preclude its growth, require
its recapitalization through the sale of shares, require its
acquisition or merger, prohibit its parent from paying dividends,
and require divestitures by its parent, including divestiture of
the bank itself. Its parent holding company will be expected to
guarantee that the bank will comply with the bank's capital
restoration plan until the bank has been adequately capitalized,
on average, for four consecutive quarters, unless the parent is
willing to accept loss or closure of the bank by regulators.
This guarantee is limited to the lesser of 5% of the bank's total
assets at the time it became undercapitalized or the amount
necessary to bring the bank into compliance with all applicable
capital standards.
If the bank does not submit an acceptable capital restoration
plan or if its parent holding company does not guarantee such
plan, the regulators will be required to take one or more
actions, including requiring recapitalization of the bank through
its sale of securities or forced sale or merger, restricting
transactions with affiliates, restricting interest rates paid on
deposits, restricting asset growth, restructuring activities,
replacing management of the bank, prohibiting deposits from
correspondent banks, requiring prior approval of dividends by the
holding company, and requiring divestiture. The law requires the
regulators, in such cases, to require the sale of securities by
the bank or to force a sale or merger of the bank, to restrict
affiliate transactions, and to restrict interest rates unless the
regulator determines that these actions would not resolve the
problems of the bank at the least possible long-term loss to the
Bank Insurance Fund of the FDIC. The law also limits advances to
any undercapitalized bank by any Federal Reserve Bank from being
outstanding more than 60 days in any 120-day period unless the
head of the bank regulatory agency certifies that, giving due
regard to economic conditions and circumstances in the market in
which the bank operates, the bank is not and is not expected to
become critically undercapitalized and is not expected to be
placed in conservatorship or receivership. None of the
Corporation's Subsidiary Banks is undercapitalized.
The foregoing references to applicable statutes and regulations
are brief summaries thereof, which do not purport to be complete
and are qualified in their entirety by reference to such statutes
and regulations.
From time to time various bills are introduced in the United
States Congress which could result in additional or in less
regulation of the business of the Corporation and the Subsidiary
Banks. It cannot be predicted whether any such legislation will
be adopted or how such adoption would affect the business of the
Corporation or the Subsidiary Banks.
The Federal Reserve Board has established risk-based capital
guidelines for bank holding companies. The guidelines define
Tier 1 Capital and Total Capital. Tier 1 Capital consists of
common and qualifying preferred shareholders' equity, before
unrealized gains and losses on available-for-sale debt securities
and minority interests in equity accounts of consolidated
subsidiaries, less goodwill, other nonqualifying intangibles,
excess deferred tax assets and 50% of investments in
unconsolidated subsidiaries. Total Capital consists of, in
addition to Tier 1 Capital, mandatory convertible debt, preferred
stock not qualifying as Tier 1 Capital, subordinated and other
qualifying term debt and a portion of the allowance for loan
losses less the remaining 50% of investments in unconsolidated
subsidiaries. The Tier 1 component must comprise at least 50% of
qualifying Total Capital. Risk-based capital ratios are
calculated with reference to risk-weighted assets, as outlined by
bank supervisory authorities, which include both on and off-
balance sheet exposures. The minimum required qualifying Total
Capital ratio is 8%, of which at least 4% must consist of Tier 1
Capital. As of December 31, 1994, the Corporation's Tier 1
Capital and Total Capital ratios were 7.20% and 10.22%,
respectively.
The Federal Reserve Board has adopted a "minimum leverage ratio"
which requires bank holding companies to maintain Tier 1 Capital
of at least 3% of adjusted quarterly average assets, although the
Federal Reserve Board may require a higher ratio depending upon
the rating of the bank holding company and its expected growth.
Regulations issued by the FDIC to implement the 1991 legislation
referred to above establish five levels of capitalization for
banks; any bank with a Tier 1 Capital ratio of 6%, Total Capital
ratio of 10% and a leverage ratio of 5% is considered to be "well
capitalized." As of December 31, 1994, the Corporation's
leverage ratio was 5.35%, and all of the Subsidiary Banks had
leverage ratios exceeding 5.50%.
MONETARY POLICY AND ECONOMIC CONDITIONS
The earnings of the Corporation are affected by the policies of
regulatory authorities, including the Federal Reserve System.
Federal Reserve monetary policies have had a significant effect
on the operating results of commercial banks in the past and are
expected to continue to do so in the future. Interest rates,
credit availability and deposit levels may change due to
circumstances beyond the control of the Corporation or the
Subsidiary Banks because of changing conditions in national and
international economies and in the money markets, as a result of
actions by monetary and fiscal authorities.
ITEM 2. PROPERTIES
The Corporation and its Subsidiaries occupied, as of December 31,
1994, 1,192 premises in 13 western states, which consisted
primarily of bank buildings. On that date, 584 premises were
owned, 456 premises were leased, and the remaining 152 premises
were owned in part and leased in part. In addition, the
Subsidiary Banks have 1,633 ATM locations. The Corporation's
headquarters are in Los Angeles, California.
ITEM 3. LEGAL PROCEEDINGS
There are presently pending against the Corporation and certain
of its Subsidiaries a number of legal proceedings. While it is
not possible to predict the outcome of these proceedings, it is
the opinion of management, after consulting with counsel, that
the ultimate disposition of potential or existing suits will not
have a material adverse effect on the Corporation's financial
position, results of operations or liquidity.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to security holders during the fourth
quarter of the year ended December 31, 1994.
EXECUTIVE OFFICERS OF THE REGISTRANT
Shown below are names and ages of all executive officers with
indication of all positions and offices with the Corporation.
There were no family relationships among the executive officers
of the Corporation.
NAME AGE OFFICE
Edward M. Carson 65 Chairman of the Board
William E. B. Siart 48 President and Chief Executive Officer
William S. Randall 54 Chief Operating Officer
James J. Curran 55 Chief Executive Officer - Northwest Region
Linnet F. Deily 49 Chief Executive Officer - Texas Region
John S. Lewis 40 Chief Executive Officer - Southwest Region
Bruce G. Willison 46 Chief Executive Officer - California Region
David S. Belles 57 Executive Vice President and Controller
William J. Bogaard 56 Executive Vice President and
General Counsel
Theodore F. Craver 43 Executive Vice President and Treasurer
Gary S. Gertz 50 Executive Vice President and
General Auditor
Lillian R. Gorman 41 Executive Vice President and
Human Resources Director
Robert E. Greene 53 Executive Vice President and
Chief Credit Officer
Thomas P. Marrie 56 Executive Vice President and
Chief Financial Officer
Richard W. Tappey 54 Executive Vice President and
Administration Director
David K. Wilson 40 Executive Vice President and
Manager of Credit Review
Mr. Carson was elected Chairman of the Board on June 1, 1990. He
was Chief Executive Officer from June, 1990 to December 31, 1994
and President from January, 1985 to May 31, 1990.
Mr. Siart was elected Chief Executive Officer effective January
1, 1995 and President of First Interstate Bancorp on June 1,
1990. He was Chairman, President and Chief Executive Officer of
First Interstate Bank of California from December, 1985 to
January, 1991.
Mr. Randall was elected Chief Operating Officer effective January
1, 1995. He served as Chief Executive Officer of the Southwest
Region from September, 1991 to December, 1994. He was Chairman,
President and Chief Executive Officer of First Interstate Bank of
Arizona, N.A. from January 11, 1990 to December, 1994. He was
previously Chairman, President and Chief Executive Officer of
First Interstate Bank of Washington, N.A. between July, 1985 and
January, 1990.
Mr. Curran was appointed Chief Executive Officer of the Northwest
Region in September, 1991. He was elected Chairman and Chief
Executive Officer of First Interstate Bank of Oregon, N.A. on
February 1, 1991 and President on October 22, 1991. He was
elected President and Chief Executive Officer of First
Interstate Bank of Washington, N.A. on October 16, 1991 and
served as Chairman from October 16, 1991 to March 30, 1994. He
was elected President and Chief Executive Officer of First
Interstate Bank of Idaho, N.A. and First Interstate Bank of
Montana, N.A. on December 17, 1991 and served as Chairman from
December 17, 1991 to March 15, 1994. He was previously Chairman
and Chief Executive Officer of First Interstate Bank of Denver,
N.A. between March, 1990 and February, 1991, and he was Chairman
and Chief Executive Officer of First Interstate Bank of Idaho,
N.A. between July, 1984 and March, 1990.
Ms. Deily was appointed Chief Executive Officer of the Texas
Region in September, 1991. She was elected Chairman of First
Interstate Bank of Texas, N.A. in November, 1991. She was
elected President and Chief Executive Officer January 1, 1991,
having served as President and Chief Operating Officer since
November, 1988.
Mr. Lewis was appointed Chairman and Chief Executive Officer of
the Southwest Region in December, 1994 at which time he was also
elected Chairman and Chief Executive Officer of First Interstate
Bank of Arizona, N.A. He has served as Chief Operating Officer
of the Southwest Region since April, 1994 and as Chairman of both
First Interstate Bank of New Mexico, N.A. and First Interstate
Bank of Utah, N. A. since 1993.
Mr. Willison was appointed Chief Executive Officer of the
California Region in September, 1991. He was elected Chairman,
President, and Chief Executive Officer of First Interstate Bank
of California on February 1, 1991 and previously was Chairman and
Chief Executive Officer of First Interstate Bank of Oregon, N.A.
between January, 1986 and February, 1991.
Mr. Belles was elected Executive Vice President and Controller
effective September, 1994 having assumed responsibility for the
management of the Corporate Controller's Group in June, 1994. He
previously served as Chief Financial Officer of the Northwest
Region.
Mr. Bogaard was elected Executive Vice President and General
Counsel in September, 1982.
Mr. Craver was elected Executive Vice President and Treasurer in
September, 1991. He was elected Executive Vice President and
Chief Financial Officer of First Interstate Bank, Ltd. in June,
1988
Mr. Gertz was elected Executive Vice President and General
Auditor in April, 1991. Between August, 1986 and April, 1991 he
held various managerial positions with First Interstate Bank of
California, including General Auditor, Chief Financial Officer
and Division Manager.
Ms. Gorman was elected Executive Vice President in January, 1994.
She has served as Human Resources Director since October, 1990.
She was named Director of First Interstate Bank of California's
Human Resources Division in 1986 and became a Senior Vice
President in 1987. Between 1985 and 1989, she was Manager of
Human Resources Strategic Planning at First Interstate Bancorp.
Mr. Greene was elected Executive Vice President and Chief Credit
Officer in October, 1987.
Mr. Marrie was elected Executive Vice President and Chief
Financial Officer in December, 1988.
Mr. Tappey was elected Executive Vice President in July, 1991.
He was Executive Vice President and head of the Banking Service
Group of First Interstate Bank of California from July 1990, and
previously held various management positions with First
Interstate Bank of California since joining the bank in January,
1961.
Mr. Wilson was elected Executive Vice President and Manager of
Credit Review effective March, 1995. He previously served as
Senior Vice President and Manager of Credit Review for the
Northwest Region.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SECURITY
HOLDER MATTERS
(a) $2 par value Common Stock
The below listed information contained in the Annual Report to
Shareholders for the year ended December 31, 1994, with respect
to the Corporation's $2 par value Common Stock is incorporated
herein by reference:
Page
Principal Market 60
Sales Prices 33
Dividends Paid 33
As of February 28, 1995, there were 24,976 holders of record of
the Corporation's $2 par value Common Stock.
ITEM 6. SELECTED FINANCIAL DATA
Consolidated Balance Sheets and Consolidated Statements of
Operations on pages 56 and 57 of the Annual Report to
Shareholders for the year ended December 31, 1994 are
incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Management's Discussion & Analysis 1992 - 1994 on pages 11
through 33 of the Annual Report to Shareholders for the year
ended December 31, 1994 is incorporated herein by reference.
Subsequent Events:
On March 15, 1995, the Corporation issued $100 million of 8.15%
Subordinated Notes Due March 15, 2002. Interest on the Notes is
payable semi-annually on March 15 and September 15 of each year,
commencing September 15, 1995. The Notes are redeemable at the
option of the Corporation, upon not less than 30 days prior
written notice, in whole on any interest payment date on or after
March 15, 1998, at a redemption price equal to 100% of the
principal amount of the Notes to be redeemed plus interest
accrued and unpaid to the redemption date. The Notes are
subordinate to all present and future Senior Debt of the
Corporation. In addition these Notes are considered to be Total
Capital, but not Tier 1 Capital, for regulatory purposes.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following consolidated financial statements of the Registrant
included in the Annual Report to Shareholders for the year ended
December 31, 1994 are incorporated herein by reference:
Consolidated Financial Statements of First Interstate Bancorp and
Subsidiaries:
Consolidated Balance Sheet - December 31, 1994 and 1993
Consolidated Statement of Operations - Years Ended December 31,
1994, 1993 and 1992
Consolidated Statement of Cash Flows - Years Ended December 31,
1994, 1993 and 1992
Statement of Shareholders' Equity - Years Ended December 31,
1994, 1993 and 1992
Notes to Financial Statements
Report of Ernst & Young LLP, Independent Auditors
Summary of Quarterly Results on page 33 of the Annual Report to
Shareholders for the year ended December 31, 1994 is incorporated
herein by reference.
The below listed financial data contained in the Annual Report to
Shareholders for the year ended December 31, 1994 is incorporated
herein by reference:
Page
Distribution of Assets, Liabilities and Shareholders'
Equity;
Interest Rates and Interest Differential:
Average balance sheets and net interest earnings 58-59
Change in interest income and expense 14
Investment Portfolio:
Investment types 40
Maturities and yields 16, 24
Investment concentrations 26-27
Loan Portfolio:
Loan types 41
Maturities and sensitivity 25
Risk Elements:
Nonaccrual, past due and restructured loans 30-31
Potential problem loans 30-31
Foreign outstandings 28
Loan concentrations 27
Summary of Credit Loss Experience:
Credit loss experience 28-29
Allocation of allowance 29
Deposits:
Average deposits 58-59
Maturities of time certificates of deposit 19
Return on Equity and Assets 55
Short Term Borrowings 41
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information required under this item relating to Directors of the
Registrant is contained in the Registrant's 1994 Proxy Statement
("1994 Proxy Statement") with respect to the Registrant's Annual
Meeting of Shareholders to take place on April 28, 1995, pursuant
to Regulation 14A of the Securities Exchange Act of 1934, as
amended, and is incorporated herein by reference. Information
required under this item related to Executive Officers of the
Registrant is contained in Part I of this report under the
caption "Executive Officers of the Registrant."
ITEM 11. EXECUTIVE COMPENSATION
Information required under this item is contained in the
Registrant's 1994 Proxy Statement, pursuant to Regulation 14A,
and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
Information required under this item is contained in the
Registrant's 1994 Proxy Statement, pursuant to Regulation 14A,
and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information required under this item is contained in the
Registrant's 1994 Proxy Statement, pursuant to Regulation 14A,
and is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a) 1 - Financial Statements
The following consolidated financial statements of the Registrant
included in the Annual Report to Shareholders for the year ended
December 31, 1994 are incorporated herein by reference in Item 8:
Consolidated Financial Statements of First Interstate Bancorp and
Subsidiaries:
Consolidated Balance Sheet - December 31, 1994 and 1993
Consolidated Statement of Operations - Years Ended December 31,
1994, 1993 and 1992
Consolidated Statement of Cash Flows - Years Ended December 31,
1994, 1993 and 1992
Statement of Shareholders' Equity - Years Ended December 31,
1994, 1993 and 1992
Notes to Financial Statements
Report of Ernst & Young LLP, Independent Auditors
(a) 2 - Other Schedules
All other schedules to the consolidated financial statements of
the Registrant required by Article 9 of Regulation S-X are not
required under the related instructions or are inapplicable and
therefore have been omitted.
(a) 3 - Exhibits:
(1) Dealer agreement dated as of December 9, 1994
among Registrant and various dealers named there-
in incorporated by reference to the Registrant's
Form 8-K dated March 24, 1995)
(3.1) Composite Certificate of Incorporation of Regis-
trant incorporating all amendments filed prior to
January 30, 1988 (incorporated by reference to
the Registrant's Form 10-K filed in March, 1990)
(3.2) By laws of Registrant incorporating all amend-
ments through July 20, 1993 (incorporated by
reference to the Registrant's Form 10-K filed in
March, 1994)
(4.1) Terms of Series F Preferred Stock (incorporated
by reference to Registrant's Form S-3 Regis-
tration Statement No. 33-42889)
(4.2) Terms of Series G Preferred Stock (incorporated
by reference to Registrant's Form S-3 Regis-
tration Statement No. 33-47174
(4.3) Registrant has outstanding certain long term
debt. See Note F of "Notes to Financial State-
ments" at Page 42 of the 1994 Annual Report
to shareholders. Such long term debt does not
exceed 10% of the total assets of Registrant
and its consolidated subsidiaries; therefore,
copies of constituent instruments defining the
rights of holders of such long term debt are not
included as exhibits. Registrant agrees to
furnish copies of such instruments to the
Securities and Exchange Commission upon request.
(10.1) 1983 Performance Stock Plan (incorporated by
reference to Registrant's Form S-8 Registration
Statement No.2-82812)
(10.2) 1988 Performance Stock Plan (incorporated by
reference to Registrant's Form S-8 Registration
Statement No. 33-23404)
(10.3) First Interstate Bancorp 1991 Performance Stock
Plan (incorporated by reference to Registrant's
Form S-8 Registration Statement No. 33-38903)
(10.4) First Interstate Bancorp 1995 Performance Stock
Plan
(10.5) First Interstate Bancorp 1991 Director Option
Plan (incorporated by reference to Registrant's
Form S-8 Registration Statement No. 33-37299)
(10.6) First Interstate Bancorp 1995 Regional Executive
Incentive Plan
(10.7) First Interstate Bancorp Corporate Executive
Incentive Plan
(10.8) First Interstate Bancorp 1995 Management Incent-
ive Plan
(10.9) 1989 Restatement of the Supplemental Employee
Savings Plan of Registrant (incorporated by
reference to the Registrant's Form 10-K filed in
March 1990)
(10.10) 1992 Restatement of the Supplemental Executive
Retirement Plan of Registrant (incorporated by
reference to Registrant's Form 10-K filed in
March 1992)
(10.11) 1989 Restatement of First Interstate Bancorp
Benefit Retirement Plan (incorporated by refer-
ence to Registrant's Form 10-K filed in March
1990)
(10.12) Retirement Plan for Directors, amended and re-
stated (incorporated by reference to Registrant's
Form 10-K filed in March, 1994)
(10.13) Dividend Reinvestment and Stock Purchase Plan, as
amended(incorporated by reference to Registrant's
Form S-3 Registration Statement No. 33-50054)
(10.14) Form of Employment Agreement between Registrant
and Edward M. Carson (incorporated by reference
to Registrant's Form 10-K filed in March 1990)
(10.15) Form of Employment Agreement between Registrant
and William E. B. Siart, William S. Randall,
Bruce G. Willison and James J. Curran
(10.16) Form of Split-Dollar Life Insurance Agreement
between Registrant and Edward M. Carson, William
E.B. Siart, William S. Randall, Bruce G. Willison
and James J. Curran (incorporated by reference
to Registrant's Form 10-K filed in March 1992)
(10.17) Form of Split-Dollar Insurance Agreement between
Registrant and Registrant's Directors (incorpor-
ated by reference to Registrant's Form 10-K filed
in March 1992)
(10.18) $500,000,000 Credit Agreement dated as of May 31,
1994 among First Interstate Bancorp and certain
banks (incorporated by reference to Registrant's
Form 10-Q for the quarter ending June 30, 1994
filed in August 1994)
(10.19) Other Agreements (1) (incorporated by reference
to Registrant's Form 10-K filed in March 1993)
(11) Computation of Earnings Per Share
(12) Computation of Ratio of Earnings to Fixed Charges
(13) Annual Report to Shareholders for the year ended
December 31, 1994
(21) Subsidiaries of the Registrant
(23) Consent of Ernst & Young LLP, Independent Auditors
(27) Financial Data Schedule
(b) - Reports on Form 8-K
A report on Form 8-K dated January 19, 1994 announced the
Corporation's 1993 fourth quarter and annual results; the
date, time and place of its 1994 Annual Meeting of Stock-
holders; and a repurchase program for up to 1,500,000
shares of Common Stock. Copies of related documents were
included in such filing.
A report on Form 8-K dated March 22, 1994 announced the
Corporation's next phase of its ongoing strategic plan. Key
elements include reduction in the expense/revenue ratio,
improved capital management, internal revenue growth,
appropriate acquisition growth and earnings improvement.
Copies of related documents were included in such filing.
A report on Form 8-K dated April 20, 1994 announced the
Corporation's 1994 first quarter results and the repurchase
of up to 6,500,000 shares of Common Stock. Copies of
related documents were included in such filing.
A report on Form 8-K dated July 20, 1994 announced the
Corporation's 1994 second quarter results and purchases
under the previously announced repurchase program for up
to 6,500,000 shares of Common Stock, as well as completion
of the repurchase program for 1,500,000 shares. Copies of
related documents were included in such filing.
A report on Form 8-K dated September 21, 1994 announced the
adoption of a restructuring plan to better position the
Corporation for the introduction of full interstate bank-
ing, purchases under the previously announced 1.5 million
and 6.5 million share repurchase programs and the approval
by the Board of Directors of a plan to repurchase up to an
additional 1.2 million shares in connection with the
proposed acquisition of Levy Bancorp. Copies of related
documents were included in such filing.
A report on Form 8-K dated October 25, 1994 announced that
President William E. B. Siart will succeed Edward M. Carson
as Chief Executive Officer of the Corporation, William S.
Randall, head of the Corporation's Southwest Region, will
become Executive Vice President and Chief Operating Officer
of the Corporation, effective January 1, 1995, and Mr.
Carson will remain Chairman of the Corporation until his
retirement on May 1, 1995. Copies of related documents
were included in such filing.
A report on Form 8-K dated February 17, 1995 announced the
date, time and place of its 1995 Annual Meeting of Stock-
holders. Copies of related documents were included in such
filing.
A report on Form 8-K dated March 24, 1995 announced that
Registrant has entered into a Dealer Agreement dated as of
December 9, 1994 among Registrant and various dealers named
therein. Copies of related documents were included in such
filing.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, this 24th day of March, 1995.
FIRST INTERSTATE BANCORP
Registrant
By /s/ Edward S. Garlock
Edward S. Garlock
Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints David S. Belles and Edward
S. Garlock, and each of them, as his or her true and lawful
attorney-in-fact and agent, with full power of substitution, for
him or her and in his or her name, place and stead, in any and
all capacities, to sign any or all amendments to this report and
to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent, full
power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that
said attorney-in-fact and agent, or his or her substitute may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the
dates indicated.
Signature Title Date
/s/ E. M. Carson
Chairman of the Board 03/24/95
E. M. Carson
Director
/s/ William E. B. Siart President and
Chief Executive Officer 03/24/95
William E. B. Siart
Director
/s/ William S. Randall
Chief Operating Officer 03/24/95
William S. Randall
(Principal Financial Officer)
Signature Title Date
/s/ David S. Belles
Executive Vice President 03/24/95
David S. Belles
(Principal Accounting Officer)
/s/ John E. Bryson
John E. Bryson
Director 03/24/95
/s/ Jewel Plummer Cobb
Jewel Plummer Cobb
Director 03/24/95
/s/ Ralph P. Davidson
Ralph P. Davidson
Director 03/24/95
/s/ Myron Du Bain
Myron Du Bain
Director 03/24/95
/s/ Don C. Frisbee
Don C. Frisbee
Director 03/24/95
/s/ George M. Keller
George M. Keller
Director 03/24/95
/s/ W. F. Kieschnick
W. F. Kieschnick
Director 03/24/95
/s/ William F. Miller
William F. Miller
Director 03/24/95
/s/ J. J. Pinola
J. J. Pinola
Director 03/24/95
/s/ Thomas L. Lee
Thomas L. Lee
Director 03/24/95
Signature Title Date
/s/ Steven B. Sample
Steven B. Sample
Director 03/24/95
/s/ Forrest N. Shumway
Forrest N. Shumway
Director 03/24/95
/s/ Richard J. Stegemeier
Richard J. Stegemeier
Director 03/24/95
/s/ Daniel M. Tellep
Daniel M. Tellep
Director 03/24/95