SUNTRUST/NEWS
FOR IMMEDIATE RELEASE: CONTACT: Jim Armstrong (404) 588-7425
January 8, 1998
SunTrust Reports Record Net Income for 1997
and the Fourth Quarter
ATLANTA, GA -- SunTrust Banks, Inc. (NYSE: STI) today reported net income
for 1997 of $667.3 million compared with $616.6 million in 1996. Diluted
earnings per share for the year were $3.13, an increase of 13.4% from $2.76
in 1996, Basic earnings per share in 1997 were $3.17 compared with $2.80 for
the previous year. The annual return on average assets (ROA) and return on
average realized common equity (ROE) were 1.30% and 21.13%, respectively,
compared with 1.35% and 18.89% in 1996.
"1997 was a great year," commented James B. Williams, Chairman and Chief
Executive Officer of SunTrust Banks, Inc. "Earnings per share were at record
levels as they have been every year since our formation in 1985; loans grew
13.4%; noninterest income excluding securities gains increased 16.0% while
noninterest expense was up 6.5%; credit quality was exceptional; and the stock
price was up 45%."
Already outstanding credit quality strengthened further as evidenced by a 41%
decline in nonperforming assets and improvement in the associated credit
ratios. Nonperforming assets at the end of 1997 totaled to $150.6 million
compared with $255.8 million in 1996. The ratio of nonperforming assets to
loans and other real estate owned declined for the sixth consecutive year to
0.38% at year-end. The reserve for loan losses was $751.8 million, or 1.87%
of loans, at December 31, 1997. Net charge-offs for the year were $91.0
million, or 0.24% of average loans.
Fourth quarter net income was $172.2 million in 1997 compared with $158.5
million in the 1996 fourth quarter. Diluted earnings per share for the fourth
quarter were $0.82 in 1997 compared with $0.72 in 1996, an increase of 13.9%.
Basic earnings per share increased 13.7% to $0.83 in the last quarter of 1997
from $0.73 in the same period of 1996. The net interest margin declined
slightly to 4.00% from its third quarter 1997 level of 4.04%. Fourth quarter
noninterest income excluding securities gains was $247.0 million, a 19.1%
increase from the previous year. Noninterest expense increased 8.7% from a
year ago.
At December 31, 1997, total assets of SunTrust were $58.0 billion, a 10.5%
increase from a year ago. In other year-to-year comparisons, loans grew 13.4%
to $40.1 billion; total deposits were $38.2 billion, up 3.5%; and total
shareholders'equity increased 6.5% to $5.2 billion.
FINANCIAL HIGHLIGHTS
Year Ended Three Months Ended
December 31 December 31
1997 1996 1997 1996
For the Period ($ Mils)
Net income $ 667.3 $ 616.6 $ 172.2 $ 158.5
Dividends paid 195.7 183.9 52.2 49.1
Per Common Share ($)
Net income - diluted 3.13 2.76 0.82 0.72
Net income - basic 3.17 2.80 0.83 0.73
Dividends 0.93 0.83 0.25 0.225
Book value 24.77 22.13 24.77 22.13
Ratios (%)
Return on average assets(1) 1.30% 1.35% 1.28% 1.32%
Return on average realized equity(1) 21.13 18.89 21.69 18.91
Net interest margin
(taxable-equivalent)(2) 4.11 4.36 4.00 4.29
Efficiency ratio 58.83 59.91 58.51 58.77
Equity to assets 8.97 9.30 8.97 9.30
Income Statement ($ Mils)
Interest income (taxable-equivalent)(2) $3,687.4 $3,286.1 $ 963.1 $ 856.4
Interest expense 1,756.4 1,461.8 469.0 384.2
Net interest income (taxable-equivalent) 1,931.0 1,824.3 494.1 472.2
Provision for loan losses 117.0 115.9 32.6 34.7
Noninterest income
Trust income 318.6 278.3 82.5 69.0
Service charges on deposit accounts 247.8 232.4 63.8 60.7
Corporate & institutional
investment income 24.6 14.3 6.4 4.8
Retail investment income 33.2 22.2 8.4 5.1
Credit card fees 73.6 66.3 18.9 17.0
Mortgage fees 45.9 36.0 13.6 8.7
Other charges and fees 113.7 98.8 28.0 26.0
Securities gains (losses) 1.5 14.2 0.4 (0.4)
Trading account profits and commissions 18.0 13.3 5.2 4.1
Other noninterest income 57.3 42.2 20.2 12.0
Total noninterest income 934.2 818.0 247.4 207.0
Noninterest expense
Personnel expense 955.6 874.1 243.6 228.6
Net occupancy expense 126.8 138.2 30.9 35.2
Equipment expense 120.7 115.4 29.6 30.4
Marketing and customer development 68.8 76.4 19.2 23.3
Other real estate expense (11.4) (0.4) (5.8) (1.1)
Other noninterest expense 425.1 379.4 116.4 82.7
Total noninterest expense 1,685.6 1,583.1 433.9 399.1
Taxable-equivalent adjustments 36.6 40.1 8.7 9.9
Income taxes 358.7 286.6 94.1 77.0
Net income $ 667.3 $ 616.6 $ 172.2 $ 158.5
Contribution to Net Income ($ Mils)
SunTrust Banks of Florida, Inc. $ 371.5 $ 341.2 $ 103.2 $ 93.7
SunTrust Banks of Georgia, Inc. 281.5 253.8 73.3 64.8
SunTrust Banks of Tennessee, inc. 110.1 100.1 29.5 26.3
(1) ROA and ROE are calculated excluding unrealized gains on investment
securities because the unrealized gains are not included in income.
(2) Net interest income and net interest margin include the effects of
taxable-equivalent using a Federal tax rate of 35% and state income
taxes where applicable to increase tax-exempt interest income to a
taxable-equivalent basis.
Average
As of Three Months Ended Year Ended
December 31 December 31 December 31
1997 1996 1997 1996 1997 1996
Balance Sheet ($ Mils)
Assets:
Loans $40,136 $35,404 $37,516 $32,793 $39,230 $34,417
Investment securities -
amortized cost 8,417 7,962 8,209 8,198 8,334 8,064
Funds sold 997 1,722 1,031 759 1,166 1,178
Interest-bearing deposits
in other bank 15 14 12 18 13 13
Trading account 178 80 228 63 228 92
Total earning assets 49,743 45,182 46,996 41,831 48,971 43,764
Reserve for loan losses (752) (726) (737) (717) (745) (725)
Cash and due from banks 2,991 3,037 2,273 2,240 2,395 2,320
Intangible assets 292 278 279 279 286 278
Other assets 2,397 2,108 2,456 1,893 2,657 1,988
Unrealized gains on
investment securities 3,312 2,589 3,005 2,193 2,999 2,436
Total assets $57,983 $52,468 $54,272 $47,719 $56,563 $50,061
Liabilities and
shareholders' equity:
Noninterest-bearing
deposits $ 8,928 $ 8,900 $ 7,540 $ 7,204 $ 7,802 $ 7,484
Interest-bearing deposits 29,270 27,990 28,375 27,037 28,138 27,357
Total deposits 38,198 36,890 35,915 34,241 35,940 34,841
Funds purchased 6,483 6,048 6,496 4,821 7,593 5,788
Other short-term borrowings 1,989 868 1,743 861 1,935 875
Long-term debt 3,172 1,565 2,442 1,269 3,073 1,568
Other liabilities 2,942 2,217 2,658 1,906 3,016 2,148
Total liabilities 52,784 47,588 49,254 43,098 51,557 45,220
Realized shareholders'
equity 3,150 3,278 3,158 3,264 3,150 3,334
Unrealized gains on
investment securities, net
of taxes 2,049 1,602 1,860 1,357 1,856 1,507
Total shareholders' equity 5,199 4,880 5,018 4,621 5,006 4,841
Total liabilities and
shareholders' equity $57,983 $52,468 $54,272 $47,719 $56,563 $50,061
Common shares outstanding 209,909 220,469
Diluted shares outstanding 213,480 223,486 210,554 221,840
Basic shares outstanding 210,243 220,364 207,138 218,353
Year Fourth Quarter
Reserve for Loan Losses ($ Mils) 1997 1996 1997 1996
Balance - beginning of period $ 725.8 $ 698.9 $ 747.1 $ 724.7
Reserve of purchased banks - 1.2 - -
Provision for loan losses 117.0 115.9 32.6 34.7
Net loan charge-offs (91.0) (90.2) (27.9) (33.6)
Balance - end of period $ 751.8 $ 725.8 $ 751.8 $725.8
Net loan charge-off ratios (annualized) 0.24% 0.27% 0.28% 0.39%
12/31/97 09/30/97 12/31/96
Nonperforming Assets ($ Mils)
Nonaccrual loans $ 125.4 $ 152.3 $ 202.3
Restructured loans 2.7 2.7 9.9
Other real estate owned 22.5 35.7 43.6
Total nonperforming assets $ 150.6 $ 190.7 $ 255.8
Ratios (%)
Reserve for loan losses/loans 1.87% 1.94% 2.05%
Reserve for loan losses/nonperforming loans 586.9 482.0 342.0
Nonperforming loans/loans 0.32 0.40 0.60