Exhibit 99.1
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NATIONSBANK POSTED SOLID EARNINGS GROWTH OF 18%
IN THIRD QUARTER 1996
CHARLOTTE, NC, October 15, 1996 -- NationsBank achieved record earnings of $625
million, or $2.12 per common share in the third quarter of 1996. The strong
operating results in the third quarter reflected growth in revenues and
continuation of balance sheet and capital management strategies.
"Our ongoing efforts to increase earnings and effectively manage capital have
generated a 19-percent return on equity this quarter," said Hugh L. McColl Jr.,
chairman and chief executive officer. "These results demonstrate the financial
power which is the foundation for the next phase of our growth through the
acquisition of Boatmen's Bancshares early in 1997."
Earnings Highlights (third quarter 1996 compared to third quarter 1995)
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* Return on average common shareholders' equity was a record 19 percent
* Revenues (net interest income plus noninterest income) grew 14 percent
to $2.5 billion
* Net interest yield rose 34 basis points to 3.69 percent
* Efficiency ratio improved to 55.9 percent, reflecting flat quarterly
expenses this year
* Capital ratios improved, with the equity to assets ratio rising to 7.09
percent from 6.56 percent
Third quarter earnings of $625 million represented an 18-percent increase from
the $530 million earned in the third quarter of 1995. Earnings per common share
for the third quarter of 1996 rose nine percent to $2.12, from $1.95 per common
share in the third quarter of 1995.
Operating net income for the first nine months of 1996 rose 26 percent to $1.82
billion, or $6.07 per common share. This compared to net income of $1.44
billion, or $5.26 per common share, in the first nine months of 1995.
Third quarter 1996 results include the impact of several acquisitions and loan
securitizations completed primarily in 1996 and at the end of 1995.
Net Interest Income
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In the third quarter of 1996, average loans and leases grew nine percent over
year-earlier levels to $121 billion. This increase was driven primarily by a
14-percent increase in average consumer loans. This loan growth, combined with
a 34 basis-point increase in the net interest yield led to a 14-percent increase
in net interest income on a taxable-equivalent basis to $1.6 billion in the
third quarter 1996. The improvement in the net interest yield to 3.69 percent
from 3.35 percent in the third quarter 1995 was primarily the result of balance
sheet management initiatives. In conjunction with these initiatives, gains on
sales of securities of $26 million were taken in the third quarter 1996, up from
$3 million one year ago.
Noninterest Income
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Noninterest income rose 14 percent to $886 million in the third quarter of 1996.
The year-over-year increase was driven by higher income from mortgage servicing,
investment banking and deposit accounts, which offset lower trading revenues.
Efficiency
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Revenue growth outpaced expense growth over the past twelve months, improving
the efficiency ratio to 55.9 percent, compared to 56.7 percent in the third
quarter 1995.
Credit Quality
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Total nonperforming assets were $1.1 billion on September 30, 1996, or .93
percent of net loans, leases and factored receivables and other real estate
owned. This compared to $1.0 billion, or .90 percent of net levels on September
30, 1995. The allowance for credit losses totaled $2.3 billion at September 30,
1996, equaling 236 percent of nonperforming loans, compared to $2.2 billion, or
256 percent at September 30, 1995. In the third quarter of 1996, net charge-
offs were $135 million. Net charge-offs in the third quarter of 1996 equaled
.44 percent of average net loans, leases and factored receivables, compared to
.35 percent of average levels in the third quarter of 1995.
Capital Strength
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Total shareholders' equity climbed to $13.3 billion on September 30, 1996, up 11
percent from levels one year ago. This represented 7.09 percent of period-end
assets, compared to 6.56 percent at September 30, 1995. Book value per common
share rose four percent to $45.77 at the end of the third quarter 1996, from one
year ago. NationsBank repurchased approximately 13 million of its common shares
in the third quarter 1996.
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 primary retail banking operations in nine
states and the District of Columbia. As of September 30, 1996, NationsBank had
total assets of $188 billion.
NATIONSBANK CORPORATION FINANCIAL HIGHLIGHTS
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
1996 1995 1996 1995
FINANCIAL OPERATING SUMMARY
(In millions except per-share data)
Net income $625 $530 $1,820 $1,440
Earnings per common share 2.12 1.95 6.07 5.26
Fully diluted earnings
per common share 2.09 1.93 5.99 5.19
Cash basis earnings (1) 658 559 1,911 1,530
Cash basis earnings per share 2.24 2.06 6.38 5.59
Average common shares issued 292.633 270.306 297.772 272.790
Average fully diluted common
shares issued 298.067 274.994 303.077 277.505
Price per share of common
stock at period end $86.875 $67.250 $86.875 $67.250
Common dividends paid 169 135 518 409
Common dividends paid per share .58 .50 1.74 1.50
Preferred dividends paid 3 2 11 6
OPERATING EARNINGS SUMMARY (Taxable-equivalent in millions)
Net interest income $1,616 $1,420 $4,811 $4,122
Provision for credit losses (145) (100) (455) (240)
Gains on sales of securities 26 3 34 8
Noninterest income 886 776 2,688 2,232
Other real estate owned expense (6) (7) (13) (10)
Other noninterest expense (1,400) (1,245) (4,199) (3,821)
Income before income taxes 977 847 2,866 2,291
Income taxes - including
FTE adjustment* 352 317 1,046 851
Net income $625 $530 $1,820 $1,440
*FTE adjustment $21 $29 $72 $88
AVERAGE BALANCE SHEET SUMMARY (In billions)
Loans and leases, net $121.197 $111.455 $122.729 $107.763
Securities held for investment 3.173 14.101 3.730 16.389
Securities available for sale 16.388 11.891 19.227 10.132
Total securities 19.561 25.992 22.957 26.521
Earning assets 174.299 168.452 179.465 166.219
Total assets 197.923 190.501 203.093 187.487
Noninterest-bearing deposits 24.190 21.519 24.000 20.866
Interest-bearing deposits 83.525 77.152 84.200 78.641
Total deposits 107.715 98.671 108.200 99.507
Shareholders' equity 13.133 11.487 13.276 11.299
Common shareholders' equity 13.014 11.450 13.163 11.263
OTHER OPERATING FINANCIAL DATA
Net interest yield 3.69% 3.35% 3.58% 3.31%
Return on average assets 1.26 1.10 1.20 1.03
Return on average common
shareholders' equity 19.00 18.29 18.36 17.02
Equity to assets ratio
(period end) 7.09 6.56 7.09 6.56
Gross charge-offs (in millions) $194 $151 $628 $425
Net charge-offs (in millions) 135 99 447 265
% of average loans, leases and
factored accounts receivable, net .44% .35% .48% .33%
Efficiency ratio 55.92 56.67 55.97 60.14
REPORTED RESULTS(Operating results including merger-related charge)
Net income $625 $530 $1,743 $1,440
Earning per common share 2.12 1.95 5.82 5.26
Fully diluted earnings per
common share 2.09 1.93 5.73 5.19
Return on average common
shareholders' equity 19.00 18.29 17.58 17.02
(1) Cash basis earnings equal net income excluding amortization of
intangibles.
SEPTEMBER 30
1996 1995
BALANCE SHEET SUMMARY (In billions)
Loans and leases, net $120.829 $113.343
Securities held for investment 3.035 13.674
Securities available for sale 13.334 9.782
Total securities 16.369 23.456
Earning assets 167.284 164.225
Factored accounts receivable 1.249 1.258
Mortgage servicing rights .944 .718
Goodwill, core deposit and
other intangibles 2.002 1.451
Total assets 187.671 182.138
Noninterest-bearing deposits 25.990 21.472
Interest-bearing deposits 82.142 76.398
Total deposits 108.132 97.870
Shareholders' equity 13.304 11.941
Common shareholders' equity 13.186 11.904
Per common share (not in billions) 45.77 44.00
RISK-BASED CAPITAL
Tier 1 capital $11.128 $10.232
Tier 1 capital ratio 7.05% 7.16%
Total capital $19.031 $16.048
Total capital ratio 12.05% 11.23%
Leverage ratio 6.30% 5.96%
Common shares issued (in millions) 288.112 270.544
Allowance for credit losses $2.319 $2.166
Allowance for credit losses
as % of net loans, leases
and factored accounts receivable 1.90% 1.89%
Allowance for credit losses
as % of nonperforming loans 235.64 255.57
Nonperforming loans $.984 $.848
Nonperforming assets 1.135 1.038
Nonperforming assets as % of:
Total assets .61% .57%
Net loans, leases, factored accounts
receivable and other real estate owned .93% .90%
OTHER DATA
Full-time equivalent headcount 63,142 58,370
Banking centers 1,980 1,821
ATMs 3,609 2,211
BUSINESS UNIT RESULTS - Three months ended September 30, 1996
(in millions)
Return on Average Loans
Total Revenue Net Income Equity and Leases,net
General Bank $1,802 72% $423 68% 24% $77,862 64%
Global Finance 525 21 135 22 14 35,801 29
Financial Services 164 7 43 7 14 8,068 7