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National City Nets $710 Million in First Quarter
CLEVELAND -- National City Corp. recently reported first quarter 2004 net income of $710 million, or $1.16 per diluted share, up 10% from $1.05 per diluted share, for the first quarter of 2003. Returns on average common equity and assets were 29.58% and 2.61%, respectively."The first quarter reflects favorable results across all of National City's businesses," says David A. Daberko, chairman and chief executive officer. "While mortgage- related activities have remained strong in the low interest environment that prevailed during the first quarter, the more significant story is the performance of the rest of National City. Excluding the results of National City Mortgage Co., net income for the rest of National City was up almost 90% from the first quarter a year ago, and 55% higher than the fourth quarter. Consumer lending and deposits have been strong. Good results were also evident in corporate banking, wealth management and processing services. Credit quality, as expected, remains on an improving trend. The positive momentum in our core banking businesses, coupled with the acquisitions of Allegiant Bank, completed last week, and Provident Financial Group, expected to be completed near the end of the second quarter, positions us well for further growth in 2004 and 2005."Tax-equivalent net interest income was $1 billion for the first quarter, approximately equal to the fourth quarter, and down 7% from the first quarter of 2003, reflecting a lower average balance of loans held for sale. For the first quarter, net interest margin was 4.16% versus 4.03% in the fourth quarter and 4.21% in the comparable period in the prior year.Average portfolio loans for the first quarter increased 8% from the first quarter a year ago and 2% from the immediately preceding quarter, reflecting continued strong volume in consumer lending, particularly in mortgage and home equity. Commercial loans outstanding have begun to grow as new business now exceeds paydowns. Average core deposits, excluding mortgage banking escrow balances, grew for the 14th consecutive quarter and were up 6% over the first quarter of 2003.Fees and other income for the first quarter were $1.1 billion, up from $981 million in the fourth quarter of 2003 and approximately equal to the first quarter a year ago. First quarter results included a $9 million gain on the securitization of automobile loans. Mortgage banking revenue for the first quarter of 2004 was $579 million compared to $451 million for the fourth quarter of 2003 and $631 million for the first quarter of 2003. Mortgage banking revenue for the first quarter included net derivative gains of $295 million, offset by a $59 million deferral of revenue as a result of a change in accounting for mortgage loan commitments to conform with the newly- issued Securities & Exchange Commission Staff Accounting Bulletin 105.The loan loss provision for the first quarter was $83 million. First quarter loan charge-offs were $82 million, down $69 million from last quarter and down $89 million from the first quarter of 2003. Nonperforming assets were $606 million at March 31, down from $657 million at Dec. 31, 2003, and $822 million a year ago. The allowance for loan losses at March 31 was $1.1 billion, or 1.41% of portfolio loans compared to $1.1 billion or 1.42% of portfolio loans as of Dec. 31, 2003.At March 31, total assets were $111.7 billion, and stockholders' equity was $9.9 billion, 8.8% of assets. Tangible common equity as a percentage of tangible assets was 7.9%, up from 7.2% at year end and 6.4% a year ago. Total deposits were $67.2 billion, including core deposits of $60.0 billion. The corporation repurchased 2.2 million shares of its common stock during the first quarter. Management intends to resume share repurchases following shareholder approval of the acquisition of Provident Financial Group, which is expected to occur near the end of the second quarter.National City Corp. is one of the nation's largest financial holding companies. The company operates through an extensive banking network primarily in Ohio, Indiana, Illinois, Kentucky, Michigan, Missouri and Pennsylvania, and also serves customers in selected markets nationally. Its core businesses include commercial and retail banking, consumer finance, asset management, mortgage financing and servicing, and payment processing.Visit National City Corp.: www.nationalcity.com"