NationsBank Reports Record Quarterly Earnings of $530 Million, 23-Percent Increase Over Previous Year

Strategic Insights -

NationsBank Corporation, a leading bank holding company, has reported record quarterly earnings of $530 million for the third quarter of 1995, a 23-percent increase over the previous year. The company's strong revenue growth and excellent expense control have driven profitability and efficiency improvements, according to Hugh McColl, chairman and chief executive officer. Average loans and leases grew by 16 percent, leading to a $90-million increase in taxable-equivalent net interest income. Noninterest income rose 20 percent, driven by growth in capital markets revenues, deposit fees, and acquisition-related mortgage servicing fees.

Key Takeaways:

  • NationsBank reported record quarterly earnings of $530 million, a 23-percent increase over the previous year.
  • Earnings per common share rose 26 percent to $1.95, compared to $1.55 per share in the same quarter of 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.
  • Average loans and leases were $111 billion in the third quarter of 1995, a 16 percent increase over year-earlier levels.
  • 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.
  • Noninterest income rose 20 percent to $776 million in the third quarter of 1995, driven by growth in capital markets revenues, deposit fees, and acquisition-related mortgage servicing fees.
  • The efficiency ratio in the third quarter was 56.7 percent, a 572-basis-point improvement over the third quarter of 1994.
  • Total nonperforming assets fell by $238 million, or 19 percent, compared to levels at September 30, 1994.
  • Net charge-offs were $99 million, or 0.35 percent of average net loans, leases, and factored receivables, in the most recent quarter.

Statistics:

  • Record quarterly earnings: $530 million
  • 23-percent increase in earnings over the previous year
  • Earnings per common share: $1.95 (up 26 percent from 1994)
  • Return on average common shareholders' equity: 18.3 percent
  • Net income for the first nine months of 1995: $1.44 billion (up 12 percent from 1994)
  • Average loans and leases: $111 billion (up 16 percent from 1994)
  • Net interest yield: 3.35 percent (down from 3.54 percent in 1994)
  • Noninterest income: $776 million (up 20 percent from 1994)
  • Efficiency ratio: 56.7 percent (down 572 basis points from 1994)
  • Total nonperforming assets: $1.04 billion (down 19 percent from 1994)
  • Net charge-offs: $99 million (0.35 percent of average net loans, leases, and factored receivables)

Sources:

  • NationsBank Corporation, PRNewswire, October 16, 1995
  • NationsBank Corporation, Form 10-Q, September 30, 1995
  • NationsBank Corporation, Press Release, October 16, 1995