Harris Bank Announces 1st Quarter Earnings

Apr 18, 2001, 01:00 ET from Harris Bank

    CHICAGO, April 18 /PRNewswire/ -- Harris Bank today announced net income
 of $64.0 million for the quarter ended March 31, 2001.  Comparability of
 results with the first quarter last year is affected by the pretax gain of
 $50.2 million from the sale of the corporate trust business in first quarter
 2000.  Excluding this gain, earnings in the first quarter increased from
 $57.4 million last year to $64.0 million this year, an increase of 12%.
     Cash ROE was 16.72% in the current quarter.  Excluding the gain from the
 sale of the corporate trust business, cash ROE was 18.92% in first quarter
 2000.  Excluding unrealized gains and losses on the securities portfolio
 recorded directly to equity and the corporate trust gain, cash ROE rose 32
 basis points from last year's first quarter.
     Alan G. McNally, Chairman and Chief Executive Officer, attributed these
 results to continued strong earnings growth in Harris Bank's core businesses
 and a more favorable interest rate environment that contributed to increased
 earnings from treasury and trading activities.  This was partially offset by
 an increased loan loss provision associated with a slowing economy.
     Net interest income on a fully taxable equivalent basis was
 $184.1 million, up 6% from first quarter last year.  Net interest margin
 increased from 2.87% in first quarter 2000 to 2.94% currently.  Average
 earning assets rose 4% to $25.3 billion from $24.3 billion in first quarter
 2000, attributable to an increase of 5% or $795 million in average loans.
 Growth in consumer, mortgage and small business loans continued to be
 particularly strong.
     First quarter noninterest income of $113.3 million decreased 27% from the
 same quarter last year.  Excluding the $50.2 million gain from the sale of the
 corporate trust business, noninterest revenue increased 8%.  Last year's first
 quarter results also included operating revenue for both the corporate trust
 business and the merchant card business which was sold to Bank of Montreal's
 credit card processing joint venture (Moneris) in December 2000.  Excluding
 both the gain on sale and operating revenue from these businesses, noninterest
 revenue increased 22%.  Most of the increase resulted from additional net
 gains from securities sales of $13.2 million and higher bond trading profits
 of $5.1 million.
     First quarter 2001 noninterest expenses of $184.4 million were essentially
 flat compared to first quarter a year ago.  Income tax expense declined by
 $17.9 million, reflecting lower pretax income from year-ago results, which
 included the gain on the sale of the corporate trust business.
     The first quarter 2001 provision for loan losses of $16.0 million was up
 from $6.6 million in the first quarter of 2000.  Net loan charge-offs during
 the current quarter amounted to $18.6 million compared to $4.7 million in the
 prior year's quarter.  Most of the increase resulted from higher commercial
 loan write-offs.
     Nonperforming assets at March 31, 2001 were $120 million or 0.8% of total
 loans, compared to $107 million or 0.7% at December 31, 2000, and $41 million
 or 0.3% a year ago.  Most of the increase from March 31, 2000 is comprised of
 syndicated loans ranging in size from $8 million to $17 million to borrowers
 in different industry sectors.  At March 31, 2001, the allowance for possible
 loan losses was $168 million, equal to 1.1% of loans outstanding, compared to
 $164 million or 1.1% at the end of first quarter 2000.  As a result, the ratio
 of the allowance for possible loan losses to nonperforming assets was 140% at
 March 31, 2001, compared to 402% at March 31, 2000.
     At March 31, 2001 regulatory Tier 1 capital of Harris Bank amounted to
 $2.07 billion, up from $1.98 billion one year earlier.  The regulatory
 leverage capital ratio was 7.35% for the first quarter of 2001 compared to
 7.21% in the same quarter of 2000.  Harris Bank's leverage capital ratio
 exceeds the prescribed regulatory minimum for bank holding companies.
 
 

SOURCE Harris Bank
    CHICAGO, April 18 /PRNewswire/ -- Harris Bank today announced net income
 of $64.0 million for the quarter ended March 31, 2001.  Comparability of
 results with the first quarter last year is affected by the pretax gain of
 $50.2 million from the sale of the corporate trust business in first quarter
 2000.  Excluding this gain, earnings in the first quarter increased from
 $57.4 million last year to $64.0 million this year, an increase of 12%.
     Cash ROE was 16.72% in the current quarter.  Excluding the gain from the
 sale of the corporate trust business, cash ROE was 18.92% in first quarter
 2000.  Excluding unrealized gains and losses on the securities portfolio
 recorded directly to equity and the corporate trust gain, cash ROE rose 32
 basis points from last year's first quarter.
     Alan G. McNally, Chairman and Chief Executive Officer, attributed these
 results to continued strong earnings growth in Harris Bank's core businesses
 and a more favorable interest rate environment that contributed to increased
 earnings from treasury and trading activities.  This was partially offset by
 an increased loan loss provision associated with a slowing economy.
     Net interest income on a fully taxable equivalent basis was
 $184.1 million, up 6% from first quarter last year.  Net interest margin
 increased from 2.87% in first quarter 2000 to 2.94% currently.  Average
 earning assets rose 4% to $25.3 billion from $24.3 billion in first quarter
 2000, attributable to an increase of 5% or $795 million in average loans.
 Growth in consumer, mortgage and small business loans continued to be
 particularly strong.
     First quarter noninterest income of $113.3 million decreased 27% from the
 same quarter last year.  Excluding the $50.2 million gain from the sale of the
 corporate trust business, noninterest revenue increased 8%.  Last year's first
 quarter results also included operating revenue for both the corporate trust
 business and the merchant card business which was sold to Bank of Montreal's
 credit card processing joint venture (Moneris) in December 2000.  Excluding
 both the gain on sale and operating revenue from these businesses, noninterest
 revenue increased 22%.  Most of the increase resulted from additional net
 gains from securities sales of $13.2 million and higher bond trading profits
 of $5.1 million.
     First quarter 2001 noninterest expenses of $184.4 million were essentially
 flat compared to first quarter a year ago.  Income tax expense declined by
 $17.9 million, reflecting lower pretax income from year-ago results, which
 included the gain on the sale of the corporate trust business.
     The first quarter 2001 provision for loan losses of $16.0 million was up
 from $6.6 million in the first quarter of 2000.  Net loan charge-offs during
 the current quarter amounted to $18.6 million compared to $4.7 million in the
 prior year's quarter.  Most of the increase resulted from higher commercial
 loan write-offs.
     Nonperforming assets at March 31, 2001 were $120 million or 0.8% of total
 loans, compared to $107 million or 0.7% at December 31, 2000, and $41 million
 or 0.3% a year ago.  Most of the increase from March 31, 2000 is comprised of
 syndicated loans ranging in size from $8 million to $17 million to borrowers
 in different industry sectors.  At March 31, 2001, the allowance for possible
 loan losses was $168 million, equal to 1.1% of loans outstanding, compared to
 $164 million or 1.1% at the end of first quarter 2000.  As a result, the ratio
 of the allowance for possible loan losses to nonperforming assets was 140% at
 March 31, 2001, compared to 402% at March 31, 2000.
     At March 31, 2001 regulatory Tier 1 capital of Harris Bank amounted to
 $2.07 billion, up from $1.98 billion one year earlier.  The regulatory
 leverage capital ratio was 7.35% for the first quarter of 2001 compared to
 7.21% in the same quarter of 2000.  Harris Bank's leverage capital ratio
 exceeds the prescribed regulatory minimum for bank holding companies.
 
 SOURCE  Harris Bank