<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended June 30, 1995 Commission File Number 1-10521
CITY NATIONAL CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 95-2568550
--------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 North Roxbury Drive, Beverly Hills, California 90210
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 888-6000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES X NO
--- ---
Number of shares of common stock outstanding at July 31, 1995: 45,258,029
<PAGE>
CITY NATIONAL CORPORATION
Consolidated Balance Sheet
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1995 1994 1994
---------- ---------- ----------
(Dollars in thousands)
<S> <C> <C> <C>
ASSETS
Cash and due from banks ........................ $ 216,067 $ 298,715 $ 209,608
Interest-bearing deposits in other banks ....... 688 674 643
Federal funds sold and securities
purchased under resale agreements ............ 100,000 296,966 215,000
Investment securities (market values
$565,473, $625,425 and $681,973 at
June 30, 1995, December 31, 1994 and
June 30, 1994, respectively) ................. 573,401 659,013 705,392
Securities available for sale (cost
$107,788, $96,124 and $227,426 at
June 30, 1995, December 31, 1994 and
June 30, 1994, respectively) ................ 108,032 90,422 222,525
Trading account securities ..................... 130,212 25,531 34,213
Loans........................................... 1,699,826 1,643,918 1,498,111
Less allowance for credit losses ............... 109,052 105,343 105,380
---------- ---------- ----------
Net loans .................................... 1,590,774 1,538,575 1,392,731
Leveraged leases ............................... 9,018 9,856 10,042
Premises and equipment, net .................... 21,699 19,231 18,115
Customers' acceptance liability ................ 4,657 5,104 3,322
Other real estate .............................. 4,733 4,726 3,992
Deferred tax asset ............................. 28,060 28,250 22,600
Other assets ................................... 31,134 35,712 30,456
---------- ---------- ----------
Total assets ................................. $2,818,475 $ 3,012,775 $ 2,868,639
========== =========== ===========
LIABILITIES
Demand deposits ................................ $ 914,364 $ 1,151,709 $ 954,336
Interest checking deposits ..................... 253,292 305,659 270,169
Money market accounts .......................... 567,852 669,940 732,681
Savings deposits ............................... 79,452 88,027 94,977
Time deposits - under $100,000 ................. 75,486 77,657 87,428
Time deposits - $100,000 and over .............. 132,774 124,770 146,155
---------- ---------- ----------
Total deposits ............................... 2,023,220 2,417,762 2,285,746
Federal funds purchased and securities sold
under repurchase agreements .................. 312,068 182,120 185,955
Other short-term borrowings .................... 72,756 50,000 50,000
Long-term debt ................................. 25,000 - -
Other liabilities .............................. 29,709 27,068 31,334
Acceptances outstanding ........................ 4,657 5,104 3,322
---------- ---------- ----------
Total liabilities ............................ 2,467,410 2,682,054 2,556,357
---------- ---------- ----------
Commitments and contingencies
SHAREHOLDERS' EQUITY
Preferred Stock authorized-5,000,000,
none outstanding
Common stock-par value-$1.00;
authorized-75,000,000 Outstanding-
45,375,260, 45,192,678 and 45,095,496 at
June 30, 1995, December 31, 1994 and
June 30, 1994, respectively .................. 45,375 45,193 45,095
Surplus ........................................ 264,939 263,611 262,905
Unrealized gain (loss) on securities available
for sale...................................... 152 (3,564) (3,183)
Retained earnings .............................. 42,222 25,481 7,465
Treasury shares, at cost - 144,300
at June 30, 1995.............................. (1,623) - -
---------- ---------- ----------
Total shareholders' equity ................... 351,065 330,721 312,282
---------- ---------- ----------
Total liabilities and shareholders' equity.... $2,818,475 $ 3,012,775 $ 2,868,639
========== =========== ===========
</TABLE>
See accompanying Notes to the Unaudited Consolidated Financial Statements
-2-
<PAGE>
City National Corporation
Consolidated Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the three months For the six months
ended June 30, ended June 30,
--------- --------- --------- -----------
1995 1994 1995 1994
--------- --------- --------- -----------
(Dollars in thousands) (Dollars in thousands)
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans .......................... $41,257 $31,656 $78,959 $61,155
Interest on federal funds sold and securities
purchased under resale agreements .................. 1,676 1,705 2,877 3,353
Interest on investment securities:
U.S. Treasury and federal agency securities ....... 7,159 8,142 14,598 16,988
Municipal securities .............................. 279 189 566 347
Other securities .................................. 495 445 1,038 688
Interest on securities available for sale............ 1,624 2,517 3,366 2,647
Interest on trading account securities............... 528 214 984 428
------- ------- -------- -------
Total ............................................. 53,018 44,868 102,388 85,606
------- ------- -------- -------
Interest expense:
Interest on deposits ................................ 7,713 7,230 14,931 14,397
Interest on federal funds purchased and securities
sold under repurchase agreements ................... 4,030 2,027 7,163 3,506
Interest on other short-term borrowings ............. 595 186 1,101 289
Interest on long-term debt .......................... 228 - 228 -
------- ------- -------- -------
Total ............................................. 12,566 9,443 23,423 18,192
------- ------- -------- -------
Net interest income ................................. 40,452 35,425 78,965 67,414
Provision for credit losses ......................... - 3,000 - 6,000
------- ------- -------- -------
Net interest income after provision for credit
losses............................................. 40,452 32,425 78,965 61,414
------- ------- -------- -------
Noninterest income:
Service charges on deposit accounts ................. 1,902 2,395 3,741 5,166
Trust fees .......................................... 1,605 1,708 3,243 3,518
Investment services income ......................... 2,069 1,750 4,053 3,209
Gain on sale of leverage leases ..................... - - - 1,331
Gain on sales of securities ........................ 291 - 635 -
All other income .................................... 2,944 3,021 5,705 5,971
------- ------- -------- -------
Total noninterest income........................... 8,811 8,874 17,377 19,195
------- ------- -------- -------
Noninterest expense:
Salaries and other employee benefits ................ 16,466 15,724 33,059 32,457
Net occupancy of premises ........................... 1,980 2,742 3,974 5,383
Data processing ..................................... 1,742 1,834 3,514 3,578
Professional ........................................ 2,281 1,809 4,428 3,395
FDIC insurance ...................................... 1,232 1,500 2,465 3,000
Office supplies ..................................... 1,041 1,145 2,111 2,341
Depreciation ........................................ 1,005 1,032 2,007 2,093
Promotion ........................................... 1,175 735 2,303 1,546
Equipment ........................................... 501 585 918 1,121
Other operating ..................................... 2,791 2,295 5,060 5,121
Other real estate expense (income)................... 59 (774) 211 (5,300)
------- ------- -------- -------
Total noninterest expense.......................... 30,273 28,627 60,050 54,735
------- ------- -------- -------
Income before taxes.................................... 18,990 12,672 36,292 25,874
Income taxes ......................................... 7,429 4,443 14,114 8,985
------- ------- -------- -------
Net income ............................................ $11,561 $8,229 $22,178 $16,889
======= ======= ======== =======
Net Income per share .................................. $0.25 $0.18 $0.48 $0.37
======= ======= ======== =======
Shares used to compute net income per share ........... 45,804 45,848 45,822 45,550
======= ======= ======== =======
</TABLE>
See accompanying Notes to the Unaudited Consolidated Financial Statements
-3-
<PAGE>
City National Corporation
Consolidated Statement of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For the six months
ended June 30,
----------------------
1995 1994
--------- ----------
(Dollars in thousands)
<S> <C> <C>
Operating Activities
Net income .............................................. $ 22,178 $ 16,889
Adjustment to net income:
Provision for credit losses............................ - 6,000
Gain on sales of ORE and Disposition Program assets.... - (5,361)
Gain on sale of leveraged leases....................... - (1,331)
Depreciation........................................... 2,007 2,093
Net (increase) decrease in trading securities.......... (104,681) 5,552
Net( increase) decrease in deferred tax benefits....... 190 (4,550)
Income tax refund ..................................... 4,500 24,955
Other, net............................................. (2,952) 13,830
--------- ----------
Net cash provided by (used in) operating activities.. (78,758) 58,077
--------- ----------
Investing Activities
Net (increase) decrease in short-term investments........ (14) 6
Purchase of securities available for sale................ (36,325) (226,528)
Sales and maturities of securities available for sale.... 24,578 -
Maturities of investment securities...................... 89,614 407,821
Purchase of investment securities........................ (5,006) (219,210)
Purchase of residential mortgage loans................... (100,588) -
Other loan originations and principal collections, net... 36,077 103,154
Proceeds from sales of ORE and Disposition Program assets 804 7,368
Proceeds from sale of leveraged leases................... - 5,141
Other, net............................................... 12,392 14,481
--------- ----------
Net cash provided by investing activities............ 21,532 92,233
--------- ----------
Financing Activities
Net increase (decrease) in federal funds purchased
and securities sold under repurchase agreements........ 129,948 (16,504)
Net decrease in deposits................................ (394,542) (241,021)
Net increase in short term borrowings.................. 22,756 35,000
Proceeds from long term debt............................ 25,000 -
Proceeds from issuance of stock......................... 1,316 444
Purchase of treasury shares............................. (1,623) -
Cash dividends paid..................................... (5,437) -
Other, net.............................................. 194 (3,125)
--------- ----------
Net cash provided by (used in) financing activities. (222,388) (225,206)
--------- ----------
Net increase (decrease) in cash and cash equivalents.... (279,614) (74,896)
Cash and cash equivalents at beginning of year.......... 595,681 499,504
--------- ----------
Cash and cash equivalents at end of year................ $ 316,067 $ 424,608
========= ==========
Supplemental disclosures of cash flow information:
Cash paid (received) during the period for:
Interest ........................................... 23,063 18,319
Income taxes........................................ 10,050 (15,970)
Non cash investing activities:
Transfer from loans to ORE ......................... 908 1,595
</TABLE>
See accompanying Notes to the Unaudited Consolidated Financial Statements
-4-
<PAGE>
CITY NATIONAL CORPORATION
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
For the six months ended
June 30,
------------------------
1995 1994
----------- -----------
(Dollars in thousands)
<S> <C> <C>
Common Stock
Balance, beginning of period .......... $45,193 $45,027
Stock options exercised ................ 182 68
--------- ---------
Balance, end of period ................. 45,375 45,095
--------- ---------
Surplus
Balance, beginning of period .......... 263,611 262,471
Stock options exercised ................ 1,134 376
Tax benefit from stock options ......... 194 58
--------- ---------
Balance, end of period ................. 264,939 262,905
--------- ---------
Treasury shares
Balance, beginning of period .......... - -
Purchase of shares .................... (1,623) -
--------- ---------
Balance, end of period ................. (1,623) -
--------- ---------
Unrealized net losses on securities
available for sale
Balance, beginning of period .......... (3,564) -
Change during period ................... 3,716 (3,183)
--------- ---------
Balance, end of period ................. 152 (3,183)
--------- ---------
Retained earnings (Deficit)
Balance, beginning of period ......... 25,481 (9,424)
Net income ............................. 22,178 16,889
Dividends paid ......................... (5,437) -
--------- ---------
Balance, end of period ................. 42,222 7,465
--------- ---------
Total shareholders' equity ............... $351,065 $312,282
========= =========
</TABLE>
See accompanying Notes to the Unaudited Consolidated Financial Statements
-5-
<PAGE>
NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
OF THE REGISTRANT
1. The results of operations reflect the interim adjustments, all of which are
of a normal recurring nature and which, in the opinion of management, are
necessary for a fair presentation of the results for such interim periods.
These unaudited consolidated financial statements should be read in
conjunction with the audited consolidated financial statements included in
the Company's Annual Report on Form 10-K for the year ended December 31,
1994.
2. Securities held for investment are classified as investment securities.
Because the Company has the ability and management has the intent to hold
investment securities until maturity, investment securities are stated at
cost, adjusted for amortization of premiums and accretion of discounts.
Trading account securities are stated at market value. Investments not
classified as trading securities nor as investment securities are
classified as securities available for sale and recorded at fair value.
Unrealized gains or losses on securities available for sale are excluded
from earnings and reported as a net amount after taxes, in a separate
component of shareholders' equity, until realized.
3. For purposes of reporting cash flows, cash and cash equivalents include
cash on hand, amounts due from banks, federal funds sold and securities
purchased under resale agreements, and do not include items with original
maturities of over 90 days.
4. The Company adopted Statements of Financial Accounting Standards No. 114
"Accounting by Creditors for Impairment of a Loan" and No. 118 "Accounting
by Creditors for Impairment of a Loan - Income Recognition and Disclosures"
on January 1, 1995. The impact of the adoption was immaterial to the
results of operations and financial condition of the Company. Certain loans
previously recorded as in-substance foreclosures have been restated as
nonaccrual loans. At June 30, 1995 the Company had identified impaired
Loans with a recorded investment amount of $29.6 million. An allowance for
credit losses in the amount of $223 thousand was allocated to these loans.
The Company's policy is to record cash receipts received on impaired loans
first as reductions to principal and then to interest income.
-6-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS OVERVIEW
City National Corporation (the Corporation) is the holding company for City
National Bank (the Bank). Because the Bank constitutes substantially all of the
business of the Corporation, references to the Company in this Item 2 reflect
the consolidated activities of the Corporation and the Bank.
RESULTS OF OPERATIONS
The Company recorded consolidated net income of $11.6 million, or $.25 per
share, in the second quarter of 1995, compared with net income of $8.2 million,
or $.18 per share, in the second quarter of 1994. Most of the change between
second quarters resulted from an increase in net interest income in the second
quarter of 1995 of $5.0 million and a decrease in the provision for credit
losses of $3.0 million, offset by an increase of $3.0 million in income taxes.
Net income for the first six months of 1995 totaled $22.2 million, or $.48
per share compared with $16.9 million, or $.37 per share in the 1994 period. The
six month increase resulted largely from an $11.5 million increase in net
interest income and a $6.0 million decrease in the provision for credit losses,
offset by an increase in income taxes of $5.1 million and the change in results
of ORE operations from income of $5.3 million in 1994 to expense of $.2 million
in 1995.
Returns on average assets for the second quarter and first half of 1995
were 1.70% and 1.65%, respectively, compared with 1.16% and 1.20% in 1994.
Returns on average equity for the second quarter and first half of 1995 were
13.39% and 13.12%, respectively, compared with 10.67% and 11.15% in 1994.
Taxable equivalent net interest income was $41.0 million in the second
quarter of 1995, up 14.9% from the year-ago quarter. The increase resulted
primarily from the increase in the net interest spread from 4.61% to 5.00%. The
net interest spread improved because the increases in the prime interest rate
during the last twelve months resulted in higher yields on loans, while rates
paid on interest bearing liabilities increased only slightly between quarters.
The second quarter net interest margin increased from 5.52% in 1994 to 6.39% in
1995. The 1995 margin was positively impacted by generally higher interest rates
in the second quarter of 1995 compared with 1994 and high levels of collections
of interest on nonaccrual and charged off loans. Despite a recent trend in loan
growth, management does not expect significant increases in quarterly net
-7-
<PAGE>
interest income for the remainder of 1995 because of the .25% decrease in the
prime rate on July 7, 1995 and possible future decreases that could reduce gross
interest revenues. Additionally, lower deposit balances are expected to increase
the cost of funds to the Company as core deposits are replaced with higher cost
alternative funds.
Average loans increased $170.4 million (11.4%) between the second quarters
of 1995 and 1994 to $1.7 billion primarily due to purchases of residential first
mortgage loans. Total average investment and available for sale securities
decreased $206.3 million (22.8%) between second quarters because maturities of
securities were used to meet liquidity requirements and fund loan growth during
the last twelve months. Average trading securities increased $18.7 million
(88.2%) between second quarters to allow the Company to efficiently service the
increase in customer securities orders. Trading securities generally turn over
on a daily basis. Total average deposits decreased $226.3 million (10.1%)
between second quarters due to continued disintermediation and because the
higher earnings credit on deposit balances allowed customers to keep lower
balances on deposit to pay for bank services.
For the first half of 1995 average loans increased $109.4 million (7.1%)
while average investment and available for sale securities decreased $127.5
million (15.1%) from the comparable period of 1994. Additionally, total average
deposits for the six months ended June 30, 1995 decreased $225.5 million (9.9%)
compared to the 1994 period. The changes in the six month average balances
resulted from the same factors that caused the changes between the second
quarter average balances.
The provision for credit losses was zero for the second quarter and first
half of 1995, compared with $3.0 million and $6.0 million, respectively, for the
corresponding periods in 1994. Loans charged off in the second quarter of 1995
were $5.6 million, compared to $17.4 million in the second quarter of 1994.
Recoveries were $6.3 million in the second quarter of 1995, compared to $8.3
million in the second quarter of 1994. Provided a deterioration of economic
conditions does not occur, the provision for credit losses is expected to remain
low for the remainder of 1995, based on continuing improvement in credit quality
and anticipated modest growth in the loan portfolio.
Non-interest income excluding gains and losses on the sale of securities
and assets totaled $8.5 million for the second quarter of 1995, down $.4 million
(4%) from a year earlier. For the six months ended June 30, 1995, noninterest
income totaled $16.7 million, a decrease of $1.2 million from last year's total
of $17.9 million. The decreases for the second quarter and the first
-8-
<PAGE>
half of the year were primarily due to the reduction in service fee income on
deposit accounts of $.5 million between the respective quarters and $1.4 million
between the six month periods. Investment services income increased $.3 million
(18.2%) for the quarter ended June 30, 1995 and $.8 million for the first six
months of 1995 as compared to the prior periods, respectively, due to higher
fees and new investment products offered to customers. Management does not
expect significant changes in the quarterly amounts of core non-interest income
during the remaining quarters of 1995.
Excluding net ORE results, non-interest expense totaled $30.2 million in
the second quarter of 1995, an increase of $.8 million (2.8%) from the second
quarter of 1994. Net occupancy of premises expenses decreased $.8 million
(27.8%) from the second quarter of 1994 due to the impact of the branch
consolidation program completed in the second quarter of 1994. Salaries and
other employee benefits increased $.7 million (4.7%) for the quarter ended June
30, 1995 from the second quarter of 1994. Higher costs associated with
performance incentives and accruals for contributions to the profit sharing plan
more than offset a decrease in salary expense due to the branch consolidation
program. Promotional expenses increased $.4 million (59.9%) in the second
quarter of 1995 compared with the second quarter of 1994 as the Company expanded
its marketing and sales supports efforts. Professional expenses were up $.5
million (26.1%) in the second quarter 1995 compared with 1994 due principally to
mortgage servicing fees paid as the result of purchases of residential first
mortgages during preceding twelve months.
For the first half of 1995 noninterest expense, excluding net ORE results,
totaled $59.8 million compared with $60.0 million in the 1994 period. Salaries
and employee benefits, professional expenses, and promotional expenses were all
higher in the first six months of 1995 compared with 1994 for the same reasons
as the quarter over quarter increases. The remaining categories of noninterest
expense were all lower in the first half of 1995 than 1994, particularly net
occupancy expense, office supplies, and equipment expense all of which are
attributable to the branch consolidation program and management's continuing
focus on cost controls. Additionally, FDIC insurance expense decreased $.5
million in the 1995 period compared with 1994 due to lower deposit levels. FDIC
insurance expense could decrease significantly in the future if the premium
assessment rates levied by the FDIC are reduced to the levels proposed as
adequate to maintain the insurance fund's solvency.
-9-
<PAGE>
Net ORE results in the second quarter of 1995 were an expense of $.1
million, compared to income of $.8 million in the prior year. For the first half
of 1995 net ORE expense was $.2 million compared with income of $5.3 million in
the 1994 period, which included $4.2 million due to the completion of the
Company's Accelerated Asset Disposition Program.
The second quarter 1995 effective tax rate increased to 39.1%, compared to
35.1% for the second quarter of 1994 as California net operating loss carry
forwards were fully utilized in 1994.
-10-
<PAGE>
Net Interest Income Summary
The following table presents the components of net interest income for the
quarters ended June 30, 1995 and 1994.
<TABLE>
<CAPTION>
June 30, 1995 June 30, 1994
-------------------------------------- ------------------------------------
Interest Average Interest Average
Average income/ interest Average income/ interest
Dollars in thousands- Balance expense(1) rate Balance expense(1) rate
--------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets(2)
Earning assets
Loans: (3)
Commercial loans $ 831,751 $ 21,799 10.10 % $ 862,402 $ 18,950 8.81 %
Real estate - construction 47,499 1,501 12.67 13,716 309 9.04
Real estate - mortgage 445,254 11,199 10.09 561,045 11,091 7.93
Residential first mortgages 306,321 6,248 8.18 18,909 408 8.65
Installment loans 36,420 823 9.06 40,733 1,010 9.95
------------- ----------- ----- ---------- --------- -----
Total loans 1,667,245 41,570 9.79 1,496,805 31,768 8.51
------------- ----------- ----- ---------- --------- -----
Due from banks-interest bearing 690 5 2.91 507 3 2.37
State and municipal investment
securities 24,428 435 7.14 16,274 294 7.19
Taxable investment securities 577,239 7,649 5.31 698,703 8,584 4.93
Securities available for sale 95,532 1,624 6.82 188,559 2,517 5.35
Federal funds sold and securities
purchased under resale agreements 110,676 1,676 6.07 171,603 1,705 3.99
Trading account securities 39,888 566 5.69 21,194 235 4.06
------------- ----------- ----- ---------- --------- -----
Total earning assets 2,515,698 53,525 8.40 2,593,645 45,106 6.98
------------- ----------- ----- ---------- --------- -----
Reserve for credit losses (109,795) (112,573)
Cash and due from banks 233,576 243,390
Other nonearning assets 94,870 111,819
------------- ----------
Total assets $ 2,734,349 2,836,281
============= ==========
Liabilities and
Shareholders' Equity
Noninterest-bearing deposits $ 869,488 - - $ 890,116 - -
Interest-bearing deposits:
Interest checking accounts 271,438 654 0.97 286,773 688 0.96
Money market accounts 599,055 4,231 2.83 732,390 4,062 2.22
Savings deposits 79,759 392 1.97 98,046 481 1.97
Time deposits-under $100,000 75,749 886 4.69 90,736 810 3.58
Time deposits-$100,000 and over 124,920 1,550 4.98 148,653 1,190 3.21
------------- ----------- ----- ---------- --------- -----
Total interest-bearing deposits 1,150,921 7,713 2.69 1,356,598 7,231 2.14
------------- ----------- ----- ---------- --------- -----
Total deposits 2,020,409 2,246,714
Federal funds purchased and
securities sold under
repurchase agreements 277,886 4,030 5.82 221,886 2,027 3.66
Other borrowings 54,111 823 6.10 18,422 186 4.05
------------- ----------- ----- ---------- --------- -----
Total interest-bearing
liabilities 1,482,918 12,566 3.40 1,596,906 9,444 2.37
------------- ----------- ----- ---------- --------- -----
Other liabilities 35,598 39,914
Shareholders' equity 346,345 309,345
------------- ----------
Total liabilities and
shareholders' equity $ 2,734,349 $2,836,281
============= ==========
Net interest spread 5.00 4.61
===== =====
Fully taxable equivalent net
interest income $ 40,959 $ 35,662
=========== =========
Net interest margin 6.39 % 5.52 %
===== =====
</TABLE>
(1) Fully taxable equivalent basis.
(2) Includes average nonaccrual loans of $51,420 and $69,369 for 1995 and
1994, respectively.
(3) Loan income includes loan fees of $1,616 and $1,819 for 1995 and 1994,
respectively.
-11-
<PAGE>
Net Interest Income Summary
The following table presents the components of net interest income for the six
months ended June 30, 1995 and 1994.
<TABLE>
<CAPTION>
June 30, 1995 June 30, 1994
-------------------------------------- ---------------------------------------
Interest Average Interest Average
Average income/ interest Average income/ interest
Dollars in thousands- Balance expense (1) rate Balance expense (1) rate
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets(2)
Earning assets
Loans: (3)
Commercial loans $ 849,453 $ 42,278 9.90 % $ 882,273 $ 35,431 8.10 %
Real estate - construction 41,710 2,632 12.73 13,934 556 8.64
Real estate - mortgage 447,816 22,516 10.14 581,357 22,832 7.92
Residential first mortgages 268,855 10,377 7.78 14,714 551 7.55
Installment loans 35,679 1,717 9.70 41,883 2,019 9.72
---------- ---------- ------ ----------- ---------- ------
Total loans 1,643,513 79,520 9.66 1,534,161 61,389 8.08
---------- ---------- ------ ----------- ---------- ------
Due from banks-interest bearing 687 8 2.35 646 8 2.47
State and municipal investment
securities 25,072 882 7.09 13,710 540 7.91
Taxable investment securities 596,982 15,628 5.28 728,687 17,667 4.89
Securities available for sale 94,180 3,366 7.21 101,374 2,647 5.27
Federal funds sold and securities
purchased under resale agreements 92,626 2,877 6.26 189,910 3,353 3.60
Trading account securities 34,098 1,068 6.32 23,663 465 5.01
---------- ---------- ------ ----------- ---------- ------
Total earning assets 2,487,158 103,349 8.32 2,592,151 86,069 6.72
---------- ---------- ------ ----------- ---------- ------
Reserve for credit losses (108,620) (113,038)
Cash and due from banks 237,360 248,113
Other nonearning assets 95,400 118,916
---------- -----------
Total assets $2,711,298 $ 2,846,142
========== ===========
Liabilities and
Shareholders' Equity
Noninterest-bearing deposits $ 874,565 - - $ 898,682 - -
Interest-bearing deposits:
Interest checking accounts 272,827 1,308 0.97 289,494 1,384 0.96
Money market accounts 612,984 8,311 2.73 732,943 7,991 2.20
Savings deposits 82,458 805 1.97 100,186 974 1.96
Time deposits-under $100,000 75,967 1,648 4.37 93,041 1,658 3.59
Time deposits-$100,000 and over 123,335 2,859 4.67 153,327 2,390 3.16
---------- ---------- ------ ----------- --------- ------
Total interest-bearing deposits 1,167,571 14,931 2.58 1,368,991 14,397 2.12
---------- ---------- ------ ----------- --------- ------
Total deposits 2,042,136 2,267,673
Federal funds purchased and securities
sold under repurchase agreements 249,705 7,163 5.78 210,483 3,506 3.34
Other borrowings 44,561 1,329 6.01 16,345 289 3.46
---------- ---------- ------ ----------- --------- ------
Total interest-bearing liabilities 1,461,837 23,423 3.23 1,595,819 18,192 2.30
---------- ---------- ------ ----------- --------- ------
Other liabilities 33,904 46,178
Shareholders' equity 340,992 305,463
---------- -----------
Total liabilities and shareholders'
equity $2,711,298 $ 2,846,142
========== ===========
Net interest spread 5.09 4.42
====== ======
Fully taxable equivalent net interest income $ 79,926 $ 67,877
========== =========
Net interest margin 6.38 % 5.28 %
====== ======
</TABLE>
(1) Fully taxable equivalent basis.
(2) Includes average nonaccrual loans of $56,461 and $67,410 for 1995 and
1994, respectively.
(3) Loan income includes loan fees of $3,358 and $2,904 for 1995 and 1994,
respectively.
- 12 -
<PAGE>
The following tables set forth, for the periods indicated, the changes in
interest earned and interest paid resulting from changes in volume and changes
in rates. Average balances in all categories in each reported period were used
in the volume computations. Average yield and rates in each reported period
were used in rate computations.
<TABLE>
<CAPTION>
Quarter Ended June 30 Quarter Ended June 30
1995 vs 1994 1994 vs 1993
--------------------------------- ----------------------------------
Increase Increase
Dollars in thousands - (decrease) (decrease)
Fully taxable equivalent basis due to (1): Net due to (1): Net
--------------------- increase -------------------- increase
Volume Rate (decrease) Volume Rate (decrease)
------- ----------- ---------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Interest earned on:
Interest-bearing deposits
in other banks $ 1 $ 1 $ 2 $ 2 $ (11) $ (9)
Loans 3,863 5,939 9,802 (5,087) 4,180 (907)
Taxable investment securities (1,565) 630 (935) 4,150 (915) 3,235
Non-taxable investment securities 145 (4) 141 228 37 265
Securities available for sale (1,461) 568 (893) 2,319 (292) 2,027
Trading account securities 251 80 331 (49) 93 44
Federal funds sold and
securities purchased
under resale agreements (733) 704 (29) (1,174) 581 (593)
------- -------- -------- -------- -------- --------
Total interest-earning
assets 501 7,918 8,419 389 3,673 4,062
------- -------- -------- -------- -------- --------
Interest paid on:
Interest checking (40) 6 (34) 27 (221) (194)
Money market deposits (820) 989 169 (21) (281) (302)
Savings deposits (89) 0 (89) (35) (63) (98)
Other time deposits (362) 798 436 (631) (77) (708)
Other borrowings 1,039 1,601 2,640 (106) 532 426
------- -------- -------- -------- -------- --------
Total interest-bearing
liabilities (272) 3,394 3,122 (766) (110) (876)
------- -------- -------- -------- -------- --------
$ 773 $ 4,524 $ 5,297 $ 1,155 $ 3,783 $ 4,938
======= ======== ======== ======== ======== ========
<CAPTION>
Six Months Ended June 30 Six Months Ended June 30
1995 vs 1994 1994 vs 1993
--------------------------------- ----------------------------------
Increase Increase
Dollars in thousands - (decrease) (decrease)
Fully taxable equivalent basis due to (1): Net due to (1): Net
--------------------- increase -------------------- increase
Volume Rate (decrease) Volume Rate (decrease)
------- ----------- ---------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Interest earned on:
Interest-bearing deposits
in other banks $ 1 $ (1) $ 0 $ (5) $ (9) $ (14)
Loans 4,604 13,527 18,131 (9,148) 1,487 (7,661)
Taxable investment securities (3,371) 1,332 (2,039) 12,269 (6,060) 6,209
Non-taxable investment securities 405 (63) 342 353 72 425
Securities available for sale (199) 918 719 3,211 (1,763) 1,448
Trading account securities 257 346 603 (103) 187 84
Federal funds sold and
securities purchased
under resale agreements (2,242) 1,766 (476) (742) 195 (547)
------- -------- -------- -------- -------- --------
Total interest-earning
assets (545) 17,825 17,280 5,835 (5,891) (56)
------- -------- -------- -------- -------- --------
Interest paid on:
Interest checking (88) 12 (76) 2 (519) (517)
Money market deposits (1,429) 1,749 320 (215) (909) (1,124)
Savings deposits (174) 5 (169) (55) (184) (239)
Other time deposits (872) 1,331 459 (1,434) (191) (1,625)
Other borrowings 1,363 3,334 4,697 (958) 213 (745)
------- -------- -------- -------- -------- --------
Total interest-bearing
liabilities (1,200) 6,431 5,231 (2,660) (1,590) (4,250)
------- -------- -------- -------- -------- --------
$ 655 $ 11,394 $ 12,049 $ 8,495 $ (4,301) $ 4,194
======= ======== ======== ======== ======== ========
</TABLE>
(1) The change in interest due to both rate and volume has been allocated to
change due to volume and rate in proportion to the relationship of the
absolute dollar amounts of the change in each.
-13-
<PAGE>
BALANCE SHEET ANALYSIS
Loan Portfolio
A comparative period-end loan table is presented below:
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1995 1994 1994
------------ ---------------- ------------
(Dollars in thousands)
<S> <C> <C> <C>
Commercial $ 827,434 $ 906,417 $ 872,443
Real estate - construction 52,356 31,201 14,622
Real estate - mortgage 425,870 457,030 533,365
Residential first mortgage 358,431 212,595 38,135
Installment 35,735 36,675 39,546
---------- ---------- ----------
Total loans, gross 1,699,826 1,643,918 1,498,111
Less: Allowance for credit losses (109,052) (105,343) (105,380)
---------- ---------- ----------
Total loans, net $1,590,774 $1,538,575 $1,392,731
========== ========== ==========
</TABLE>
Gross loans at June 30, 1995 totaled $1,699.8 million, up $201.7 million
(13.4%) from June 30, 1994. The decrease in commercial and real estate mortgage
loans resulted from payoffs in excess of new loans funded. However, residential
first mortgage loans increased $320.3 million between June 30, 1994 and 1995, as
a result of purchases of residential mortgages originated by third parties and
the Bank's own originations. Construction loans also increased significantly
from June 30, 1994, up 258% to $52.4 million at June 30, 1995 as the Company
continued to expand its lending for single family residential construction
development. The Company expects that during the second half of 1995 the Bank's
loan portfolio may continue to grow at a rate comparable to that experienced
during the first half of the year.
-14-
<PAGE>
The following table presents information concerning nonaccrual loans, ORE,
and restructured loans.
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1995 1994 1994
-------- ------- -------
(Dollars in thousands)
<S> <C> <C> <C>
Nonaccrual loans:
Real estate - mortgages $29,210 $35,534 $49,751
Commercial 13,208 23,267 18,606
------- ------- -------
Total 42,418 58,801 68,357
ORE 4,733 4,726 3,992
------- ------- -------
Total nonaccrual loans
and ORE $47,151 $63,527 $72,349
======= ======= =======
Restructured loans, accrual status $ 2,897 $ 2,061 $ 2,125
======= ======= =======
Ratio of nonaccrual loans
to total loans 2.50% 3.58% 4.56%
Ratio of nonperforming assets
to total assets 1.67 2.11 2.52
Ratio of allowance for credit
losses to nonaccrual loans 257.09 179.15 154.16
</TABLE>
The adoption of SFAS No. 114, "Accounting by Creditors for Impairment of a
Loan," upon its January 1, 1995, effective date did not have a material impact
on the Company's results of operations or financial condition. The reduction in
nonperforming assets levels between June 30, 1994 and 1995 reflects the
Company's commitment to improving credit quality through initial credit review
and approval policies, and aggressive recovery efforts when loans become
questionable.
-15-
<PAGE>
The table below summarizes the approximate changes in nonaccrual loans for
the quarters and six months ended June 30, 1995 and June 30, 1994.
<TABLE>
<CAPTION>
Quarter ended Six months ended
June 30, June 30,
---------------------- ----------------
1995 1994 1995 1994
------- ------ ------ ------
<S> <C> <C> <C> <C>
(Dollars in millions)
Balance, beginning of period $ 59.9 $ 73.2 $ 58.8 $ 79.4
Loans placed on nonaccrual 7.3 30.5 18.8 49.5
Charge offs ( 4.4) (12.7) (5.6) (19.4)
Loans returned to accrual ( 3.7) (6.0) (4.2) (12.4)
Repayments (including interest
applied to principal) ( 16.5) (15.9) (25.2) (28.0)
Transfers to ORE (.2) (.7) (0.2) (0.7)
------- ------ ------ ------
Balance, end of period $ 42.4 $ 68.4 $ 42.4 $ 68.4
======= ====== ====== ======
</TABLE>
At June 30, 1995, in addition to loans disclosed above as past due or
nonaccrual, management had also identified $6.2 million of potential problem
loans about which the ability of the borrowers to comply with the present loan
repayment terms in the future is questionable, but noncompliance is not
sufficiently probable to place the loans on nonaccrual status.
-16-
<PAGE>
The following table summarizes average loans outstanding and changes in the
allowance for credit losses for the periods presented:
<TABLE>
<CAPTION>
Quarter ended Six months ended
June 30, June 30,
--------------------------- ---------------------
1995 1994 1995 1994
-------- -------- -------- --------
(Dollars in millions)
<S> <C> <C> <C> <C>
Average amount of loans outstanding $1,667.2 $1,496.8 $1,643.5 $1,534.2
======== ======== ======== ========
Balance of allowance for credit losses,
beginning of period $108.4 $ 111.5 $105.3 $ 110.5
Loans charged off:
Commercial 5.1 10.2 7.4 15.5
Real estate loans - construction - - - -
Real estate loans - mortgage 0.5 7.0 1.1 10.4
Installment - .2 - 0.4
-------- -------- ------- --------
Total loans charged off 5.6 17.4 8.5 26.3
-------- -------- ------- --------
Less recoveries of loans previously
charged off:
Commercial 5.6 7.9 10.8 14.6
Real estate loans - construction - - - 0.1
Real estate loans - mortgage 0.6 .1 1.2 0.1
Installment
0.1 0.3 0.3 0.4
-------- -------- ------- --------
Total recoveries 6.3 8.3 12.3 15.2
-------- -------- ------- --------
Net loans charged off (recovered) (.7) 9.1 (3.8) 11.1
Provisions charged to operating
expense - 3.0 - 6.0
-------- -------- -------- --------
Balance, end of period $ 109.1 $ 105.4 $ 109.1 $105.4
======== ======== ======== ========
Ratio of net charge-offs to
average loans NM 2.43% NM 1.45%
======== ======== ======== =======
Ratio of allowance for credit
losses to total loans 6.42% 7.03% 6.42% 7.03%
======== ======== ======== ========
</TABLE>
CONSOLIDATION CHARGE RESERVE
In March 1993, the Bank announced a consolidation plan to improve
efficiency and operational productivity in its branch network. To cover the
costs associated with this action, the Bank recorded a consolidation charge of
$12.0 million in the fourth quarter of 1993. At June 30, 1995, the balance
remaining in the consolidation reserve was $5.6 million. The Bank is continuing
to negotiate settlements of lease commitments and believes the reserve
balance at
-17-
<PAGE>
June 30, 1995 is adequate to cover these lease liabilities and the remaining
expenses expected to be incurred as part of the consolidation program.
CAPITAL
As of June 30, 1995, the Company had a ratio of Tier 1 capital to risk-
weighted assets (Tier 1 risk-based capital ratio) of 18.72%, a ratio of total
capital to risk weighted assets (total risk-based capital ratio) of 20.03%, and
a ratio of Tier 1 capital to average adjusted total assets (Tier 1 leverage
ratio) of 12.86%, while the Bank had a Tier 1 risk-based capital ratio of
17.70%, a total risk-based capital ratio of 19.01% and a Tier 1 leverage ratio
of 12.15%.
The Corporation resumed paying dividends on its outstanding common stock in
the fourth quarter of 1994 after suspending payment of dividends in August,
1991. A dividend of $.05 per share for the first quarter of 1995 was paid on
February 16, 1995. On April 18, 1995, the Board of Directors of City National
Corporation approved an increase in the Company's quarterly common stock
dividend by 40% to $.07 per share which was paid on May 9, 1995 to shareholders
of record on April 28, 1995. The Board of Directors also declared a quarterly
dividend on the Company's common stock of $.07 per share payable on August 18,
1995 to shareholders of record on August 8, 1995.
On May 3, 1995, the Corporation announced that the Board of Directors
authorized the purchase of up to 5%, or 2.28 million shares of the Corporation's
common stock from time to time in open market transactions. As of June 30, 1995
a total of 144,300 shares of stock had been repurchased at a cost of $1.6
million. In addition, management continues to review and evaluate other uses of
the Company's capital, including potential acquisitions.
LIQUIDITY
The Company continues to manage its liquidity through the combination of
core deposit funding, federal funds purchases, repurchase agreements,
collateralized borrowing lines at the Federal Reserve Bank and the Federal Home
Loan Bank of San Francisco, and a portfolio of securities available for sale.
Liquidity is also provided by maturing investment securities and loans. During
the second quarter of 1995 the Company borrowed $50 million from the Federal
Home Loan Bank, $25 million of which matures in May of 1996 and the other $25
million of which matures in May of 1997.
Average core deposits comprised 80.6% of total funding in the second
quarter of 1995, compared to 84.4% in the second quarter of 1994. At June 30,
1995, investment securities maturing
-18-
<PAGE>
within one year amounted to $164.5 million, and securities available for sale
amounted to $108.0 million. Maturing loans also provide liquidity, and $773
million of the Bank's loans are scheduled to mature in the next twelve months.
The following table shows that the Company's positive interest rate
sensitivity gap increased from $209.8 million at June 30, 1994 to $392.1 million
at June 30, 1995 due primarily to the decreases in Company's deposit base,
growth in loans concentrated in the short term and variable pricing categories,
and an increase in trading securities, the majority of which were subsequently
sold on the first business day of July 1995. The Company's asset sensitive
position during the past period of rising interest rates has had a positive
effect on net interest income. The recent decreases in interest rates should
they continue during the remainder of 1995 could negatively impact net interest
income in the remaining quarters of 1995. The Company continuously evaluates
strategies to minimize the decrease in net interest income caused by decreases
in interest rates and implement specific strategies as circumstances warrant.
While the interest rate sensitivity gap is a useful measure and contributes
towards effective asset and liability management, it is difficult to predict the
net interest margin based solely on that measure.
-19-
<PAGE>
Interest Rate Sensitivity Management
At June 30, 1995 and 1994, the Company's distribution of rate-sensitive assets
and liabilities was as follows:
<TABLE>
<CAPTION>
Maturing or repricing in
-------------------------------------------------------------------------
After 3 After 1 year
3 months months but but within After
or less within 1 year 5 years 5 years Total
------------- ------------- ----------- --------- -------
(Dollars in millions)
<S> <C> <C> <C> <C> <C>
June 30, 1995
Rate-sensitive assets:
Interest-bearing deposits in other banks $ 0.7 $ - $ - $ - $ 0.7
Loans ................................... 1,320.2 109.8 147.2 82.0 1,659.2
Investment securities ................... 62.7 101.8 197.5 211.4 573.4
Securities available for sale ........... 28.0 - 32.7 47.3 108.0
Trading account.......................... 130.2 - - - 130.2
Federal funds sold and securities
purchased with agreement to resell ... 100.0 - - - 100.0
-------- -------- -------- -------- ---------
Total rate-sensitive assets .......... 1,641.8 211.6 377.4 340.7 2,571.5
-------- -------- -------- -------- ---------
Rate-sensitive liabilities: (1)
Interest checking ....................... 253.3 - - - 253.3
Money market deposits ................... 567.9 - - - 567.9
Savings deposits ........................ 79.5 - - - 79.5
Other time deposits ..................... 83.3 92.5 32.5 - 208.3
Other borrowings ........................ 359.8 25.0 25.0 - 409.8
-------- -------- -------- -------- ---------
Total rate-sensitive liabilities .... 1,343.8 117.5 57.5 - 1,518.8
-------- -------- -------- -------- ---------
Interest rate sensitivity gap ............. $ 298.0 $ 94.1 $ 319.9 $ 340.7 $ 1,052.7
======== ======== ======== ======== =========
Cumulative interest rate sensitivity gap .. $ 298.0 $ 392.1 $ 712.0 $ 1,052.7
======== ======== ======== =========
Cumulative ratio of rate-sensitive
assets to rate-sensitive liabilities..... 122% 127% 147% 169% 169%
======== ======== ======== ======== =========
<CAPTION>
Maturing or repricing in
-------------------------------------------------------------------------
After 3 After 1 year
3 months months but but within After
or less within 1 year 5 years 5 years Total
------------- ------------- ----------- --------- -------
(Dollars in millions)
<S> <C> <C> <C> <C> <C>
June 30, 1994
Rate-sensitive assets:
Interest-bearing deposits in other banks $ 0.6 $ - $ - $ - $ 0.6
Loans ................................... 1,227.2 65.2 86.5 50.9 1,429.8
Investment securities ................... 63.1 131.3 308.9 202.1 705.4
Securities available for sale ........... - 4.0 166.5 52.0 222.5
Trading account.......................... 34.2 - - - 34.2
Federal funds sold and securities
purchased with agreement to resell ... 215.0 - - - 215.0
-------- -------- -------- -------- ---------
Total rate-sensitive assets ......... 1,540.1 200.5 561.9 305.0 2,607.5
-------- -------- -------- -------- ---------
Rate-sensitive liabilities: (1)
Interest checking ....................... 270.2 - - - 270.2
Money market deposits ................... 732.7 - - - 732.7
Savings deposits ........................ 95.0 - - - 95.0
Other time deposits ..................... 120.6 76.3 36.7 - 233.6
Short-term borrowings ................... 236.0 - - - 236.0
-------- -------- -------- -------- ---------
Total rate-sensitive liabilities ..... 1,454.5 76.3 36.7 - 1,567.5
-------- -------- -------- -------- ---------
Interest rate sensitivity gap ............. $ 85.6 $ 124.2 $ 525.2 $ 305.0 $ 1,040.0
======== ======== ======== ======== =========
Cumulative interest rate sensitivity gap .. $ 85.6 $ 209.8 $ 735.0 $1,040.0
======== ======== ======== ========
Cumulative ratio of rate-sensitive
assets to rate-sensitive liabilities..... 106% 114% 147% 166% 166%
======== ======== ======== ======== =========
</TABLE>
(1) Customer deposits which are subject to immediate withdrawal are
presented as repricing within 3 months or less. The distribution of
other time deposits is based on scheduled maturities.
-20-
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS.
On April 18, 1995, the Registrant held its annual meeting of shareholders.
The shareholders elected the 12 directors listed in the Registrant's proxy
statement and approved the City National Corporation 1995 Omnibus Plan (the
Plan). The following table sets forth the number of votes cast for or withheld
with respect to each director. Under applicable Delaware law, votes withheld
have the same effect as votes cast against a nominee, and for this reason the
ballot did not offer a separate opportunity to vote against nominees.
Additionally, the table sets forth the number of votes cast for or against the
Plan, as well as the number of abstentions and broker non-votes.
<TABLE>
<CAPTION>
Name For Withheld
------------------------------- ----------- -------------
<S> <C> <C>
George H. Benter, Jr. 39,831,041 932,731
Richard L. Bloch 39,392,568 1,371,204
Mirion P. Bowers, M.D. 40,376,970 386,802
Steven D. Broidy 39,791,521 972,251
Stuart D. Buchalter 38,926,275 1,837,497
Bram Goldsmith 39,780,717 983,055
Russell D. Goldsmith 39,803,866 959,906
Burton S. Horwitch 39,788,401 975,371
Charles E. Rickerhauser, Jr. 40,359,591 404,181
Edward Sanders 40,353,386 410,386
Andrea L. Van De Kamp 40,371,358 392,414
Kenneth Ziffren 40,388,950 374,822
<CAPTION>
Matter For Against Abstain Broker Non-Votes
------ ---------- --------- -------- -----------------
<S> <C> <C> <C> <C>
Approval of the Corporation's
1995 Omnibus Plan 25,782,333 7,325,532 343,079 7,312,828
</TABLE>
-21-
<PAGE>
ITEM 5. OTHER INFORMATION.
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CITY NATIONAL CORPORATION
-------------------------
(Registrant)
DATE: August 8, 1995 /s/ FRANK P. PEKNY
--------------------- -------------------------
FRANK P. PEKNY
Executive Vice President
and Treasurer
-22-
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit Page No.
----------- ------- --------
27 Financial Data Schedule (EDGAR Only)
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 216,067
<INT-BEARING-DEPOSITS> 688
<FED-FUNDS-SOLD> 100,000
<TRADING-ASSETS> 130,212
<INVESTMENTS-HELD-FOR-SALE> 108,032
<INVESTMENTS-CARRYING> 573,401
<INVESTMENTS-MARKET> 565,473
<LOANS> 1,699,826
<ALLOWANCE> 109,052
<TOTAL-ASSETS> 2,818,475
<DEPOSITS> 2,023,220
<SHORT-TERM> 384,824
<LIABILITIES-OTHER> 34,366
<LONG-TERM> 25,000
<COMMON> 45,375
0
0
<OTHER-SE> 305,690
<TOTAL-LIABILITIES-AND-EQUITY> 2,818,475
<INTEREST-LOAN> 78,959
<INTEREST-INVEST> 19,568
<INTEREST-OTHER> 3,861
<INTEREST-TOTAL> 102,388
<INTEREST-DEPOSIT> 14,931
<INTEREST-EXPENSE> 23,423
<INTEREST-INCOME-NET> 78,965
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 635
<EXPENSE-OTHER> 60,050
<INCOME-PRETAX> 36,292
<INCOME-PRE-EXTRAORDINARY> 36,292
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 22,178
<EPS-PRIMARY> 0.48
<EPS-DILUTED> 0.48
<YIELD-ACTUAL> .083
<LOANS-NON> 42,418
<LOANS-PAST> 3,660
<LOANS-TROUBLED> 8,896
<LOANS-PROBLEM> 6,209
<ALLOWANCE-OPEN> 105,343
<CHARGE-OFFS> 8,602
<RECOVERIES> 12,310
<ALLOWANCE-CLOSE> 109,051
<ALLOWANCE-DOMESTIC> 109,051
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
