SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: January 24, 1994
_____________________________________
FIRST SECURITY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-6906 87-6118148
(State of incorporation) (Commission File Number) (I.R.S. Employer
Identification No.)
79 South Main, P.O. Box 30006
Salt Lake City, Utah 84130-0006
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(801) 246-5706
There are 14 pages in this document
<PAGE>
Item 5. Other Information
On January 19, 1994, First Security Corporation (the Registrant, FSC)
issued a press release relating to its Fourth Quarter 1993 earnings, a
copy of which is attached to this report as Exhibit A.
SIGNATURES
Pursuant to the requirements of the Security Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
FIRST SECURITY CORPORATION
Date January 24, 1994 BY___[SIGNED]_________________________________
Scott C. Ulbrich
Executive Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer)
<PAGE>
EXHIBIT A
FIRST SECURITY NEWS
FOR IMMEDIATE RELEASE Contact: Scott C. Ulbrich
January 19, 1994 (801) 246-5706
FIRST SECURITY EARNS RECORD NET INCOME FOR 1993
SALT LAKE CITY -- First Security Corporation (FSC; OTC/NASDAQ symbol:
FSCO) today announced record net income totaling $125.18 million for
1993, excluding one-time merger-related charges of $11.12 million after
tax associated with the acquisition of First National Financial
Corporation (FNFC - Albuquerque, New Mexico), up $24.83 million (24.7%)
from $100.34 million earned in 1992. Reported net income, including the
FNFC merger charges, was a record $114.06 million for 1993, up $13.71
million (13.7%) from $100.34 million earned in 1992. Net income for the
year, excluding the FNFC merger charges, generated a 1.36% return on
average assets (ROAA) and a 15.97% return on average equity (ROAE) for
1993, compared with a 1.18% ROAA and a 14.75% ROAE for 1992. Net income
per share, excluding the FNFC merger charges, was $2.61 for 1993, up
$0.45 (20.8%) from $2.16 for 1992. FSC's financial statements have been
restated to reflect the pooling-of-interests merger with FNFC and the
adoption of Statement of Financial Accounting Standard 109, "Accounting
for Income Taxes".
Reported net income, including the FNFC merger charges, was a record
$114.06 million for 1993, up $13.71 million (13.7%) from $100.34 million
earned in 1992. This net income generated a 1.24% ROAA and a 14.55% ROAE
for 1993, compared with the 1.18% ROAA and a 14.75% ROAE for 1992. Net
income per share was $2.38 for 1993, up $0.22 (10.2%) from $2.16 for
1992.
Spencer F. Eccles, chairman and chief executive officer of the
regional banking and financial services company, said "1993 was the most
profitable year in First Security's 65 year history and the seventh
straight year in which its earnings have increased." Mr. Eccles
explained, "For 1993, growth in net income was due primarily to continued
strong growth in interest-earning assets, plus a significant reduction in
the provision for loan losses combined with a lower cost of funds and
higher noninterest income." Mr. Eccles pointed out, "First Security's
assets also reached a significant milestone in 1993 when total assets
passed the $10 billion dollar mark for the first time to total $10.21
billion by year end".
Net income for the fourth quarter of 1993, excluding one-time FNFC
merger-related charges of $11.12 million after tax, was $32.19 million,
up $5.07 million (18.7%) from the fourth quarter of 1992. Net income,
excluding the FNFC merger charges, generated a 1.32% ROAA and a 15.37%
ROAE, compared with a 1.25% ROAA and a 15.18% ROAE for the year-ago
quarter. Net income per share, excluding the FNFC merger charges, was
$0.66, up $0.08 (13.8%) from $0.58 one year ago.
Reported net income for the fourth quarter of 1993, including the FNFC
merger charges, was $21.06 million, down $6.05 million (22.3%) from the
fourth quarter of 1992. This generated a 0.87% ROAA and a 10.06% ROAE,
compared with a 1.25% ROAA and a 15.18% ROAE for the year-ago quarter.
Net income per share was $0.43, down $0.15 (25.9%) from $0.58 one year
ago.
FSC's net interest income on a fully-taxable equivalent (FTE) basis
totaled $411.57 million for 1993, up $27.71 million (7.2%) from 1992, and
was $108.79 million for the fourth quarter of 1993, up $11.04 million
(11.3%) from the fourth quarter of 1992. These improvements included the
impact of: sustained growth in consumer and residential mortgage loans,
reflecting FSC's position as the leading lender in both Utah and Idaho; a
favorable shift in the funding mix towards noninterest-bearing deposits
and equity; the positive impact of the current short-term interest rate
environment; an increase in investment securities; and the effects of
recent acquisitions. The FTE adjusted net interest margin was 4.95% for
1993 and 5.01% for the fourth quarter, compared with 5.00% for 1992 and
5.03% for the year-ago quarter.
Noninterest income totaled $167.16 million for 1993, up $23.12 million
(16.1%) from 1992, and was $46.45 million for the fourth quarter, up
$7.87 million (20.4%) from the year-ago quarter. These increases
resulted largely from growth in service charges on accounts, real estate
loan service fees, third-party computer processing fees, and insurance
commissions.
Noninterest expenses, including the FNFC merger charges, totaled
$386.15 million for 1993, up $46.69 million (13.8%) from 1992, and were
$116.02 million for the fourth quarter, up $27.11 million (30.5%) from
the year-ago quarter. The rise in noninterest expenses was due to growth
resulting from FSC's acquisitions and ongoing operations, plus numerous
one-time events including the cost of acquisitions and the related
restructuring charges.
FSC's efficiency ratio (the ratio of noninterest expenses to the sum
of FTE net interest income and noninterest income), excluding the FNFC
merger charges, was 64.80% for 1993 and 67.57% for the fourth quarter,
compared with 64.30% for 1992 and 65.22% for the year-ago quarter,
respectively. The Corporation's efficiency ratio, including the FNFC
merger charges, was 66.72% for 1993 and 74.74% for the quarter.
The provision for loan losses totaled $11.68 million for 1993, down
$18.59 million (61.4%) from 1992, and was $4.65 million for the fourth
quarter, down $289 thousand (5.9%) from the year-ago quarter. Net loan
chargeoffs included in this provision amounted to $11.86 million for the
year, down $20.97 million (63.9%) from 1992, and $4.77 million for the
quarter, down $4.10 million (46.2%) for the year-ago quarter.
Nonperforming assets, which include nonaccruing and renegotiated loans
plus other real estate owned (ORE), were reduced to $52.82 million at
December 31, 1993, down $54.64 million (50.8%) from December 31, 1992.
Nonperforming assets equaled 0.80% of total loans and ORE at year-end
1993, decreasing from 1.90% at year-end 1992.
The reserve for loan losses was $134.85 million at December 31, 1993,
up $7.00 million (5.5%) from December 31, 1992. Merger transactions
added $7.18 million in reserves since the end of 1992. The reserve
equaled 2.06% of total loans and 370.93% of nonaccruing loans at year-end
1993, compared with corresponding ratios of 2.28% and 159.87% at year-end
1992.
Stockholders' equity in FSC increased to $835.73 million at December
31, 1993, up $116.12 million (16.1%) from December 31, 1992. This was
due primarily to record earnings, combined with the effects of
acquisitions. The Corporation's market capitalization (market price per
share times shares outstanding) was $1.25 billion at year-end 1993,
essentially unchanged from year-end 1992. The ratio of total
stockholders' equity to total assets was 8.18% at December 31, 1993, up
from 8.09% at year-end 1992. For the same periods, the ratio of tangible
common equity to tangible total assets was 8.07% at year-end 1993, up
from 7.93% at year-end 1992. Prior period equity ratios have been
restated due to FSC's acquisition of FNFC plus adoption of Statement of
Financial Accounting Standard 109, "Accounting for Income Taxes". FSC
adopted this standard in 1993, the cumulative effect of which reduced
equity by $7.59 million over the period of December 31, 1988 to December
31, 1992.
Other significant financial information at December 31, 1993, compared
with December 31, 1992, included:
* Assets totaled $10.21 billion, up $1.32 billion (14.8%).
* Loans (net of unearned income but before the reserve for loan
losses) totaled $6.56 billion, up $944.31 million (16.8%). For 1993, the
Corporation, excluding its New Mexico and Nevada banks, originated $2.09
billion in real estate secured loans, passing through $927 million into
secondary markets, while retaining most of the servicing. Consumer loans
have also continued to show record activity, reflecting FSC's position as
a leading consumer lender.
* Deposits totaled $7.50 billion, up $635.25 million (9.2%).
* The loan to deposit ratio was 87.44%, up from 81.78%.
* The bid price of FSC common stock was $25.75 per share at the close
of the market on December 31, 1993, down $1.50 (5.5%) from $27.25 per
share on December 31, 1992. The ratio of market price to book value per
share was 149.36% on a book value per share of $17.24 at year-end 1993,
compared with 173.02% on a book value per share of $15.75 year-end 1992.
Restatements of FSC's Financial Statements
FSC's financial statements have been restated to reflect the November
19, 1993 pooling-of-interests merger with First National Financial
Corporation (FNFC) and its wholly-owned subsidiary First National Bank in
New Mexico (with $1.13 billion in deposits and 26 branches, headquartered
in Albuquerque, New Mexico). The Corporation's financial statements have
also been restated to reflect FSC's adoption of Statement of Financial
Accounting Standard 109, "Accounting for Income Taxes", which requires an
asset and liability approach to financial reporting of income taxes that
differs from the method previously required by generally accepted
accounting principles.
Acquisitions
During 1993, FSC completed 9 acquisitions, expanding its existing bank
operations in Utah, Oregon, and Wyoming, and acquiring new bank
subsidiaries in New Mexico and Nevada (see attached exhibit). These
acquisitions added a total of 39 branches and approximately $1.5 billion
in deposits to FSC's operations. Except for the merger with First
National Financial Corporation in New Mexico, these acquisitions were not
material under applicable accounting rules to FSC's consolidated
operations, so historical amounts were not restated.
Currently, FSC has announced four pending acquisitions in 1994,
expanding its bank operations in Utah, Idaho, and Wyoming. These
acquisitions will add approximately 12 branches and $200 million in
deposits to FSC's operations.
National & Regional Economy
Economic growth nationwide was strong in the fourth quarter of 1993,
and this improved momentum is expected to carry into 1994. The
significantly lower interest rates reduced the borrowing costs of certain
existing credit outstanding. The drop in financing costs also helped
invigorate new consumer loan demand for mortgage and automobile credit,
while businesses are increasing borrowing for capital equipment and
commercial real estate. Accordingly, new jobs are being created,
residential construction is expanding, and consumer expenditures are
rising rapidly. Inflation is likely to remain near the current 3
percent, so any rise in interest rates should not have a noticeable
impact on 1994 credit demands.
The Intermountain area's economic growth led the nation in 1993. The
following four states were among the top five in job gains: Utah, Idaho,
New Mexico, and Nevada. In each of these states, rapid net in-migration
was matched with new job opportunities. Employment gains, combined with
a favorable mortgage-financing climate, resulted in a strong housing
market and expanded consumer spending, particularly for consumer durable
goods. This formula for prosperity for many western states appears to be
solidly intact for 1994.
First Security Corporation
FSC is the largest financial services organization headquartered in
the Intermountain region. Incorporated in 1928, it is the oldest
multistate bank holding company in the United States. FSC operates 245
full-service bank branches in Utah, Idaho, New Mexico, Oregon, Wyoming
and Nevada. Other subsidiaries include a leasing company, two insurance
companies, an investment management company, a full-service broker/dealer
operation, and an information technology subsidiary.
# # #
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
FINANCIAL HIGHLIGHTS
(restated, in thousands, except per share data and ratios; unaudited)
<CAPTION>
4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr Twelve Months
1993 1993 1993 1993 1992 1993 1992 %Chg
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Common Stock Data:
Earnings per common share........................... 0.43 0.68 0.62 0.65 0.58 2.38 2.16 10.2
Dividends paid per common share..................... 0.23 0.23 0.23 0.19 0.19 0.88 0.68 29.4
Book value EOP...................................... 17.24 17.12 16.62 16.29 15.75 17.24 15.75 9.5
Market price (bid) EOP.............................. 25.75 28.00 28.25 28.50 27.25 25.75 27.25 -5.5
High bid for the period........................... 30.00 28.50 30.00 30.25 27.50 30.25 23.33 29.7
Low bid for the period............................ 24.00 26.50 25.50 25.50 22.00 24.00 18.17 32.1
Market capitalization EOP: mktprice x #comshrs...... 1,247,242 1,322,790 1,316,917 1,305,067 1,243,757 1,247,242 1,243,757 0.3
Market price EOP / book value EOP................(%) 149.36 163.55 169.98 174.95 173.02 149.36 173.02
Dividend payout ratio: dividend / EPS............(%) 53.49 33.82 37.10 29.23 32.76 36.97 31.48
Dividend yield: dividend / market price..........(%) 3.57 3.29 3.26 2.67 2.79 3.57 2.79
Price / earnings ratio: market price / 4 qtrs earn.. 10.8 11.1 11.6 12.1 12.6 10.8 12.6
Common shares outstanding: EOP...................... 48,437 47,243 46,617 45,792 45,642 48,437 45,642 6.1
Common shares outstanding: average.................. 48,969 48,147 47,829 47,112 46,874 48,020 46,520 3.2
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
Income:
Net interest income................................. 105,863 103,343 98,879 95,853 95,586 403,938 375,949 7.4
Fully-taxable equivalent (FTE) adjustment........... 2,922 (1,092) 2,221 3,582 2,160 7,633 7,911 -3.5
Net interest income, FTE............................ 108,785 102,251 101,100 99,435 97,746 411,571 383,860 7.2
Provision for loan losses........................... 4,647 5,139 (78) 1,976 4,936 11,684 30,277 -61.4
Noninterest income.................................. 46,446 43,107 36,739 40,867 38,573 167,159 144,036 16.1
Noninterest expenses................................ 116,015 94,824 90,081 85,226 88,910 386,146 339,456 13.8
Net income.......................................... 21,064 32,587 29,693 30,712 27,112 114,056 100,343 13.7
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
Average Balance Sheet:
Investment securities............................... 1,713,340 1,768,370 1,932,218 1,756,738 1,732,045 1,792,481 1,708,039 4.9
Loans, net of unearned income....................... 6,314,632 6,037,540 5,745,824 5,563,702 5,491,578 5,917,816 5,463,285 8.3
Reserve for loan losses............................. (130,881) (127,787) (128,874) (127,636) (131,232) (128,801) (130,548) -1.3
Total interest-earning assets....................... 8,683,703 8,384,769 8,304,335 7,896,287 7,772,115 8,319,615 7,677,463 8.4
Total assets........................................ 9,638,743 9,300,515 9,179,622 8,723,137 8,640,307 9,213,259 8,484,548 8.6
Interest-bearing deposits........................... 5,667,076 5,510,779 5,506,463 5,423,080 5,419,487 5,527,474 5,353,698 3.2
Short-term borrowed funds........................... 1,171,037 1,123,909 1,146,787 1,032,089 897,774 1,118,851 981,139 14.0
Long-term debt...................................... 226,694 236,674 236,561 124,733 131,368 206,528 105,059 96.6
Total interest-bearing liabilities.................. 7,064,807 6,871,362 6,889,811 6,579,902 6,448,629 6,852,853 6,439,896 6.4
Total deposits...................................... 7,265,005 6,985,568 6,889,948 6,677,150 6,747,490 6,956,113 6,567,776 5.9
Stockholders' equity................................ 830,817 797,703 768,275 736,671 710,571 783,664 680,129 15.2
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
End of Period Balance Sheet:
Investment securities............................... 1,742,795 1,760,168 1,862,131 1,970,338 1,750,180 1,742,795 1,750,180 -0.4
Loans, net of unearned income....................... 6,561,021 6,185,830 5,946,520 5,596,166 5,616,707 6,561,021 5,616,707 16.8
Reserve for loan losses............................. (134,848) (130,726) (126,896) (127,329) (127,847) (134,848) (127,847) 5.5
Total interest-earning assets....................... 9,329,273 8,797,725 8,524,631 8,447,960 8,054,144 9,329,273 8,054,144 15.8
Total assets........................................10,210,597 9,725,657 9,489,482 9,158,174 8,892,833 10,210,597 8,892,833 14.8
Interest-bearing deposits........................... 5,806,020 5,523,565 5,453,683 5,460,770 5,439,139 5,806,020 5,439,139 6.7
Short-term borrowed funds........................... 1,486,022 1,288,460 1,180,024 1,239,066 994,160 1,486,022 994,160 49.5
Long-term debt...................................... 225,719 227,550 239,088 125,390 128,834 225,719 128,834 75.2
Total interest-bearing liabilities.................. 7,517,761 7,039,575 6,872,795 6,825,226 6,562,133 7,517,761 6,562,133 14.6
Total deposits...................................... 7,503,707 7,061,649 6,978,451 6,744,977 6,868,453 7,503,707 6,868,453 9.2
Stockholders' equity................................ 835,731 809,677 775,694 746,579 719,606 835,731 719,606 16.1
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
End of Period Problem Assets:
Total nonaccruing & renegotiated loans.............. 36,354 53,707 64,520 67,312 79,968 36,354 79,968 -54.5
ORE and other foreclosed assets..................... 16,465 23,052 27,181 31,343 27,487 16,465 27,487 -40.1
Total nonperforming assets.......................... 52,819 76,759 91,701 98,655 107,455 52,819 107,455 -50.8
Accruing loans past due 90 days or more............. 7,155 8,310 9,150 10,309 11,766 7,155 11,766 -39.2
Total problem assets................................ 59,974 85,069 100,851 108,964 119,221 59,974 119,221 -49.7
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
End of Period Other Data (not rounded to thousands):
Full-time equivalent employees...................... 6,318 6,259 6,059 5,911 5,891 6,318 5,891 7.2
Total domestic bank offices......................... 245 239 236 236 230 245 230 6.5
=================================================== ========== ========= ========= ========= ========= ========== ========= ======
<FN>
Note: Figures have been restated where applicable to reflect a pooling-of-interests merger with First National
Financial Corp., and the adoption of SFAS 109, "Accounting for Income Taxes".
EOP: End of period.
</TABLE>
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
FINANCIAL HIGHLIGHTS - Continued
(in thousands, except per share data and ratios; unaudited)
<CAPTION>
4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr Twelve Months
1993 1993 1993 1993 1992 1993 1992 %Chg
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Reconciliation of the Reserve for Loan Losses:
Balance, beginning of period........................ 130,726 126,896 127,329 127,847 131,782 127,847 126,887 0.8
Net loans charged off............................... (4,775) (2,384) (2,212) (2,494) (8,871) (11,865) (32,831)-63.9
Provision for loan losses........................... 4,647 5,139 (78) 1,976 4,936 11,684 30,277 -61.4
Reserves acquired in merger transactions............ 4,250 1,075 1,857 0 0 7,182 3,514
Balance, end of period.............................. 134,848 130,726 126,896 127,329 127,847 134,848 127,847 5.5
- --------------------------------------------------- ---------- --------- --------- --------- --------- ---------- --------- ------
Selected Ratios (%):
Return on average assets............................ 0.87 1.39 1.30 1.43 1.25 1.24 1.18
Return on average stockholders' equity.............. 10.06 16.21 15.50 16.91 15.18 14.55 14.75
Net interest margin, FTE............................ 5.01 4.88 4.87 5.04 5.03 4.95 5.00
Net interest spread, FTE............................ 4.37 4.25 4.27 4.43 4.37 4.33 4.29
Efficiency ratio:
(nonint exp / (net int inc FTE + nonint inc))..... 74.74 65.23 65.35 60.74 65.22 66.72 64.30
Productivity ratio:
(nonint exp / average assets)..................... 4.78 4.04 3.94 3.96 4.09 4.19 4.00
Stockholders' equity / assets....................... 8.18 8.33 8.17 8.15 8.09 8.18 8.09
Tangible common equity / tangible assets............ 8.07 8.20 8.03 8.00 7.93 8.07 7.93
Loans / deposits.................................... 87.44 87.60 85.21 82.97 81.78 87.44 81.78
Loans / assets...................................... 64.26 63.60 62.66 61.11 63.16 64.26 63.16
Reserve for loan losses at quarter end to:
Total loans....................................... 2.06 2.11 2.13 2.28 2.28 2.06 2.28
Nonaccruing loans................................. 370.93 243.41 196.68 189.16 159.87 370.93 159.87
Nonaccruing + accruing loans past due 90 days..... 309.93 210.79 172.25 164.04 139.37 309.93 139.37
Nonaccruing loans / total loans..................... 0.55 0.87 1.09 1.20 1.42 0.55 1.42
Nonaccruing + accruing loans past due 90 days
/ total loans..................................... 0.66 1.00 1.24 1.39 1.63 0.66 1.63
Nonperforming assets to:
Total loans + ORE................................. 0.80 1.24 1.54 1.75 1.90 0.80 1.90
Total assets...................................... 0.52 0.79 0.97 1.08 1.21 0.52 1.21
Total equity...................................... 6.32 9.48 11.82 13.21 14.93 6.32 14.93
Total equity + reserve for loan losses............ 5.44 8.16 10.16 11.29 12.68 5.44 12.68
Problem assets to:
Total loans + ORE................................. 0.91 1.37 1.69 1.94 2.11 0.91 2.11
Total assets...................................... 0.59 0.87 1.06 1.19 1.34 0.59 1.34
Total equity...................................... 7.18 10.51 13.00 14.60 16.57 7.18 16.57
Total equity + reserve for loan losses............ 6.18 9.05 11.17 12.47 14.07 6.18 14.07
Net loans charged off / average loans............... 0.30 0.16 0.15 0.18 0.64 0.20 0.60
=================================================== ========== =================== ========= ========= ========== ========= ======
<FN>
Note: Figures have been restated where applicable to reflect a pooling-of-interests merger with First National
Financial Corp., and the adoption of SFAS 109, "Accounting for Income Taxes".
EOP: End of period.
</TABLE>
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
December 31 December 31 Dec/Dec
(restated, in thousands; unaudited) 1993 1992 % Change
------------ ------------ ---------
<S> <C> <C> <C>
Assets:
Cash and due from banks........................................... $673,877 $616,121 9.4
Interest-bearing deposits in other banks.......................... 16,461 10,037 64.0
Fed funds sold, securities purchased under resale agreements...... 401,142 288,259 39.2
Trading account securities........................................ 607,854 388,961 56.3
Investment securities:
U.S. Treasury and U.S. Government agencies & corporations....... 1,307,331 1,267,688 3.1
Obligations of states and political subdivisions................ 180,129 199,692 (9.8)
Other securities................................................ 255,335 282,800 (9.7)
------------ ------------ ---------
Total investment securities 1,742,795 1,750,180 (0.4)
(Market values: $1,774,290; $1,781,913; respectively)
------------ ------------ ---------
Loans............................................................. 6,573,203 5,630,568 16.7
Unearned income................................................. (12,182) (13,861) (12.1)
Reserve for loan losses......................................... (134,848) (127,847) 5.5
------------ ------------ ---------
Total loans, net 6,426,173 5,488,860 17.1
------------ ------------ ---------
Premises and equipment, net....................................... 145,718 129,393 12.6
Accrued income receivable......................................... 52,654 56,483 (6.8)
Other real estate and other foreclosed assets..................... 16,465 27,487 (40.1)
Intangible assets................................................. 11,833 14,867 (20.4)
Other assets...................................................... 115,625 122,185 (5.4)
------------ ------------ ---------
TOTAL ASSETS $10,210,597 $8,892,833 14.8
============ ============ =========
Liabilities:
Deposits:
Noninterest-bearing............................................. $1,697,687 $1,429,314 18.8
Interest-bearing................................................ 5,806,020 5,439,139 6.7
------------ ------------ ---------
Total deposits 7,503,707 6,868,453 9.2
------------ ------------ ---------
Fed funds purchased, securities sold under repurchase agreements.. 1,387,109 944,385 46.9
U.S. Treasury demand notes........................................ 43,645 36,409 19.9
Other short-term borrowings....................................... 55,268 13,366 313.5
Accrued income taxes.............................................. 85,837 81,110 5.8
Accrued interest.................................................. 17,429 18,030 (3.3)
Other liabilities................................................. 56,152 82,640 (32.1)
Long-term debt.................................................... 225,719 128,834 75.2
------------ ------------ ---------
TOTAL LIABILITIES 9,374,866 8,173,227 14.7
------------ ------------ ---------
Stockholders' Equity:
Preferred stock: Series "A", $3.15 cumulative convertible
(14; 16; shares, respectively).................................. 703 783 (10.2)
------------ ------------ ---------
Common Stockholders' Equity:
Common stock: par value $1.25
(48,787; 46,163; shares, respectively)........................ 60,983 57,704 5.7
Paid-in surplus................................................. 120,072 98,141 22.3
Retained earnings............................................... 659,924 570,585 15.7
------------ ------------ ---------
Subtotal 840,979 726,430 15.8
------------ ------------ ---------
Common treasury stock, at cost
(350; 521; shares, respectively).............................. (5,951) (7,607) (21.8)
------------ ------------ ---------
TOTAL COMMON STOCKHOLDERS' EQUITY 835,028 718,823 16.2
------------ ------------ ---------
TOTAL STOCKHOLDERS' EQUITY 835,731 719,606 16.1
------------ ------------ ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $10,210,597 $8,892,833 14.8
============ ============ =========
<FN>
Note: Figures have been restated where applicable to reflect a pooling-of-interests merger with
First National Financial Corp., and the adoption of SFAS 109, "Accounting for Income Taxes".
</TABLE>
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the Periods Ended December 31, 1993 and 1992
<CAPTION>
Three Months Twelve Months
(in thousands, except per share data; unaudited) 1993 1992 %Chg 1993 1992 %Chg
---------- ---------- ------ ---------- ---------- ------
<S> <C> <C> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans................................ $135,128 $123,310 9.6 $513,810 $507,490 1.2
Interest and dividends on investment securities:
U.S. Treasury, U.S. Government agencies & corporations.. 16,651 19,574 -14.9 72,175 87,585 -17.6
Obligations of states & political subdivisions.......... 2,460 3,092 -20.4 10,844 12,486 -13.2
Other investment securities............................. 3,846 4,234 -9.2 17,445 14,672 18.9
Federal funds sold and securities purchased............... 3,084 2,002 54.0 9,191 6,416 43.3
Interest-bearing deposits in other banks.................. 133 87 52.9 456 691 -34.0
Trading account interest.................................. 4,551 5,645 -19.4 20,811 27,108 -23.2
---------- ---------- ------ ---------- ---------- ------
TOTAL INTEREST INCOME 165,853 157,944 5.0 644,732 656,448 -1.8
---------- ---------- ------ ---------- ---------- ------
Interest Expense:
Interest on deposits...................................... 47,357 52,951 -10.6 192,992 238,135 -19.0
Interest on short-term borrowings......................... 8,900 6,929 28.4 33,979 34,125 -0.4
Interest on long-term debt................................ 3,733 2,478 50.6 13,823 8,239 67.8
---------- ---------- ------ ---------- ---------- ------
TOTAL INTEREST EXPENSE 59,990 62,358 -3.8 240,794 280,499 -14.2
---------- ---------- ------ ---------- ---------- ------
Net Interest Income:
NET INTEREST INCOME....................................... 105,863 95,586 10.8 403,938 375,949 7.4
Provision for loan losses................................. 4,647 4,936 -5.9 11,684 30,277 -61.4
---------- ---------- ------ ---------- ---------- ------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 101,216 90,650 11.7 392,254 345,672 13.5
---------- ---------- ------ ---------- ---------- ------
Noninterest Income:
Service charges on deposit accounts....................... 14,348 13,380 7.2 55,865 51,505 8.5
Other service charges, collections, commissions and fees.. 17,981 12,961 38.7 58,286 47,804 21.9
Commissions and fees from fiduciary activities............ 5,269 4,969 6.0 18,980 18,176 4.4
Bankcard service fees..................................... 9,125 7,224 26.3 33,083 27,411 20.7
Other..................................................... (379) (198) -91.4 215 (1,719) 112.5
Investment securities gains............................... 102 237 -57.0 730 859 -15.0
---------- ---------- ------ ---------- ---------- ------
TOTAL NONINTEREST INCOME 46,446 38,573 20.4 167,159 144,036 16.1
---------- ---------- ------ ---------- ---------- ------
TOTAL INCOME 147,662 129,223 14.3 559,413 489,708 14.2
---------- ---------- ------ ---------- ---------- ------
Noninterest Expenses:
Salaries and employee benefits............................ 46,165 42,180 9.4 175,696 160,982 9.1
Net occupancy............................................. 8,018 5,355 49.7 24,224 20,869 16.1
Furniture and equipment................................... 8,369 7,772 7.7 27,858 25,052 11.2
Legal..................................................... 1,219 1,222 -0.2 4,706 4,913 -4.2
Insurance................................................. 5,039 4,223 19.3 19,697 18,868 4.4
Stationery and supplies................................... 4,191 3,854 8.7 15,956 12,865 24.0
Provision for loss on other real estate................... 5,226 446 1071.7 7,448 6,903 7.9
Other real estate expense, net............................ (515) 643 -180.1 1,191 4,207 -71.7
Telephone................................................. 2,189 2,059 6.3 8,610 7,344 17.2
Other..................................................... 36,114 21,156 70.7 100,760 77,453 30.1
---------- ---------- ------ ---------- ---------- ------
TOTAL NONINTEREST EXPENSES 116,015 88,910 30.5 386,146 339,456 13.8
---------- ---------- ------ ---------- ---------- ------
INCOME BEFORE INCOME TAX PROVISION 31,647 40,313 -21.5 173,267 150,252 15.3
---------- ---------- ------ ---------- ---------- ------
Provision for Income Taxes:
Operating income.......................................... 10,528 13,115 -19.7 58,937 49,722 18.5
Securities transactions................................... 55 86 -36.0 274 187 46.5
---------- ---------- ------ ---------- ---------- ------
TOTAL PROVISION FOR INCOME TAXES 10,583 13,201 -19.8 59,211 49,909 18.6
---------- ---------- ------ ---------- ---------- ------
Net Income:
NET INCOME................................................ $21,064 $27,112 -22.3 $114,056 $100,343 13.7
Dividend requirement of preferred stock................... 10 11 -9.1 43 48 -10.4
---------- ---------- ------ ---------- ---------- ------
NET INCOME APPLICABLE TO COMMON STOCK $21,054 $27,101 -22.3 $114,013 $100,295 13.7
========== ========== ====== ========== ========== ======
Earnings Per Common Share:
EARNINGS PER COMMON SHARE................................... $0.43 $0.58 -25.9 $2.38 $2.16 10.2
========== ========== ====== ========== ========== ======
Cash Dividends Paid or Accrued Per Share:
Preferred Stock ($3.15 annual rate)....................... $0.79 $0.79 $3.15 $3.15
Common stock.............................................. $0.23 $0.19 21.1 $0.88 $0.68 28.8
========== ========== ====== ========== ========== ======
<FN>
Note: Figures have been restated where applicable to reflect a pooling-of-interests merger with
First National Financial Corp., and the adoption of SFAS 109, "Accounting for Income Taxes".
</TABLE>
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
RATE / VOLUME ANALYSIS
For the Three Months Ended December 31, 1993 and 1992
(Fully Taxable Equivalent; in thousands; unaudited)
<CAPTION>
Avg Balance Avg Balance Yield/Rate % Interest Income/Exp Change Changes Due
1993 1992 1993 1992 1993 1992 1993-92 Volume Rate(B)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
<C> <C> <C> <C> <S> <C> <C> <C> <C> <C>
INTEREST-EARNING ASSETS/INCOME:
Loans, net of unearned income and
$6,179,856 $5,358,176 8.85 9.27 deferred taxes on leases (C) $136,799 $124,146 $12,653 $19,038 ($6,385)
1,553,502 1,533,821 5.31 6.24 Taxable investment securities 20,620 23,927 (3,307) 307 (3,614)
159,838 198,224 8.97 8.65 Tax-exempt investment securities 3,583 4,289 (706) (831) 125
407,342 260,101 3.03 3.08 Federal funds sold & RP's purchased 3,084 2,002 1,082 1,133 (51)
22,044 10,216 2.41 3.41 Interest-bearing deposits other bank 133 87 46 101 (55)
361,121 411,577 5.05 5.49 Trading account securities 4,556 5,654 (1,098) (693) (405)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
$8,683,703 $7,772,115 7.77 8.24 TOTAL INTEREST-EARNING ASSETS 168,775 160,105 8,670 19,055 (10,385)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
INTEREST-BEARING LIABILITIES/EXPENSE:
Interest-bearing deposits:
$1,019,932 $920,303 1.78 2.14 NOW accounts 4,546 4,918 (372) 532 (904)
2,380,996 2,002,379 3.04 3.28 Savings accounts 18,102 16,409 1,693 3,103 (1,410)
329,531 355,575 4.02 4.59 Time deposits $100,000 & over 3,311 4,081 (770) (299) (471)
1,936,617 2,141,230 4.42 5.15 Other time deposits 21,399 27,543 (6,144) (2,632) (3,512)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
5,667,076 5,419,487 3.34 3.91 TOTAL INTEREST-BEARING DEPOSITS 47,358 52,951 (5,593) 704 (6,297)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
1,113,882 855,018 2.84 2.90 Federal funds purchased & RP's sold 7,916 6,193 1,723 1,875 (152)
57,155 42,756 6.88 6.39 Other short-term borrowings 983 683 300 230 70
226,694 131,368 6.59 7.71 Long-term debt 3,733 2,531 1,202 1,837 (635)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
$7,064,807 $6,448,629 3.40 3.87 TOTAL INTEREST-BEARING LIABILITIES 59,990 62,358 (2,368) 4,646 (7,014)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
7.77 8.24 Interest income/earning assets
2.76 3.21 Interest expense/earning assets
------ ------
5.01 5.03 Net interest income/earning assets 108,785 97,747 11,038 $14,409 ($3,371)
Less fully taxable equivalent adjust 2,923 2,161 762
------ ------ --------- --------- -------- -------- --------
NET INTEREST INCOME, PER CONSOLIDATED
STATEMENT OF INCOME $105,862 $95,586 $10,276
=========== =========== ====== ====== =================================== ========= ========= ======== ======== ========
<CAPTION>
For the Twelve Months Ended December 31, 1993 and 1992
Avg Balance Avg Balance Yield/Rate % Interest Income/Exp Change Changes Due
1993 1992 1993 1992 1993 1992 1993-92 Volume Rate(B)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
<C> <C> <C> <C> <S> <C> <C> <C> <C> <C>
INTEREST-EARNING ASSETS/INCOME:
Loans, net of unearned income and
$5,785,068 $5,336,252 8.91 9.56 deferred taxes on leases (C) $515,682 $510,201 $5,481 $42,911 ($37,430)
1,617,841 1,520,497 5.57 6.76 Taxable investment securities 90,070 102,788 (12,718) 6,581 (19,299)
174,640 187,541 9.23 9.12 Tax-exempt investment securities 16,125 17,096 (971) (1,176) 205
302,521 186,938 3.04 3.43 Federal funds sold & RP's purchased 9,191 6,416 2,775 3,967 (1,192)
15,454 16,210 2.95 4.26 Interest-bearing deposits other bank 456 691 (235) (32) (203)
424,091 430,025 4.91 6.32 Trading account securities 20,841 27,167 (6,326) (375) (5,951)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
$8,319,615 $7,677,463 7.84 8.65 TOTAL INTEREST-EARNING ASSETS 652,365 664,359 (11,994) 51,876 (63,870)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
INTEREST-BEARING LIABILITIES/EXPENSE:
Interest-bearing deposits:
$962,411 $865,945 1.90 2.67 NOW accounts 18,239 23,095 (4,856) 2,573 (7,429)
2,220,848 1,840,670 3.07 3.72 Savings accounts 68,275 68,543 (268) 14,157 (14,425)
340,714 394,368 4.15 5.13 Time deposits $100,000 & over 14,124 20,233 (6,109) (2,753) (3,356)
2,003,501 2,252,715 4.61 5.60 Other time deposits 92,354 126,264 (33,910) (13,968) (19,942)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
5,527,474 5,353,698 3.49 4.45 TOTAL INTEREST-BEARING DEPOSITS 192,992 238,135 (45,143) 9 (45,152)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
1,065,495 929,123 2.59 3.04 Federal funds purchased & RP's sold 27,630 28,288 (658) 4,152 (4,810)
53,356 52,016 11.90 11.22 Other short-term borrowings 6,349 5,837 512 150 362
206,528 104,959 6.69 7.85 Long-term debt 13,823 8,239 5,584 7,973 (2,389)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
$6,852,853 $6,439,796 3.51 4.36 TOTAL INTEREST-BEARING LIABILITIES 240,794 280,499 (39,705) $12,284 ($51,989)
- ----------- ----------- ------ ------ --------- --------- -------- -------- --------
7.84 8.65 Interest income/earning assets
2.89 3.65 Interest expense/earning assets
------ ------
4.95 5.00 Net interest income/earning assets 411,571 383,860 27,711 $39,592 ($11,881)
Less fully taxable equivalent adjust 7,633 7,911 (278)
------ ------ --------- --------- -------- -------- --------
NET INTEREST INCOME, PER CONSOLIDATED
STATEMENT OF INCOME $403,938 $375,949 $27,989
=========== =========== ====== ====== =================================== ========= ========= ======== ======== ========
<FN>
(A) Interest and rates are presented on a fully taxable equivalent basis, calculated on federal and state taxes applicable
to the subsidiary carrying the asset. The combined tax rate was approximately 38% in 1992 and 39% in 1993.
(B) Changes not due entirely to changes in volume or rate have been allocated to rate.
(C) Loans include nonaccruing loans. Interest on loans includes fees of $4,417 and $3,820 for the two quarters, and
$13,708 and $12,736 for the two twelve month periods, respectively.
</TABLE>
<PAGE>
<TABLE>
FIRST SECURITY CORPORATION
MERGERS AND ACQUISITIONS
(unaudited)
<CAPTION>
Acquisition # Bank Offices Deposits
Date: Type: Acquired Institution: Home Office: Acquire: Retain: $ 000
- ------ ----------------- ------------------------------------ ---------------------- -------- -------- -----------
1993:
<S> <S> <S> <S> <C> <C> <C>
01-Apr Pool-of-interests First Bancshares St. George, UT 5 5 72,910
01-May Pool-of-interests Benton County Bank Corvallis, OR 2 2 31,987
02-Aug Purchase Bank of America Arizona Deposits only, UT - - 6,753
26-Aug Pool-of-interests Desert SouthWest Community Bancorp Las Vegas, NV 1 1 43,242
30-Sep Purchase Bank One of Utah Deposits only, UT - - 5,772
28-Oct Pool-of-interests State Bank of Green River Green River, WY 1 1 27,957
19-Nov Pool-of-interests First National Financial Corporation Albuquerque, NM 26 26 1,127,302
19-Nov Pool-of-interests Continental Bancorporation Las Vegas, NV 4 4 198,157
30-Nov Purchase First Professional Bank Core deposits only, UT - - 7,000
1993 Subtotal: 39 39 1,521,080
1994:
<S> <S> <S> <S> <C> <C> <C>
TBA Purchase Equality State Bank 2 branches only, WY 2 2 30,900
TBA Purchase Community First Bank Clearfield, UT 5 5 64,000
TBA Purchase American Ban Corporation Boise, ID 4 4 55,400
TBA Purchase Star Valley State Bank Afton, WY 1 1 55,000
1994 Subtotal: 12 12 205,300
- ------ ----------------- ------------------------------------ ---------------------- -------- -------- -----------
TOTALS 51 51 $1,726,380
====== ================= ==================================== ====================== ======== ======== ===========
<FN>
TBA: To Be Announced.
</TABLE>
