UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2000
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to _________
Commission File Number 0-9756
RIGGS NATIONAL CORPORATION
--------------------------
(Exact name of registrant as specified in its charter)
Delaware 52-1217953
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1503 Pennsylvania Avenue, N.W., Washington, D.C. 20005
------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(202) 835-4309
--------------
(Registrant's telephone number, including area code)
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 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 .
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, $2.50 par value 28,360,666
----------------------------- ----------
(Title of Class) (Outstanding at July 31, 2000)
<PAGE>
RIGGS NATIONAL CORPORATION
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements-Unaudited
Consolidated Statements of Income
Three and six months ended June 30, 2000 and 1999 3
Consolidated Statements of Condition
June 30, 2000 and 1999, and December 31, 1999 4
Consolidated Statements of Changes in Shareholders' Equity
Six months ended June 30, 2000 and 1999 5
Consolidated Statements of Cash Flows
Six months ended June 30, 2000 and 1999 6
Notes to the Consolidated Financial Statements 7-11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12-19
Item 3. Quantitative and Qualitative Disclosures about Market Risk 20-22
PART II.OTHER INFORMATION
Item 1. Legal Proceedings 23
Item 2. Change in Securities 23
Item 3. Defaults Upon Senior Securities 23
Item 4. Submission of Matters to a Vote of Security Holders 23
Item 5. Other Information 24
Item 6. Exhibits and Reports on Form 8-K 24
Signatures 24
2
<PAGE>
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS-UNAUDITED
RIGGS NATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
(UNAUDITED) THREE MONTHS ENDED SIX MONTHS ENDED
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) JUNE 30, JUNE 30,
-----------------------------------------------
2000 1999 2000 1999
===================================================================================================================================
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and Fees on Loans $ 59,368 $ 56,404 $ 118,716 $ 114,278
Interest and Dividends on Securities Available for Sale 19,578 17,025 39,917 31,338
Interest on Time Deposits with Other Banks 5,507 6,159 11,096 13,393
Interest on Federal Funds Sold and Reverse Repurchase Agreements 5,359 1,221 10,164 3,327
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest Income 89,812 80,809 179,893 162,336
INTEREST EXPENSE
Interest on Deposits:
Savings and NOW Accounts 562 626 1,188 1,313
Money Market Deposit Accounts 9,969 8,591 19,467 16,947
Time Deposits in Domestic Offices 10,864 9,948 23,106 19,961
Time Deposits in Foreign Offices 9,454 7,620 17,353 15,919
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest on Deposits 30,849 26,785 61,114 54,140
-----------------------------------------------------------------------------------------------------------------------------------
Interest on Short-Term Borrowings and Long-Term Debt:
Repurchase Agreements and Other Short-Term Borrowings 8,612 3,818 17,777 7,796
Long-Term Debt 1,618 4,368 3,236 8,736
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest on Short-Term Borrowings and Long-Term Debt 10,230 8,186 21,013 16,532
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest Expense 41,079 34,971 82,127 70,672
-----------------------------------------------------------------------------------------------------------------------------------
Net Interest Income 48,733 45,838 97,766 91,664
Less: Provision for Loan Losses 403 - 1,003 -
-----------------------------------------------------------------------------------------------------------------------------------
Net Interest Income after Provision for Loan Losses 48,330 45,838 96,763 91,664
NONINTEREST INCOME
Trust and Investment Advisory Income 13,864 12,685 27,462 25,290
Service Charges and Fees 10,442 9,879 20,050 19,330
Venture Capital Investment Gains, Net 5,579 - 12,616 -
Other Noninterest Income 2,377 1,769 4,365 3,957
Securities Gains, Net 11 1,018 321 1,104
-----------------------------------------------------------------------------------------------------------------------------------
Total Noninterest Income 32,273 25,351 64,814 49,681
NONINTEREST EXPENSE
Salaries and Employee Benefits 24,756 21,811 49,284 44,069
Occupancy, Net 4,972 4,555 9,903 9,221
Data Processing Services 5,237 4,722 10,437 9,283
Furniture and Equipment 2,974 2,658 6,033 5,223
Other Real Estate Owned Expense (Income), Net 14 22 (23) 38
Other Noninterest Expense 17,663 16,441 33,826 32,530
-----------------------------------------------------------------------------------------------------------------------------------
Total Noninterest Expense 55,616 50,209 109,460 100,364
-----------------------------------------------------------------------------------------------------------------------------------
Income before Taxes and Minority Interest 24,987 20,980 52,117 40,981
Applicable Income Tax Expense 8,915 6,420 18,555 13,718
Minority Interest in Income of Subsidiaries, Net of Taxes 5,742 4,986 11,680 9,973
===================================================================================================================================
Net Income $ 10,330 $ 9,574 $ 21,882 $ 17,290
EARNINGS PER SHARE- Basic $ .36 $ .34 $ .77 $ .60
Diluted .36 .33 .77 .59
DIVIDENDS DECLARED AND PAID PER SHARE $ .05 $ .05 $ .10 $ .10
</TABLE>
3
<PAGE>
RIGGS NATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CONDITION
<TABLE>
<CAPTION>
(UNAUDITED) JUNE 30, JUNE 30, DECEMBER 31,
(IN THOUSANDS, EXCEPT SHARE AMOUNTS) 2000 1999 1999
=======================================================================================================================
<S> <C> <C> <C>
ASSETS
Cash and Due from Banks $ 147,108 $ 158,225 $ 149,712
Federal Funds Sold and Reverse Repurchase Agreements 398,000 55,000 346,000
-----------------------------------------------------------------------------------------------------------------------
Total Cash and Cash Equivalents 545,108 213,225 495,712
Time Deposits with Other Banks 326,029 511,541 413,528
Securities Available for Sale (at Market Value) 1,310,150 1,167,418 1,289,884
Venture Capital Investments 76,266 15,219 39,525
Loans 3,140,441 3,186,045 3,201,981
Reserve for Loan Losses (37,036) (52,174) (41,455)
-----------------------------------------------------------------------------------------------------------------------
Total Net Loans 3,103,405 3,133,871 3,160,526
Premises and Equipment, Net 200,597 203,273 202,840
Other Real Estate Owned 908 1,678 908
Other Assets 230,308 207,655 227,226
=======================================================================================================================
Total Assets $5,792,771 $5,453,880 $ 5,830,149
LIABILITIES
Deposits:
Noninterest-Bearing Demand Deposits $ 653,968 $ 674,175 $ 729,030
Interest-Bearing Deposits:
Savings and NOW Accounts 326,012 383,054 395,024
Money Market Deposit Accounts 1,661,356 1,500,861 1,489,690
Time Deposits in Domestic Offices 876,094 976,431 1,068,920
Time Deposits in Foreign Offices 734,934 604,943 492,669
-----------------------------------------------------------------------------------------------------------------------
Total Interest-Bearing Deposits 3,598,396 3,465,289 3,446,303
-----------------------------------------------------------------------------------------------------------------------
Total Deposits 4,252,364 4,139,464 4,175,333
Repurchase Agreements and Other Short-Term Borrowings 636,377 369,291 832,202
Other Liabilities 124,430 62,908 68,376
Long-Term Debt 66,525 191,525 66,525
-----------------------------------------------------------------------------------------------------------------------
Total Liabilities 5,079,696 4,763,188 5,142,436
GUARANTEED PREFERRED BENEFICIAL INTERESTS IN JUNIOR
SUBORDINATED DEFERRABLE INTEREST DEBENTURES 350,000 350,000 350,000
=======================================================================================================================
SHAREHOLDERS' EQUITY
Common Stock-$2.50 Par Value
Shares Authorized - 50,000,000 at June 30, 2000 and 1999, and
December 31, 1999
Shares Issued - 31,651,464 at June 30, 2000, 31,557,995 at
June 30, 1999 and 31,615,495 at December 31, 1999 79,129 78,895 79,039
Surplus - Common Stock 161,744 160,789 161,439
Undivided Profits 229,734 199,208 210,682
Accumulated Other Comprehensive Loss (36,175) (26,843) (42,090)
Treasury Stock - 3,300,798 shares at June 30, 2000 and 1999, and
December 31, 1999 (71,357) (71,357) (71,357)
-----------------------------------------------------------------------------------------------------------------------
Total Shareholders' Equity 363,075 340,692 337,713
=======================================================================================================================
Total Liabilities and Shareholders' Equity $5,792,771 $5,453,880 $ 5,830,149
</TABLE>
4
<PAGE>
RIGGS NATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
COMMON ACCUMULATED
STOCK OTHER TOTAL
$2.50 UNDIVIDED COMPREHENSIVE TREASURY SHAREHOLDERS'
PAR SURPLUS PROFITS INCOME (LOSS) STOCK EQUITY
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1998 $ 78,888 $ 160,760 $ 184,794 $ (2,548) $ (29,166) $ 392,728
Comprehensive Income:
Net Income 17,290 17,290
Other Comprehensive Income
(Loss), Net of Tax: (1)
Unrealized Gain (Loss) on
Securities Available for Sale, Net
of Reclassification Adjustments (22,355) (22,355)
Foreign Exchange
Translation Adjustments (1,940) (1,940)
------------
Total Other Comprehensive
Income (Loss) (24,295)
============
Total Comprehensive Income (Loss) (7,005)
Issuance of Common Stock for
Stock Option Plans-2,650 Shares 7 29 36
Cash Dividends -
Common Stock, $.10 per Share (2,876) (2,876)
Common Stock Repurchase-
2,125,000 shares (42,191) (42,191)
===================================================================================================================================
Balance, June 30, 1999 $ 78,895 $ 160,789 $ 199,208 $ (26,843) $ (71,357) $ 340,692
Balance, December 31, 1999 $ 79,039 $ 161,439 $ 210,682 $ (42,090) $ (71,357) $ 337,713
Comprehensive Income:
Net Income 21,882 21,882
Other Comprehensive Income
(Loss), Net of Tax: (1)
Unrealized Gain (Loss) on
Securities Available for Sale, Net
of Reclassification Adjustments 7,684 7,684
Foreign Exchange
Translation Adjustments (1,769) (1,769)
------------
Total Other Comprehensive
Income (Loss) 5,915
============
Total Comprehensive Income (Loss) 27,797
Issuance of Common Stock for
Stock Option Plans, 33,000 Shares 90 305 395
Cash Dividends -
Common Stock, $.10 per Share (2,830) (2,830)
===================================================================================================================================
Balance, June 30, 2000 $ 79,129 $ 161,744 $ 229,734 $ (36,175) $ (71,357) $ 363,075
</TABLE>
(1) - See Notes to the Financial Statements for gross unrealized gains or losses
arising during each period and the tax effect on each item of comprehensive
income.
5
<PAGE>
RIGGS NATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
(UNAUDITED)
(IN THOUSANDS) SIX MONTHS ENDED
JUNE 30,
------------------------
2000 1999
===================================================================================================================================
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 21,882 $ 17,290
Adjustments to Reconcile Net Income to Cash
Provided By Operating Activities:
Provision for Loan Losses 1,003 -
Depreciation Expense and Amortization of Leasehold Improvements 6,884 5,839
Gains on Sale of Securities Available for Sale (321) (1,104)
Increase in Other Assets (7,219) (13,848)
Increase in Other Liabilities 56,054 14,058
-----------------------------------------------------------------------------------------------------------------------------------
Total Adjustments 56,401 4,945
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Provided By Operating Activities 78,283 22,235
-----------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net Decrease In Time Deposits with Other Banks 87,499 184,640
Principal Collections and Maturities of Securities Available for Sale 593,201 2,080,310
Proceeds from Sales of Securities Available for Sale 207,942 55,985
Purchases of Securities Available for Sale (809,267) (2,366,274)
Net Decrease in Loans 56,547 70,260
Net Increase in Venture Capital Investments (36,741) -
Proceeds from Sale and Other Payments of Other Real Estate Owned - 1
Net Increase in Premises and Equipment (4,641) (6,041)
Other, Net (429) (450)
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Provided By Investing Activities 94,111 18,431
-----------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net Increase (Decrease) in:
Demand, NOW, Savings and Money Market Deposit Accounts 27,592 (22,936)
Time Deposits 49,439 17,552
Repurchase Agreements and Other Short-Term Borrowings (195,825) (5,089)
Proceeds from the Issuance of Common Stock 395 36
Dividend Payments - Common (2,830) (2,876)
Repurchase of Common Shares - (42,191)
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Used in Financing Activities (121,229) (55,504)
-----------------------------------------------------------------------------------------------------------------------------------
Effect of Exchange Rate Changes (1,769) (1,940)
-----------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Cash and Cash Equivalents 49,396 (16,778)
Cash and Cash Equivalents at Beginning of Period 495,712 230,003
===================================================================================================================================
Cash and Cash Equivalents at End of Period $ 545,108 $ 213,225
SUPPLEMENTAL SCHEDULE OF CASH FLOW ACTIVITIES:
NONCASH ACTIVITIES:
Loans Transferred to Other Real Estate Owned $ - $ -
CASH PAID DURING THE YEAR FOR:
Interest Paid (Net of Amount Capitalized) $ 82,378 $ 72,168
Income Tax Payments 1,102 1
</TABLE>
6
<PAGE>
RIGGS NATIONAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
NOTE 1. BASIS OF PRESENTATION
In our opinion, the accompanying unaudited financial statements contain all
normal recurring adjustments necessary for a fair presentation of the interim
period results, in conformity with generally accepted accounting principles
applied on a consistent basis and which require the use of estimates. These
statements should be read in conjunction with the financial statements and
accompanying notes included in our Annual Report on Form 10-K for the year ended
December 31, 1999. Certain reclassifications have been made to prior-period
amounts to conform with the current period's presentation. The results of
operations for the first six months of 2000 are not necessarily indicative of
the results to be expected for the full 2000 year.
NOTE 2. EARNINGS PER SHARE
Earnings per share computations are as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2000 JUNE 30, 1999
================================================
BASIC DILUTED BASIC DILUTED
EPS EPS EPS EPS
================================================
<S> <C> <C> <C> <C>
Net Income Available to Common Shareholders $ 10,330 $ 10,330 $ 9,574 $ 9,574
Weighted-Average Shares Outstanding 28,331,857 28,331,857 28,256,902 28,256,902
Weighted-Average Dilutive Effect
of Stock Option Plans n/a 219,217 n/a 533,816
------------------------------------------------
Adjusted Weighted-Average Shares Outstanding 28,331,857 28,551,074 28,256,902 28,790,718
Basic EPS $ .36 $ .34
Diluted EPS $ .36 $ .33
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2000 JUNE 30, 1999
================================================
BASIC DILUTED BASIC DILUTED
EPS EPS EPS EPS
------------------------------------------------
<S> <C> <C> <C> <C>
Net Income Available to Common Shareholders $ 21,882 $ 21,882 $ 17,290 $ 17,290
Weighted-Average Shares Outstanding 28,323,744 28,323,744 28,623,632 28,623,632
Weighted-Average Dilutive Effect
of Stock Option Plans n/a 105,109 n/a 587,079
------------------------------------------------
Adjusted Weighted-Average Shares Outstanding 28,323,744 28,428,853 28,623,632 29,210,711
Basic EPS $ .77 $ .60
Diluted EPS $ .77 $ .59
</TABLE>
7
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
NOTE 3. OTHER COMPREHENSIVE INCOME
<TABLE>
<CAPTION>
OTHER COMPREHENSIVE INCOME (LOSS) BEFORE - TAX
TAX (EXPENSE) NET-OF-TAX
AMOUNT BENEFIT AMOUNT
===================================================================================================================================
SIX MONTHS ENDED JUNE 30, 2000:
<S> <C> <C> <C>
Foreign Currency Translation Adjustments $ (2,722) $ 953 $ (1,769)
Unrealized Gains (Losses) on Securities:
Unrealized Holding Gains (Losses) Arising During Period 12,142 (4,249) 7,893
Less: Reclassification Adjustment for (Gains) Losses Realized in Net Income (321) 112 (209)
-----------------------------------------------------------------------------------------------------------------------------------
Net Unrealized Gains (Losses) 11,821 (4,137) 7,684
===================================================================================================================================
Other Comprehensive Income (Loss) $ 9,099 $ (3,184) $ 5,915
SIX MONTHS ENDED JUNE 30, 1999:
Foreign Currency Translation Adjustments $ (2,985) $ 1,045 $ (1,940)
Unrealized Gains (Losses) on Securities:
Unrealized Holding Gains (Losses) Arising During Period (33,288) 11,651 (21,637)
Less: Reclassification Adjustment for (Gains) Losses Realized in Net Income (1,104) 386 (718)
-----------------------------------------------------------------------------------------------------------------------------------
Net Unrealized Gains (Losses) (34,392) 12,037 (22,355)
===================================================================================================================================
Other Comprehensive Income (Loss) $(37,377) $ 13,082 $(24,295)
</TABLE>
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BALANCES
<TABLE>
<CAPTION>
FOREIGN UNREALIZED ACCUMULATED
CURRENCY GAIN (LOSS) OTHER
TRANSLATION ON COMPREHENSIVE
ADJUSTMENTS SECURITIES INCOME (LOSS)
===================================================================================================================================
<S> <C> <C> <C>
SIX MONTHS ENDED JUNE 30, 2000:
Balance, December 31, 1999 $ (2,597) $ (39,493) $ (42,090)
Current-Period Change (1,769) 7,684 5,915
===================================================================================================================================
Balance, June 30, 2000 $ (4,366) $ (31,809) $ (36,175)
SIX MONTHS ENDED JUNE 30, 1999:
Balance, December 31, 1998 $ (1,349) $ (1,199) $ (2,548)
Current-Period Change (1,940) (22,355) (24,295)
===================================================================================================================================
Balance, June 30, 1999 $ (3,289) $ (23,554) $ (26,843)
</TABLE>
8
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
NOTE 4. SEGMENT PROFITABILITY
<TABLE>
<CAPTION>
===================================================================================================================================
SIX MONTHS RIGGS RIGGS
ENDED INTERNATIONAL RIGGS & CAPITAL NATIONAL
JUNE 30, 2000 BANKING BANKING COMPANY TREASURY PARTNERS OTHER RECONCILIATION CORPORATION
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET INTEREST INCOME
Interest Income $ 98,749 $ 31,958 $ 2,947 $ 74,799 $ - $ 23,729
Interest Expense 29,151 41,328 5,854 29,597 - 27,361
Funds Transfer Income (Expense) (7,520) 27,481 8,751 (38,480) 145 9,623
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss),
Tax-Equivalent 62,078 18,111 5,844 6,722 145 5,991
Provision for Loan Losses (300) (703) - - - -
Tax Equivalent Adjustment (1,125) - - - - -
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss) $ 60,653 $ 17,408 $ 5,844 $ 6,722 $ 145 $ 5,991 $ - $ 96,763
-----------------------------------------------------------------------------------------------
NONINTEREST INCOME
Noninterest Income-External
Customers $ 19,670 $ 2,030 $ 28,624 $ 1,783 $ 12,418 $ 289
Intersegment Noninterest Income 1,778 2,070 132 1 162 1,446
-----------------------------------------------------------------------------------------------
Total Noninterest Income $ 21,448 $ 4,100 $ 28,756 $ 1,784 $ 12,580 $ 1,735 $ (5,589) $ 64,814
-----------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Depreciation and Amortization $ 3,781 $ 488 $ 444 $ 9 $ 10 $ 4,426
Direct Expense 33,366 14,649 18,276 2,039 1,052 36,509
Overhead and Support 26,150 6,261 6,241 852 39 (39,543)
-----------------------------------------------------------------------------------------------
Total Noninterest Expense $ 63,297 $ 21,398 $ 24,961 $ 2,900 $ 1,101 $ 1,392 $ (5,589) $ 109,460
-----------------------------------------------------------------------------------------------
Income (Loss) Before Taxes and
Minority Interest $ 18,804 $ 110 $ 9,639 $ 5,606 $ 11,624 $ 6,334 $ - $ 52,117
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Total Average Assets $2,804,332 $ 944,652 $ 103,316 $2,438,887 $ 60,854 $ 941,686 $(1,572,515) $5,721,212
===================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
===================================================================================================================================
SIX MONTHS RIGGS RIGGS
ENDED INTERNATIONAL RIGGS & CAPITAL NATIONAL
JUNE 30, 1999 BANKING BANKING COMPANY TREASURY PARTNERS OTHER RECONCILIATION CORPORATION
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET INTEREST INCOME
Interest Income $ 92,455 $ 29,455 $ 2,897 $ 47,220 $ - $ 26,591
Interest Expense 30,170 34,881 4,448 11,897 - 24,200
Funds Transfer Income (Expense) 1,352 21,220 6,591 (31,363) (332) 2,532
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss),
Tax-Equivalent 63,637 15,794 5,040 3,960 (332) 4,923
Provision for Loan Losses - - - - - -
Tax Equivalent Adjustment (1,005) - - (353) - -
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss) $ 62,632 $ 15,794 $ 5,040 $ 3,607 $ (332) $ 4,923 $ - $ 91,664
-----------------------------------------------------------------------------------------------
NONINTEREST INCOME
Noninterest Income-External
Customers $ 19,486 $ 1,978 $ 25,942 $ 885 $ 384 $ 1,006
Intersegment Noninterest Income 259 2,017 293 1 - 1,799
-----------------------------------------------------------------------------------------------
Total Noninterest Income $ 19,745 $ 3,995 $ 26,235 $ 886 $ 384 $ 2,805 $ (4,369) $ 49,681
-----------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Depreciation and Amortization $ 3,765 $ 369 $ 411 $ 6 $ 4 $ 3,580
Direct Expense 30,304 10,982 16,377 759 1,011 37,165
Overhead and Support 27,104 5,590 5,974 773 2 (39,443)
-----------------------------------------------------------------------------------------------
Total Noninterest Expense $ 61,173 $ 16,941 $ 22,762 $ 1,538 $ 1,017 $ 1,302 $ (4,369) $ 100,364
-----------------------------------------------------------------------------------------------
Income (Loss) Before Taxes and
Minority Interest $ 21,204 $ 2,848 $ 8,513 $ 2,955 $ (965) $ 6,426 $ - $ 40,981
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Total Average Assets $2,727,600 $ 934,159 $ 101,351 $1,758,129 $ 11,702 $1,115,160 $(1,159,600) $5,488,501
===================================================================================================================================
</TABLE>
9
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
Our reportable segments are strategic business units that provide diverse
products and services within the financial services industry. We have six
reportable segments: Banking, International Banking, Riggs & Company, Treasury,
Riggs Capital Partners and Other. The Banking segment provides traditional
banking services, such as lending and deposit taking to retail, corporate and
commercial customers. The International Banking segment includes our Washington,
D.C.- based embassy banking business and our London-based banking subsidiary,
Riggs Bank Europe Limited. Riggs & Company is our private client services
division that provides trust and investment management services to a broad
customer base. The Treasury segment is responsible for asset and liability
management throughout our operations. Riggs Capital Partners is our venture
capital subsidiary, and specializes in equity investments in privately-held
high-growth companies. "Other" consists of our unallocated parent-company income
and expense, net interest income from unallocated equity and foreclosed real
estate activities of Riggs Bank N.A., our principal banking subsidiary.
We evaluate segment performance based on net income before taxes and minority
interest. The accounting policies of the segments are substantially the same as
those described in the summary of significant accounting policies. We account
for intercompany transactions as if the transactions were to third parties under
market conditions. Overhead and support expenses are allocated to each operating
segment based on number of employees, service usage and other factors relevant
to the expense incurred.
Reconciliations are provided from the segment totals to our consolidated
financial statements. The reconciliations of noninterest income and noninterest
expense offset, as these items result from intercompany transactions. For years
in which we have either no provision for loan losses or a reduction to the
reserve for loan losses, an allocation of loan loss is not provided to the
segments. The reconciliation of total average assets represents the elimination
of intercompany transactions.
<TABLE>
<CAPTION>
===================================================================================================================================
THREE MONTHS RIGGS RIGGS
ENDED INTERNATIONAL RIGGS & CAPITAL NATIONAL
JUNE 30, 2000 BANKING BANKING COMPANY TREASURY PARTNERS OTHER RECONCILIATION CORPORATION
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET INTEREST INCOME
Interest Income $ 49,799 $ 15,938 $ 1,493 $ 37,278 $ - $ 11,901
Interest Expense 15,253 21,520 2,769 14,429 - 13,146
Funds Transfer Income (Expense) (3,049) 14,599 4,146 (20,421) 93 4,632
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss),
Tax-Equivalent 31,497 9,017 2,870 2,428 93 3,387
Provision for Loan Losses - (403) - - - -
Tax Equivalent Adjustment (559) - - - - -
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss) $ 30,938 $ 8,614 $ 2,870 $ 2,428 $ 93 $ 3,387 $ - $ 48,330
-----------------------------------------------------------------------------------------------
NONINTEREST INCOME
Noninterest Income-External
Customers $ 10,153 $ 996 $ 14,589 $ 846 $ 5,451 $ 238
Intersegment Noninterest Income 892 983 45 - 85 723
-----------------------------------------------------------------------------------------------
Total Noninterest Income $ 11,045 $ 1,979 $ 14,634 $ 846 $ 5,536 $ 961 $ (2,728) $ 32,273
-----------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Depreciation and Amortization $ 1,889 $ 246 $ 225 $ 4 $ 5 $ 2,221
Direct Expense 17,083 7,355 9,427 1,022 530 18,337
Overhead and Support 13,401 3,128 3,061 455 22 (20,067)
-----------------------------------------------------------------------------------------------
Total Noninterest Expense $ 32,373 $ 10,729 $ 12,713 $ 1,481 $ 557 $ 491 $ (2,728) $ 55,616
-----------------------------------------------------------------------------------------------
Income (Loss) Before Taxes and
Minority Interest $ 9,610 $ (136) $ 4,791 $ 1,793 $ 5,072 $ 3,857 $ - $ 24,987
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Total Average Assets $2,795,051 $ 927,655 $ 107,253 $2,380,600 $ 70,745 $ 942,014 $(1,564,941) $ 5,658,377
===================================================================================================================================
</TABLE>
10
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
<TABLE>
<CAPTION>
===================================================================================================================================
THREE MONTHS RIGGS RIGGS
ENDED INTERNATIONAL RIGGS & CAPITAL NATIONAL
JUNE 30, 1999 BANKING BANKING COMPANY TREASURY PARTNERS OTHER RECONCILIATION CORPORATION
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET INTEREST INCOME
Interest Income $ 46,000 $ 14,394 $ 1,451 $ 24,308 $ - $ 13,259
Interest Expense 15,072 17,148 2,217 6,320 - 12,293
Funds Transfer Income (Expense) 349 10,681 3,290 (15,584) (202) 1,466
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss),
Tax-Equivalent 31,277 7,927 2,524 2,404 (202) 2,432
Provision for Loan Losses - - - - - -
Tax Equivalent Adjustment (524) - - - - -
-----------------------------------------------------------------------------------------------
Net Interest Income (Loss) $ 30,753 $ 7,927 $ 2,524 $ 2,404 $ (202)$ 2,432 $ - $ 45,838
-----------------------------------------------------------------------------------------------
NONINTEREST INCOME
Noninterest Income-External
Customers $ 9,903 $ 947 $ 13,031 $ 488 $ 211 $ 771
Intersegment Noninterest Income 259 1,014 145 - - 920
-----------------------------------------------------------------------------------------------
Total Noninterest Income $ 10,162 $ 1,961 $ 13,176 $ 488 $ 211 $ 1,691 $ (2,338) $ 25,351
-----------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Depreciation and Amortization $ 1,878 $ 186 $ 209 $ 3 $ 4 $ 1,799
Direct Expense 15,422 5,533 7,817 383 514 18,799
Overhead and Support 13,046 2,861 3,325 338 1 (19,571)
-----------------------------------------------------------------------------------------------
Total Noninterest Expense $ 30,346 $ 8,580 $ 11,351 $ 724 $ 519 $ 1,027 $ (2,338) $ 50,209
-----------------------------------------------------------------------------------------------
Income (Loss) Before Taxes and
Minority Interest $ 10,569 $ 1,308 $ 4,349 $ 2,168 $ (510)$ 3,096 $ - $ 20,980
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Total Average Assets $2,731,372 $ 938,613 $ 101,849 $1,799,240 $ 13,766 $ 1,110,517 $(1,216,102) $ 5,479,255
===================================================================================================================================
</TABLE>
NOTE 5. NEW FINANCIAL ACCOUNTING STANDARDS
SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities,"
was issued in June 1998. SFAS No. 133 will require us to record derivative
instruments, such as interest-rate swap agreements, on the Consolidated
Statement of Condition as assets or liabilities, measured at fair value.
Currently we treat such instruments as off-balance-sheet items. Gains or losses
resulting from changes in the values of those derivatives would be accounted for
depending on the specific use of each derivative instrument and whether it
qualifies for hedge accounting treatment as stated in the standard. SFAS No.
137, issued in June 1999, deferred the effective date for implementation of SFAS
No. 133 to January 1, 2001. We do not anticipate any material impact from the
implementation of SFAS No. 133.
11
<PAGE>
RIGGS NATIONAL CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
We earned $10.3 million of net income for the second quarter of 2000, an
increase of 7% over the $9.6 million for the same period a year ago. Diluted
earnings per share for the second quarter of 2000 were $.36 compared to $.33
reported in the second quarter of 1999.
For the first half of 2000, we had net income of $21.9 million, or $.77 per
diluted share, compared with net income of $17.3 million, or $.59 per diluted
share for the first half of 1999.
The increase in net income for the second quarter and first half of 2000 was
primarily due to $5.6 and $12.6 million, respectively, in venture capital gains
from our venture capital subsidiary, Riggs Capital Partners. Noninterest income
also was enhanced by 9% increases for both periods in trust and advisory fee
income at Riggs & Company, our private client services division. These increases
in noninterest income were partially offset by increases in noninterest expense
of $5.4 and $9.1 million for the second quarter and six months ended June 30,
2000.
Return on average assets was .73% and .77% for the three and six months ended
June 30, 2000, compared to .70% and .64% for the same periods a year ago. Return
on average stockholder's equity was 11.88% at June 30, 2000, compared to 11.12%
at June 30, 1999.
NET INTEREST INCOME
Net interest income on a tax-equivalent basis (net interest income plus an
amount equal to the tax savings on tax-exempt interest) totaled $49.3 million in
the first quarter of 2000, and $98.9 million for the first six months of the
year, increasing $2.9 and $5.9 million, respectively from the same periods in
1999. The increase from the prior year's first six months was primarily due to a
reduction in interest expense due to the redemption of $125 million in
subordinated notes, and increases in interest income of $8.2, $4.6, and $6.8
million, respectively, on the securities, loans, and overnight investments
portfolios. These items were partially offset by increases in interest expense
on our interest-bearing deposits and short-term borrowings. The increase in net
interest income for the second quarter year to year was due to the same factors.
NET INTEREST INCOME CHANGES (1)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2000 VS 1999 JUNE 30, 2000 VS 1999
------------------------------------------------------------------------
DUE TO DUE TO TOTAL DUE TO DUE TO TOTAL
(IN THOUSANDS) RATE VOLUME CHANGE RATE VOLUME CHANGE
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Interest Income:
Loans, Including Fees $ 3,965 $ (966) $ 2,999 $ 5,516 $ (958) $ 4,558
Securities Available for Sale 1,517 1,036 2,553 2,721 5,505 8,226
Time Deposits with Other Banks 1,649 (2,301) (652) 3,108 (5,405) (2,297)
Federal Funds Sold and Reverse
Repurchase Agreements 496 3,642 4,138 1,049 5,788 6,837
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest Income 7,627 1,411 9,038 12,394 4,930 17,324
Interest Expense:
Interest-Bearing Deposits 4,212 (148) 4,064 6,748 226 6,974
Repurchase Agreements and Other
Short-Term Borrowings 2,480 2,327 4,807 4,470 5,537 10,007
Long-Term Debt 248 (3,011) (2,763) 456 (5,982) (5,526)
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest Expense 6,940 (832) 6,108 11,674 (219) 11,455
===================================================================================================================================
Net Interest Income $ 687 $ 2,243 $ 2,930 $ 720 $ 5,149 $ 5,869
</TABLE>
(1) - The dollar amount of changes in interest income and interest expense
attributable to changes in rate/volume (change in rate multiplied by
change in volume) has been allocated between rate and volume variances
based on the percentage relationship of such variances to each other.
Income and rates are computed on a tax-equivalent basis using a
Federal income tax rate of 35% and local tax rates as applicable.
12
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
AVERAGE CONSOLIDATED STATEMENTS OF CONDITION AND RATES
<TABLE>
<CAPTION>
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2000 JUNE 30, 1999
------------------------------------------------------------------------
(TAX-EQUIVALENT BASIS) (1) AVERAGE INCOME/ AVERAGE INCOME/
(IN THOUSANDS) BALANCE EXPENSE RATE BALANCE EXPENSE RATE
===================================================================================================================================
ASSETS
<S> <C> <C> <C> <C> <C> <C>
Loans, Including Fees (2) $ 3,121,795 $ 59,927 7.72% $3,173,289 $ 56,928 7.20%
Securities Available for Sale (3) 1,249,821 19,578 6.30 1,178,835 17,025 5.79
Time Deposits with Other Banks 351,907 5,507 6.29 518,610 6,159 4.76
Federal Funds Sold and Reverse Repurchase Agreements 337,812 5,359 6.38 101,179 1,221 4.84
-----------------------------------------------------------------------------------------------------------------------------------
Total Earning Assets and Average Rate Earned 5,061,335 90,371 7.18 4,971,913 81,333 6.56
Reserve for Loan Losses (38,102) (52,750)
Cash and Due from Banks 140,758 148,266
Other Assets 494,386 411,826
===================================================================================================================================
Total Assets $ 5,658,377 $5,479,255
LIABILITIES, MINORITY INTEREST AND
SHAREHOLDERS' EQUITY
Interest-Bearing Deposits $ 3,536,847 $ 30,849 3.51% $3,554,151 $ 26,785 3.02%
Repurchase Agreements and Other Short-Term Borrowings 625,305 8,625 5.55 382,782 3,818 4.00
Long-Term Debt 66,525 1,605 9.70 191,525 4,368 9.15
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest-Bearing Funds and Average Rate Paid 4,228,677 41,079 3.91 4,128,458 34,971 3.40
Demand Deposits 632,007 587,393
Other Liabilities 97,865 67,974
Minority Interest in Preferred Stock of Subsidiaries 350,000 350,000
Shareholders' Equity 349,828 345,430
===================================================================================================================================
Total Liabilities, Minority Interest and
Shareholders' Equity $ 5,658,377 $5,479,255
===================================================================================================================================
NET INTEREST INCOME AND SPREAD $ 49,292 3.27% $ 46,362 3.16%
===================================================================================================================================
NET INTEREST MARGIN ON EARNING ASSETS 3.92% 3.74%
</TABLE>
(1) - Income and rates are computed on a tax-equivalent basis using a Federal
income tax rate of 35% and local tax rates as applicable.
(2) - Nonperforming loans are included in average balances used to
determine rates.
(3) - The averages and rates for the securities available for sale portfolio
are based on amortized cost.
NONINTEREST INCOME
Noninterest income for the three months ended June 30, 2000, totaled $32.3
million, an increase of $6.9 million from the $25.4 million for the same period
a year ago. This increase was primarily due to $5.6 million in venture capital
investment gains at Riggs Capital Partners. Also contributing to the increase in
noninterest income for the current quarter was $13.9 million in trust and
investment advisory income at Riggs & Company, an increase of $1.2 million, or
9%, over the same period a year ago.
Noninterest income for the six months ended June 30, 2000, totaled $64.8
million, an increase of $15.1 million from the $49.7 million earned for the same
period in 1999. This increase was primarily due to $12.6 million in venture
capital investment gains at Riggs Capital Partners, and an increase of $2.2
million in trust and advisory income from 1999 to 2000 at Riggs & Company.
13
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
<TABLE>
<CAPTION>
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 2000 JUNE 30, 1999
------------------------------------------------------------------------
(TAX-EQUIVALENT BASIS) (1) AVERAGE INCOME/ AVERAGE INCOME/
(IN THOUSANDS) BALANCE EXPENSE RATE BALANCE EXPENSE RATE
===================================================================================================================================
ASSETS
<S> <C> <C> <C> <C> <C> <C>
Loans, Including Fees (2) $ 3,151,310 $ 119,841 7.65% $3,185,659 $ 115,283 7.30%
Securities Available for Sale (3) 1,276,771 39,917 6.29 1,098,346 31,691 5.82
Time Deposits with Other Banks 368,337 11,096 6.06 566,836 13,393 4.76
Federal Funds Sold and Reverse Repurchase Agreements 335,725 10,164 6.09 138,552 3,327 4.84
-----------------------------------------------------------------------------------------------------------------------------------
Total Earning Assets and Average Rate Earned 5,132,143 181,018 7.09 4,989,393 163,694 6.62
Reserve for Loan Losses (39,810) (53,478)
Cash and Due from Banks 142,715 146,542
Other Assets 486,164 406,044
===================================================================================================================================
Total Assets $ 5,721,212 $5,488,501
LIABILITIES, MINORITY INTEREST AND
SHAREHOLDERS' EQUITY
Interest-Bearing Deposits $ 3,579,326 $ 61,114 3.43% $3,535,864 $ 54,140 3.09%
Repurchase Agreements and Other Short-Term Borrowings 671,446 17,803 5.33 391,819 7,796 4.01
Long-Term Debt 66,525 3,210 9.70 191,525 8,736 9.20
-----------------------------------------------------------------------------------------------------------------------------------
Total Interest-Bearing Funds and Average Rate Paid 4,317,297 82,127 3.83 4,119,208 70,672 3.46
Demand Deposits 622,916 604,404
Other Liabilities 86,782 60,589
Minority Interest in Preferred Stock of Subsidiaries 350,000 350,000
Shareholders' Equity 344,217 354,300
===================================================================================================================================
Total Liabilities, Minority Interest and
Shareholders' Equity $ 5,721,212 $5,488,501
===================================================================================================================================
NET INTEREST INCOME AND SPREAD $ 98,891 3.26% $ 93,022 3.16%
===================================================================================================================================
NET INTEREST MARGIN ON EARNING ASSETS 3.87% 3.76%
</TABLE>
(1) - Income and rates are computed on a tax-equivalent basis using a Federal
income tax rate of 35% and local tax rates as applicable.
(2) - Nonperforming loans are included in average balances used to
determine rates.
(3) - The averages and rates for the securities available for sale portfolio
are based on amortized cost.
NONINTEREST EXPENSE
Noninterest expense for the three months ended June 30, 2000, was $55.6 million,
an increase of $5.4 million from the $50.2 million reported for the three months
ended June 30, 1999. This increase was a result of added personnel costs during
the year, partially related to new business initiatives, and other noninterest
expense, such as data processing costs and occupancy expense related to these
business initiatives.
Noninterest expense for the six months ended June 30, 2000, was $109.5 million
compared to $100.4 million for the same period a year ago. The increase for the
six month period was mostly due to the new business initiatives discussed in the
preceding paragraph.
14
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
FINANCIAL CONDITION
SECURITIES
Securities available for sale totaled $1.31 billion at June 30, 2000, compared
to $1.29 billion at year-end 1999 and $1.17 billion at June 30, 1999. The
activity for the first six months included purchases of securities available for
sale totaling $809.3 million, which were mostly offset by maturities,
curtailments and sales of securities available for sale totaling $801.1 million.
The weighted-average durations and yields for the portfolio, adjusted for
anticipated prepayments, were approximately 3.4 years and 6.06%, respectively,
at June 30, 2000.
<TABLE>
<CAPTION>
JUNE 30, 2000 JUNE 30, 1999 DECEMBER 31, 1999
------------------------------------------------------------------------
AMORTIZED MARKET/ AMORTIZED MARKET/ AMORTIZED MARKET/
AVAILABLE FOR SALE COST BOOK VALUE COST BOOK VALUE COST BOOK VALUE
===================================================================================================================================
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
U.S. Treasury Securities $ 313,826 $ 299,273 $ 213,476 $ 200,348 $ 289,242 $ 268,008
Government Agencies Securities 475,239 470,976 418,326 416,098 479,297 474,457
Mortgage-Backed Securities 511,911 481,790 530,233 509,352 518,418 483,734
Other Securities 58,111 58,111 41,620 41,620 63,685 63,685
===================================================================================================================================
Total $1,359,087 $1,310,150 $1,203,655 $1,167,418 $ 1,350,642 $ 1,289,884
</TABLE>
LOANS
At June 30, 2000, loans outstanding totaled $3.14 billion, decreasing slightly
from the June 30, 1999 and December 31, 1999 balances of $3.19 and $3.20
billion, respectively. The decreases were primarily in commercial and financial
and foreign loans from both prior periods. These decreases were partially offset
by increases in home equity and real estate/commercial construction loans.
During the second quarter of 2000, we began originating mortgage loans for sale
in the secondary market. At June 30, 2000, residential real estate loans
originated and held for sale totaled $7.8 million. There were no such loans at
either June 30, 1999, or December 31, 1999.
<TABLE>
<CAPTION>
JUNE 30, JUNE 30, DECEMBER 31,
(IN THOUSANDS) 2000 1999 1999
=======================================================================================================================
<S> <C> <C> <C>
Commercial and Financial $ 630,296 $ 676,769 $ 667,393
Real Estate - Commercial/Construction 421,885 409,707 415,304
Residential Mortgage 1,204,924 1,224,250 1,219,740
Loans Available for Sale 7,803 - -
Home Equity 339,168 312,681 315,520
Consumer 70,686 69,101 73,158
Foreign 470,994 497,540 517,012
-----------------------------------------------------------------------------------------------------------------------
Total Loans 3,145,756 3,190,048 3,208,127
Net Deferred Loan Fees,
Premiums and Discounts (5,315) (4,003) (6,146)
=======================================================================================================================
Loans $3,140,441 $3,186,045 $3,201,981
</TABLE>
15
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
RESERVE FOR LOAN LOSSES
Changes in the reserve for loan losses are summarized as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
-----------------------
2000 1999
===================================================================================================================================
<S> <C> <C>
Balance, January 1 $ 41,455 $ 54,455
Provision for loan losses 1,003 -
Loans charged-off 6,411 2,770
Less: Recoveries on charged-off loans 1,418 940
-----------------------------------------------------------------------------------------------------------------------------------
Net loan charge-offs (recoveries) 4,993 1,830
Foreign exchange translation adjustments (429) (451)
===================================================================================================================================
Balance, June 30 $ 37,036 $ 52,174
</TABLE>
ASSET QUALITY
NONPERFORMING ASSETS
Nonperforming assets, which include nonaccrual loans, renegotiated loans and
other real estate owned (net of reserves), totaled $41.7 million at June 30,
2000, a $2.0 million decrease from the year-end 1999 total of $43.7 million and
a $12.2 million increase from the June 30, 1999 total. The increase in
nonperforming assets from the second quarter of 1999 was mainly due to two
nonperforming loans in which we participated with other major banks. These
credits were an $8.1 million loan to a health care entity and a $4.0 million
loan to a computer equipment manufacturing and service company that were placed
on nonaccrual in the third quarter of 1999. These two credits are considered
impaired. Impaired loans also include a $25.0 million loan to a commercial real
estate investment trust that went to nonaccrual in the fourth quarter of 1998.
Impaired loans totaled $39.7 million at June 30, 2000. The assigned reserve for
loan losses for impaired loans was $8.4 million at June 30, 2000.
PAST-DUE AND POTENTIAL PROBLEM LOANS
Past-due loans consist of residential real estate loans, commercial and
industrial loans, and consumer loans that are in the process of collection and
that are accruing interest. Past-due loans increased $3.0 million during the
first six months of 2000 to $10.4 million, with most of the increase in secured,
residential real estate loans. Potential problem loans increased $3.2 million
from December 31, 1999. A decrease in potential problem loans of $10.7 million
from June 30, 1999 occurred as the loan to the health care entity discussed in
the previous paragraph moved to nonaccrual status.
NONPERFORMING ASSETS AND PAST-DUE LOANS
<TABLE>
<CAPTION>
JUNE 30, JUNE 30, DECEMBER 31,
(IN THOUSANDS) 2000 1999 1999
=======================================================================================================================
NONPERFORMING ASSETS:
<S> <C> <C> <C>
Nonaccrual Loans (1) $ 39,751 $ 26,389 $ 41,534
Renegotiated Loans 1,055 1,452 1,263
Other Real Estate Owned, Net 908 1,678 908
=======================================================================================================================
Total Nonperforming Assets $ 41,714 $ 29,519 $ 43,705
PAST-DUE LOANS (2) $ 10,419 $ 8,574 $ 7,429
POTENTIAL PROBLEM LOANS $ 5,206 $ 15,861 $ 2,013
</TABLE>
(1) Loans (other than consumer) that are in default in either principal or
interest for 90 days or more that are not well-secured and in the
process of collection, or that are, in management's opinion, doubtful
as to the collectibility of either interest or principal.
(2) Loans contractually past due 90 days or more in principal or interest
that are well-secured and in the process of collection.
16
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
DEPOSITS
Deposits are our primary and most stable source of funds. Deposits totaled $4.25
billion at June 30, 2000, an increase of $77 million from the December 31, 1999
total of $4.18 billion, and an increase of $113 million from the June 30, 1999
deposit total of $4.14 billion. For both periods, deposits decreased in demand
deposit, savings and NOW, and time deposits in domestic offices accounts, and
increased in money market and time deposits in foreign offices accounts.
SHORT-TERM BORROWINGS AND LONG-TERM DEBT
Short-term borrowings decreased by $195.8 million from the year-end 1999
balance, and increased $267.1 million from the June 30, 1999 balance. These
changes reflect borrowings and partial calls of $400 million in advances from
the Federal Home Loan Bank of Atlanta (FHLB). During 1999, we borrowed $400
million, all callable during the year 2000, at an average rate of 4.99%. $200
million was called by the FHLB in the first quarter 2000. $100 million of the
remaining available credit has a final maturity of ten years, with the other
$100 million maturing in five years. Short-term borrowings are an additional
source of funds that we have utilized to meet certain asset/liability and daily
cash management objectives and are used to generate cash and maintain adequate
levels of liquidity.
The decrease in long-term debt from the June 30, 1999, balance was due to our
redemption in July 1999 of $125 million of 8.5% subordinated notes due in 2006,
at the price of 104.25%. General corporate funds were used to retire the debt.
We recorded an extraordinary expense of $5.1 million, after tax, in the third
quarter 1999 as a result of the redemption.
<TABLE>
<CAPTION>
JUNE 30, JUNE 30, DECEMBER 31,
(IN THOUSANDS) 2000 1999 1999
=======================================================================================================================
<S> <C> <C> <C>
Repurchase Agreements and Other Short-Term Borrowings $ 636,377 $ 369,291 $ 832,202
Subordinated Debentures due 2009 66,525 66,525 66,525
Subordinated Notes due 2006 - 125,000 -
-----------------------------------------------------------------------------------------------------------------------
Total Long-Term Debt 66,525 191,525 66,525
=======================================================================================================================
Total Short-Term Borrowings and Long-Term Debt $ 702,902 $ 560,816 $ 898,727
</TABLE>
LIQUIDITY
We seek to maintain sufficient liquidity to meet the needs of depositors,
borrowers and creditors at a reasonable cost and without undue stress on our
operations and those of our banking subsidiaries. Our Asset/Liability Committee
actively analyzes and manages liquidity in coordination with other areas of the
organization (see "Sensitivity to Market Risk"). At June 30, 2000, our liquid
assets, on a consolidated basis, which include cash and due from banks,
Government obligations and other securities, federal funds sold, reverse
repurchase agreements and time deposits at other banks, totaled $2.18 billion
(38% of total assets). This compares with $2.20 billion (38%) at December 31,
1999, and $1.89 billion (35%) at June 30, 1999. At June 30, 2000, $977.6 million
of our assets were pledged to secure deposits and other borrowings. This
compares with pledged assets of $1.02 billion at December 31, 1999, and $824.5
million at June 30, 1999.
Our liquidity position is maintained by a stable source of funds from our core
deposit relationships. We have other sources of funds, such as short-term credit
lines available from several Federal Home Loan Banks and other financial
institutions. In addition, we have a line of credit available through our
membership in the FHLB. At June 30, 2000, December 31, 1999, and June 30, 1999,
short-term credit lines and the FHLB Atlanta line of credit available totaled
approximately $1.56 billion, $1.38 billion, and $1.68 billion, respectively. At
June 30, 2000, December 31, 1999, and June 30, 1999, the amounts outstanding
were $214.3 million, $423.2 million, and $31.9 million, respectively.
17
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
SHAREHOLDERS' EQUITY AND REGULATORY CAPITAL
Total shareholders' equity at June 30, 2000, was $363.1 million, an increase of
$25.4 million from year-end 1999 and $22.4 million from a year ago. The increase
from year-end was primarily the result of net income of $21.9 million and
unrealized securities losses that were smaller by $7.7 million, after tax. The
increase from June 30, 1999 was primarily the result of net income of $36.2
million, which was partially offset by unrealized securities losses of $8.3
million. For more information on our securities portfolio, see the discussion
under "Securities" in the Management's Discussion and Analysis of this Form
10-Q.
Book value per common share was $12.81 as of June 30, 2000, compared to $11.93
at year-end 1999 and $12.06 at June 30, 1999. The increases in book value from
June 30th and year-end 1999 were primarily the result of the net income and net
unrealized securities gains described in the preceding paragraph.
Following are our capital ratios and those of our banking subsidiary, Riggs Bank
National Association (Riggs Bank N.A.) at June 30, 2000 and 1999, and December
31, 1999.
<TABLE>
<CAPTION>
JUNE 30, JUNE 30, DECEMBER 31, REQUIRED
2000 1999 1999 MINIMUMS
===================================================================================================================================
<S> <C> <C> <C> <C>
RIGGS NATIONAL CORPORATION:
Tier I 15.15% 13.47% 14.09% 4.00%
Combined Tier I and Tier II 24.55 26.59 23.55 8.00
Leverage 9.12 8.70 8.59 4.00
RIGGS BANK N.A.:
Tier I 13.87 12.89 12.63 4.00
Combined Tier I and Tier II 15.01 14.14 13.86 8.00
Leverage 8.49 8.78 7.91 4.00
</TABLE>
YEAR 2000 READINESS DISCLOSURE
GENERAL
Advances and changes in technology can have a significant impact on our
business. Financial institutions are dependent on information systems and also
have many external interdependencies with other companies. Many computer
programs were designed to recognize calendar years by their last two digits.
Calculations performed using these digits may not have worked properly with
dates beginning in the Year 2000 and beyond. The Year 2000 issue created risk
for us from unforeseen problems in our computer systems and from Year 2000
issues with our vendors, service providers and customers. For January 1, 2000
and subsequent dates through the date of this report, we experienced no material
impact as a result of Year 2000 date changes.
APPROACH AND RISKS
We began to identify the risks associated with the Year 2000 in 1995. We
established a corporate oversight structure to ensure timely risk assessments,
remediation plans, systems testing, conversions, and centralized management of
the project. The structure of the effort entailed a number of groups, each
addressing a different aspect of the project, and reporting to the Year 2000
Program Manager. Oversight of the entire project was performed by the Year 2000
Advisory Group. This was a management committee appointed by the Board of
Directors that reported to the Board on a quarterly basis.
We determined that an enterprise-wide business risk-assessment approach was most
appropriate for addressing and remediating Year 2000 problems. This included an
assessment of the information technology resources of each of our functional
areas, as well as separate assessments of information technology vendors and
suppliers, mainframe applications, third party suppliers, alternative platforms,
and non-information technology and facilities risks.
18
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONTINUED
In addition to systems-related risks, we undertook a review of risks created by
potential business interruptions suffered by our major business counterparties,
both domestic and foreign. We divided our business counterparties into three
broad categories: Funds Takers (primarily borrowers), Funds Providers
(depositors and other funding sources) and Capital Markets partners (trading
counterparties and fiduciary relationships). For those business partners that
would have had a significant impact on our liquidity, income, or capital markets
activities, if they had encountered significant business interruption due to the
Year 2000, we assessed their readiness and contingency plans for recovering from
an abrupt interruption.
After the assessment phase, Year 2000 efforts focused on remediation and
verification. We developed detailed action plans to address mainframe systems,
third party servicers, embedded technology and facilities and non-information
technology issues. For purchased systems and software and third party servicers,
the Year 2000 efforts involved contacting the vendors or suppliers and
determining the Year 2000 status of the various systems and of the plans to
bring the systems into compliance. For in-house systems, the Year 2000 efforts
included correction of the programs to ensure proper data processing. Our action
plans also included testing mission-critical systems to verify the remediation
efforts. We recorded and tracked information to keep ourselves aware of the
status of our company's information technology systems. The Program Manager
worked with our functional areas to develop contingency plans for a variety of
situations, such as the failure of a vendor to remediate Year 2000 issues by a
particular date or a system not being available for processing.
The failure to correct a material problem could have resulted in an interruption
in or failure of certain business operations. Year 2000 risks and uncertainties
included increased credit losses, service delays, funding delays, counterparty
failures, inaccurate information processing, ATM failures, and problems with
international accounts. There was no assurance that the Year 2000 issue would
not have a material adverse impact on our financial position, results of
operations, or relationships with customers, vendors, or others.
COSTS
The total cost of the Year 2000 project at June 30, 2000, was $7.1 million. The
future cost of completing the Year 2000 project is estimated to be $21 thousand.
The total amount expended to date for 2000 was $86 thousand. The most
significant components of the $7.1 million total estimated cost consisted of 60%
for personnel costs, including consultants and special Year 2000 incentives, and
28% for data processing services. We did not separately track all internal costs
incurred for the Year 2000 project. Internal costs were principally the
payroll-related costs for the information systems group.
CONTINGENCY PLANS
The remediation plans addressed any information systems which, through testing,
had been identified as not Year 2000 compliant. These plans described and
scheduled alternative provisions, including, if necessary, the replacement of
vendors or third party servicers to ensure compliance. The remediation plans
were complete; however, implementation of these plans was not necessary because
of our state of readiness.
The business resumption plans addressed how we would continue operations in the
event a Year 2000 related interruption occurred. The business resumption plans
for our mission-critical systems and third-party servicers were substantially
completed as of June 30, 1999. In some cases these plans provided for the manual
processing of certain normal bank functions. Manual processing would have caused
delays, which could have disrupted the normal business activities of our company
and our customers. While implementation of the business resumption plans was not
expected to be necessary, it ensured that we had the ability to process
transactions and serve our customers if a Year 2000 problem actually had
occurred.
19
<PAGE>
RIGGS NATIONAL CORPORATION
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
SENSITIVITY TO MARKET RISK
We are exposed to various market risks. We have determined that interest-rate
risk has a material impact on our financial performance, and as such we have
established the Asset/Liability Committee ("ALCO") to manage interest-rate risk.
The role of this committee is to prudently manage the asset/liability mix of our
operations to provide a stable net interest margin while maintaining liquidity
and capital. This entails the management of our overall risk in conjunction with
the acquisition and deployment of funds based upon ALCO's view of both current
and prospective market and economic conditions.
We manage our interest-rate risk through the use of an income simulation model,
which forecasts the impact on net interest income of a variety of different
interest rate scenarios. A "most likely" interest rate scenario is forecasted
based upon an analysis of current market conditions and expectations. The model
then evaluates the impact on net interest income of rates moving significantly
higher or lower than the "most likely" scenario. The results are compared to
risk tolerance limits set by corporate policy. The model's results as of June
30, 2000 and 1999 are shown in the following tables. Current policy establishes
limits for possible changes in net interest income for 12 and 36 month horizons.
The interest rate scenarios monitored by ALCO are based upon a 100 basis point
(1%) gradual increase or decrease in rates over a 12-month time period and a 300
basis point (3%) gradual increase or decrease in rates over a 36-month time
period.
<TABLE>
<CAPTION>
INTEREST-RATE SENSITIVITY ANALYSIS (1)
MOVEMENTS IN INTEREST RATES FROM JUNE 30, 2000
===================================================================================================================================
SIMULATED IMPACT OVER SIMULATED IMPACT OVER
NEXT TWELVE MONTHS NEXT THIRTY-SIX MONTHS
-----------------------------------------------------------------------------------------------------------------------------------
(In Thousands) +100BP -100BP +300BP -300BP
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Simulated Impact Compared With a
"Most Likely" Scenario:
Net Interest Income Increase/(Decrease) -1.0% 2.3% -1.80% 3.4%
Net Interest Income Increase/(Decrease) $ (1,840) $ 4,348 $ (10,660) $ 20,133
</TABLE>
<TABLE>
<CAPTION>
MOVEMENTS IN INTEREST RATES FROM JUNE 30, 1999
===================================================================================================================================
SIMULATED IMPACT OVER SIMULATED IMPACT OVER
NEXT TWELVE MONTHS NEXT THIRTY-SIX MONTHS
-----------------------------------------------------------------------------------------------------------------------------------
(In Thousands) +100BP -100BP +300BP -300BP
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Simulated Impact Compared With a
"Most Likely" Scenario:
Net Interest Income Increase/(Decrease) -0.9% 2.2% -2.3% 2.2%
Net Interest Income Increase/(Decrease) $ (1,785) $ 4,098 $ (13,636) $ 13,140
</TABLE>
(1) Key Assumptions:
Assumptions with respect to the model's projections of the effect of changes in
interest rates on Net Interest Income include:
1. Target balances for various asset and liability classes, which are
solicited from the management of the various units of the Corporation.
2. Interest rate scenarios which are generated by ALCO for the "most likely"
scenario and are dictated by policy for the alternative scenarios.
3. Spread relationships between various interest rate indices, which are
generated by the analysis of historical relationships and ALCO consensus.
4. Assumptions about the effect of embedded options and prepayment speeds:
instruments that are callable are assumed to be called at the first
opportunity if an interest rate scenario makes it advantageous for the owner
of the call to do so. Prepayment assumptions for mortgage products are derived
from accepted industry sources.
5. Reinvestment rates for funds replacing assets or liabilities that are
assumed (through early withdrawal, prepayment, calls, etc.) to run off the
balance sheet, which are generated by the spread relationships.
6. Maturity strategies with respect to assets and liabilities, which are
solicited from the management of the various units of the Corporation.
20
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK,
CONTINUED
At June 30, 2000, the forecasted impact of rates rising or falling 100 basis
points versus the "most likely" scenario over a 12-month time period was a
change in net interest income not exceeding 4%. For a 300 basis point movement
in rates versus the "most likely" scenario over a 36- month period, the impact
on net interest income did not exceed 4%. The results of the simulation for June
30, 2000, indicated that we were liability sensitive over the 12 and 36-month
time horizons. We were within guidelines for interest rates moving significantly
in either direction.
In managing our interest-rate risk, ALCO uses financial derivative instruments,
such as interest-rate swaps. Financial derivatives are employed to assist in the
management and/or reduction of our interest-rate risk and can effectively alter
the sensitivity of segments of the statement of condition for specified periods
of time. All of these derivative instruments are considered off-balance-sheet,
as they do not materially affect the level of our assets or liabilities. Along
with financial derivative instruments, the income simulation model includes
short-term financial instruments, investment securities, loans, deposits, and
other borrowings. Interest-rate risk management strategies are discussed and
approved by ALCO prior to implementation.
We find that the methodologies previously discussed provide a meaningful
representation of our interest-rate and market risk sensitivity, though factors
other than changes in the interest rate environment, such as levels of
non-earning assets, and changes in the composition of earning assets, may affect
net interest income. We believe our current interest-rate sensitivity level is
appropriate, considering our economic outlook and conservative approach taken in
the review and monitoring of our sensitivity position.
COMMITMENTS AND CONTINGENT LIABILITIES
Outstanding commitments and contingent liabilities that do not appear in the
consolidated financial statements at June 30, 2000 and 1999, and December 31,
1999 are detailed in the table below. At June 30, 2000, our financial derivative
instruments included four swaps with a total notional amount of $30.0 million,
which extend the maturities of certain short-term liabilities at the current
funding rates to protect these liabilities against rising interest rates. These
agreements were contracted in October 1999, December 1999 and January 2000, and
entail the payment of a blended 6.84% fixed rate and the receipt of a floating
rate equal to three-month LIBOR. These swaps reset quarterly and mature in 2004.
We also had 28 swaps at Riggs Bank Europe Limited, our London based banking
subsidiary, with a total notional amount of $89.4 million that entail the
payment of a blended 6.63% fixed rate and the receipt of a floating rate equal
to six-month LIBOR. These swaps have varying maturities extending until 2004 and
are entered into for the purpose of converting fixed rate loans to variable.
As a result of Riggs Capital Partners venture capital investment activity, we
had venture capital commitments of $15.8 million at June 30, 2000 of which $666
thousand were less than one year.
<TABLE>
<CAPTION>
CONTRACTUAL OR NOTIONAL VALUE
-----------------------------------------------------------
JUNE 30, JUNE 30, DECEMBER 31,
2000 1999 1999
=======================================================================================================================
<S> <C> <C> <C>
Commitments to Extend Credit $ 892,238 $1,093,187 $ 1,035,644
Venture Capital Commitments 15,818 21,777 25,210
Letters of Credit 120,546 145,382 137,622
Derivative Instruments:
Foreign Exchange Contracts:
Commitments to Purchase $ 66,969 $ 109,009 $ 112,226
Commitments to Sell 285,774 193,770 317,837
Futures 1,655 - -
Interest Rate Agreements
Swaps 119,385 99,635 126,786
Purchased Options - 615 629
</TABLE>
21
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK,
CONTINUED
Our interest rate agreement activity for the six months ended June 30, 2000, is
as follows:
<TABLE>
<CAPTION>
BALANCE BALANCE
DECEMBER 31, JUNE 30,
1999 ADDITIONS MATURITIES TERMINATIONS 2000
===================================================================================================================================
<S> <C> <C> <C> <C> <C>
Interest Rate Agreements:
Receive variable/pay fixed $ 25,000 $ 5,000 $ - $ - $ 30,000
Riggs Bank Europe Limited 101,786 - 12,401 - 89,385
===================================================================================================================================
Total $126,786 $ 5,000 $ 12,401 $ - $ 119,385
</TABLE>
This Quarterly Report on Form 10-Q, including the Management's Discussion and
Analysis of Financial Condition and Results of Operations, and the Quantitative
and Qualitative Disclosures About Market Risk, contains forward-looking
statements, including the references to earnings from venture capital and our
trust and investment advisory income. A variety of factors could cause our
actual results and experiences to differ materially from those expressed or
implied by the forward-looking statements. These factors include, but are not
limited to, certain risks and uncertainties that may affect the operations,
performance, development, growth projections and results of our business. These
factors also include the growth of the economy, changes in credit quality or
interest rates, changes in value of venture capital investments in the
technology and other sectors, timing of technology enhancements for products and
operating systems, the impact of competitive products, services and pricing,
customer business requirements, Congressional legislation and similar matters.
22
<PAGE>
RIGGS NATIONAL CORPORATION
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of the shareholders of the Corporation was held
on April 12, 2000, in Washington D.C. Chairman of the Board Joe L.
Allbritton presided and 26,204,181 of the 28,316,197 shares
outstanding as of the record date of February 29, 2000, were
represented in person or by proxy.
1-Elections of Directors
----------------------
Nominees for membership on the Board of Directors of the
Corporation, listed below, were elected by the shareholders. The
following schedule lists the number of shares cast for each nominee:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
Total Total
Votes For Votes Withheld
-----------------------------------------------------------------------------------
<S> <C> <C>
Joe L. Allbritton 23,990,541 1,019,980
-----------------------------------------------------------------------------------
Robert L. Allbritton 25,004,146 1,019,980
-----------------------------------------------------------------------------------
Timothy C. Coughlin 24,288,179 1,019,980
-----------------------------------------------------------------------------------
John M. Fahey, Jr. 25,159,170 1,019,980
-----------------------------------------------------------------------------------
Lawrence I. Hebert 25,154,826 1,019,980
-----------------------------------------------------------------------------------
Steven B. Pfeiffer 25,159,240 1,019,980
-----------------------------------------------------------------------------------
John E.V. Rose 25,156,937 1,019,980
-----------------------------------------------------------------------------------
Robert L. Sloan 25,158,019 1,019,980
-----------------------------------------------------------------------------------
Jack Valenti 25,112,174 1,019,980
-----------------------------------------------------------------------------------
William L. Walton 25,140,653 1,019,980
-----------------------------------------------------------------------------------
Eddie N. Williams 25,148,355 1,019,980
-----------------------------------------------------------------------------------
</TABLE>
2-Proposal to Adopt the Executive Incentive Plan
----------------------------------------------
By a vote of 23,899,503 For, to 2,017,514 Against, with 287,164
Abstaining, the Corporation's shareholders approved a proposal to
adopt the Riggs National Corporation Executive Incentive Plan, which
provides an opportunity for executives to earn incentive cash
compensation for contributing significantly to the strategic and
long-term performance objectives and growth of the Corporation.
3-Proposal to Elect the Corporation's Independent Accountants Each
----------------------------------------------------------------
Year
----
By a vote of 4,567,142 For, to 16,873,564 Against, with 360,398
Abstaining, the Corporation's shareholders rejected a proposal to
implement procedures to have the shareholders elect the
Corporation's independent accountants each year.
23
<PAGE>
RIGGS NATIONAL CORPORATION
PART II OTHER INFORMATION
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
The exhibits listed on page 25 are incorporated by
reference or filed herewith in response to this item.
(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.
RIGGS NATIONAL CORPORATION
Date: August 4, 2000 /s/ TIMOTHY C. COUGHLIN
-------------- -----------------------
Timothy C. Coughlin
President
Date: August 4, 2000 /s/ JOHN L. DAVIS
-------------- ------------------------
John L. Davis
Chief Financial Officer
(Principal Financial and Accounting Officer)
24
<PAGE>
<TABLE>
<CAPTION>
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION PAGES
NO.
===================================================================================================================================
<S> <C> <C>
(3.1)Restated Certificate of Incorporation of Riggs National Corporation,
dated April 19, 1999 (Incorporated by reference to the Registrant's
Form 10-Q for the quarter ended June 30, 1999, SEC File No. 09756).
(3.2)By-laws of the Registrant with amendments through April 12, 2000 Exhibit 3.2
(4.1)Indenture dated June 1, 1989, with respect to $100 million 9.65%
Subordinated Debentures due 2009 (Incorporated by reference to the
Registrant's Form 8-K dated June 20, 1989, SEC File No. 09756.)
(4.2)Indenture dated December 13, 1996, with respect to $150 million,
8.625% Trust Preferred Securities, Series A due 2026 (Incorporated
by reference to the Registrant's S-3 dated February 6, 1997, SEC
File No. 333-21297.)
(4.3)Indenture dated March 12, 1997, with respect to $200 million, 8.875%
Trust Preferred Securities, Series C due 2027 (Incorporated by
reference to the Registrant's S-3 dated May 2, 1997, SEC File No.
333-26447.)
(10.1)Riggs National Corporation and Riggs Bank N.A. Deferred Compensation
Plan for Directors, revised April 12, 2000 Exhibit 10.1
(27)Financial Data Schedule Exhibit 27
</TABLE>
(Exhibits omitted are not required or not applicable.)
25
