SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
_____________________________________
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
OR
[ ] 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 1-7273
_____________________________________
FIRST MARYLAND BANCORP
(Exact name of registrant as specified in its charter)
Maryland 52-0981378
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
25 South Charles Street, Baltimore, Maryland 21201
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: 410-244-4000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past
90 days
Yes__X__ No_____
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
All voting stock (16,985,149 shares of Common Stock, $5.00 par
value) is owned by Allied Irish Banks, p.l.c., an Irish
Banking Corporation.
<PAGE>
PAGE 2
<TABLE>
FIRST MARYLAND BANCORP AND SUBSIDIARIES
FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1994
<CAPTION>
Part I. Financial Information
Page
<S> <C>
Item 1. Financial Statements:
Consolidated Statements of Income....................... 3
Consolidated Statements of Condition.................... 4
Consolidated Statements of Changes in Stockholders'
Equity.................................................. 5
Consolidated Statements of Cash Flows................... 6
Notes to Consolidated Financial Statements.............. 7-9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations..................... 10-26
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K........................ 27
</TABLE>
<PAGE>
PAGE 3
Part I - Financial Information
Item 1. Financial Statements
<TABLE>
FIRST MARYLAND BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- -------------------
1994 1993 1994 1993
-------- -------- -------- --------
(in thousands)
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on loans........................................ $106,185 $102,293 $206,163 $205,839
Interest and dividends on investment securities:
Taxable....................................................... 22,243 39,623 46,004 80,109
Tax-exempt.................................................... - 4,035 - 8,103
Dividends..................................................... - 21 - 68
Interest on investment securities available-for-sale:
Taxable....................................................... 11,109 4,275 25,038 5,474
Tax-exempt.................................................... 4,151 - 8,126 -
Dividends..................................................... 330 - 561 -
Interest on loans held-for-sale................................... 1,619 2,933 4,369 4,909
Interest on money market investments.............................. 8,157 2,873 14,264 5,567
-------- -------- -------- --------
Total interest and dividend income.......................... 153,794 156,053 304,525 310,069
-------- -------- -------- --------
INTEREST EXPENSE
Interest on deposits.............................................. 41,617 43,864 81,974 89,122
Interest on Federal funds purchased and
other short-term borrowings..................................... 13,276 11,037 26,657 20,954
Interest on long-term debt........................................ 4,327 4,327 8,654 8,657
-------- -------- -------- --------
Total interest expense...................................... 59,220 59,228 117,285 118,733
-------- -------- -------- --------
NET INTEREST INCOME............................................... 94,574 96,825 187,240 191,336
Provision for credit losses (note 4).............................. 5,999 11,652 14,998 24,217
-------- -------- -------- --------
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES............. 88,575 85,173 172,242 167,119
-------- -------- -------- --------
NONINTEREST INCOME
Service charges on deposit accounts............................... 18,532 18,175 36,785 35,589
Mortgage banking income........................................... 7,994 8,470 11,074 11,255
Trust fees........................................................ 4,541 5,194 9,679 10,378
Bankcard charges and fees......................................... 4,340 4,840 8,718 9,190
Servicing income from securitized assets, net..................... 3,813 7,062 9,289 14,000
Securities gains, net............................................. 1,548 7,284 12,748 19,848
Other income...................................................... 12,714 11,905 22,976 22,116
-------- -------- -------- --------
Total noninterest income.................................... 53,482 62,930 111,269 122,376
-------- -------- -------- --------
NONINTEREST EXPENSES
Salaries and wages................................................ 39,635 40,786 79,991 79,666
Other personnel costs............................................. 12,775 10,650 28,751 21,772
Net occupancy costs............................................... 7,926 7,678 16,073 15,334
Equipment costs................................................... 6,968 7,150 13,903 13,949
Other operating expenses.......................................... 30,955 33,413 61,166 65,592
-------- -------- -------- --------
Total noninterest expenses.................................. 98,259 99,677 199,884 196,313
-------- -------- -------- --------
INCOME BEFORE INCOME TAXES........................................ 43,798 48,426 83,627 93,182
Income tax expense................................................ 15,728 17,406 29,501 33,700
-------- -------- -------- --------
NET INCOME........................................................ $28,070 $31,020 $54,126 $59,482
======== ======== ======== ========
<FN>
See accompanying notes to consolidated financial statements
</TABLE>
<PAGE>
PAGE 4
<TABLE>
FIRST MARYLAND BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION
(Unaudited)
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
------------ ------------ ------------
(in thousands)
<S> <C> <C> <C>
ASSETS
Cash and due from banks .......................................... $521,027 $630,731 $488,550
Money market investments (note 2)................................. 531,432 196,573 207,599
Investment securities available-for-sale (note 3)................. 1,107,839 1,306,899 -
Investment securities (market value of $1,433,231,
$1,731,462 and $2,814,920) (note 3)............................. 1,471,771 1,709,648 2,726,159
Loans held-for-sale (at cost which approximates market)........... 104,666 269,222 208,064
Loans, net of unearned income of $69,728, $71,224
and $116,039:
Commercial.................................................... 1,601,670 1,626,080 1,686,668
Real estate,construction...................................... 249,583 284,008 330,859
Real estate,mortgage:
Residential................................................ 562,033 497,543 394,238
Commercial................................................. 977,409 957,568 894,361
Retail........................................................ 911,965 885,117 967,356
Bankcard...................................................... 474,055 527,657 494,906
Leases receivable............................................. 226,595 211,821 199,279
Foreign....................................................... 271,065 207,927 225,587
--------- --------- ---------
Total loans, net of unearned income...................... 5,274,375 5,197,721 5,193,254
Allowance for credit losses (note 4).......................... (201,073) (200,006) (199,279)
--------- --------- ---------
Loans, net .............................................. 5,073,302 4,997,715 4,993,975
--------- --------- ---------
Premises and equipment............................................ 100,158 100,726 96,884
Due from customers on acceptances................................. 14,467 9,127 8,791
Other assets...................................................... 275,311 307,864 297,899
--------- --------- ---------
Total assets........................................ $9,199,973 $9,528,505 $9,027,921
========== ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Domestic deposits:
Noninterest bearing deposits ................................. $1,679,222 $1,914,452 $1,666,229
Interest bearing deposits..................................... 4,860,551 4,747,825 4,770,826
Interest bearing deposits in foreign banking office............... 122,884 111,880 70,026
--------- --------- ---------
Total deposits........................................... 6,662,657 6,774,157 6,507,081
Federal funds purchased and securities sold under
repurchase agreements........................................... 566,507 748,266 841,660
Other borrowed funds, short-term (note 7)......................... 629,105 645,369 533,847
Bank acceptances outstanding...................................... 14,467 9,127 8,791
Accrued taxes and other liabilities............................... 151,073 185,215 194,395
Long-term debt (note 8)........................................... 189,604 189,577 189,549
--------- --------- ---------
Total liabilities................................... 8,213,413 8,551,711 8,275,323
--------- --------- ---------
Stockholders' equity :
7.875% Noncumulative preferred stock, Series A, $5 par
value per share, $25 liquidation preference per share;
authorized 9,000,000 shares; issued 6,000,000 shares....... 30,000 30,000 -
Common stock, $5 par value per share; authorized
41,000,000 shares; issued 16,985,149 shares................ 84,926 84,926 84,926
Capital surplus.............................................. 198,176 198,127 83,324
Retained earnings............................................ 684,186 637,128 584,348
Unrealized (losses) gains on investment securities available
-for-sale (net of income tax (benefits) of ($7,020) and
$17,018)................................................... (10,728) 26,613 -
--------- --------- ---------
Total stockholders' equity.......................... 986,560 976,794 752,598
--------- --------- ---------
Total liabilities and stockholders' equity.......... $9,199,973 $9,528,505 $9,027,921
========== ========== ==========
<FN>
See accompanying notes to consolidated financial statements
</TABLE>
<PAGE>
PAGE 5
<TABLE>
FIRST MARYLAND BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
<CAPTION>
Unrealized
gains
(losses) on
investment
securities
available-
Preferred Common Capital Retained for-sale,
Stock Stock Surplus Earnings net of tax Total
------------ ----------- ----------- ----------- ----------- -----------
(in thousands)
<S> <C> <C> <C> <C> <C> <C>
Six Months Ended June 30, 1993
------------------------------------
Balance at beginning of year........... $ - $84,926 $83,324 $525,908 $ - $694,158
Net income............................. 59,482 59,482
Net cost not yet recognized as
periodic pension expense............. (1,042) (1,042)
--------- --------- --------- --------- --------- ---------
Balance at June 30, 1993............... $ - $84,926 $83,324 $584,348 $ - $752,598
========== ========== ========== ========== ========== ==========
Six Months Ended June 30, 1994
------------------------------------
Balance at beginning of year........... $30,000 $84,926 $198,127 $637,128 $26,613 $976,794
Net income............................. 54,126 54,126
Dividends declared on preferred
stock.................................. (5,910) (5,910)
Net cost not yet recognized as
periodic pension expense............... (1,158) (1,158)
Adjustment of the unrealized losses
on investment securities available-
for-sale, net of income tax benefits... (37,341) (37,341)
Adjustment to preferred stock issuance
costs.................................. 49 49
--------- --------- --------- --------- --------- ---------
Balance at June 30, 1994............... $30,000 $84,926 $198,176 $684,186 ($10,728) $986,560
========== ========== ========== ========== ========== ==========
<FN>
See accompanying notes to consolidated financial statements
</TABLE>
<PAGE>
PAGE 6
<TABLE>
FIRST MARYLAND BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Six Months Ended June 30,
--------------------------------
1994 1993
-------- --------
(in thousands)
<S> <C> <C>
OPERATING ACTIVITIES
Net income................................................................................ $54,126 $59,482
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for credit losses............................................................. 14,998 24,217
Provision for other real estate losses.................................................. 44 3,324
Depreciation and amortization........................................................... 15,401 17,221
Deferred income tax expense............................................................. 2,289 613
Net gain on the sale of assets.......................................................... (15,018) (22,101)
Net decrease (increase) in loans originated for sale.................................... 152,061 (50,968)
Decrease (increase) in trading account securities....................................... 6,867 (3,586)
(Increase) decrease in accrued interest receivable...................................... (2,568) 3,112
Increase (decrease) in accrued interest payable......................................... 1,841 (1,822)
Other, net.............................................................................. 2,323 30,055
--------- ---------
Net cash provided by operating activities............................................ 232,364 59,547
--------- ---------
INVESTING ACTIVITIES
Proceeds from sales of investment securities available-for-sale........................... 1,268,329 -
Proceeds from sales of investment securities held-to-maturity............................. - 708,890
Proceeds from paydowns and maturities of investment securities available-for-sale......... 73,669 -
Proceeds from paydowns and maturities of investment securities held-to-maturity........... 243,918 654,748
Purchases of investment securities available-for-sale..................................... (1,182,886) -
Purchases of investment securities held-to-maturity....................................... (17,437) (1,446,088)
Net increase in short-term investments.................................................... (341,983) (173,880)
Net disbursements from lending activities of bank subsidiaries............................ (79,971) (29,994)
Principal collected on loans of nonbank subsidiaries...................................... 15,599 9,222
Loans originated by nonbank subsidiaries.................................................. (9,047) (29,195)
Principal payments received under leases.................................................. 2,410 5,448
Purchases of assets to be leased.......................................................... (1,193) (880)
Proceeds from other real estate transactions.............................................. 10,098 7,627
Proceeds from sales of premises and equipment............................................. 965 157
Purchases of premises and equipment....................................................... (9,474) (12,145)
Sale of deposits.......................................................................... - (8,712)
Other, net................................................................................ (1,269) (2,012)
--------- ---------
Net cash used for investing activities............................................... (28,272) (316,814)
--------- ---------
FINANCING ACTIVITIES
Net decrease in deposits ................................................................. (111,500) (302,758)
Net (decrease) increase in short-term borrowings.......................................... (198,023) 395,318
Principal payment on long-term debt....................................................... - (875)
Cash dividends paid....................................................................... (4,530) -
--------- ---------
Net cash (used for) provided by financing activities................................. (314,053) 91,685
--------- ---------
Decrease in cash and cash equivalents ...................................................... (109,961) (165,582)
Cash and cash equivalents at beginning of year.............................................. 631,137 654,527
--------- ---------
Cash and cash equivalents at June 30,....................................................... $521,176 $488,945
========= =========
SUPPLEMENTAL DISCLOSURES
Interest payments......................................................................... $115,444 $120,681
Income tax payments....................................................................... 30,614 28,980
NONCASH INVESTING AND FINANCING ACTIVITIES
Loan charge-offs.......................................................................... 21,636 30,686
Transfers to other real estate............................................................ 1,610 11,048
<FN>
See accompanying notes to consolidated financial statements
</TABLE>
<PAGE>
PAGE 7
FIRST MARYLAND BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accounting and reporting policies of First Maryland Bancorp
and subsidiaries ("The Corporation") conform to generally accepted
accounting principles.
The accompanying consolidated financial statements are unaudited.
In the opinion of management, all adjustments necessary for a fair
presentation of the results of operations for the periods presented have
been made, and all such adjustments are of a normal recurring nature.
Certain amounts in the 1993 consolidated financial statements have been
reclassified to conform with the 1994 presentation.
2. Money Market Investments
<TABLE>
Money market investments at June 30, 1994, December 31, 1993
and June 30, 1993 included the following:
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
---------- ------------- ----------
(in thousands)
<S> <C> <C> <C>
Interest bearing deposits in other banks............. $149 $406 $395
Trading account securities........................... 46,470 53,337 11,202
Federal funds sold................................... 321,700 121,000 157,000
Securities purchased under agreements
to resell.......................................... 163,113 21,830 39,002
-------- -------- --------
Total money market investments................. $531,432 $196,573 $207,599
======== ======== ========
</TABLE>
3. Investment Securities
<TABLE>
The following is a comparison of the amortized cost and book values of the
available-for-sale securities:
<CAPTION>
June 30, 1994 December 31, 1993
--------------------- ---------------------
Amortized Amortized
Cost Book Cost Book
----------- ---------- ----------- ----------
(in thousands)
<S> <C> <C> <C> <C>
U.S. Treasury and U.S. Government agencies........... $51,714 $49,879 $ - $ -
Mortgage-backed obligations of
Federal agencies.................................. 813,566 781,198 900,549 914,215
Collateralized mortgage obligations:
Issued by Federal agencies........................ 16,944 16,981 122,818 126,564
Privately issued.................................. 5,598 5,634 12,265 12,362
Obligations of states and political
subdivisions...................................... 203,783 214,696 201,062 220,467
Other investment securities.......................... 33,982 39,451 26,574 33,291
---------- ---------- ---------- ----------
Total.......................................... $1,125,587 $1,107,839 $1,263,268 $1,306,899
========== ========== ========== ==========
</TABLE>
<PAGE>
PAGE 8
FIRST MARYLAND BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
<TABLE>
The following is a comparison of the book and market values of the
held-to-maturity securities:
<CAPTION>
June 30, 1994 December 31, 1993 June 30, 1993
--------------------- --------------------- ---------------------
Book Market Book Market Book Market
-------- ---------- -------- ---------- -------- ----------
(in thousands)
<S> <C> <C> <C> <C> <C> <C>
U.S. Treasury and U.S. Government agencies........... $881,151 $861,914 $970,554 $989,046 $824,488 $851,126
Mortgage-backed obligations of
Federal agencies.................................. 174,206 168,070 211,920 214,765 977,640 1,002,890
Collateralized mortgage obligations:
Issued by Federal agencies........................ 358,116 348,550 450,385 451,462 608,622 618,314
Privately issued.................................. 57,031 53,430 69,921 69,321 82,772 83,475
Obligations of states and political
subdivisions...................................... - - - - 201,739 223,584
Other investment securities.......................... 1,267 1,267 6,868 6,868 30,898 35,531
---------- ---------- ---------- ---------- ---------- ----------
Total.......................................... $1,471,771 $1,433,231 $1,709,648 $1,731,462 $2,726,159 $2,814,920
========== ========== ========== ========== ========== ==========
</TABLE>
4. Allowance for Credit Losses
<TABLE>
The provision for credit losses is determined by analyzing
the status of individual loans, reviewing historical loss
experience and reviewing the delinquency of principal and
interest payments where pertinent. Management believes that
all uncollectible amounts have been charged off and that the
allowance is adequate to cover possible future charge-offs.
The following is a summary of the activity in the allowance
for credit losses:
<CAPTION>
Six Months Ended June 30,
------------------------------
1994 1993
-------- --------
(in thousands)
<S> <C> <C>
Balance at beginning of year...................................... $200,006 $201,451
Provision for credit losses....................................... 14,998 24,217
Less: charge-offs, net of recoveries of $7,705 and $4,297......... (13,931) (26,389)
-------- --------
Balance at June 30................................................ $201,073 $199,279
======== ========
</TABLE>
5. Intangible Assets
<TABLE>
Intangible assets at June 30, 1994, December 31, 1993 and June 30,
1993 included the following:
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
------------ ------------- ------------
(in thousands)
<S> <C> <C> <C>
Goodwill............................................. $32,089 $33,373 $34,656
Premium on bankcard receivables...................... 16,370 18,124 19,915
Premium on deposits.................................. 1,125 1,299 1,580
Mortgage servicing rights............................ 999 777 1,026
Other................................................ 865 985 881
------- ------- -------
Total intangible assets........................ $51,448 $54,558 $58,058
======= ======= =======
</TABLE>
<PAGE>
PAGE 9
FIRST MARYLAND BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
6. Valuation Allowance for Other Real Estate Owned
<TABLE>
A summary of the activity in the valuation allowance for other
real estate owned is provided below:
<CAPTION>
Six Months Ended June 30,
-------------------------------
1994 1993
-------- --------
(in thousands)
<S> <C> <C>
Balance at beginning of year...................................... $4,412 $9,195
Provision for other real estate losses............................ 44 3,344
Writedowns........................................................ (271) (2,992)
------ ------
Balance at June 30................................................ $4,185 $9,547
====== ======
</TABLE>
7. Other Borrowed Funds, Short-term
<TABLE>
Other borrowed funds, short-term at June 30, 1994, December 31, 1993
and June 30, 1993 included the following:
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
------------ ------------- ------------
(in thousands)
<S> <C> <C> <C>
Master demand note of the Corporation................ $421,357 $463,645 $430,530
Bank notes........................................... 190,000 177,000 100,000
Other................................................ 17,748 4,724 3,317
-------- -------- --------
Total other borrowed funds, short-term......... $629,105 $645,369 $533,847
======== ======== ========
</TABLE>
8. Long-term Debt
<TABLE>
Following is a summary of the long-term debt of the Corporation
at June 30, 1994, December 31, 1993 and June 30, 1993 which is all
unsecured:
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
------------ ------------- ------------
(in thousands)
<S> <C> <C> <C>
10.375% Subordinated Capital Notes due August 1,
1999............................................. $59,955 $59,951 $59,947
9.15% Notes due June 1, 1996......................... 10,000 10,000 10,000
8.68% Notes due January 31, 1997..................... 9,996 9,996 9,995
8.67% Notes due March 20, 1997....................... 9,996 9,995 9,994
8.375% Subordinated Notes due May 15, 2002........... 99,657 99,635 99,613
-------- -------- --------
Total long-term debt........................... $189,604 $189,577 $189,549
======== ======== ========
</TABLE>
<PAGE>
PAGE 10
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Earnings Summary
The net income of First Maryland Bancorp ("The Corporation") for
the six months and quarter ended June 30, 1994 was $54.1 million and
$28.1 million, respectively, compared to $59.5 million and $31.0 million
for the first six months and quarter ended June 30, 1993. Return on
average assets and return on average total equity were 1.13% and 11.10%,
respectively, for the six months ended June 30, 1994 compared with
1.29% and 16.47% for the six months ended June 30, 1993.
<TABLE>
Table 1 Selected Quarterly Financial Information
<CAPTION>
2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter
1994 1994 1993 1993 1993
----------- ----------- ----------- ----------- -----------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED SUMMARY OF OPERATIONS:
Net interest income (fully tax equivalent)........ $97,191 $95,293 $98,747 $98,698 $99,425
Tax equivalent adjustment......................... 2,617 2,627 2,717 2,865 2,600
-------- -------- -------- -------- --------
Net interest income............................... 94,574 92,666 96,030 95,833 96,825
Provision for credit losses....................... 5,999 8,999 7,955 13,119 11,652
-------- -------- -------- -------- --------
Net interest income after provision for credit
losses.......................................... 88,575 83,667 88,075 82,714 85,173
Noninterest income................................ 53,482 57,787 57,233 53,836 62,930
Noninterest expenses.............................. 98,259 101,625 103,417 94,923 99,677
-------- -------- -------- -------- --------
Income before income taxes........................ 43,798 39,829 41,891 41,627 48,426
Income tax expense................................ 15,728 13,773 14,164 14,968 17,406
-------- -------- -------- -------- --------
Net income........................................ $28,070 $26,056 $27,727 $26,659 $31,020
======== ======== ======== ======== ========
Dividends declared on preferred stock............. $2,955 $2,955 $1,575 $ - $ -
CONSOLIDATED AVERAGE BALANCES:
Total assets...................................... 9,556,600 9,802,100 9,557,800 9,401,500 9,501,300
Loans, net........................................ 5,042,000 5,004,300 4,944,500 4,912,600 4,861,700
Deposits.......................................... 6,743,800 6,695,500 6,668,900 6,589,300 6,720,100
Long-term debt.................................... 189,600 189,600 189,600 189,600 189,500
Stockholders' equity.............................. 980,300 986,300 826,500 771,600 743,600
CONSOLIDATED RATIOS:
Return on average assets.......................... 1.18% 1.08% 1.15% 1.13% 1.31%
Return on average total stockholders' equity...... 11.49 10.71 13.31 13.71 16.73
Return on average common stockholders' equity..... 12.06 11.13 13.00 13.71 16.73
Average stockholders' equity to average total
assets.......................................... 10.26 10.06 8.65 8.21 7.83
Capital to risk-adjusted assets:
Tier 1.......................................... 13.70 12.95 12.88 10.72 10.45
Total........................................... 17.38 16.59 16.62 14.53 14.29
Tier 1 leverage ratio............................. 10.12 9.60 9.60 7.93 7.55
Net interest margin............................... 4.43 4.32 4.54 4.62 4.64
Net charge-offs to average loans, net of average
unearned income (annualized).................... 0.36 0.72 0.95 0.29 1.18
Allowance for credit losses to period end loans,
net of unearned income.......................... 3.81 3.80 3.85 3.98 3.84
Nonperforming assets to period end loans, net of
unearned income plus other foreclosed assets
owned........................................... 1.88 2.28 2.59 3.26 3.32
</TABLE>
<PAGE>
PAGE 11
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Net Interest Income and Net Interest Margin
Net interest income on a fully tax equivalent basis for the quarter
ended June 30, 1994 of $97.2 million decreased $2.2 million (2.2%)
when compared to net interest income of $99.4 million for the quarter
ended June 30, 1993. This decrease was the result of a decline
in earning assets yields primarily resulting from lower yielding
investment securities which was partially offset by an increase in
interest free funds resulting from an increase in equity. Average
earning assets increased $209.2 million when the first six months of
1994 is compared to the first six months of 1993 primarily due to an
increase in funds sold and repurchase agreements partially offset by
a decrease in investment securities. The net interest margin for the
quarter ended June 30, 1994 was 4.43% compared to 4.64% for the quarter
ended June 30, 1993.
Net interest income on a fully tax equivalent basis for the six
months ended June 30, 1994 of $192.5 million decreased $4.0 million
(2.0%) when compared to net interest income of $196.5 million for the
first six months of 1993. This decrease was the result of a decline
in earning assets yields primarily resulting from lower yielding
investment securities. These negative rate variances were partially
offset by an increase in interest free funds resulting from an increase
in equity. Average earning assets increased $429.0 million when the
first six months of 1994 is compared to the first six months of 1993
primarily due to an increase in funds sold and repurchase agreements.
The net interest margin for the six months ended June 30, 1994 was 4.38%
compared to 4.70% for the six months ended June 30, 1993.
An analysis of fully tax equivalent net interest income, net interest
spreads and net interest margins for the three months and six months ended
June 30, 1994 and 1993 is presented in Tables 2 and 3.
<TABLE>
Table 2 Net Interest Income, Interest Rate Spread and Net Interest Margin on Average Earning Assets
(Tax Equivalent Basis)
<CAPTION>
Three Months ended June 30,
-----------------------------------------------------------------------
1994 1993
----------------------------------- -------------------------------
Average Yield/ Average Yield/
balance Interest rate balance Interest rate
-------- -------- -------- -------- -------- --------
(dollars in millions)
<S> <C> <C> <C> <C> <C> <C>
Investment securities (1).............. $2,641.7 $39.8 6.05% $2,997.1 $49.8 6.66%
Loans held-for-sale.................... 99.0 1.6 6.56 170.3 3.0 7.07
Loans, net of unearned income.......... 5,240.8 106.8 8.17 5,062.9 103.1 8.15
Other earning assets................... 819.2 8.2 3.99 361.2 2.8 3.11
------- ------ ------- ------
Earning assets......................... $8,800.7 156.4 7.13 $8,591.5 158.7 7.41
======== ------ ======== ------
Interest bearing liabilities........... 6,684.5 59.2 3.55 6,799.9 59.3 3.49
Interest rate spread (2)............... 3.58 3.92
Interest free sources utilized
to fund earning assets............... 2,116.2 1,791.6
------- ------ ------- ------
Total sources of funds................. $8,800.7 59.2 2.70 $8,591.5 59.3 2.77
======== ------ ======== ------
Net interest income.................... $97.2 $99.4
====== ======
Net interest margin (3)................ 4.43% 4.64%
==== ====
<FN>
(1) Includes investment securities available-for-sale at amortized cost and investment securities held-to-maturity.
(2) Interest rate spread is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average interest bearing liabilities.
(3) Net interest margin is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average earning assets.
</TABLE>
<PAGE>
PAGE 12
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
Table 3 Net Interest Income, Interest Rate Spread and Net Interest Margin on Average Earning Assets
(Tax Equivalent Basis)
<CAPTION>
Six months ended June 30,
-----------------------------------------------------------------------
1994 1993
----------------------------------- -------------------------------
Average Yield/ Average Yield/
balance Interest rate balance Interest rate
-------- -------- -------- -------- -------- --------
(dollars in millions)
<S> <C> <C> <C> <C> <C> <C>
Investment securities (1).............. $2,737.0 $83.7 6.17% $2,873.9 $97.6 6.85%
Loans held-for-sale.................... 125.7 4.5 7.12 139.7 5.0 7.28
Loans, net of unearned income.......... 5,222.1 207.3 8.01 5,066.0 207.1 8.24
Other earning assets................... 775.7 14.3 3.71 351.9 5.6 3.21
------- ------ ------- ------
Earning assets......................... $8,860.5 309.8 7.05 $8,431.5 315.3 7.54
======== ------ ======== ------
Interest bearing liabilities........... 6,766.0 117.3 3.50 6,692.6 118.8 3.58
Interest rate spread (2)............... 3.55 3.96
Interest free sources utilized
to fund earning assets............... 2,094.5 1,738.9
------- ------ ------- ------
Total sources of funds................. $8,860.5 117.3 2.67 $8,431.5 118.8 2.84
======== ------ ======== ------
Net interest income.................... $192.5 $196.5
====== ======
Net interest margin (3)................ 4.38% 4.70%
==== ====
<FN>
(1) Includes investment securities available-for-sale at amortized cost and investment securities held-to-maturity.
(2) Interest rate spread is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average interest bearing liabilities.
(3) Net interest margin is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average earning assets.
</TABLE>
Provision for Credit Losses
The provision for credit losses for the second quarter of 1994
totaled $6.0 million compared to $11.7 million for the second quarter
of 1993, a decrease of $5.7 million (48.5%). The provision for credit
losses for the first six months of 1994 totaled $15.0 million, a decrease
of $9.2 million (38.1%) over the $24.2 million provision recorded for
the first six months of 1993. These decreases in the provision were the
result of improved credit loss trends and declining levels of nonperforming
assets.
<PAGE>
PAGE 13
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Noninterest Income
<TABLE>
The following table presents the components of noninterest income
for the three months and six months ended June 30, 1994 and 1993.
Table 4 Noninterest Income
<CAPTION>
Three months ended June 30, Six months ended June 30,
---------------------------------- ----------------------------------
Percent Percent
Change Change
1994 1993 1994/1993 1994 1993 1994/1993
------- ------- ----------- ------- ------- -----------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Service charges on deposit accounts.... $18,532 $18,175 2.0% $36,785 $35,589 3.4%
Mortgage banking income................ 7,994 8,470 (5.6) 11,074 11,255 (1.6)
Trust fees............................. 4,541 5,194 (12.6) 9,679 10,378 (6.7)
Bankcard charges and fees.............. 4,340 4,840 (10.3) 8,718 9,190 (5.1)
Servicing income from securitized
assets, net.......................... 3,813 7,062 (46.0) 9,289 14,000 (33.7)
Securities gains, net.................. 1,548 7,284 (78.7) 12,748 19,848 (35.8)
Other income:
Customer service fees................ 2,382 2,461 (3.2) 5,058 4,416 14.5
Investment banking income............ 2,100 2,310 (9.1) 3,711 4,440 (16.4)
Other................................ 8,232 7,134 15.4 14,207 13,260 7.1
------- ------- ----- ------- ------- -----
Total other income..................... 12,714 11,905 6.8 22,976 22,116 3.9
------- ------- ----- ------- ------- -----
Total noninterest income........ $53,482 $62,930 (15.0) $111,269 $122,376 (9.1)
======= ======= ======= ======= ======= =======
</TABLE>
The Corporation's noninterest income for the quarter ended June
30, 1994 decreased $9.4 million (15.0%) when compared to the second
quarter of 1993. Securities gains of $1.5 million were recorded in
the second quarter of 1994 compared to $7.3 million in securities
gains in the second quarter of 1993. Investment securities sales
are discussed in detail under "Changes in Financial Position."
Servicing income from securitized assets decreased $3.2 million (46.0%)
as a result of an increase in credit losses on the securitized receivables
portfolio of a nonbanking subsidiary of the Corporation and servicing fees
paid under a sub-servicing agreement for this securitized receivables
portfolio. Trust fees decreased $653,000 (12.6%) primarily due to a $1.2
million decrease in fee income for personal trust services which was
partially offset by a $648,000 increase in fee income for employee benefit
administration. Other income increased $1.1 million (15.4%) due to $1.9
million in gains on other real estate properties in the second quarter of
1994 compared to $945,000 in gains recorded in the second quarter of 1993.
The Corporation's noninterest income for the first six months
of 1994 decreased $11.1 million (9.1%) when compared to the first six
months of 1993. Securities gains of $12.7 million were recorded in
the first six months of 1994 compared to $19.8 million in securities
gains in the first six months of 1993. Investment securities sales
are discussed in detail under "Changes in Financial Position." Servicing
income from securitized assets decreased $4.7 million (33.7%) primarily
due to an increase in credit losses on the securitized receivables
portfolio of a nonbanking subsidiary of the Corporation and the payment
of servicing fees under a sub-servicing contract on this securitized
receivables portfolio. Service charges on deposit accounts increased
$1.2 million (3.4%) primarily due to a $1.3 million increase in service
charges on business checking accounts. Trust fees decreased $699,000
(6.7%) primarily due to a $1.0 million decrease in personal trust services
which was partially offset by a $624,000 increase in fee income for
employee benefit administration.
<PAGE>
PAGE 14
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Noninterest Expense
<TABLE>
The following table presents the components of noninterest expense
for the three months and six months ended June 30, 1994 and 1993.
Table 5 Noninterest Expenses
<CAPTION>
Three months ended June 30, Six months ended June 30,
--------------------------------- ---------------------------------
Percent Percent
Change Change
1994 1993 1994/1993 1994 1993 1994/1993
------- ------- ------------ ------- ------- ------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Salaries and wages..................... $39,635 $40,786 (2.8%) $79,991 $79,666 0.4%
Other personnel costs.................. 12,775 10,650 20.0 28,751 21,772 32.1
Net occupancy costs.................... 7,926 7,678 3.2 16,073 15,334 4.8
Equipment costs........................ 6,968 7,150 (2.5) 13,903 13,949 (0.3)
Other operating expenses:
Examinations and assessments......... 4,076 4,027 1.2 8,185 8,056 1.6
Lending and collection............... 3,255 3,479 (6.4) 6,372 6,543 (2.6)
Postage and communications........... 3,231 3,242 (0.3) 6,655 6,611 0.7
Professional fees.................... 4,859 3,258 49.1 8,414 5,649 48.9
Advertising and public relations..... 3,301 3,742 (11.8) 6,652 6,965 (4.5)
Other real estate expense............ 92 1,563 (94.1) 75 4,332 (98.3)
Other................................ 12,141 14,102 (13.9) 24,813 27,436 (9.6)
------ ------ ----- ------ ------ -----
Total other operating expenses..... 30,955 33,413 (7.4) 61,166 65,592 (6.7)
------ ------ ----- ------ ------ -----
Total noninterest expenses..... $98,259 $99,677 (1.4) $199,884 $196,313 1.8
======= ======= ======= ======= ======= =======
</TABLE>
The Corporation's noninterest expenses for the second quarter of 1994
decreased $1.4 million (1.4%) when compared to the second quarter of 1993.
Salaries and wages decreased $1.2 million (2.8%) due to a $3.1 million
decrease in incentive accruals and commissions which is partially offset
by an increase of $1.5 million in regular salary expense and severance
expense. Other personnel costs increased $2.1 million (20.0%) due to
an increase in employee retirement expenses. Professional fees increased
$1.6 million (49.1%) primarily as a result of $2.1 million in consulting
fees related to a corporate reengineering project which were partially
offset by lower consulting fees for system conversions. Other real
estate expense decreased $1.5 million (94.1%) due to an $892,000 decrease
in provisions for other real estate and a $579,000 decrease in other real
estate expenses. Other noninterest expenses decreased $2.0 million (13.9%)
due to a $1.0 million accrual for the discontinuation of operations at a
nonbanking subsidiary of the Corporation in the second quarter of 1993
and an $868,000 decrease in bankcard premium amortization expense due to
acceleration of the premium amortization on purchased credit card
portfolios in the second quarter of 1993 due to higher than expected
runoff of the portfolios.
The Corporation's noninterest expenses for the first six months of
1994 increased $3.6 million (1.8%) when compared to the first six
months of 1993 primarily due to the following. Salaries and wages
increased $325,000 (0.4%) due to a $4.2 million increase in regular
salary expense and severance expense partially offset by a $3.9 million
decrease in incentive accruals and commissions. Other personnel costs
increased $7.0 million (32.1%) primarily as a result of an increase in
employee retirement expenses of $6.1 million and increased medical
benefits expense of $767,000. Other real estate expense decreased $4.3
million (98.3%) due to a $3.3 million decrease in provisions for other
real estate and a $957,000 decrease in other real estate expenses.
Professional fees increased $2.8 million (48.9%) as a result of consulting
fees associated with a corporate reengineering project and a trust system
conversion project of $2.5 million and $1.1 million, respectively, in
1994. These fees were partially offset by $1.2 million in fees paid in
1993 for systems conversions and other projects. Other noninterest
expenses decreased $2.6 million (9.6%) due to accruals recorded in 1993
of $2.0 million for the cost of discontinuing operations at a nonbanking
subsidiary of the Corporation and $1.0 million for a defalcation and
account reconciliation problem as well as a $1.1 million decrease in
bankcard premium amortization expense due to acceleration of the premium
amortization on purchased credit card portfolios in 1993 due to higher
than expected runoff of the portfolios. These increases in other
expenses in 1993 were partially offset by a $961,000 increase in office
supplies and forms expense in 1994 primarily due to forms expense related
to systems conversions.
<PAGE>
PAGE 15
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Off-Balance Sheet Derivative Financial Instruments
Asset/Liability Management
Derivative financial instruments are an integral part of the
Corporation's asset/liability management process. Derivatives allow the
Corporation to modify the repricing or maturity characteristics of assets
and liabilities in a cost-efficient manner. This flexibility helps the
Corporation to achieve liquidity, capital, and interest rate risk
objectives.
Derivatives fluctuate in value as interest rates rise or fall just
as on-balance sheet assets and liabilities fluctuate in value. If the
derivatives are purchased or sold as hedges of specific balance sheet
items, the appreciation or depreciation of the derivatives, as interest
rates change, will generally be offset by the unrealized appreciation
or depreciation of the hedged items. Derivatives are used to hedge
assets and liabilities as well as to provide basis risk protection.
Asset Hedges
Asset hedges are used to convert fixed rate assets to floating rate
assets or vice versa. When the Corporation uses swaps to match/fund
fixed rate term loans to customers, the Corporation is converting the
fixed rate loans to floating rate loans that better match the floating
rate deposits received from core customers.
Asset hedges are also used to extend the period over which the
Corporation's floating rate loans reprice. When the Corporation sells
interest rate swaps, the Corporation receives a fixed rate for a specified
term and pays a floating rate. This allows the Corporation to extend the
period over which the floating rate assets (e.g. prime rate loans) reprice
thus locking in a fixed rate. This strategy is used to reduce the asset
sensitivity of the balance sheet or to better match maturities of assets
and liabilities. The appropriateness of buying or selling asset hedges
is a function of the current or desired interest rate sensitivity of the
Corporation and is limited by interest rate risk policies approved by the
Board of Directors.
Liability Hedges
Liability hedges are used to convert floating rate liabilities to
fixed rate liabilities or vice versa. Interest rate swaps purchased as
liability hedges are used to extend the period over which the Corporation's
short-term deposits reprice and fix the interest rates. This offers
protection against liabilities repricing faster than assets during
periods of rising interest rates. Interest rate swaps sold as liability
hedges are used to adjust fixed rate long-term deposits to floating rate
deposits. The Corporation receives a fixed rate on this type of swap
that offsets the fixed rate paid on the term deposits thus converting the
deposits to a floating rate. By issuing long-term deposits, the
Corporation increases its overall liquidity. Customer demand for long
term deposits is primarily fixed rate. Interest rate swaps allow the
Corporation to swap fixed rate liabilities for floating rate liabilities
when appropriate for interest rate sensitivity purposes.
Basis Hedges
Basis risk hedges protect the interest rate spread between assets
and liabilities that are repriced based on different indexes. Prime
rate loans are often funded by liabilities that reset off of a CD index,
treasury index, or LIBOR. Basis hedges lock-in the spread between
different indices during the life of the hedges. These hedges transfer
the basis risk to third parties willing to assume the risk and allow the
Corporation to lock-in interest rate spreads between certain assets and
liabilities.
Trading
The Corporation maintains active trading positions in a variety of
financial derivatives. Many of these positions are a result of activity
generated by corporate customers. The balance of the positions represent
strategic trading decisions of the Corporation's derivative and foreign
exchange traders. The active involvement of the Corporation's traders
in these markets allows the Corporation to offer competitive pricing to
customers and the expertise necessary to advise the Corporation's asset/
liability managers on the proper timing and execution of derivative hedges
for the Corporation's balance sheet.
<PAGE>
PAGE 16
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
The following table presents the off-balance sheet derivative financial
instruments used in the Corporation's asset/liability management. The
mark-to-market value of the interest rate swaps was determined by
calculating the present value of the difference of the remaining cash flows
between the original rates of the swaps and the current replacement rates.
Table 6 Off-Balance Sheet Derivative Financial Instruments
June 30, 1994
<CAPTION>
Weighted
Average Weighted Average Rate
Notional Maturity -------------------------- Mark to
Amount in Years Receive Pay Market
------------ ------------ ----------- ----------- -----------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
ASSET/LIABILITY MANAGEMENT
--------------------------
ASSET HEDGES
------------
Interest rate swaps sold
------------------------
Convert floating rate to fixed rate $375,000 2.89 5.46% 4.66% ($6,435)
--------
Unrealized gross gains 19
Unrealized gross losses (6,454)
Interest rate swaps purchased
-----------------------------
Convert fixed rate to floating rate 100,950 2.65 4.01 6.69 919
--------
Unrealized gross gains 1,458
Unrealized gross losses (539)
Interest rate swaps purchased forward
-------------------------------------
Convert fixed rate to floating rate 12,657 5.01 - 5.98 665
--------
Unrealized gross gains 665
Unrealized gross losses -
LIABILITY HEDGES
----------------
Interest rate swaps sold
------------------------
Convert fixed rate to floating rate $64,000 1.76 8.46% 4.40% $2,149
--------
Unrealized gross gains 2,366
Unrealized gross losses (217)
Interest rate swaps purchased
-----------------------------
Convert floating rate to fixed rate 125,000 0.74 4.22 3.93 1,075
--------
Unrealized gross gains 1,075
Unrealized gross losses -
Interest rate caps purchased
----------------------------
Cap floating rate at strike level 306,400 3.17 Cap - 13.50% (1) -
Hedge risk associated with bankcard
asset securitizations
Call options purchased 9,237 -
---------------------
Hedge risk associated with deposits
that reprice based upon the S&P 500
index
BASIS HEDGES
------------
Interest rate swap
------------------
Convert floating rate to different
index $30,000 4.69 3.73% 4.36% ($1,943)
--------
Unrealized gross gains -
Unrealized gross losses (1,943)
<FN>
(1) Pays interest if interest rates exceed 13.50%.
</TABLE>
<PAGE>
PAGE 17
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Changes in Financial Position
Money Market Investments
Money market investments increased $334.9 million from December 31,
1993 to June 30, 1994. Federal funds sold increased $200.7 million due
to the investment of funds generated from investment securities sales
in liquid assets. Securities purchased under agreements to resell
increased $141.3 million primarily due to the temporary investment of
the $144.8 million in proceeds from the issuance of preferred stock in
December of 1993.
Money market investments increased $323.8 million from June 30,
1993 to June 30, 1994. Federal funds sold increased $164.7 million due
to the investment of funds generated from investment securities sales
in liquid assets. Securities purchased under agreements to resell
increased $124.1 million primarily due to the temporary investment of
the $144.8 million in proceeds from the issuance of preferred stock in
December of 1993.
Investment Securities
Available-for-Sale Portfolio
Investment securities available-for-sale decreased $199.1 million
from December 31, 1993 to June 30, 1994. In the first quarter of 1994,
$1.1 billion in mortgage-backed obligations of Federal agencies ("MBS's")
were sold, resulting in gains of $15.1 million and $166.3 million in U.S.
Treasury and agency securities were sold, resulting in losses of $3.9
million. In the second quarter of 1994, $23.5 million in U.S Treasury
and agency securities and $2.4 in equity securities were sold, resulting
in gains of $91,000 and $1.4 million, respectively. Paydowns, maturities,
and/or calls on the available-for-sale securities totaled $73.7 million
for the first six months of 1994. These decreases in the portfolio were
partially offset by significant purchases which included $912.6 million
in MBS's, $239.6 million in U.S. Treasury and agency securities, and $16.3
million in equity securities. The book value of the available-for-sale
portfolio at June 30, 1994 was $17.7 million below the amortized cost
compared to a book value at December 31, 1993 which was $43.6 million
above the amortized cost. This change in the book value resulted in
a $37.3 million adjustment (net of income tax benefits) to the unrealized
gains (losses) on available-for-sale securities which is included as a
component of stockholders' equity. Table 7 provides information on the
gross unrealized gains and losses of the available-for-sale portfolio.
Investment securities available-for-sale increased $1.1 billion from
June 30, 1993 to June 30, 1994 primarily as a result of the
reclassification of $1.3 billion in securities from the held-to-maturity
portfolio as a result of the Corporation's adoption of Financial Accounting
Standards No. 115 "Accounting for Certain Investments in Debt and Equity
Securities" ("FAS 115") on December 31, 1993.
Held-to-Maturity Portfolio
Investment securities held-to-maturity decreased $237.9 million from
December 31, 1993 to June 30, 1994. This decrease is the result of $243.9
million in paydowns and maturities partially offset by the purchase of
$17.3 million in U.S. Treasury and agency securities in 1994. The market
value of the held-to-maturity porfolio is $38.5 million below the book
value. Table 8 provides information on the gross unrealized gains and
losses of the held-to-maturity portfolio.
Investment securities held-to-maturity decreased $1.3 billion from
June 30, 1993 to June 30, 1994 primarily as a result of the
reclassification of $1.3 billion in securities to the available-for-sale
portfolio as a result of the Corporation's adoption of FAS 115 on December
31, 1993.
<PAGE>
PAGE 18
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
The amortized cost and book values of the available-for-sale securities at
June 30, 1994 are shown in the following table.
Table 7 Available-for-Sale Portfolio
<CAPTION>
June 30, 1994
-------------------------------------------------
Gross Gross
Amortized unrealized unrealized
Cost gains losses Book
---------- ---------- ---------- ----------
(in thousands)
<S> <C> <C> <C> <C>
U.S. Treasury and U.S. Government agencies........... $51,714 $ - ($1,835) $49,879
Mortgage-backed obligations of
Federal agencies.................................. 813,566 556 (32,924) 781,198
Collateralized mortgage obligations:
Issued by Federal agencies........................ 16,944 39 (2) 16,981
Privately issued.................................. 5,598 36 - 5,634
Obligations of states and political
subdivisions...................................... 203,783 12,435 (1,522) 214,696
Other debt securities................................ 10,605 - - 10,605
Equity securities.................................... 23,377 6,115 (646) 28,846
--------- --------- --------- ---------
Total.......................................... $1,125,587 $19,181 ($36,929) $1,107,839
========== ========== ========== ==========
</TABLE>
<TABLE>
The book and market values of the held-to-maturity securities at June
30, 1994 are shown in the following table.
Table 8 Held-to-Maturity Portfolio
<CAPTION>
June 30, 1994
-------------------------------------------------
Gross Gross
unrealized unrealized
Book gains losses Market
---------- ---------- ---------- ----------
(in thousands)
<S> <C> <C> <C> <C>
U.S. Treasury and U.S. Government agencies........... $881,151 $2,362 ($21,599) $861,914
Mortgage-backed obligations of
Federal agencies.................................. 174,206 422 (6,558) 168,070
Collateralized mortgage obligations:
Issued by Federal agencies........................ 358,116 71 (9,637) 348,550
Privately issued.................................. 57,031 - (3,601) 53,430
Other debt securities................................ 1,267 - - 1,267
--------- --------- --------- ---------
Total.......................................... $1,471,771 $2,855 ($41,395) $1,433,231
========== ========== ========== ==========
</TABLE>
<PAGE>
PAGE 19
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Loan Portfolio
Total loans, net of unearned income increased $76.7 million from
December 31, 1993 to June 30, 1994. This modest increase of 1.5% is
indicative of the trends the Corporation is observing in its marketplace.
While the Corporation believes there are areas of growth in residential
mortgages and retail loans, the overwhelming trend is that competition
remains strong and general economic uncertainty continues in the
Corporation's region.
The economy on the national level in the first six months of 1994
continued to rebound, but the Federal Reserve's positioning of interest
rates remained a primary concern. The increase in short-term interest
rates experienced in the first six months of 1994 had the most impact on
the Corporation's retail lending products. During most of 1993, the
Corporation, like many of its competitors, saw a surge of refinancing of
first and second mortgages, as well as home equity lines of credit. With
the onset of higher rates and the perception that rates could increase
more, refinancing for first mortgages has dropped significantly.
In addition, the consumer has turned away from the variable rate open-end
products to fixed rate, fixed term second mortgages, thus contributing
to the 3.0% increase in retail loans. The growth experienced in the
Corporation's residential mortgage portfolio of 13.0% is attributed to
strong marketing efforts.
While commercial loan demand on the national level could be viewed
as increasing, it has remained weak in the Corporation's region. The
Corporation did experience some modest commercial loan growth in the first
quarter of 1994, but this growth was offset by a 2.4% decline in the
second quarter, resulting in a 1.5% decrease in commercial loans for the
first six months of 1994. When analyzing the Corporation's three primary
commercial market segments, large corporate loans exhibited moderate
increases, particularly in the specialized industry groups. Middle market
loans reflected the stress of competition and small business loans remained
relatively flat due to a lagging regional economy.
The Corporation's commercial real estate loans, comprising 23.3% of
total loans, decreased 1.2% during the first six months of 1994. Most
of that decline was attributable to decreases in the construction mortgage
portfolio which decreased 12.1% due to a continuation of conversions from
the construction phase to permanent. The commercial mortgage portfolio
advanced during the first six months of 1994 with a 2.1% increase. This
increase reflected the transfer of completed projects into permanent
financing and the ability of the Corporation to record selective new
loans. The commercial real estate portfolio continues to be well-balanced
by property type and geographically centered in the Corporation's regional
marketplace as reflected in Tables 10 and 11.
The Corporation monitors exposure based on industry classifications
and establishes exposure limits that are reviewed by the Board of
Directors. Significant exposures by industry classification in the loan
portfolio are presented in the following table.
<TABLE>
Table 9 Significant Exposures by Industry Classification
<CAPTION>
June 30, 1994
--------------------------------------
Outstanding Unfunded Total
Balance Commitments Exposure
----------- ----------- ----------
(in thousands)
<S> <C> <C> <C>
Communications Industries:
Cable............................................. $114,113 $46,010 $160,123
Wireless.......................................... 91,421 17,890 109,311
Publishing & Newspapers........................... 63,951 12,742 76,693
Broadcast......................................... 10,267 19,599 29,866
-------- -------- --------
$279,752 $96,241 $375,993
-------- -------- --------
Healthcare (1)....................................... $265,541 $121,779 $387,320
Transportation (2)................................... $317,677 $41,026 $358,703
<FN>
----------------
(1) Includes exposure to hospitals and nursing care facilities, both commercial loans
and real estate loans.
(2) Includes loans and leases for vessel, commercial aircraft and railroad equipment
financing.
</TABLE>
<PAGE>
PAGE 20
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
Table 10 Loans Secured by Real Estate and Other Real Estate Owned by Property Type
<CAPTION>
June 30, 1994
-------------------------------------------------
Total loans
------------------------ Other
Real estate Real estate Nonperforming real estate
Construction Mortgage loans owned
------------- ----------- ------------- -----------
(in thousands)
<S> <C> <C> <C> <C>
Office buildings..................................... $104,002 $264,803 $2,112 $ -
Industrial warehouse and other commercial
properties......................................... 32,813 192,934 4,235 -
Retail............................................... 44,271 117,785 10,033 -
Hospitals/nursing home medical centers............... - 87,346 - -
Hotels/motels........................................ - 75,357 9,324 5,000
Commercial land...................................... 49,217 - 962 6,348
Churches, restaurants and other special purpose
properties........................................ 6,092 64,515 360 -
Apartments........................................... 1,587 72,274 10,421 -
Mixed use............................................ 37 40,802 164 -
Residential land..................................... 8,628 - 2,559 1,793
Other land-farm recreational facilities.............. 514 10,500 1,191 -
Residential properties held for resale............... 1,204 779 212 -
Miscellaneous........................................ 1,218 50,314 527 -
--------- --------- --------- ---------
Total.......................................... $249,583 $977,409 $42,100 $13,141
========== ========== ========== ==========
</TABLE>
<TABLE>
Table 11 Loans Secured by Real Estate and Other Real Estate Owned by Geographic Region
<CAPTION>
June 30, 1994
-------------------------------------------------
Total loans
----------------------- Other
Real estate Real estate Nonperforming real estate
Construction Mortgage loans owned
------------- ----------- ------------- -----------
(in thousands)
<S> <C> <C> <C> <C>
Maryland............................................. $173,787 $618,020 $25,338 $7,947
Pennsylvania......................................... 8,682 176,406 12,462 2,598
Virginia............................................. 31,881 48,201 4,293 2,096
Washington, D.C...................................... 22,987 28,879 - -
Florida.............................................. 12,156 25,774 - 500
New Jersey........................................... - 14,934 - -
Delaware............................................. - 9,123 7 -
All other............................................ 90 56,072 - -
--------- --------- --------- ---------
Total.......................................... $249,583 $977,409 $42,100 $13,141
========== ========== ========== ==========
</TABLE>
<PAGE>
PAGE 21
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Asset Quality
Economic Environment
Economic activity continued to improve during the first six months
of 1994 with the first quarter particularly robust despite a severe winter
storm. Stong consumer spending and rebounding employment increased the
risk of inflation and the Federal Reserve responded by aggressively
raising short-term interest rates. 1994 may be the strongest year of
this expansion with growth near 4% and next year slowing due to the effect
of higher interest rates.
Maryland's economy continued its recovery from the past recession but
at a much more gradual pace, particularly in the area of job creation due
to stagnant government payrolls and declining budgets. Overall, generally
improving economic and market conditions have contributed to a reduction
in the financial difficulties faced by some of the Corporation's borrowers.
The Corporation anticipates moderate near term improvement in general
economic conditions, and expects that these trends, and their effect on
asset quality, will continue to be positive in 1994 and next year.
Nonperforming Assets
Nonperforming assets totaled $99.3 million at June 30, 1994,
a decrease of $36.1 million when compared to nonperforming assets of
$135.4 million at December 31, 1993. The most significant changes in
nonperforming assets in the six months ended June 30, 1994 were paydowns
of $27.0 million, loans reclassified to accrual status of $8.9 million,
charge-offs of $3.3 million, and other real estate owned sales of $7.5
million. These decreases were partially offset by $10.6 million in
additions to nonperforming assets due to the transfer of loans to
nonaccrual status. The most significant paydowns were on a variety of
commercial and real estate transactions in which cash payments were
received on nonaccrual loans. Loans reclassified to accrual status
included $4.5 million in real estate loans which were upgraded from
troubled debt restructuring status and returned to accrual and $4.4
million in commercial and real estate loans which met the regulatory
tests for return to accrual status. The most significant charge-off
was a $1.0 million charge-off on a nonaccrual real estate loan.
Table 12 sets forth nonperforming assets and accruing loans which
are 90 days past due as to principal or interest on the dates indicated.
Nonperforming assets at June 30, 1993 have been restated to reflect
the reclassification of loans previously classified as in-substance
foreclosures consistent with a policy change adopted by the federal
regulatory agencies.
<PAGE>
PAGE 22
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
Table 12 Nonperforming Assets
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
---------- ------------ ----------
(in thousands)
<S> <C> <C> <C>
Nonaccrual loans
Domestic:
Commercial ........................................ $31,558 $47,521 $68,418
Real estate, construction.......................... 3,772 5,787 8,610
Real estate mortgage, commercial................... 38,328 44,853 53,379
Real estate mortgage, residential.................. 5,293 5,381 6,452
Leases receivable.................................. 720 863 945
Foreign.............................................. 3,800 3,800 8,004
-------- -------- --------
Total nonaccrual loans......................... 83,471 108,205 145,808
-------- -------- --------
Restructured loans................................... 168 4,692 185
Other assets owned:
Other real estate.................................. 19,627 26,427 36,439
Valuation reserves................................. (4,185) (4,412) (9,547)
Other assets....................................... 257 510 609
-------- -------- --------
Total other assets owned....................... 15,699 22,525 27,501
-------- -------- --------
Total nonperforming assets......................... $99,338 $135,422 $173,494
======== ======== ========
Nonperforming assets as a percentage of total
loans, net of unearned income plus other
foreclosed assets owned........................... 1.88% 2.59% 3.32%
==== ==== ====
Accruing loans contractually past due
90 days or more as to principal or interest:
Domestic.......................................... $12,331 $17,172 $14,769
======== ======== ========
</TABLE>
<PAGE>
PAGE 23
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
<TABLE>
The following table details certain information relating to the allowance
for credit losses of the Corporation for the six months ended June 30, 1994
and June 30, 1993, respectively.
Table 13 Analysis of the Allowance for Credit Losses
<CAPTION>
Six Months ended June 30,
-----------------------------
1994 1993
---------- ----------
(in thousands)
<S> <C> <C>
Allowance at beginning of year....................... $200,006 $201,451
Provision for credit losses.......................... 14,998 24,217
Losses charged off:
Commercial loans................................. (1,419) (3,247)
Real estate loans, construction.................. (1,333) (1,048)
Real estate loans, mortgage:
Residential.................................... (228) (357)
Commercial..................................... (1,786) (6,859)
Retail........................................... (3,066) (3,272)
Bankcard receivables............................. (13,729) (13,444)
Leases receivable................................ (75) (204)
Foreign loans.................................... - (2,255)
-------- --------
Total losses charged off....................... (21,636) (30,686)
Recoveries of losses previously charged off:
Commercial loans................................. 2,698 366
Real estate loans, construction.................. 11 16
Real estate loans, mortgage:
Residential.................................... 320 5
Commercial..................................... 213 49
Retail........................................... 1,518 1,299
Bankcard receivables............................. 2,674 2,296
Leases receivable................................ 271 180
Foreign loans.................................... 0 86
-------- --------
Total recoveries............................... 7,705 4,297
Net losses charged off............................... (13,931) (26,389)
-------- --------
Total allowance at June 30........................... $201,073 $199,279
======== ========
Average loans, net of average unearned income........ $5,222,139 $5,066,047
========== ==========
Period end loans, net of unearned income............. $5,274,375 $5,193,254
========== ==========
Net charge-offs to average loans, net of average
unearned income (annualized)...................... 0.54% 1.05%
Allowance as a percentage of period end loans, net
of unearned income................................ 3.81 3.84
Allowance as a percentage of nonperforming loans..... 240.41 136.50
</TABLE>
<PAGE>
PAGE 24
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations-(Continued)
Deposits
Total deposits decreased $111.5 million from December 31, 1993 to
June 30, 1994. Core deposits totaled $6.2 billion at June 30, 1994
compared to $6.4 billion at December 31, 1994. This decrease of $214.6
million is primarily the result of a $213.1 million decrease in
commercial noninterest bearing demand deposits partially due to an
increase in the earnings credit rate on commercial deposits which lowers
the compensating balance requirement of the Corporation's commercial
customers. Purchased deposits, which include large denomination time and
foreign time deposits, increased $103.1 million from December 31, 1993
to June 30, 1994 primarily due to a $92.1 million increase in large
denomination time deposits.
Total deposits increased $155.6 million from June 30, 1993 to June
30, 1994 primarily due to a $101.9 million increase in purchased deposits.
Core deposits increased $53.7 million with the largest increase in
savings deposits of $186.8 million partially offset by a $108.5 million
decrease in money market deposits.
Capital Resources
<TABLE>
The following table details the Corporation's capital components
and ratios at June 30, 1994, December 31, 1993 and June 30,
1993, based upon the capital requirements of the Federal Reserve Board.
Table 14 Capital Components
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
---------- ------------- ----------
(Dollars in thousands)
<S> <C> <C> <C>
Preferred stockholders' equity.................................... $144,852 $144,803 $ -
Common stockholder's equity....................................... 841,708 831,991 752,598
Disallowed intangibles............................................ (34,079) (35,657) (37,117)
Unrealized losses (gains) on investment securities available-
-for-sale (1)................................................... 10,728 (26,613) -
-------- -------- --------
Tier 1 capital.................................................... 963,209 914,524 715,481
-------- -------- --------
Qualifying long-term debt......................................... 109,654 115,629 115,606
Allowance for credit losses (2)................................... 89,285 90,153 86,938
Mandatory convertible securities.................................. 59,956 59,951 59,947
-------- -------- --------
Tier 2 capital.................................................... 258,895 265,733 262,491
-------- -------- --------
Total capital..................................................... $1,222,104 $1,180,257 $977,972
========== ========== ========
Risk-adjusted assets.............................................. $7,031,005 $7,102,379 $6,843,873
========== ========== ==========
Average quarterly assets (regulatory guidelines).................. $9,547,432 $9,557,793 $9,507,472
========== ========== ==========
Risk-based capital ratios:
Tier 1 to risk adjusted assets.................................. 13.70% 12.88% 10.45%
Regulatory minimum.............................................. 4.00 4.00 4.00
Total capital to risk-adjusted assets........................... 17.38 16.62 14.29
Regulatory minimum.............................................. 8.00 8.00 8.00
Leverage ratio.................................................... 10.12 9.60 7.55
<FN>
(1) Not included as Tier 1 capital under current regulatory capital guidelines.
(2) The amount of the allowance for credit losses which is includable as Tier 2 capital is limited
to 1.25% of the risk-adjusted assets less disallowed intangibles.
</TABLE>
Tier 1 and total capital increased $48.7 million and $41.8 million,
respectively, when June 30, 1994 is compared to December 31, 1993
primarily due to $54.1 million in net income partially offset by $5.9
million in dividends declared on preferred stock in the first six months
of 1994. Tier 1 and total capital increased $247.7 million and $244.1
million, respectively, when June 30, 1994 is compared to June 30, 1993
as a result of $108.5 million in net income during this period and $144.8
million in proceeds from the issuance of preferred stock in December of
1993. Additional information regarding the Corporation's capital is
presented in the Consolidated Statements of Changes in Stockholders'
Equity.
<PAGE>
PAGE 25
<TABLE>
Table 15
First Maryland Bancorp and Subsidiaries
Average Balances, Interest Rates and Yields and Net Interest Margin
(Tax Equivalent Basis)
<CAPTION>
Three Months ended June 30, 1994
-------------------------------------
Average
Average rate/
Balance Interest yield
------- ----------- -----------
(dollars in millions)
<S> <C> <C> <C>
ASSETS
Cash and due from banks.............................. $572.2 $ - - %
Money market investments:
Interest bearing deposits in other banks........... 34.0 0.4 3.84
Trading account securities......................... 42.5 0.5 5.05
Funds sold......................................... 742.7 7.3 3.94
Investment securities available-for-sale:
Taxable securities................................. 902.0 11.1 4.94
Tax-exempt securities(1)........................... 204.4 6.1 12.06
Equity investments................................. 21.7 0.4 6.41
--------- ---------
Total securities available-for-sale (2)......... 1,128.1 17.6 6.26
Investment securities:
Taxable securities................................. 1,511.4 22.2 5.90
Equity investments................................. 2.2 - -
--------- ---------
Total securities................................ 1,513.6 22.2 5.89
Loans held-for-sale.................................. 99.0 1.6 6.56
Loans, net of unearned income (1,3):
Commercial......................................... 1,618.0 30.4 7.55
Real estate, construction.......................... 252.8 4.6 7.32
Real estate mortgage, commercial................... 984.2 19.3 7.86
Real estate mortgage, residential.................. 548.3 9.2 6.71
Retail............................................. 888.2 17.7 7.98
Bankcard........................................... 475.9 18.5 15.57
Leases receivable.................................. 215.6 3.1 5.80
Foreign............................................ 257.8 4.0 6.23
--------- ---------
Total loans, net of unearned income........... 5,240.8 106.8 8.17
Allowance for credit losses....................... (198.8) - -
---------
Loans, net...................................... 5,042.0 - -
Other assets (4)..................................... 382.5 - -
--------- ---------
Total assets/interest income.................... $9,556.6 $156.4
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits in domestic offices:
Noninterest bearing demand......................... $1,726.0 $ - - %
---------
Interest bearing demand............................ 562.8 3.3 2.35
Money market accounts.............................. 1,359.6 9.9 2.92
Savings........................................... 1,196.7 8.1 2.70
Other consumer time................................ 1,411.9 14.3 4.08
Large denomination time............................ 353.8 4.2 4.76
Deposits in foreign banking offices.................. 133.0 1.8 5.51
--------- ---------
Total interest bearing deposits................. 5,017.8 41.6 3.33
--------- ---------
Total deposits.................................. 6,743.8 - -
Funds purchased...................................... 744.6 6.6 3.56
Other borrowed funds, short-term..................... 732.5 6.7 3.65
Other liabilities.................................... 165.8 - -
Long-term debt (5)................................... 189.6 4.3 9.15
Stockholders' equity................................. 980.3 - -
--------- ---------
Total liabilities and stockholders'
equity/interest expense...................... $9,556.6 $59.2
======== ========
Earning assets/interest income....................... $8,800.7 $156.4 7.13%
Interest bearing liabilities/interest expense........ 6,684.5 59.2 3.55
Earning assets/interest expense...................... 8,800.7 59.2 2.70
Net interest spread (6).............................. 3.58%
=====
Net interest margin (7).............................. 4.43%
=====
<FN>
----------------
(1) Interest on loans to and obligations of public entities is not subject to Federal income tax.
In order to make pre-tax yields comparable to taxable loans and investments, a tax equivalent
adjustment is used based on a 35% Federal tax rate.
(2) Yields on investment securities available-for-sale are calculated based upon average amortized cost.
(3) Nonaccrual loans are included under the appropriate loan categories as earning assets.
(4) Includes overdrafts excluded from average loan balances for yield purposes.
(5) Includes current portion of long-term debt.
(6) Net interest spread is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average interest bearing liabilities.
(7) Net interest margin is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average earning assets.
</TABLE>
<PAGE>
PAGE 26
<TABLE>
Table 16
First Maryland Bancorp and Subsidiaries
Average Balances, Interest Rates and Yields and Net Interest Margin
(Tax Equivalent Basis)
<CAPTION>
Six Months ended June 30, 1994
------------------------------------
Average
Average rate/
Balance Interest yield
------- ----------- -----------
(dollars in millions)
<S> <C> <C> <C>
ASSETS
Cash and due from banks.............................. $607.9 $ - - %
Money market investments:
Interest bearing deposits in other banks........... 27.5 0.5 3.71
Trading account securities......................... 48.8 1.2 4.77
Funds sold......................................... 699.4 12.6 3.63
Investment securities available-for-sale:
Taxable securities................................. 938.9 25.0 5.38
Tax-exempt securities(1)........................... 203.5 12.1 12.00
Equity investments................................. 15.2 0.6 7.81
--------- ---------
Total securities available-for-sale (2)......... 1,157.6 37.7 6.57
Investment securities:
Taxable securities................................. 1,575.5 46.0 5.89
Equity investments................................. 3.9 - -
--------- ---------
Total securities................................ 1,579.4 46.0 5.87
Loans held-for-sale.................................. 125.7 4.5 7.12
Loans, net of unearned income (1,3):
Commercial......................................... 1,623.7 57.6 7.15
Real estate, construction.......................... 263.8 9.1 6.98
Real estate mortgage, commercial................... 972.9 37.5 7.77
Real estate mortgage, residential.................. 533.5 17.8 6.73
Retail............................................. 880.7 34.4 7.89
Bankcard........................................... 488.5 37.5 15.49
Leases receivable.................................. 212.6 6.2 5.84
Foreign............................................ 246.4 7.2 5.88
--------- ---------
Total loans, net of unearned income........... 5,222.1 207.3 8.01
Allowance for credit losses....................... (198.8) - -
---------
Loans, net...................................... 5,023.3 - -
Other assets (4)..................................... 409.1 - -
--------- ---------
Total assets/interest income.................... $9,678.7 $309.8
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits in domestic offices:
Noninterest bearing demand......................... $1,756.1 $ - - %
---------
Interest bearing demand............................ 563.3 6.5 2.32
Money market accounts.............................. 1,357.9 19.3 2.86
Savings........................................... 1,173.6 15.9 2.74
Other consumer time................................ 1,413.8 28.6 4.08
Large denomination time............................ 322.2 8.5 5.31
Deposits in foreign banking offices.................. 132.9 3.2 4.90
--------- ---------
Total interest bearing deposits................. 4,963.7 82.0 3.33
--------- ---------
Total deposits.................................. 6,719.8 - -
Funds purchased...................................... 780.2 12.6 3.27
Other borrowed funds, short-term..................... 832.5 14.0 3.40
Other liabilities.................................... 173.3 - -
Long-term debt (5)................................... 189.6 8.7 9.20
Stockholders' equity................................. 983.3 - -
--------- ---------
Total liabilities and stockholders'
equity/interest expense...................... $9,678.7 $117.3
======== ========
Earning assets/interest income....................... $8,860.5 $309.8 7.05%
Interest bearing liabilities/interest expense........ 6,766.0 117.3 3.50
Earning assets/interest expense...................... $8,860.5 117.3 2.67
Net interest spread (6).............................. 3.55%
=====
Net interest margin (7).............................. 4.38%
=====
<FN>
----------------
(1) Interest on loans to and obligations of public entities is not subject to Federal income tax.
In order to make pre-tax yields comparable to taxable loans and investments, a tax equivalent
adjustment is used based on a 35% Federal tax rate.
(2) Yields on investment securities available-for-sale are calculated based upon average amortized cost.
(3) Nonaccrual loans are included under the appropriate loan categories as earning assets.
(4) Includes overdrafts excluded from average loan balances for yield purposes.
(5) Includes current portion of long-term debt.
(6) Net interest spread is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average interest bearing liabilities.
(7) Net interest margin is the difference between the ratio of interest income to average earning assets and the
ratio of interest expense to average earning assets.
</TABLE>
<PAGE>
PAGE 27
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
There are no exhibits furnished to this Form 10-Q.
(b) Reports on Form 8-K
There were no Current Reports on Form 8-K filed during the
quarter ended June 30, 1994
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.
First Maryland Bancorp
August 12, 1994 BY /s/ Robert W. Schaefer
----------------------------
Robert W. Schaefer
Executive Vice President and
Chief Financial Officer
August 12, 1994 BY /s/ James A. Smith
----------------------------
James A. Smith
Senior Vice President and
Chief Accounting Officer
