FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTERLY PERIOD ENDED JUNE 30, 1995 COMMISSION FILE NUMBER 1-2981
FIRSTAR CORPORATION
(Exact Name of Registrant as Specified in its Charter)
WISCONSIN 39-0711710
(State of Incorporation) (I.R.S. EMPLOYER
Identification No.)
777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
Telephone Number (414) 765-4985
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 precedeing
12 months and (2) has been subject to such filing requirements for the
past 90 days.
As of July 31, 1995, 76,583,209 shares of common stock were outstanding.
FIRSTAR CORPORATION
CONTENTS
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Balance Sheets 1
Consolidated Statements of Income 2
Consolidated Statements of Cash Flows 3
Supplemental Footnotes 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
Additional Financial Data 15
PART II. OTHER INFORMATION
Item 5. Other Information 17
Item 6. Exhibits and Reports on Form 8-K 17
SIGNATURES 17
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
------------------------------------------------------------------------------------------------
June 30 December 31 June 30
(thousands of dollars) 1995 1994 1994
------------------------------------------------------ ------------ ------------ ------------
(unaudited) (unaudited)
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 953,824 $ 1,092,114 $ 1,028,889
Interest-bearing deposits with banks 6,342 33,532 21,632
Federal funds sold and resale agreements 258,943 351,304 240,071
Trading securities 17,929 29,050 19,346
Securities held to maturity (market value $4,186,277
$3,636,897 and $3,320,824 on June 30, 1995,
December 31, 1994 and June 30, 1994) 4,122,251 3,750,897 3,357,994
Securities available for sale 80,878 222,719 176,527
Loans:
Commercial and industrial 3,169,201 2,944,565 2,696,758
Real estate 2,889,442 2,801,759 2,579,539
Other 957,295 963,883 949,750
------------ ------------ ------------
Commercial loans 7,015,938 6,710,207 6,226,047
Credit card 544,423 575,278 505,577
Real estate - mortgage 2,621,853 2,382,857 2,311,531
Home equity 887,948 767,540 690,629
Other 1,413,269 1,469,946 1,451,069
------------ ------------ ------------
Consumer loans 5,467,493 5,195,621 4,958,806
------------ ------------ ------------
Total loans 12,483,431 11,905,828 11,184,853
Reserve for loan losses (199,423) (190,552) (191,935)
------------ ------------ ------------
Loans - net 12,284,008 11,715,276 10,992,918
Bank premises and equipment 345,485 335,078 310,161
Customer acceptance liability 30,072 13,466 17,426
Other assets 472,114 450,770 460,534
------------ ------------ ------------
Total assets $ 18,571,846 $ 17,994,206 $ 16,625,498
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand $ 2,893,599 $ 3,113,103 $ 2,772,983
Interest-bearing demand 1,556,554 1,714,368 1,618,790
Money market accounts 2,005,050 2,086,665 1,998,615
Savings passbook 1,750,815 1,822,836 1,888,478
Certificates of deposit 5,401,863 4,672,243 4,354,774
------------ ------------ ------------
Total deposits 13,607,881 13,409,215 12,633,640
Short-term borrowed funds 2,530,321 2,196,478 1,806,488
Other debt 595,846 573,545 492,429
Bank acceptances outstanding 30,072 13,466 17,426
Other liabilities 266,567 288,817 251,008
------------ ------------ ------------
Total liabilities 17,030,687 16,481,521 15,200,991
Stockholders' equity:
Preferred stock 19,110 26,979 27,441
Common stock 96,196 96,465 94,628
Issued: June 30, 1995, 76,956,450 shares
Issued: December 31, 1994, 77,171,835 shares
Issued: June 30, 1994, 75,702,271 shares
Capital surplus 215,199 230,453 213,698
Retained earnings 1,212,124 1,172,062 1,098,932
Treasury stock (2,600) (10,669) (7,582)
Held: June 30, 1995, 478,653 shares
Held: December 31, 1994, 792,303 shares
Held: June 30, 1994, 697,611 shares
Restricted stock (571) (1,551) (1,744)
Unrealized losses on securities available for sale 1,701 (1,054) (866)
------------ ------------ ------------
Total stockholders' equity 1,541,159 1,512,685 1,424,507
------------ ------------ ------------
Total liabilities and stockholders' equity $ 18,571,846 $ 17,994,206 $ 16,625,498
============ ============ ============
-1-
</TABLE>
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
--------------------------------------------------------------------------------------------
Three Months Ended Six Months Ended
June 30 June 30
(thousands of dollars, except per share data) 1995 1994 1995 1994
--------------------------------------------- ---------------------- ----------------------
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
INTEREST REVENUE
Loans $ 271,246 $ 220,648 $ 529,966 $ 427,967
Securities 64,186 46,575 124,036 92,046
Interest-bearing deposits with banks 241 257 659 581
Federal funds sold and resale agreements 3,163 2,004 6,130 3,766
Trading securities 246 298 464 537
---------- ---------- ---------- ----------
Total interest revenue 339,082 269,782 661,255 524,897
INTEREST EXPENSE
Deposits 113,706 75,408 216,956 146,267
Short-term borrowed funds 35,378 14,266 65,763 24,324
Other debt 10,889 6,993 20,902 13,583
---------- ---------- ---------- ----------
Total interest expense 159,973 96,667 303,621 184,174
---------- ---------- ---------- ----------
NET INTEREST REVENUE 179,109 173,115 357,634 340,723
Provision for loan losses 9,987 2,877 23,123 6,552
---------- ---------- ---------- ----------
NET INTEREST REVENUE AFTER
LOAN LOSS PROVISION 169,122 170,238 334,511 334,171
OTHER OPERATING REVENUE
Trust and investment management fees 32,433 30,234 64,117 61,072
Service charges on deposit accounts 20,028 20,671 39,785 41,172
Credit card service revenue 14,817 13,574 28,772 25,944
Data processing fees 4,597 5,322 9,516 10,380
Securities (losses) gains (378) 26 (6,061) 675
Other revenue 25,118 25,514 48,701 51,302
---------- ---------- ---------- ----------
Total other operating revenue 96,615 95,341 184,830 190,545
OTHER OPERATING EXPENSE
Salaries 82,203 77,759 163,296 154,699
Employee benefits 19,325 17,635 38,738 36,402
Equipment expense 14,950 12,881 28,820 26,426
Net occupancy expense 14,418 13,504 28,951 27,334
Net other real estate revenue 195 (223) (148) (422)
Restructuring expense 3,155 0 23,151 0
Processing loss 0 22,000 0 22,000
Other expense 49,763 49,161 100,957 94,798
---------- ---------- ---------- ----------
Total other operating expense 184,009 192,717 383,765 361,237
INCOME BEFORE INCOME TAXES 81,728 72,862 135,576 163,479
Applicable income taxes 27,946 23,306 45,509 53,785
---------- ---------- ---------- ----------
NET INCOME $ 53,782 $ 49,556 $ 90,067 $ 109,694
========== ========== ========== ==========
Net income applicable to common stock $ 53,383 $ 48,995 $ 89,120 $ 108,572
========== ========== ========== ==========
PER COMMON SHARE
Net income $.70 $.65 $1.17 $1.45
Dividends .34 .30 .64 .56
-2-
</TABLE>
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
------------------------------------------------------------------------------------------------------
Six Months Ended
June 30
(thousands of dollars) 1995 1994
------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income $ 90,067 $ 109,694
Adjustments:
Provision for loan losses 23,123 6,552
Depreciation, amortization, and accretion 21,931 22,947
Net decrease (increase) in trading securities 11,121 (6,855)
Net (increase) decrease in loans held for resale (99,413) 217,926
(Losses) gains on sale of assets 7,960 (3,300)
Increase in other assets (28,146) (38,933)
(Decrease) increase in other liabilities (19,130) 28,939
Other net 3,038 (2,658)
------------- -------------
Net cash provided by operating activities 10,551 334,312
Cash Flows from Investing Activities:
Net decrease in federal funds sold and resale agreements 92,361 51,861
Net decrease in interest-bearing deposits with banks 27,190 40,801
Purchase of securities available for sale (4,801) 0
Sale of securities available for sale 238,370 22,364
Maturities of securities available for sale 91,738 7,300
Maturities of securities held to maturity 422,050 490,316
Purchase of securities held to maturity (914,013) (639,848)
Net increase in loans (485,782) (508,208)
Cash acquired in acquisitions 294 4,600
Proceeds from sale of other real estate 7,834 10,581
Purchase of bank premises and equipment (28,338) (24,138)
Proceeds from sale of bank premises and equipment 1,093 291
------------- -------------
Net cash used in investing activities (552,004) (544,080)
Cash Flows from Financing Activities:
Net increase (decrease) in deposits 124,738 (679,598)
Net increase in short-term borrowed funds 331,070 612,734
Issuance of long-term debt 35,260 41,217
Repayment of long-term debt (11,802) (9,259)
Redemption of preferred stock (8,350)
Common stock transactions (18,506) (2,303)
Cash dividends (49,247) (40,792)
------------- -------------
Net cash provided by (used in) financing activities 403,163 (78,001)
Net decrease in cash and due from banks (138,290) (287,769)
Cash and due from banks at beginning of period 1,092,114 1,316,658
------------- -------------
Cash and due from banks at end of period $ 953,824 $ 1,028,889
============= =============
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 290,253 $ 183,083
Income taxes 56,372 71,049
Transfer to other real estate from loans $ 4,882 $ 6,922
-3-
</TABLE>
FIRSTAR CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL FOOTNOTES (unaudited)
-----------------------------------------------------
(thousands of dollars except as otherwise indicated)
1. The financial data presented herein are unaudited, but in the opinion
of management, reflect all adjustments which are necessary for a fair
presentation of such information. Results for interim periods should
not be considered indicative of results for a full year. Reference
should be made to the financial statements contained in the
registrant's annual report on Form 10-K/A for the year ended December
31, 1994.
2. Mergers and Acquisitions
On January 31, 1995, Firstar Corporation completed its merger with
First Colonial Bankshares Corporation, a $1.8 billion bank holding
company operating in the Chicago metro area. The transaction was
accounted for as a pooling of interests. The total number of shares of
Firstar common stock issued was 7,700,767 shares. All financial
information has been restated to reflect this transaction.
On March 31, 1995, Firstar Corporation completed its acquisition of
First Moline Financial Corporation, an $86 million thrift holding
company operating in Moline, Illinois. The transaction was accounted
for as a purchase with the issuance of 313,650 shares of Firstar common
stock.
On April 28, 1995, Firstar Corporation completed the acquisition of
Investors Bank Corp., a $1.1 billion thrift company operating in the
Minneapolis/St. Paul metro area. The transaction was accounted for
as a pooling of interests through the issuance of 3,006,923 shares of
Firstar common stock. All financial information has been restated to
reflect this transaction.
3. Securities
The amortized cost and approximate market values of securities held to
maturity are as follows:
<TABLE>
<CAPTION>
June 30, 1995
-------------------------------------------------
Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
----------- ---------- ------------ ----------
<S> <C> <C> <C> <C>
Securities held to maturity:
U.S. Treasury and federal agencies $ 1,770,908 $ 38,504 $ (13,972)$ 1,795,440
Mortgage backed obligations of federal agencies 1,135,033 32,844 (2,207) 1,165,670
State and political subdivisions 1,051,247 15,921 (6,993) 1,060,175
Corporate debt 30,257 57 (128) 30,186
Equity securities 58,860 0 0 58,860
Other 75,946 0 0 75,946
----------- ---------- ------------ ----------
Total $ 4,122,251 $ 87,326 $ (23,300)$ 4,186,277
=========== ========== ============ ==========
Securities available for sale:
U.S. Treasury and federal agencies $ 65,189 $ 2,546 $ (31)$ 67,704
Mortgage backed obligations of federal agencies 6,044 128 (22) 6,150
State and political subdivisions 6,943 76 (47) 6,972
Corporate debt 52 0 0 52
----------- ---------- ------------ ----------
Total $ 78,228 $ 2,750 $ (100)$ 80,878
=========== ========== ============ ==========
</TABLE>
-4-
FIRSTAR CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL FOOTNOTES (unaudited)
---------------------------- -----------------------
4. Nonperforming Assets and Past Due Loans
<TABLE>
<CAPTION>
June 30 December 31 June 30
1995 1994 1994
---------- ------------ ----------
<S> <C> <C> <C>
Nonaccrual loans:
Commercial $ 26,748 $ 29,710 $ 45,043
Commercial - real estate 43,994 28,993 24,186
Consumer 13,819 9,831 9,217
---------- ------------ ----------
84,561 68,534 78,446
Renegotiated loans:
Commercial 41 71 79
Commercial - real estate 1,610 674 644
---------- ------------ ----------
1,651 745 723
Other real estate 7,526 13,282 17,804
---------- ------------ ----------
Total $ 93,738 $ 82,561 $ 96,973
========== ============ ==========
Nonperforming assets as a percent of:
Loans and other real estate 0.75 % 0.69 % 0.87 %
Total assets 0.50 0.46 0.58
Loans past due 90 days and still accruing
Commercial $ 8,733 $ 7,432 $ 9,101
Commercial - eeal estate 13,513 3,760 19,878
Consumer 16,861 15,709 13,546
---------- ------------ ----------
Total $ 39,107 $ 26,901 $ 42,525
========== ============ ==========
</TABLE>
4. Reserve for Loan Losses
<TABLE>
<CAPTION>
Six Months Ended
June 30
------------------------
1995 1994
------------ ----------
<S> <C> <C>
Balance - beginning of period
As previously reported $ 172,606 $ 174,873
Adjustments for pooling of interests 17,946 14,841
------------ ----------
Balance - as restated 190,552 189,714
Provision for loan losses 23,123 6,552
Loan recoveries 8,482 9,475
Loan charge-offs (23,599) (15,017)
Reserves of acquired banks 865 1,211
------------ ----------
Balance - end of period $ 199,423 $ 191,935
============ ==========
Net charge-offs to average loans .25 % .10 %
Reserve to period-end loans 1.60 1.72
</TABLE>
Firstar adopted Financial Accounting Standards Board Statements Nos.
114 and 118, Accounting by Creditors for Impairment of a Loan on
January 1, 1995. These statements establish procedures for determining
the appropriate reserve for loan losses for loans deemed impaired.
The calculation of reserve levels is based upon the discounted present
value of expected cash flows received from the debtor or other measures
of value such as market prices or collateral values. Firstar has
identified $70.7 million of loans considered to be impaired. Income
recognition for these loans is limited to actual cash receipts. These
statements did not have any impact on the current level of the reserve
for loan losses and is not expected to effect 1995 operating results.
-5-
FIRSTAR CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL FOOTNOTES (unaudited)
---------------------------- -----------------------
6. Firstar adopted Financial Accounting Standards Board Statement No. 122,
Accounting for Mortgage Servicing Rights. This statement requires that
separate assets be recognized for the rights to service mortgage loans
for others whether those servicing rights are purchased or related to
loans originated by the company. Firstar established an asset of $1.5
million in the second quarter of 1995 representing the cost of mortgage
servicing rights originated during the first half of 1995. This asset,
along with purchased mortgage servicing rights is amortized as an
expense in relation to the servicing revenue expected to be earned.
7. Changes in Stockholders' Equity
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
----------------------- ------------------------
1995 1994 1995 1994
----------- ---------- ------------ ----------
<S> <C> <C> <C> <C>
Balance - beginning of period
As previously reported $ 1,463,965 $ 1,348,477 $ 1,459,822 $ 1,312,161
Adjustments for pooling of interests 51,866 49,917 52,863 47,153
----------- ---------- ------------ ----------
Balance - as restated $ 1,515,831 $ 1,398,394 1512685 1359314
Net income 53,782 49,556 90067 109694
Common stock issued 4,089 1,217 7959 4836
Common stock retired (281) 0 (24,688) 0
Preferred stock converted (278) (275) (278) (1,475)
Preferred stock redemption (8,350) 0 (8,350) 0
Treasury stock issued 0 0 9,276 0
Treasury stock purchased 0 (2,008) 0 (4,548)
Restricted stock transactions 898 92 980 (409)
Change in unrealized gains(losses) on 1,808 (732) 2,755 (1,966)
securities available for sale
Dividends - common stock (25,941) (21,176) (48,300) (39,817)
- preferred stock (399) (561) (947) (1,122)
----------------------- ------------------------
Balance - end of period $ 1,541,159 $ 1,424,507 $ 1,541,159 $ 1,424,507
======================= ========================
</TABLE>
-6-
FIRSTAR CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL FOOTNOTES (unaudited)
---------------------------- -----------------------
8. Derivative Financial Instruments
The following table summarizes the various types of interest rate
contracts that Firstar uses for the purpose of managing interest
rate risk as of June 30, 1995.
<TABLE>
<CAPTION>
June 30, 1995
-------------------------------------------------------------
Market
12-31-94 Average Average Weighted Value
Notional Notional Receive Pay Average Asset
Amount Amount Rate Rate Maturity (Liability)
--------- --------- ----------- ---------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
(millions)
Interest rate swaps
Receive fixed rate
Index amortizing $ 290 $ 290 5.40 % 6.17 % 2.9 yr $ (5.3)
Other 75 75 6.98 7.35 0.7 (0.1)
Receive variable 76 57 6.09 6.63 1.4 (1.7)
Periodic caps* 930 480 4.81 5.79 2.1 (2.4)
Interest rate floors** 301 501 5.06 6.1
Interest rate caps** 80 25 5.95 0.1
--------- --------- ----------
$ 1,752 $ 1,428 $ (3.3)
========= ========= ==========
* Periodic caps interest rate swaps with a notional value of $450
million were terminated in June 1995. Additionally, another $250
million of these swaps were terminated in July 1995.
**Interest rate floors and caps provide for the receipt of payments
when the index interest rate is below or above the predetermined
interest rate.
<\TABLE.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Firstar Corporation reported net income for the six months ended June 30,
1995 of $90.1 million, or $1.17 per common share, down from $109.7 million,
or $1.45 per common share, for the same period last year. Return on common
equity was 12.01% for the first six months of the year, compared with 15.97%
for the same period last year, while return on assets was 1.01% compared to
1.38% during the same period last year.
Net income for the second quarter totaled $53.8 million, or $.70 per common
share, up from $49.6 million or $.65 per common share for the same quarter of
1994. Return on common equity was 14.19% in the second quarter of 1995
compared to 14.15% for the comparible 1994 period. Return on assets was
1.19% compared with 1.22% in the same period last year. Table 1 shows the
components of net interest revenue, net income and net interest margin.
</TABLE>
<TABLE>
<CAPTION>
Table 1. Condensed income statements - taxable equivalent basis
Three Months Ended June 30 Six Months Ended June 30
---------------------------- ----------------------------------------
1995 1994 Change 1995 1994 Change
------ --------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
(millions of dollars) (millions of dollars)
Interest revenue $ 339.1 $ 269.8 $ 69.3 $ 661.3 $ 525.0 $ 136.3
Taxable-equivalent adjustment 8.0 8.7 (0.7) 16.4 17.0 (0.6)
------ --------- --------- ------------ ------------ ------------
Interest revenue - taxable-equivalent 347.1 278.5 68.6 677.7 542.0 135.7
Interest expense 160.0 96.6 63.4 303.6 184.2 119.4
------ --------- --------- ------------ ------------ ------------
Net interest revenue - taxable-equivalent 187.1 181.9 5.2 374.1 357.8 16.3
Provision for loan losses 10.0 2.9 7.1 23.1 6.6 16.5
Other operating revenue 96.6 95.3 1.3 184.8 190.5 (5.7)
Other operating expense 184.0 192.7 (8.7) 383.8 361.2 22.6
------ --------- --------- ------------ ------------ ------------
Income before income taxes 89.7 81.6 8.1 152.0 180.5 (28.5)
Provision for income taxes 27.9 23.3 4.6 45.5 53.8 (8.3)
Taxable-equivalent adjustment 8.0 8.7 (0.7) 16.4 17.0 (0.6)
------ --------- --------- ------------ ------------ ------------
Net income $ 53.8 $ 49.6 $ 4.2 $ 90.1 $ 109.7 $ (19.6)
====== ========= ========= ============ ============ ============
Yield on earning assets 8.33 % 7.57 % 0.76 8.28 % 7.50 % 0.78 %
Cost of interest-bearing liabilities 4.70 3.29 1.41 4.57 3.21 1.36
------ --------- --------- ------------ ------------ ------------
Interest spread 3.63 4.28 (0.65) 3.71 4.29 (0.58)
Impact of interest-free funds 0.86 0.66 0.20 0.86 0.66 0.20
------ --------- --------- ------------ ------------ ------------
Net interest margin 4.49 % 4.94 % (0.45) 4.57 % 4.95 % (0.38)%
====== ========= ========= ============ ============ ============
</TABLE>
In the first six months of 1995 certain merger and restructuring charges
were taken in connection with four completed acquisitions. These expenses
totaled $43.0 million pre-tax and reduced net income by $27.6 million, or 36
cents per share as shown in Table 2.
<TABLE>
<CAPTION>
Table 2. Acquisition related restructuring costs
Three Six
Months Months
Ended Ended
6-30-95 6-30-95
--------- ---------
<S> <C> <C>
(thousands of dollars)
Additional loan loss provisions $ 4,818 $ 13,612
Losses on sales of securities 554 6,263
Restructuring expenses:
Employee severence 1,501 11,899
Facilities and equipment 1,476 4,801
Professional fees 36 2,531
Other 142 3,920
--------- ---------
3,155 23,151
--------- ---------
Total pre-tax costs 8,527 43,026
Income tax benefit 3,083 15,393
--------- ---------
Total $ 5,444 $ 27,633
========= =========
Per common share impact $ 0.07 $ 0.36
</TABLE>
-8-
Additional loan loss provisions of $13.6 million were taken to increase the
new acquisitions' loan loss reserve levels to conform with Firstar's policy.
Also, securities not compatible with Firstar's investment policy were sold
with a resulting loss of $6.3 million. These funds, totaling $146 million,
were redeployed in the securities portfolio with a resulting increase in the
net yield which will recover the realized loss within one year.
Acquisition related restructuring charges totaling $23.2 million are included
in operating expenses. Included in this charge was $11.9 million of costs
associated with the severance of approximately 500 employees, $4.8 million
related with office closings and write-off of unusable equipment, $2.5 million
of professional fees and $3.9 million of other costs associated with the
mergers. The restructuring charge of $23.2 million consists of $17.3 million
in anticipated cash expenditures and $5.9 million of non-cash asset
write-downs. Substantially all of the cash expenditures associated with these
charges should be made by the end of 1995.
Net interest revenue during the first six months of 1995, on a taxable
equivalent basis, was $374.1 million which was $16.3 million, or 4.6%, above
the level of the same period last year. The net interest margin was 4.57%
during the first six months compared to 4.95% a year earlier. The increase in
net interest revenue was attributable to the higher average earning asset
balances, up 13.2% from a year earlier, partially offset by the reduced net
interest margin. The margin has been compressed as a result of increasing
costs of fund sources not being met by similar increases in earning asset
rates.
Table 3 shows the components of interest revenue and expense along with
changes related to volumes and rates. Total interest revenue on a
taxable-equivalent basis increased by 25% to $677.7 million during the first
six months of 1995 compared to the same period last year. This resulted from
a 13.2% increase in average earning assets, along with higher interest rates.
The rate received on earning assets increased from 7.50% in the first six
months of 1994 to 8.28% in the same period in 1995. Loan revenue increased
$102.1 million, or 23.7%, in the first six months of 1995 compared to the same
period last year. The increased loan balances, up 11.5% from the same period
last year, along with higher rates, accounted for the increase in revenue.
Interest revenue from commercial loans increased $62.6 million due to both
higher balances and rates. Interest revenue from consumer loans increased
$39.5 million due to both higher balances and rates.
Total interest expense was $303.6 million during the first six months in
1995, an increase of $119.4 million, or nearly 65%, from the same period last
year. Interest rates on liabilities increased from 3.21% in 1994 to 4.57% in
1995, which was a major factor in the increase of expense. Expense on total
deposits increased $70.7 million, or 48.3%, in the first six months of 1995
compared to the same period last year, due primarily to higher interest rates.
Interest paid on short-term borrowed funds increased by $41.4 million, or
170.4%, due to both higher average balances and rates.
Net cash flows of off-balance sheet derivative instruments used to manage
interest rate risk reduced net interest revenue by $6.7 million and net
interest margin by .08% during the first six months of 1995. This compares to
an increase in net interest revenue of $3.2 million and an increase in net
interest margin of .05% in the same period of 1994. Using a most likely
interest rate scenario, it is expected that derivative financial instruments
will result in a reduction of net interest margin of approximately .04% during
the next twelve months.
-9-
Table 3. Analysis of interest revenue and expense
<TABLE>
<CAPTION>
Six Months Ended June 30
--------------------------------------------------------------
Interest Total Due to
-------------------- --------------------------
1995 1994 Change Volume Rate
--------- --------- ------------ ------------ ------------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Interest-bearing deposits
with banks $ 659 $ 581 $ 78 $ (24)$ 102
Federal funds sold and
resale agreements 6,130 3,766 2,364 7 2,357
Trading securities 565 686 (121) (153) 32
Securities 136,876 105,542 31,334 22,103 9,232
Commercial loans 301,121 238,525 62,596 28,297 34,299
Consumer loans 232,357 192,854 39,503 23,959 15,543
--------- --------- ------------
Total loans 533,478 431,379 102,099 52,308 49,790
--------- --------- ------------
Total interest revenue 677,708 541,954 135,754 75,802 59,952
Interest-bearing demand 13,728 10,356 3,372 (406) 3,778
Money market accounts 41,492 24,425 17,067 1,093 17,763
Savings passbook 23,765 21,411 2,354 (1,050) 3,404
Certificates of deposit 137,971 90,075 47,896 19,798 24,355
--------- --------- ------------
Total deposits 216,956 146,267 70,689 13,187 57,502
Short-term borrowed funds 65,763 24,324 41,439 19,928 21,511
Long-term debt 20,902 13,583 7,319 3,279 4,040
--------- --------- ------------
Total interest expense 303,621 184,174 119,447 32,240 87,207
--------- --------- ------------
Net interest revenue $ 374,087 $ 357,780 $ 16,307 48,968 (32,661)
========= ========= ============
Calculations are computed on a taxable-equivalent basis using a tax rate of 35%. The change attributable
to both volume and rate has been allocated proportionately to the changes due to volume
and rate.
</TABLE>
The provision for loan losses of $23.1 million was $16.6 million higher than
last year. As discussed previously, $13.6 million of this increase was a
merger related adjustment to loan loss reserve levels. Net charge-offs for
the first six months were at a level of .25% of average outstanding loans
compared to .10% a year earlier. Charge-off levels for the first half of 1994
were unusually low and the current periods' level of .25% is consistent with
recent experience. The reserve for loan losses represented 1.60% of total
loans at June 30, 1995 the same level as at year-end and down from 1.72% a
year earlier.
Nonperforming assets were $93.7 million at June 30, 1995, which amounted to
.75% of total loans and other real estate. This was a $11.2 million increase
from the December 31, 1994 level which was .69% of total loans and other real
estate. Nonperforming assets have gone up in part due to the application of
Firstar's credit review policies to the loan portfolios of the recently
acquired banks. Nonperforming real estate related assets increased $10.2
million. Commercial nonperforming loans decreased $3.0 million and consumer
nonperforming loans increased $4.0 million. Real estate related nonperforming
assets represent the major portion of the nonperforming portfolio, with the
balance at June 30, 1995 of $53.1 million, or 56.7%, of total nonperforming
assets. Commercial nonperforming assets currently represent $26.8 million, or
28.6% of the nonperforming portfolio.
Other operating revenue, excluding securities gains and losses, increased by
less than 1% to a level of $190.9 million in the first six months of 1995
compared to the same period last year. Firstar continues to emphasize growth
in non-interest revenue although recent growth trends have been lower than
previously experienced. Firstar's broad customer base provides opportunities
for expanded revenues as the marketplace looks to financial institutions for
services beyond traditional lending and deposit activities. Table 4 shows the
composition of other operating revenue.
-10-
<TABLE>
<CAPTION>
Table 4. Other operating revenue
Six Months Ended
June 30, 1995
----------------------------------------
1995 1994 Change
------------ ------------ ------------
(thousands of dollars)
<S> <C> <C> <C>
Trust and investment management fees $ 64,117 $ 61,072 5.0 %
Service charges on deposit accounts 39,785 41,172 (3.4)
Credit card service revenue 28,772 25,944 10.9
Mortgage loan servicing 11,888 10,688 11.2
Mortgage loan origination 5,396 11,029 (51.1)
Data processing fees 9,516 10,380 (8.3)
Insurance revenue 5,615 4,927 14.0
Brokerage revenue 4,277 5,485 (22.0)
International fees 2,897 2,780 4.2
Foreign exchange gains 1,130 961 17.6
ATM fees 2,574 2,422 6.3
Safe deposit fees 2,136 2,004 6.6
Trading securities gains (losses) 1,220 (513)
Other 11,568 11,519 0.4
------------ ------------
Subotal 190,891 189,870 0.5
Securities (losses) gains (6,061) 675
Total ------------ ------------
$ 184,830 $ 190,545 (3.0)%
============ ============
</TABLE>
Other operating revenue represents 34% of Firstar's revenue. An industry
measure of fee revenue prominence is the ratio of this revenue stream to
average assets. During the first six months of 1995, this ratio was 2.14%
compared to 2.38% during the same period last year. While fee revenue
increased, the effect of the larger 11.8% growth in average assets is shown in
the reduction of this ratio to 2.14% during the first six months of 1995.
Trust and investment management fees are the single largest source of fee
revenue, contributing $64.1 million, or 35%, of other operating revenue. This
level represents a 5% growth in revenue during the first six months of 1995
compared to the same period last year. Trust assets under management were
$16.8 billion on June 30, 1995, a 9.5% increase from the year-end level.
Additionally, assets held in custody rose by 22.8% to a level of $47.4 million.
Revenue from service charges on deposit accounts at $39.8 million for the
first six months of 1995 was 3.4% lower than last year. This reduction was
primarily due to higher rate credits given to business customers for
services, thus reducing the level of cash payments necessary.
Credit card service revenues are the third largest source of fee revenue
totaling $28.8 million during the first six months of 1995, which was a 10.9%
increase over the same period last year. The introduction of new credit card
products, increased merchant fee revenue and the repricing of service charges
have all added to this revenue growth.
Revenue from mortgage loan origination activities decreased 51.1% to $5.4
million during the first six months of 1995 compared to the same period last
year, due to substantially reduced refinancing activity resulting from higher
interest rates. Mortgage loan servicing revenues have increased to a level of
$11.9 million, representing an 11% increase over the first six months of 1994.
Included in servicing revenue were gains on the sale of servicing rights of
$3.9 million in 1995 and $3.6 million in 1994.
Data processing fee income declined 8.3% in the first six months of 1995
from the same period last year. A shrinking customer base due to continuing
bank consolidations through mergers or acquisitions and conversions by smaller
community banks to in-house data processing systems have acted to reduce
revenues.
The remaining sources of other operating revenue derive from a wide range of
services and collectively increased by $99,000, or .3%, exclusive of trading
and securities transactions, in the first six months of 1995 compared to the
same period last year.
-11-
Other operating expense increased to a level of $383.8 million. Excluding
the acquisition related restructuring charges taken in the first six months of
this year and the check kiting loss in 1994, expenses increased 6.3%.
Personnel costs rose by 5.7% to a level of $202 million due in part to a bank
acquisition that occurred late in 1994. Nonpersonnel costs, excluding the
restructuring charges in 1995 and the check kiting loss in 1994, increased
7.1%. The check kiting loss reduced earnings per share by $.17 in 1994.
Net occupancy expense increased $1.6 million, or 5.9% in the first six
months of 1995 compared to the same period last year. The increase was due to
a bank acquisition late in 1994 and the acceleration of depreciation on
leasehold improvements to match the remaining lease terms. Equipment expense
increased $2.4 million, or 9.1% during the first six months of 1995 compared
to the same period last year.
The efficiency ratio, which is the ratio of expense to revenue was 63.83% in
the first six months of 1995 compared to 61.94% a year earlier. Firstar has
announced a corporate-wide restructuring program with a goal of reaching a 55%
efficiency ratio in 1997. To reach a 55% efficiency ratio would require
either a $100 million reduction in expenses or a $180 million increase in
revenue or some combination of both expense reduction and revenue increases
on an annual basis. The restructuring program is expected to be implemented
over the next 18 months during which period charges for restructuring
related expenses, which could be substantial, will be made.
The detail of other expense is shown in table 5.
<TABLE>
<CAPTION>
Table 5. Other operating expense
Six Months Ended
June 30, 1995
----------------------------------------
1995 1994 Change
------------ ------------ ------------
(thousands of dollars)
<S> <C> <C> <C>
Salaries $ 163,296 $ 154,699 5.6 %
Employee benefits 38,738 36,402 6.4
------------ ------------
Total personnel expense 202,034 191,101 5.7
Net occupancy expense 28,951 27,334 5.9
Equipment expense 28,820 26,426 9.1
Business development 13,822 12,380 11.6
F.D.I.C. insurance 14,706 14,234 3.3
Stationery and supplies 9,869 9,183 7.5
Delivery 9,228 7,625 21.0
Professional fees 9,497 7,622 24.6
Information processing expense 10,171 9,876 3.0
Amortization of intangibles 5,845 5,708 2.4
Employee education/recruiting 4,448 3,850 15.5
Federal Reserve processing fees 2,420 2,547 (5.0)
Commissions and service fees 3,344 3,152 6.1
Wire communication 3,476 4,170 (16.6)
Processing and other losses 2,177 1,769 23.1
Credit card assessment fees 2,194 1,990 10.3
Net other real estate income (148) (422) (64.9)
Published information 1,184 1,317 (10.1)
Insurance 1,040 850 22.4
Other 7,536 8,525 (11.6)
Check Kiting Loss 22,000
Restructuring charges 23,151 0
------------ ------------
Total nonpersonnel expense 181,731 170,136 6.8
------------ ------------
Total other operating expense $ 383,765 $ 361,237 6.2 %
============ ============
</TABLE>
Total assets on June 30, 1995 were $18.6 billion, an increase of $1.9
billion, or 11.7%, from the same time last year. Without the effect of the
acquisitions, the year-to-year increase would be 8.8%.
-12-
Earning assets totaled $17.0 billion on June 30, 1995, an increase of $2.0
billion, or 13.1%, over June 30, 1994. Loans, the largest category of earning
assets, represented 73.6% of earning assets as compared to 74.6% a year
earlier. Total loans were $12.5 billion on June 30, 1995, an increase of $1.6
billion, or 14.6%, over the 1994 level, which excludes loans which have been
securitized and held in the investment portfolio. Firstar securitized $330
million of residential mortgages near the end of 1994.
Commercial loans, which account for 56% of the loan portfolio, increased by
$790 million, or 12.7%, to $7.0 billion on June 30, 1995. Consumer loans
totaled $5.5 billion, an increase of $839 million, or 16.9% compared to the
same time last year, adjusted for the securitization. Credit card loans
increased $38.8 million, or 7.7% over June 30, 1994. Residential mortgages
increased $640 million, or 27.7% over the same period last year adjusted for
the effect of the securitization. Recent mortgage loan originations have been
retained in the corporate portfolio rather than being sold into the secondary
market, contributing to this increase in balances.
Short-term investments, which include interest-bearing deposits with banks,
trading account securities, and federal funds sold and resale agreements,
totaled $283.2 million on June 30, 1995, an increase of $2.2 million, or .8%,
from a year earlier.
Securities represent 24.8% of earning assets. They totaled $4.2 billion on
June 30, 1995, an increase of $338.6 million, or 9.6%, over last year,
adjusted for securitization. The average maturity of the portfolio was 3.8
years at the end of June.
Fund sources, consisting of deposits and borrowed funds, increased by $1.8
billion, or 12.1%, to $16.7 billion on June 30, 1995. Total deposits were
$13.6 billion, an increase of $974 million, or 7.7% over a year earlier.
Approximately one-half of the increase in deposits was due to a bank
acquisition that occurred late in 1994.
Core deposits, which include transaction accounts and other stable time
deposits, are Firstar's prime source of funding. These deposits equaled $12.7
billion on June 30, 1995, in increase of $524.8 million, or 4.3% from last
year due entirely to bank acquisitions. Increased competition for consumer
deposits and heightened consumer sensitivity to interest rates have limited
Firstar's core deposit growth. Increased emphasis will be placed on
generating more core deposits in 1995 through competitive pricing of deposit
products.
More reliance was placed on purchased fund sources to support the growth in
loan balances. Other time deposits, primarily certificates of deposit over
$100,000, increased $302.5 million, or 61.3% from last year. Short-term
borrowed funds were increased $723.8 million, or 40.1% to a level of $2.5
billion in the same period. In addition, Federal Home Loan Bank Notes
increased $116.3 million, or 36.4% to a level of $435.3 million in the same
period.
Stockholders' equity totaled $1,541.2 million at the end of the second
quarter, an increase of $28.5 million from the level at year-end and $116.7
million over last year. Total equity as a percent of total assets amounted to
8.30% at June 30, 1995. Under risk-based capital rules, total capital at June
30, 1995 was 12.61% of risk-adjusted assets. A summary of capital components
and ratios is shown in table 6.
-13-
<TABLE>
<CAPTION>
Table 6. Capital components and ratios
June 30 December 31 June 30
1995 1994 1994
------------ ------------ ------------
(thousands of dollars)
<S> <C> <C> <C>
Risk-based capital:
Stockholders' equity $ 1,541,159 $ 1,512,685 $ 1,424,507
Unrealized (gains) losses on securities available for sale (1,710) 1,054 866
Minority interest in subsidiaries 2,868 2,920 2,435
Less goodwill (109,080) (107,967) (109,889)
------------ ------------ ------------
Total Tier I capital 1,433,237 1,408,692 1,317,919
Allowable reserve for loan losses 164,234 156,426 147,334
Allowable long-term debt 54,336 79,705 79,974
------------ ------------ ------------
Total Tier II capital 218,570 236,131 227,308
------------ ------------ ------------
Total capital $ 1,651,807 $ 1,644,823 $ 1,545,227
============ ============ ============
Risk-adjusted assets $ 13,103,508 $ 12,479,987 $ 11,742,117
Tier I capital to risk-adjusted assets 10.94 % 11.29 % 11.22 %
Total capital to risk-adjusted assets 12.61 13.18 13.16
Tier I leverage ratio 7.93 8.15 8.16
</TABLE>
The Board of Directors declared a quarterly dividend to common stockholders
of 34 cents per share which is payable August 15 to shareholders of record
July 31. Additionally the Board, in July, 1995, authorized the repurchase of
up to 3.5 million shares of Firstar's common stock. The timing of repurchases
will be subject to price, market conditions and other factors.
Firstar will be incurring additional indebtedness in the form of a revolving
bank credit line and/or a medium term public note offering. These borrowings
are needed in the near term to fund certain commitments for such items as
stock repurchases, repayment of outstanding indebtedness, extensions of credit
to subsidiaries and other general corporate purposes.
-14-
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
ADDITIONAL FINANCIAL DATA (unaudited)
--------------------------------------------------------------------------------------------------
Selected Financial Data
(thousands of dollars, except per share)
Quarter ended June 30 Six Months ended June 30
--------------------- ------------------------------
1995 1994 1995 1994
--------------------- ------------------------------
<S> <C> <C> <C> <C>
Earnings and Dividends
Net income $ 53,782 $ 49,556 $ 90,067 $ 109,694
Per common share:
Net income 0.70 0.65 1.17 1.45
Dividends 0.34 0.30 0.64 0.56
Stockholders' equity 19.90 18.63
Performance Ratios
Return on average assets 1.19 % 1.22 1.01 % 1.38 %
Return on average common equity 14.19 14.15 12.01 15.97
Dividend payout ratio 48.57 46.15 54.70 38.62
Equity to assets 8.30 8.57
Net loan charge-offs as a percentage
of average loans 0.22 0.09 0.25 0.10
Nonperforming assets as a
percentage of loans and other
real estate 0.75 0.87
Net interest margin 4.49 4.94 4.57 4.95
Statistical Data
Full-time equivalent staff (at quarter end) 9,700 9,903
Average common shares
outstanding (000's) 76,345 74,940 76,186 74,923
Actual common shares
outstanding (000's at quarter end) 76,478 75,005
Stock Price Information
High $ 34.250 $ 35.375 $ 34.250 $ 35.375
Low 28.250 33.000 26.250 29.750
Close 33.625 35.735 33.625 35.375
-15-
</TABLE>
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
ADDITIONAL FINANCIAL DATA (Unaudited)
------------------------------------------------------------------------------------------------------
Consolidated Average Balance Sheets, Net Interest Revenue and Rate Analysis
(Thousands of Dollars)
Quarter ended June 30
----------------------------------------------------------------------
1995 1994
------------------------------------ ---------------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------------------------------------ ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Interest-bearing deposits
with banks $ 19,484 $ 241 4.96 % $ 18,068 $ 257 5.71 %
Federal funds sold and
resale agreements 200,933 3,163 6.31 193,598 2,004 4.15
Trading securities 17,731 295 6.67 22,388 378 6.77
Securities:
Taxable 3,151,659 51,127 6.51 2,372,112 34,456 5.83
Nontaxable 1,020,547 19,290 7.56 1,113,761 19,020 6.83
----------- --------- ----------- ---------
Total securities 4,172,206 70,417 6.76 3,485,873 53,476 6.14
Loans:
Commercial 6,858,408 153,638 8.98 6,179,045 124,677 8.09
Consumer 5,438,726 119,300 8.79 4,852,696 97,740 8.07
----------- --------- ----------- ---------
Total loans 12,297,134 272,938 8.90 11,031,741 222,417 8.08
----------- --------- ----------- ---------
Interest earning assets 16,707,488 347,054 8.33 14,751,668 278,532 7.57
Reserve for loan losses (196,447) (191,887)
Cash and due from banks 847,560 942,385
Other assets 834,991 764,341
----------- -----------
Total assets $ 18,193,592 $ 16,266,507
=========== ===========
Liabilities and
Stockholders' Equity
Interest-bearing demand $ 1,586,260 $ 6,758 1.71 % $ 1,649,274 $ 5,174 1.26 %
Money market accounts 2,015,423 21,395 4.26 2,035,705 12,775 2.52
Savings passbook 1,754,570 12,082 2.76 1,885,006 10,949 2.33
Certificates of deposit 5,327,617 73,471 5.53 4,318,120 46,510 4.32
Short-term borrowed funds 2,374,598 35,378 5.98 1,460,702 14,266 3.92
Other debt 597,494 10,889 7.29 440,795 6,993 6.35
----------- --------- ----------- ---------
Interest-bearing liabilities 13,655,962 159,973 4.70 11,789,602 96,667 3.29
Demand deposits 2,708,232 2,791,122
Other liabilities 298,800 269,279
Stockholders' equity 1,530,598 1,416,504
----------- -----------
Total liabilities and
stockholders' equity $ 18,193,592 $ 16,266,507
=========== ===========
Net interest
revenue/margin $ 187,081 4.49 % $ 181,865 4.94 %
========= =========
</TABLE>
:
<TABLE>
<CAPTION>
Six months ended June 30
------------------------------------ ---------------------------------
1995 1994
---------------------------------- ---------------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------------------------------------ ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Interest-bearing deposits
with banks $ 23,615 $ 659 5.63 % $ 24,585 $ 581 4.77 %
Federal funds sold and
resale agreements 203,729 6,130 6.07 203,332 3,766 3.73
Trading securities 16,171 565 7.05 20,589 686 6.72
Securities:
Taxable 3,080,591 97,763 6.40 2,358,627 68,649 5.87
Nontaxable 1,035,977 39,113 7.55 1,077,903 36,892 6.85
----------- --------- ----------- ---------
Total securities 4,116,568 136,876 6.67 3,436,530 105,541 6.16
Loans:
Commercial 6,750,714 301,121 8.99 6,071,946 238,525 7.92
Consumer 5,349,145 232,357 8.73 4,781,621 192,855 8.11
----------- --------- ----------- ---------
Total loans 12,099,859 533,478 8.88 10,853,567 431,380 8.00
----------- --------- ----------- ---------
Interest earning assets 16,459,942 677,708 8.28 14,538,603 541,954 7.50
Reserve for loan losses (194,028) (191,115)
Cash and due from banks 877,438 964,394
Other assets 818,144 755,887
----------- -----------
Total assets $ 17,961,496 $ 16,067,769
=========== ===========
Liabilities and
Stockholders' Equity
Interest-bearing demand $ 1,598,807 $ 13,728 1.73 % $ 1,655,504 $ 10,356 1.26 %
Money market accounts 2,029,942 41,492 4.12 2,009,741 24,425 2.45
Savings passbook 1,763,460 23,765 2.72 1,850,993 21,411 2.33
Certificates of deposit 5,176,612 137,971 5.37 4,230,281 90,075 4.29
Short-term borrowed funds 2,244,404 65,763 5.91 1,385,568 24,324 3.54
Other debt 576,765 20,902 7.25 440,464 13,583 6.17
----------- --------- ----------- ---------
Interest-bearing liabilities 13,389,990 303,621 4.57 11,572,551 184,174 3.21
Demand deposits 2,753,242 2,826,306
Other liabilities 297,721 269,995
Stockholders' equity 1,520,543 1,398,917
----------- -----------
Total liabilities and
stockholders' equity $ 17,961,496 $ 16,067,769
=========== ===========
Net interest
revenue/margin $ 374,087 4.57 % $ 357,780 4.95 %
========= =========
-16-
</TABLE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits to Part 1 of Form 10-Q
27. Financial Data Schedule
(b) An 8-K report dated April 18, 1995 was
filed regarding the completion of the
acquisition of First Colonial Bankshares
Corporation in a transaction accounted for
as a pooling of interests. The following
financial statements of First Colonial
Bankshares Corporation were filed as part
of the document.
Consolidated Balance Sheets as of
December 31, 1994 and 1993
Consolidated Statements of Income for the
Years Ended December 31, 1994, 1993 and
1992
Consolidated Statements of Stockholders'
Equity for the Years Ended December 31,
1994, 1993 and 1992
Consolidated Statements of Cash Flows for
the Years Ended December 31, 1994, 1993
and 1992
Notes to the Consolidated Financial
Statements Independent Auditors' Report
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.
FIRSTAR CORPORATION
/s/ William H. Risch
________________
William H. Risch
Senior Vice President-Finance and
Treasurer (Chief Financial Officer)
August 7, 1995
-17-
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> JUN-30-1995
<CASH> 953,824
<INT-BEARING-DEPOSITS> 6,342
<FED-FUNDS-SOLD> 258,943
<TRADING-ASSETS> 17,929
<INVESTMENTS-HELD-FOR-SALE> 80,878
<INVESTMENTS-CARRYING> 4,122,251
<INVESTMENTS-MARKET> 4,186,277
<LOANS> 12,483,431
<ALLOWANCE> 199,423
<TOTAL-ASSETS> 18,571,846
<DEPOSITS> 13,607,881
<SHORT-TERM> 2,530,321
<LIABILITIES-OTHER> 296,639
<LONG-TERM> 595,846
<COMMON> 96,196
0
19,110
<OTHER-SE> 1,425,853
<TOTAL-LIABILITIES-AND-EQUITY> 18,571,846
<INTEREST-LOAN> 529,966
<INTEREST-INVEST> 124,036
<INTEREST-OTHER> 7,253
<INTEREST-TOTAL> 661,255
<INTEREST-DEPOSIT> 216,956
<INTEREST-EXPENSE> 303,621
<INTEREST-INCOME-NET> 357,634
<LOAN-LOSSES> 23,123
<SECURITIES-GAINS> (6,061)
<EXPENSE-OTHER> 383,765
<INCOME-PRETAX> 135,576
<INCOME-PRE-EXTRAORDINARY> 135,576
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 90,067
<EPS-PRIMARY> 1.17
<EPS-DILUTED> 1.17
<YIELD-ACTUAL> 4.57
<LOANS-NON> 84,561
<LOANS-PAST> 39,107
<LOANS-TROUBLED> 1,651
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 190,552
<CHARGE-OFFS> 23,599
<RECOVERIES> 8,482
<ALLOWANCE-CLOSE> 199,423
<ALLOWANCE-DOMESTIC> 198,808
<ALLOWANCE-FOREIGN> 615
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
