<PAGE>
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 MARCH 31, 1998 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) 765-4321
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 April 30, 1997, 145,139,566 shares of common stock were outstanding.
FIRSTAR CORPORATION
<PAGE>
CONTENTS
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Balance Sheets 1
Consolidated Statements of Income 2
Consolidated Statements of Equity 3
Consolidated Statements of Cash Flows 4
Supplemental Footnotes 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
Additional Financial Data 14
Item 3. Quantitative and Qualitative Disclosures
About Market Risk 8,9
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security
Holders 16
Item 6. Exhibits and Reports on Form 8-K 16
SIGNATURES 16
<TABLE>
<PAGE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
- ------------------------------------------------------------------------------------------------
March 31 December 31 March 31
(thousands of dollars) (unaudited) 1998 1997 1997
- ------------------------------------------------------ ------------ ------------ ------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 1,575,234 $ 1,254,289 $ 1,082,339
Interest-bearing deposits with banks 4,722 5,249 9,458
Federal funds sold and resale agreements 37,751 82,589 192,073
Trading securities 4,809 2,293 994
Securities held to maturity (market value $2,458,821
$2,505,360 and $2,264,757 on March 31, 1998
December 31, 1997 and March 31, 1997) 2,406,057 2,452,124 2,251,167
Securities available for sale 1,752,150 1,707,606 1,942,234
Loans:
Commercial and industrial 3,830,281 3,644,721 3,491,449
Real estate 2,961,372 2,951,968 2,970,110
Other 1,157,907 1,123,824 1,118,083
------------ ------------ ------------
Commercial loans 7,949,560 7,720,513 7,579,642
Credit card 696,203 736,484 644,958
Real estate - mortgage portfolio 1,950,660 2,150,398 2,462,691
Real estate - mortgages held for sale 546,226 234,008 123,090
Home equity 1,246,807 1,271,966 1,120,622
Other 1,437,043 1,455,417 1,415,970
------------ ------------ ------------
Consumer loans 5,876,939 5,848,273 5,767,331
------------ ------------ ------------
Total loans 13,826,499 13,568,786 13,346,973
Reserve for loan losses (218,977) (218,861) (213,136)
------------ ------------ ------------
Loans - net 13,607,522 13,349,925 13,133,837
Bank premises and equipment 376,006 368,083 371,274
Customer acceptance liability 11,535 7,360 6,572
Other assets 607,884 614,167 548,368
------------ ------------ ------------
Total assets $ 20,383,670 $ 19,843,685 $ 19,538,316
============ ============ ============
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand $ 3,882,701 $ 3,607,659 $ 3,595,873
Interest-bearing demand 1,633,520 1,756,520 1,551,807
Money market accounts 3,169,567 2,947,683 2,758,497
Savings passbook 1,334,346 1,339,038 1,504,410
Certificates of deposit 5,104,313 5,063,754 5,176,447
------------ ------------ ------------
Total deposits 15,124,447 14,714,654 14,587,034
Short-term borrowed funds 2,166,866 2,121,412 2,458,339
Long-term debt 1,036,194 1,057,151 697,688
Bank acceptances outstanding 11,535 7,360 6,572
Other liabilities 300,706 250,007 248,460
------------ ------------ ------------
Total liabilities 18,639,748 18,150,584 17,998,093
Stockholders' equity:
Preferred stock 4,717 5,308 8,129
Common stock 181,394 181,102 181,102
Issued: March 31, 1998, 145,115,318 shares
Issued: December 31, 1997, 144,881,896 shares
Issued: March 31, 1997, 144,881,896 shares
Capital surplus 4,258 0 0
Retained earnings 1,526,611 1,484,199 1,352,149
Treasury stock (4) (132) (1,817)
Held: March 31, 1998, 1,404 shares
Held: December 31, 1997, 48,547 shares
Held: March 31, 1997, 275,606 shares
Accumulated other comprehensive income 26,946 22,624 660
------------ ------------ ------------
Total stockholders' equity 1,743,922 1,693,101 1,540,223
------------ ------------ ------------
Total liabilities and stockholders' equity $ 20,383,670 $ 19,843,685 $ 19,538,316
============ ============ ============
-1-
</TABLE>
<TABLE>
<PAGE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
- -----------------------------------------------------------------------
Three Months Ended
March 31
(thousands of dollars, except per share data) 1998 1997
- --------------------------------------------- -----------------------
(unaudited)
<S> <C> <C>
INTEREST REVENUE
Loans $ 284,109 $ 276,232
Securities 63,859 63,653
Interest-bearing deposits with banks 88 87
Federal funds sold and resale agreements 1,264 1,540
Trading securities 26 69
---------- ----------
Total interest revenue 349,346 341,581
INTEREST EXPENSE
Deposits 119,840 114,117
Short-term borrowed funds 28,493 28,294
Long-term debt 17,259 12,146
---------- ----------
Total interest expense 165,592 154,557
---------- ----------
NET INTEREST REVENUE 183,754 187,024
Provision for loan losses 15,650 9,718
---------- ----------
NET INTEREST REVENUE AFTER
LOAN LOSS PROVISION 168,104 177,306
OTHER OPERATING REVENUE
Trust and investment management fees 46,046 39,851
Service charges on deposit accounts 24,439 22,176
Credit card revenue 12,636 12,256
Mortgage banking revenue 21,294 8,684
Data processing fees 5,011 5,178
Securities gains 3 1,126
Other revenue 19,618 21,247
---------- ----------
Total other operating revenue 129,047 110,518
OTHER OPERATING EXPENSE
Salaries 86,698 78,268
Employee benefits 20,024 18,514
Equipment expense 16,299 17,069
Net occupancy expense 16,805 15,379
Other expense 50,640 49,461
---------- ----------
Total other operating expense 190,466 178,691
INCOME BEFORE INCOME TAXES 106,685 109,133
Provision for income taxes 33,769 37,338
---------- ----------
NET INCOME $ 72,916 $ 71,795
========== ==========
Net income applicable to common stock $ 72,834 $ 71,654
========== ==========
PER COMMON SHARE
Net income $ 0.50 $ 0.49
Net income assuming dilution 0.50 0.48
Dividends 0.21 0.19
-2-
</TABLE>
<PAGE>
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (unaudited)
<TABLE>
<CAPTION>
Preferred Common Capital Retained
Stock Stock Surplus Earnings
-------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance at December 31, 1996 $ 11,344 $ 188,532 $ 51,145 $ 1,437,891
Net income 71,795
Unrealized loss on securities
available for sale
Reclassification adjustment
for gains realized on net
income
Income taxes
Comprehensive income
Cash dividends:
Preferred stock, series D ($8.75 per share) (142)
Common stock ($.19 per share) (28,534)
Converted 6,430 shares of preferred stock
into 275,974 shares of common stock (3,215) (518) (592)
Issued 648,816 shares of common stock for
employee benefit plans (5,184) (5,659)
Retired 5,944,300 shares of common stock (7,430) (45,443) (122,610)
Purchased 648,816 shares of treasury stock
-------------- ----------- ----------- -----------
Balance at March 31, 1997 $ 8,129 $ 181,102 $ 0 $ 1,352,149
============== =========== =========== ===========
</TABLE>
<TABLE> Accumulated
<CAPTION> Other
Comprehensive Treasury
Income Stock Total
-------------- ----------- -----------
<S> <C> <C> <C>
Balance at December 31, 1996 $ 19,191 $ (4,056)$ 1,704,047
Net income 71,795
Unrealized loss on securities
available for sale (27,383) (27,383)
Reclassification adjustment
for gains realized in net
income (1,126) (1,126)
Income taxes 9,978 9,978
-----------
Comprehensive income 53,264
Cash dividends:
Preferred stock, series D ($8.75 per share) (142)
Common stock ($.19 per share) (28,534)
Converted 6,430 shares of preferred stock
into 275,974 shares of common stock 4,325 0
Issued 648,816 shares of common stock for
employee benefit plans 18,291 7,448
Retired 5,944,300 shares of common stock (12,941) (188,424)
Purchased 648,816 shares of treasury stock (7,436) (7,436)
-------------- ----------- -----------
Balance at March 31, 1997 $ 660 $ (1,817)$ 1,540,223
============== =========== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Preferred Common Capital Retained
Stock Stock Surplus Earnings
-------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance at December 31, 1997 $ 5,308 $ 181,102 $ $ 1,484,199
Net income 72,916
Unrealized gain on securities
available for sale
Reclassification adjustment
for gains realized in net
income
Income taxes
Comprehensive income
Cash dividends:
Preferred stock, series D ($8.75 per share) (40) (83)
Common stock ($.21 per share) (30,423)
Converted 1,180 shares of preferred stock
into 50,644 shares of common stock (551) 34 493
Issued 330,943 shares of common stock for
employee benefit plans 214 4,258 (496)
Issued 224 shares of common stock for
Purchased 101,246 shares of treasury stock
-------------- ----------- ----------- -----------
Balance at March 31, 1998 $ 4,717 $ 181,394 $ 4,258 $ 1,526,611
============== =========== =========== ===========
</TABLE>
<PAGE>
<TABLE> Accumulated
<CAPTION> Other
Comprehensive Treasury
Income Stock Total
-------------- ----------- -----------
<S> <C> <C> <C>
Balance at December 31, 1997 $ 22,624 $ (132)$ 1,693,101
Net income 72,916
Unrealized gain on securities
available for sale 6,654 6,654
Reclassification adjustment
for gains realized in net
income (3) (3)
Income taxes (2,329) (2,329)
-----------
Comprehensive income 77,238
Cash dividends:
Preferred stock, series D ($8.75 per share) (123)
Common stock ($.21 per share) (30,423)
Converted 1,180 shares of preferred stock
into 50,644 shares of common stock 64 40
Issued 330,943 shares of common stock for
employee benefit plans 3,996 7,972
Issued 224 shares of common stock for
Purchased 101,246 shares of treasury stock (3,937) (3,937)
-------------- ----------- -----------
Balance at March 31, 1998 $ 26,946 $ (4)$ 1,743,922
============== =========== ===========
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
- -------------------------------------------------------------------------------------------------------
Three Months Ended
March 31
(thousands of dollars) 1998 1997
- -------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income $ 72,916 $ 71,795
Adjustments:
Provision for loan losses 15,650 9,718
Depreciation, amortization, and accretion 17,071 15,476
Net (increase) decrease in trading securities (2,516) 12,495
Net (increase) decrease in loans held for resale (312,218) 21,315
Loss (gain) on securities and other assets 41 (1,379)
Deferred Income Taxes (782) 0
Decrease (increase) in other assets 7,612 (31,149)
Increase (decrease) in other liabilities 50,699 (19,427)
Other, net (6,523) 6,525
------------- --------------
Net cash (used) provided by operating activities (158,050) 85,369
Cash Flows from Investing Activities:
Net decrease in federal funds sold and resale agreements 44,838 892
Net decrease (increase) in interest-bearing deposits with banks 527 (3,109)
Sale of securities available for sale 3 1,126
Maturities of securities held to maturity 111,360 98,038
Maturities of securities available for sale 7,813 143,850
Purchase of securities held to maturity (65,207) (106,636)
Purchase of securities available for sale (45,632) (144,079)
Net decrease (increase) in loans 37,338 (174,144)
Proceeds from sales of foreclosed assets 586 2,687
Purchases of bank premises and equipment (15,969) (17,500)
Proceeds from sales of bank premises and equipment 61 777
------------- --------------
Net cash provided (used) by investing activities 75,718 (198,098)
Cash Flows from Financing Activities:
Net increase (decrease) in deposits 409,793 (627,165)
Net increase in short-term borrowed funds 45,454 589,733
Repayment of long-term debt (120,000) (104)
Proceeds from long-term debt 99,043 598
Cash dividends (30,546) (28,676)
Common/treasury stock repurchases (3,937) (195,860)
Common/treasury stock issued 3,470 7,448
------------- --------------
Net cash provided (used) by financing activities 403,277 (254,026)
Net increase (decrease) in cash and due from banks 320,945 (366,755)
Cash and due from banks at beginning of period 1,254,289 1,449,094
------------- --------------
Cash and due from banks at end of period $ 1,575,234 $ 1,082,339
============= ==============
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 157,676 $ 166,620
Income taxes 1,461 4,226
Transfer to foreclosed assets from loans $ 2,076 $ 2,816
-3-
</TABLE>
<PAGE>
FIRSTAR CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL FOOTNOTES (unaudited)
- -----------------------------------------------------
(thousands of dollars except as otherwise indicated)
1. The financial data presented herein are unaudited, however, 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. Certain
amounts have been reclassified in prior periods to conform to
classifications used in the March 31, 1998 financial statements.
Reference should be made to the financial statements contained in the
registrant's annual report on Form 10-K for the year ended December 31,
1997.
In June 1997, the Financial Accounting Standards Board issued
SFAS No. 130, "Reporting Comprehensive Income." This statement establised
standards for reporting the components of comprehensive income prominently
within the financial statements. Comprehensive income includes net income
plus certain transactions that are reported directly within stockholders'
equity. Firstar adopted this statement with the first quarter of 1998
financial statements. The adoption of this statement did not have
any impact on financial position or results of operations of Firstar.
In March 1998, the American Institute of Certified Public Accountants
issued SOP 98-1, "Accounting for the Costs of Computer Software Developed
or Obtained for Internal Use." This statement requires the capitalization
of certain internal and external costs incurred in the development of
internal use computer software. Firstar adopted this statement with the
first quarter of 1998 financial statements and capitalized $783 thousand
of related expenses.
<PAGE>
2. Securities- The amortized cost and approximate market values of securities
are as follows:
<TABLE>
<CAPTION>
March 31, 1998
--------------------------------------------------
Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Securities held to maturity:
Mortgage backed obligations of federal agencies $ 1,091,072 $ 28,223 $ 635 $ 1,118,660
State and political subdivisions 1,308,782 26,362 1,127 1,334,017
Corporate debt 6,203 5 64 6,144
----------- ----------- ----------- -----------
Total $ 2,406,057 $ 54,590 $ 1,826 $ 2,458,821
=========== =========== =========== ===========
Securities available for sale:
U.S. Treasury and federal agencies $ 1,422,591 $ 42,307 $ 262 $ 1,464,636
Mortgage backed obligations of federal agencies 153,755 1,210 338 154,627
State and political subdivisions 5,757 46 4 5,799
Equity securities 78,372 0 0 78,372
Money market mutual funds 48,716 0 0 48,716
----------- ----------- ----------- -----------
Total $ 1,709,191 $ 43,563 $ 604 $ 1,752,150
=========== =========== =========== ===========
</TABLE>
<PAGE>
3. Nonperforming Assets and Past Due Loans
<TABLE>
<CAPTION>
March 31 December 31 March 31
1998 1997 1997
----------- ----------- -----------
<S> <C> <C> <C>
Nonaccrual loans:
Commercial $ 36,204 $ 26,739 $ 47,264
Commercial mortgage 18,248 20,291 25,957
Consumer 18,097 16,828 18,622
----------- ----------- -----------
72,549 63,858 91,843
Renegotiated loans:
Commercial mortgage 262 263 274
Foreclosed assets 7,146 6,244 9,347
----------- ----------- -----------
Total $ 79,957 $ 70,365 $ 101,464
=========== =========== ===========
Nonperforming assets as a percent of:
Loans and foreclosed assets .58 % .52 % .76 %
Total assets .39 .35 .52
Loans past due 90 days and still accruing
Commercial $ 24,148 $ 21,774 $ 32,686
Commercial - eeal estate 13,495 15,626 16,209
Consumer 17,461 20,228 22,854
----------- ----------- -----------
Total $ 55,104 $ 57,628 $ 71,749
=========== =========== ===========
</TABLE>
<PAGE>
4. Reserve for Loan Losses
<TABLE>
<CAPTION>
Three Months Ended
March 31
------------------------
1998 1997
----------- -----------
<S> <C> <C>
Balance - beginning of period $ 218,861 $ 213,138
Provision for loan losses 15,650 9,718
Loan recoveries 8,792 4,798
Loan charge-offs (24,326) (14,518)
----------- -----------
Balance - end of period $ 218,977 $ 213,136
=========== ===========
Net charge-offs to average loans .47 % .30 %
Reserve to period-end loans 1.58 1.60
</TABLE>
5. Net Income Per Common Share
<TABLE>
<CAPTION>
Three Months Ended
March 31
------------------------
1998 1997
----------- -----------
<S> <C> <C>
Basic:
Net income $ 72,916 $ 71,795
Less preferred dividends 82 141
----------- -----------
Net income applicable to common stock $ 72,834 $ 71,654
Average common shares outstanding 144,990 146,701
Net income per common share- basic $ 0.50 $ 0.49
Diluted:
Net income $ 72,916 $ 71,795
Average common shares outstanding 144,990 146,701
Options and stock plans 1,636 1,448
Preferred stock 405 698
----------- -----------
Average common shares outstanding- diluted 147,031 148,847
Net income per common share- diluted $ 0.50 $ 0.48
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Forward Looking Information
The following discussion includes forward looking statements
concerning Firstar's business results. These forward-looking
statements, such as statements of plans, strategies, goals,
objectives, expectations, estimates and intentions, are based on
assumptions that involve risks and uncertainties and that are
subject to change based on various important factors (some of
which are beyond Firstar's control). The following factors,
among others, could cause actual results to differ materially
from any forward-looking statement: the strength of the U.S.
economy in general and the strength of the local economies in
the areas in which Firstar conducts operations; the effects of
and changes in trade, monetary and fiscal policies and laws,
including interest rate policies of the Board of Governors of
the Federal Reserve System on both Firstar and its customers;
inflation, interest rate and market fluctuations; the timely
development of and acceptance of new products and services and
the perceived overall value of these products; the willingness
of customers to substitute competitors' products and services
for Firstar's products and services; the impact of changes in
financial services' laws and regulations; technological changes;
acquisitions; changes in consumer spending and saving habits;
and the success of Firstar at managing the risks involved in the
foregoing.
Financial Discussion - Income Statement
Firstar Corporation's net income for the first quarter of 1998
was $72.9 million, or $.50 per common share, on a diluted basis,
up from the $71.8 million, or $.48 per common share, for the
same period last year. This represented a 1.6% increase in net
income and a 4.2% increase in earnings per share. Return on
common equity was 17.23% for the first quarter of the year,
compared with 18.35% for the same period last year, while return
on average assets was 1.51% compared to 1.52% during the first
quarter of last year.
Table 1 shows the components of net income and the net interest
margin.
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
Table 1. Condensed income statements - taxable equivalent basis
Three Months Ended
March 31
----------------------------------
1998 1997 Change
---------- ---------- ----------
<S> <C> <C> <C>
(millions of dollars)
Interest revenue $ 349.3 $ 341.6 $ 7.7
Taxable-equivalent adjustment 9.0 8.5 0.5
---------- ---------- ----------
Interest revenue - taxable-equivalent 358.4 350.1 8.3
Interest expense 165.6 154.6 11.0
---------- ---------- ----------
Net interest revenue - taxable-equivalent 192.8 195.5 (2.7)
Provision for loan losses 15.7 9.7 6.0
Other operating revenue 129.0 110.5 18.5
Other operating expense 190.5 178.6 11.9
---------- ---------- ----------
Income before income taxes 115.7 117.7 (2.0)
Provision for income taxes 33.8 37.4 (3.6)
Taxable-equivalent adjustment 9.0 8.5 0.5
---------- ---------- ----------
Net income $ 72.9 $ 71.8 $ 1.1
========== ========== ==========
Yield on earning assets 8.13 % 8.09 % 0.04 %
Cost of interest-bearing liabilities 4.68 4.46 0.22
---------- ---------- ----------
Interest spread 3.45 3.63 (0.18)
Impact of interest-free funds 0.92 0.88 0.04
---------- ---------- ----------
Net interest margin 4.37 % 4.51 % (0.14)%
========== ========== ==========
</TABLE>
<PAGE>
Net interest revenue during the first quarter of 1998, on a
taxable equivalent basis, was $192.8 million, a $2.7 million, or
1.4%, decrease from the level experienced in the same period
last year. The net interest margin was 4.37% during the first
quarter compared to 4.51% a year earlier. The competition for
loans and deposits along with the flat yield curve have placed
pressure on the margin and net interest revenue.
Table 2 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 $8.3 million
to $358.4 million during the first three months of 1998 compared
to the same period last year. Loan income rose by $7.6 million
due to higher average commercial loan balances. Securities
revenue increased by $949 thousand with higher yields being
partially offset by lower average balances.
Total interest expense was $165.6 million during the first
quarter of 1998, an increase of $11.0 million from the same
period last year. Interest rates on liabilities increased from
4.46% in 1997 to 4.68% in 1998. Interest expense on total
deposits increased $5.7 million in the first quarter of 1998
compared to the same period last year due to higher deposit
levels and a change in mix of deposits from lower cost passbook
and long-term certificates of deposit to higher cost money
market savings accounts and market competitive certificates of
deposit. Interest expense on borrowed funds increased by $5.3
million due to the issuance of long-term debt.
<PAGE>
<TABLE>
<CAPTION>
Table 2. Analysis of interest revenue and expense
Three Months Ended March 31
---------------------------------------------------------------
Interest Total Due to
------------------------ ------------------------
1998 1997 Change Volume Rate
----------- ----------- ----------- ----------- -----------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Interest-bearing deposits
with banks $ 88 $ 87 $ 1 $ 3 $ (2)
Federal funds sold and
resale agreements 1,264 1,540 (276) (376) 100
Trading securities 26 71 (45) (24) (21)
Securities 71,426 70,477 949 (947) 1,896
Commercial loans 159,562 151,706 7,856 8,290 (434)
Consumer loans 125,997 126,218 (221) 15 (236)
----------- ----------- -----------
Total loans 285,559 277,924 7,635 8,518 (883)
----------- ----------- -----------
Total interest revenue 358,363 350,099 8,264 6,415 1,849
Interest-bearing demand 6,900 5,734 1,166 347 819
Money market accounts 34,207 27,593 6,614 3,273 3,341
Savings passbook 7,456 8,952 (1,496) (1,012) (484)
Certificates of deposit 71,277 71,838 (561) (2,432) 1,870
----------- ----------- -----------
Total deposits 119,840 114,117 5,723 489 5,233
Short-term borrowed funds 28,493 28,294 199 (1,304) 1,503
Long-term debt 17,259 12,146 5,113 5,582 (469)
----------- ----------- -----------
Total interest expense 165,592 154,557 11,035 3,107 7,927
----------- ----------- -----------
Net interest revenue $ 192,771 $ 195,542 $ (2,771) 3,527 (6,297)
=========== =========== ===========
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>
<PAGE>
Market risk is the risk of loss arising from adverse changes
in the fair value of financial instruments due to changes in
interest rates, exchange rates and equity prices. Firstar's
market risk is composed primarily of interest rate risk.
Firstar's Asset/Liability Committee (ALCO) is responsible for
reviewing the interest rate sensitivity position of the
Corporation and establishing policies to monitor and limit
exposure to interest rate risk. The guidelines established by
ALCO are reviewed by the Audit-Examining Committee.
Firstar's primary purpose is to manage exposure to risks
associated with interest rate movements and provide for
acceptable and predictable results. Firstar utilizes an
investment portfolio as well as off-balance sheet instruments to
manage the interest rate risk naturally created through its
business activities. The components of interest rate risk which
are actively measured and managed include: repricing risk,
basis risk, option risk and the risk of non-parallel shifts in
the yield curve.
An earnings simulation model forecasts earnings over each of
the next two years under a variety of scenarios that incorporate
changes in the shape of the yield curve, changes in interest
rate relationships, changes in the direction of rates, and
changes in the mix and levels of balance sheet accounts.
Management evaluates the effects on income of these various rate
scenarios against earnings in a base rate environment.
The most recent earnings simulation projects net income would
increase by approximately 1.9% of base rate net income if rates
gradually fall by 150 basis points over the next year. It
projects a decrease of approximately 2.3% if rates rise
gradually by 150 basis points. Both simulations are well within
the policy of limiting changes to 5% of income.
The provision for loan losses increased to $15.6 million in
the first quarter of 1998, from $9.7 million in the same period
last year due to increased net charge-offs. Net loan
charge-offs for the quarter were $15.5 million or .47% of
average outstanding loans, compared with $9.7 million or .30%
for the same period in 1997. The reserve for loan losses
represented 1.58% of total loans at March 31, 1998, compared to
1.60% a year earlier.
Net charge-offs on consumer loans were .82% in the current
quarter compared to .77% in the fourth quarter of 1997 and .71%
a year earlier. Credit card charge-offs for the first quarter
of 1998 were 4.13%, up from the 3.39% of the fourth quarter and
3.44% a year ago. Firstar expects credit card charge-offs to be
in the range of 3.50% to 4.50% over the next twelve months.
Other consumer loan charge-offs were down from the fourth
quarter and level with the first quarter of 1997. Commercial
loan charge-offs were .20% in the first quarter, down from .39%
in the fourth quarter. The first quarter charge-off level
benefited from a $3 million recovery on foreign loans.
Total nonperforming assets were $80.0 million, or .58% of total
loans and foreclosed assets on March 31, 1998. This represents
a reduction in nonperforming assets of $21.5 million from a year
earlier and an increase of $9.6 million from year end 1997.
<PAGE>
<TABLE>
<CAPTION>
Table 3. Net loan charge-offs
Quarter ended
----------------------------------------------------------
3-31-98 12-31-97 9-30-97 6-30-97 3-31-97
---------- ---------- ---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C> <C> <C>
Credit card $ 7,156 $ 5,988 $ 6,172 $ 5,673 $ 5,556
Other consumer 4,491 5,264 2,485 2,869 4,497
---------- ---------- ---------- ---------- ----------
Total consumer 11,647 11,252 8,657 8,542 10,053
Commercial 3,887 7,367 3,034 363 (333)
---------- ---------- ---------- ---------- ----------
Total net charge-offs $ 15,534 $ 18,619 $ 11,691 $ 8,905 $ 9,720
========== ========== ========== ========== ==========
Net charge-offs as a % of:
Credit card 4.13 % 3.39 % 3.66 % 3.52 % 3.44 %
Other consumer 0.36 0.41 0.19 0.22 0.36
Total consumer 0.82 0.77 0.59 0.59 0.71
Commercial 0.20 0.39 0.16 0.02 (0.02)
Total loans 0.47 0.55 0.35 0.27 0.30
</TABLE>
<PAGE>
Other operating revenue, excluding securities gains and
losses, increased by 18.0% over the first quarter of 1997 to
129.0 million. Other operating revenue represents 40.1% of
total taxable equivalent revenue for the first quarter of 1998
compared to 35.9% for the same period one year ago. Table 4
shows the composition of other operating revenue.
<TABLE>
<CAPTION>
Table 4. Other operating revenue
Three Months Ended
March 31
----------------------------------
1998 1997 Change
---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C>
Trust and investment management fees $ 46,046 $ 39,851 15.5 %
Service charges on deposit accounts 24,439 22,176 10.2
Mortgage origination 14,116 5,312 165.7
Mortgage servicing 7,178 3,372 112.9
---------- ----------
Mortgage banking revenue 21,294 8,684 145.2
Credit card service revenue 12,636 12,256 3.1
Merchant fees 1,532 4,804 (68.1)
Data processing fees 5,011 5,178 (3.2)
Insurance revenue 2,825 2,288 23.5
Brokerage revenue 3,052 2,674 14.1
International fees 1,549 1,349 14.8
Foreign exchange gains 671 765 (12.3)
ATM fees 1,993 1,157 72.3
Safe deposit fees 1,213 1,395 (13.0)
Trading securities gains 172 517 (66.7)
Other 6,611 6,298 5.0
---------- ----------
Subtotal 129,044 109,392 18.0
Securities gains 3 1,126
---------- ----------
Total $ 129,047 $ 110,518 16.8 %
========== ==========
</TABLE>
<PAGE>
Trust and investment management fees are the single largest
source of fee revenue, contributing $46.0 million, or 35.7%, of
other operating revenue. This level represents a 15.5% growth
in revenue during the first quarter of 1998 compared to the same
period last year. Trust and investment assets under management
were $27.1 billion on March 31, 1998, a 23.7% increase from the
year earlier level due to both the result of general market
appreciation and additional net new business. Additionally,
assets held in custody accounts rose by 21.7% to a level of
$88.6 billion due in part to increased mutual fund services
business. The increased volatility of equity markets and
interest rates has had a significant effect on trust and
investment management fees and future revenue levels could
likewise be influenced by these factors.
Revenue from service charges on deposit accounts are the
second largest source of fee revenue at $24.4 million for the
first quarter of 1998. This level represented a 10.2% increase
from the same period one year ago.
Revenue from mortgage loan originations activity for the first
quarter of this year increased 165.7%. The lower interest rates
currently available to borrowers has significantly increased
mortgage volumes. Mortgage loan closings were nearly $1 billion
in the first quarter of 1998, an increase of 220% over a year
earlier. Mortgage loan servicing revenues increased by 112.9%
from the year earlier level due to $3.8 million in gains on the
sale of servicing rights this year. Excluding these gains,
revenue from mortgage servicing increased by 7.4%. The company
sold mortgage servicing rights as part of its risk management of
the servicing portfolio. Mortgage loans serviced for others
were $3.3 billion on March 31, 1998.
Credit card revenues, excluding merchant processing revenue,
totaled $12.6 million during the first quarter of 1998. This
level represented a 3.1% increase over the same period last
year. In the fourth quarter of 1997, Firstar formed a joint
venture with Nova Information Systems Inc. to provide credit
card processing services to merchants. Merchant processing
revenue decreased 68.1% over a year earlier due to the transfer
of this activity to the joint venture.
The remaining sources of other operating revenue derive from a
wide range of services and aggregated $23.1 million, an increase
of 6.8% over the first three months of 1997.
Other operating expense rose by 6.6% over the first quarter of
1997 to a level of $190.5 million. Personnel costs increased
by 10.3% from the same period last year. Nonpersonnel expense
increased by 2.2%. The detail of other operating expense is
shown in Table 5.
Personnel costs increased by 10.3%, reflecting higher
commissions paid to mortgage banking personnel due to the
increased sales volume, normal salary increases for all
employees, and increased contract programming costs due in part
to the Year 2000 project. Employee benefit expense has
increased due to higher pension costs and payroll taxes.
Full-time equivalent personnel headcount was 7,866 on March 31,
1998, down from 8,038 one year earlier.
Net occupancy expense rose by $1.4 million or 9.3%. As of the
end of 1997, all deferred gains from the sale of a building in
1988 had been amortized. This amortization reduced occupancy
expense in the first quarter of 1997 by $1.7 million. Business
development expense rose by 6.6% from last year as a result of
increased advertising associated with a Firstar brand identity
program. Professional fees decreased 11.4% with lower levels of
fees paid to outside consultants. Processing losses increased
$1.3 million or 90.2% due to higher fraud losses and other
losses incurred by the company in the first quarter of 1998.
All other operating expenses totaled $49.8 million, a decrease
of .9% over the first three months of 1997.
The efficiency ratio, which is the ratio of expense to
revenue, was 59.2% in the first quarter of 1998 compared to
58.6% a year earlier.
Firstar is implementing a program to insure that its computer
systems are year 2000 compliant. This process involves
modifying or replacing certain hardware and software maintained
by Firstar as well as monitoring the progress of service
providers to ensure that they are taking the appropriate action
to solve their year 2000 issues. Year 2000 compliance does
involve significant business risk to Firstar. Additionally,
Firstar is dependent upon the successful completion of year 2000
issues by it customers and third parties with whom Firstar has
financial transactions. Firstar has completed assessment of its
year 2000 issues and the required updates and testing are
currently in progress. Firstar expects that the total cost of
this process will approach $20 million. Approximately $6.3
million has been expensed during 1997 and through the first
quarter of 1998. Firstar plans to complete substantially all
year 2000 work associated with its critical business
applications by the end of 1998. Testing of vendor provided
software may continue into 1999 dependent upon the availability
of their upgrades.
<PAGE>
<TABLE>
<CAPTION>
Table 5. Other operating expense
Three Months Ended
March 31
----------------------------------
1998 1997 Change
---------- ---------- ----------
(thousands of dollars)
<S> <C> <C> <C>
Salaries $ 86,698 $ 78,268 10.8 %
Employee benefits 20,024 18,514 8.2
---------- ----------
Total personnel expense 106,722 96,782 10.3
Net occupancy expense 16,805 15,379 9.3
Equipment expense 16,299 17,069 (4.5)
Business development 7,711 7,232 6.6
F.D.I.C. insurance 587 649 (9.6)
Stationery and supplies 4,905 5,823 (15.8)
Delivery 4,299 5,040 (14.7)
Professional fees 6,762 7,630 (11.4)
Information processing expense 5,801 4,856 19.5
Amortization of intangibles 4,841 4,658 3.9
Employee education/recruiting 2,512 1,930 30.2
Bank processing fees 2,177 1,681 29.5
Wire communication 2,041 2,522 (19.1)
Processing and other losses 2,663 1,400 90.2
Credit card assessment fees 929 1,811 (48.7)
Net foreclosed assets expense(income) 201 (73)
Published information 1,023 832 23.0
Insurance 361 154 134.4
Other 3,827 3,316 15.4
---------- ----------
Total nonpersonnel expense 83,744 81,909 2.2
---------- ----------
Total other operating expense $ 190,466 $ 178,691 6.6 %
========== ==========
</TABLE>
<PAGE>
Income tax expense was $33.8 million in the first quarter of
1998 compared to $37.3 million in the same period last year.
The effective tax rate was 31.7 % in 1998 compared to 34.2% in
1997. The implemation of various tax planning strategies has
reduced the effective tax rate.
Financial Discussion - Balance Sheet
Total assets on March 31, 1998 were $20.4 billion, up $540
million from December 31, 1997 and $845 million from a year
earlier. Earning assets totaled $18.0 billion, up $213 million
from year end. Earning assets have increased $289 million, or
1.6% from a year earlier.
Average loans totaled $13.5 billion during the first three
months of 1998, an increase of $404 million, or 3.1% from a year
earlier.
Commercial loans averaged $7.8 billion during the first
quarter of 1998, an increase of $403 million, or 5.5% from a
year earlier. While this loan growth is encouraging,
competitive pressures are leading to narrower interest spreads
for commercial lending.
Consumer loans, excluding residential mortgages, averaged $3.4
billion, an increase of $229 million, or 7.2% over the first
quarter of 1997. Good growth has occurred in home equity loans
and credit card loans, which are up 13.0% and 7.2% respectively,
from the same period one year ago.
Residential mortgage loans, exclusive of loans held for sale,
declined by 17.5% on average from the first quarter of 1997.
The reduction was attributable to the normal loan amortization
and prepayments partially offset by the placement in the
portfolio of some shorter term variable rate mortgages. Lower
interest rates experienced in the last half of 1997 and
continuing into the first quarter of 1998 along with a flat
yield curve, have increased the prepayment rate on portfolio
mortgages during this same time period. Firstar's primary
strategy in this area has been to originate and sell mortgages
into the secondary market thereby reducing the amount of
portfolio mortgages held on the balance sheet.
Total securities, including both those designated as available
for sale and those held to maturity averaged $4.2 billion during
the first quarter of both 1998 and 1997.
Funding sources, consisting of deposits and borrowed funds,
averaged $17.6 billion during the first quarter of 1998. Total
deposits averaged $14.5 billion, an increase of .7% from a year
ago. The change in the mix of deposits is reflected in the
11.8% reduction in average passbook deposit levels and the 3.3%
reduction of certificate of deposits, primarily long-term
issues. Money market deposit accounts have increased by 11.2%
during the same period. Increased competition for consumer
deposits and continued consumer sensitivity to interest rates
and other uses of funds, such as investments in equity markets,
have limited Firstar's deposit growth.
Borrowed funds averaged $3.2 billion during the first quarter
of 1998, up 7.9% from a year earlier. A $250 million issue of
long-term senior bank notes was made in December 1997.
Stockholders' equity totaled $1,744 million at March 31, 1998,
a increase of $51 million from year end 1997. Firstar's capital
management plan strives to match longer term capital needs with
maintaining sound capital levels. Firstar's policy has been to
manage tier 1 leverage to the top quartile level of its peer
group which was 9.02 % at the end of 1997. Firstar's tier 1
leverage ratio was 8.67% at March 31, 1998. Future purchases
by Firstar of its common stock for retirement will take into
consideration the goal of returning to the top quartile range of
its peers for the tier 1 leverage ratio.
On April 16, 1998, the board of directors declared a quarterly
dividend to common stockholders of $.23 per share. This
represented an increase of $.02 per share in the quarterly
dividend. The dividend is payable May 15 to shareholders of
record on April 27. The board also called for the redemption on
June 10, 1998 ("Redemption Date") of all outstanding shares of
its Series D Converible Preferred Stock (and related Depositary
Shares representing the Series D Converible Preferred Stock
evidenced by Depositary Receipts) at the redemption price of
$500 per share of Series D Convertible Preferred Stock (and $25
per Depository Share).
<PAGE>
<TABLE>
<CAPTION>
Table 6. Capital components and ratios
March 31 December 31 March 31
1998 1997 1997
------------ ------------ ------------
(thousands of dollars)
<S> <C> <C> <C>
Risk-based capital:
Stockholders' equity $ 1,743,922 $ 1,693,101 $ 1,540,223
Trust capital securities 150,000 150,000 150,000
Unrealized gains on securities available for sale (26,946) (22,624) (660)
Minority interest in subsidiaries 3,056 2,913 2,469
Less disallowed intangibles (184,546) (188,466) (197,198)
------------ ------------ ------------
Total Tier I capital 1,685,486 1,634,924 1,494,834
Allowable reserve for loan losses 199,299 200,438 177,033
Allowable long-term debt 40,000 40,000 75,668
------------ ------------ ------------
Total Tier II capital 239,299 240,438 252,701
------------ ------------ ------------
Total capital $ 1,924,785 $ 1,875,362 $ 1,747,535
============ ============ ============
Risk-adjusted assets $ 15,924,235 $ 16,016,627 $ 14,126,511
Tier I capital to risk-adjusted assets 10.58 % 10.21 % 10.58 %
Total capital to risk-adjusted assets 12.09 11.71 12.37
Tier I leverage ratio 8.67 8.50 7.49
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
FIRSTAR CORPORATION AND SUBSIDIARIES
ADDITIONAL FINANCIAL DATA (unaudited)
- -----------------------------------------------------------------
Selected Financial Data
(thousands of dollars, except per share)
Quarter ended
March 31
----------------------
1998 1997
----------------------
<S> <C> <C>
Earnings and Dividends
Net income $ 72,916 $ 71,795
Per common share:
Net income 0.50 0.49
Net income assuming dilution 0.50 0.48
Dividends 0.21 0.19
Stockholders' equity 11.99 10.59
Performance Ratios
Return on average assets 1.51 % 1.52 %
Return on average common equity 17.23 18.35
Dividend payout ratio 42.00 38.78
Equity to assets 8.56 7.88
Net loan charge-offs as a percentage
of average loans 0.47 0.30
Nonperforming assets as a
percentage of loans and foreclosed
assets 0.58 0.76
Net interest margin 4.37 4.51
Efficiency ratio 59.18 58.60
Fee revenue as a percentage
of average assets 40.10 35.87
Statistical Data
Full-time equivalent staff (at quarter end) 7,866 8,038
Average common shares
outstanding (000's) 144,990 146,701
Average common shares
outstanding assuming dilution (000's) 147,031 148,847
Actual common shares
outstanding (000's at quarter end) 145,114 144,606
Stock Price Information
High $ 42.625 $ 32.625
Low 35.750 25.563
Close 39.500 27.500
-14-
</TABLE>
<PAGE>
<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 March 31
------------------------------------------------------------------------
1998 1997
------------------------------------- ----------------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Interest-bearing deposits
with banks $ 4,658 $ 88 7.66 % $ 4,507 $ 87 7.83 %
Federal funds sold and
resale agreements 89,972 1,264 5.70 117,137 1,540 5.33
Trading securities 2,475 26 4.26 4,231 71 6.81
Securities:
Taxable 2,857,510 48,390 6.82 3,068,662 50,006 6.57
Nontaxable 1,300,755 23,036 7.08 1,145,757 20,471 7.15
----------- ---------- ----------- ----------
Total securities 4,158,265 71,426 6.90 4,214,419 70,477 6.73
Loans:
Commercial 7,762,478 159,562 8.33 7,359,236 151,706 8.36
Consumer 5,783,502 125,997 8.79 5,782,792 126,218 8.80
----------- ---------- ----------- ----------
Total loans 13,545,980 285,559 8.53 13,142,028 277,924 8.55
----------- ---------- ----------- ----------
Interest earning assets 17,801,350 358,363 8.13 17,482,322 350,099 8.09
Reserve for loan losses (217,415) (212,469)
Cash and due from banks 1,066,484 1,029,532
Other assets 983,436 904,366
----------- -----------
Total assets $ 19,633,855 $ 19,203,751
=========== ===========
<PAGE>
Liabilities and
Stockholders' Equity
Interest-bearing demand $ 1,682,512 $ 6,900 1.66 % $ 1,589,960 $ 5,734 1.46 %
Money market accounts 3,052,715 34,207 4.54 2,744,691 27,593 4.08
Savings passbook 1,331,242 7,456 2.27 1,508,525 8,952 2.41
Certificates of deposit 5,095,731 71,277 5.67 5,271,576 71,838 5.53
Short-term borrowed funds 2,141,995 28,493 5.39 2,242,899 28,294 5.12
Long-term debt 1,029,180 17,259 6.71 697,126 12,146 6.97
----------- ---------- ----------- ----------
Interest-bearing liabilities 14,333,375 165,592 4.68 14,054,777 154,557 4.46
Demand deposits 3,315,406 3,263,554
Other liabilities 265,871 293,721
Stockholders' equity 1,719,203 1,591,699
----------- -----------
Total liabilities and
stockholders' equity $ 19,633,855 $ 19,203,751
=========== ===========
Net interest
revenue/margin $ 192,771 4.37 % $ 195,542 4.51 %
========== ==========
</TABLE>
-15-
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The annual meeting of the shareholders of Firstar Corporation was held on
April 16, 1998. The items presented at the meeting and the results of the vote
were as follows:
1. The management nominees for directors for terms expiring in 2001 were
elected. There were no abstentions or broker nonvotes.
For Withheld
---------------- ------------
Roger H. Derusha 112,857,911 12,784,548
William H. Lacy 122,109,159 3,533,300
Sheldon B. Lubar 122,123,143 3,519,316
Kenneth P. Manning 122,118,974 3,523,485
Daniel F. McKeithan 122,203,306 3,439,153
William W. Wirtz 121,733,853 3,908,606
2. The Amendments to the 1988 Incentive Stock Plan for Key Employees were
approved.
For 107,818,756
Against 14,504,240
Abstain 8,022,915
Broker Nonvotes 0
3. The Amendments to the Annual Executive Incentive Plan were approved.
For 109,671,256
Against 12,378,849
Abstain 8,295,806
Broker Nonvotes 0
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits to Part 1 of Form 10-Q
27. Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter
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/ Jeffrey B. Weeden
------------------
Jeffrey B. Weeden
Senior Vice President-Finance and
Chief Financial Officer
May 14, 1998
-16-
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 1,575,234
<INT-BEARING-DEPOSITS> 4,722
<FED-FUNDS-SOLD> 37,751
<TRADING-ASSETS> 4,809
<INVESTMENTS-HELD-FOR-SALE> 1,752,150
<INVESTMENTS-CARRYING> 2,406,057
<INVESTMENTS-MARKET> 2,458,821
<LOANS> 13,826,499
<ALLOWANCE> 218,977
<TOTAL-ASSETS> 20,383,670
<DEPOSITS> 15,124,447
<SHORT-TERM> 2,166,866
<LIABILITIES-OTHER> 312,241
<LONG-TERM> 1,036,194
<COMMON> 181,394
0
4,717
<OTHER-SE> 1,557,811
<TOTAL-LIABILITIES-AND-EQUITY> 20,383,670
<INTEREST-LOAN> 284,109
<INTEREST-INVEST> 63,859
<INTEREST-OTHER> 1,378
<INTEREST-TOTAL> 349,346
<INTEREST-DEPOSIT> 119,840
<INTEREST-EXPENSE> 165,592
<INTEREST-INCOME-NET> 183,754
<LOAN-LOSSES> 15,650
<SECURITIES-GAINS> 3
<EXPENSE-OTHER> 190,466
<INCOME-PRETAX> 106,685
<INCOME-PRE-EXTRAORDINARY> 72,916
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 72,916
<EPS-PRIMARY> 0.50
<EPS-DILUTED> 0.50
<YIELD-ACTUAL> 4.37
<LOANS-NON> 72,549
<LOANS-PAST> 55,104
<LOANS-TROUBLED> 262
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 218,861
<CHARGE-OFFS> 24,326
<RECOVERIES> 8,792
<ALLOWANCE-CLOSE> 218,977
<ALLOWANCE-DOMESTIC> 218,428
<ALLOWANCE-FOREIGN> 549
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 1,082,339
<INT-BEARING-DEPOSITS> 9,458
<FED-FUNDS-SOLD> 192,073
<TRADING-ASSETS> 994
<INVESTMENTS-HELD-FOR-SALE> 1,942,234
<INVESTMENTS-CARRYING> 2,251,167
<INVESTMENTS-MARKET> 2,264,757
<LOANS> 13,346,973
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<TOTAL-ASSETS> 19,538,316
<DEPOSITS> 14,587,034
<SHORT-TERM> 2,458,339
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<LONG-TERM> 697,688
<COMMON> 181,102
0
8,129
<OTHER-SE> 1,350,992
<TOTAL-LIABILITIES-AND-EQUITY> 19,538,316
<INTEREST-LOAN> 276,232
<INTEREST-INVEST> 63,653
<INTEREST-OTHER> 1,696
<INTEREST-TOTAL> 341,581
<INTEREST-DEPOSIT> 114,117
<INTEREST-EXPENSE> 154,557
<INTEREST-INCOME-NET> 187,024
<LOAN-LOSSES> 9,718
<SECURITIES-GAINS> 1,126
<EXPENSE-OTHER> 178,691
<INCOME-PRETAX> 109,933
<INCOME-PRE-EXTRAORDINARY> 71,795
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 71,795
<EPS-PRIMARY> 0.49
<EPS-DILUTED> 0.48
<YIELD-ACTUAL> 4.51
<LOANS-NON> 91,843
<LOANS-PAST> 71,749
<LOANS-TROUBLED> 274
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 213,138
<CHARGE-OFFS> 14,518
<RECOVERIES> 4,798
<ALLOWANCE-CLOSE> 213,136
<ALLOWANCE-DOMESTIC> 212,520
<ALLOWANCE-FOREIGN> 616
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 1,254,289
<INT-BEARING-DEPOSITS> 5,249
<FED-FUNDS-SOLD> 82,589
<TRADING-ASSETS> 2,293
<INVESTMENTS-HELD-FOR-SALE> 1,707,606
<INVESTMENTS-CARRYING> 2,452,124
<INVESTMENTS-MARKET> 2,505,360
<LOANS> 13,568,786
<ALLOWANCE> 218,861
<TOTAL-ASSETS> 19,843,685
<DEPOSITS> 14,714,654
<SHORT-TERM> 2,121,412
<LIABILITIES-OTHER> 257,367
<LONG-TERM> 1,057,151
<COMMON> 181,102
0
5,308
<OTHER-SE> 1,506,691
<TOTAL-LIABILITIES-AND-EQUITY> 19,843,685
<INTEREST-LOAN> 1,138,417
<INTEREST-INVEST> 256,354
<INTEREST-OTHER> 6,702
<INTEREST-TOTAL> 1,401,473
<INTEREST-DEPOSIT> 471,670
<INTEREST-EXPENSE> 651,088
<INTEREST-INCOME-NET> 750,385
<LOAN-LOSSES> 54,658
<SECURITIES-GAINS> 679
<EXPENSE-OTHER> 744,018
<INCOME-PRETAX> 442,848
<INCOME-PRE-EXTRAORDINARY> 295,209
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 295,209
<EPS-PRIMARY> 2.03
<EPS-DILUTED> 2.00
<YIELD-ACTUAL> 4.47
<LOANS-NON> 63,858
<LOANS-PAST> 57,628
<LOANS-TROUBLED> 263
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 213,138
<CHARGE-OFFS> 70,743
<RECOVERIES> 21,808
<ALLOWANCE-CLOSE> 218,861
<ALLOWANCE-DOMESTIC> 218,552
<ALLOWANCE-FOREIGN> 309
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 1,449,094
<INT-BEARING-DEPOSITS> 6,349
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0
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0
15,344
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