<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1994 Commission File Number 1-10294
HIBERNIA CORPORATION
(Exact name of registrant as specified in its charter)
Louisiana 72-0724532
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
313 Carondelet Street, New Orleans, Louisiana 70130
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code (504) 533-5332
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at July 31, 1994
Class A Common Stock, no par value 88,667,382 Shares
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<TABLE>
CONSOLIDATED BALANCE SHEETS
Hibernia Corporation and Subsidiary
<CAPTION>
June 30 December 31 June 30
Unaudited ($ in thousands) 1994 1993 1993
--------- ------------ --------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $236,320 $216,675 $192,406
Short-term investments 75,245 220,000 288,105
Securities available for sale 435,223 402,579 438,472
Securities held to maturity (estimated fair values at
June 30, 1994, December 31, 1993 and June 30, 1993,
respectively, were $1,468,842, $1,543,893, and $1,467,300) 1,501,374 1,518,292 1,427,875
Loans, net of unearned income 2,498,068 2,328,119 2,230,827
Reserve for possible loan losses (158,332) (159,143) (185,189)
Loans, net 2,339,736 2,168,976 2,045,638
Bank premises and equipment 84,938 81,291 85,900
Customers' acceptance liability 9,730 11,800 4,315
Other assets 174,598 175,970 185,265
TOTAL ASSETS $4,857,164 $4,795,583 $4,667,976
LIABILITIES
Deposits:
Demand, noninterest-bearing $763,265 $812,693 $694,910
Interest-bearing 3,385,878 3,273,342 3,336,116
Total Deposits 4,149,143 4,086,035 4,031,026
Federal funds purchased and securities sold under
agreements to repurchase 166,197 137,986 121,760
Liability on acceptances 9,730 11,800 4,315
Payables arising from securities transactions not yet settled - 50,875 49,775
Other liabilities 89,354 80,515 67,430
TOTAL LIABILITIES 4,414,424 4,367,211 4,274,306
SHAREHOLDERS' EQUITY
Preferred Stock, no par value:
Authorized - 100,000,000 shares; issued and
outstanding - none - - -
Class A Common Stock, no par value:
Authorized - 200,000,000 shares; issued and
outstanding - 83,717,760, 83,611,764, and 83,376,649 at
June 30, 1994, December 31, 1993, and June 30, 1993 160,738 160,535 160,083
Surplus 405,362 404,745 404,388
Retained earnings (deficit) (118,276) (147,160) (170,801)
Unrealized gain (loss) on securities available for sale (5,084) 10,252 -
TOTAL SHAREHOLDERS' EQUITY 442,740 428,372 393,670
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $4,857,164 $4,795,583 $4,667,976
See notes to consolidated financial statements.
</TABLE>
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<TABLE>
CONSOLIDATED INCOME STATEMENTS
Hibernia Corporation and Subsidiary
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
---------------------------- ------------------------
Unaudited ($ in thousands, except per-share data) 1994 1993 1994 1993
--------- --------- -------- --------
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $49,949 $46,110 $96,700 $92,960
Interest on securities available for sale:
U.S. government securities and obligations of
U.S. government agencies 6,049 7,644 11,626 16,481
Other 278 118 396 213
Interest on securities held to maturity:
U.S. government securities and obligations of
U.S. government agencies 20,637 19,993 41,557 37,234
Trading account interest 9 8 15 10
Interest on time deposits in domestic banks - 7 - 181
Interest on federal funds sold and securities
purchased under agreements to resell 945 1,770 2,428 5,140
Total Interest Income 77,867 75,650 152,722 152,219
Interest Expense
Interest on deposits 26,600 25,452 51,423 50,573
Interest on federal funds purchased and securities
sold under agreements to repurchase 1,206 937 2,291 1,798
Interest on debt - 85 - 279
Total Interest Expense 27,806 26,474 53,714 52,650
Net Interest Income 50,061 49,176 99,008 99,569
Provision for possible loan losses - 3,800 - 8,800
Net Interest Income After Provision for
Possible Loan Losses 50,061 45,376 99,008 90,769
Noninterest Income
Trust fees 3,272 3,320 6,223 6,374
Service charges on deposits 8,598 7,624 16,482 14,838
Other service, collection and exchange charges 4,659 4,073 9,266 7,985
Other operating income 1,311 2,775 3,068 4,291
Securities gains, net - - - -
Total Noninterest Income 17,840 17,792 35,039 33,488
Noninterest Expense
Salaries and employee benefits 22,758 20,654 45,167 41,397
Occupancy expense, net 5,187 5,029 10,286 9,922
Equipment expense 2,599 2,648 5,432 5,385
Data processing expense 4,562 4,345 9,291 8,014
Foreclosed property expense, net (645) 68 (4,900) 2,662
Other operating expense 14,230 18,906 31,445 35,076
Total Noninterest Expense 48,691 51,650 96,721 102,456
Income Before Income Taxes 19,210 11,518 37,326 21,801
Income tax expense 771 - 1,751 -
Net Income $18,439 $11,518 $35,575 $21,801
Net Income Per Share $0.22 $0.14 $0.43 $0.26
See notes to consolidated financial statements.
</TABLE>
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<TABLE>
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Hibernia Corporation and Subsidiary
<CAPTION>
Unrealized
Shares of Retained Gains (Losses)
Six Months Ended June 30, 1994 Common Common Earnings on Securities
Unaudited ($ in thousands) Stock Stock Surplus (Deficit) Available for Sale Total
---------- -------- -------- ----------- ------------------- --------
<S> <C> <C> <C> <C> <C> <C>
Balances at December 31, 1993 83,611,764 $160,535 $404,745 ($147,160) $10,252 $428,372
Net income - - - 35,575 - 35,575
Issuance of Common Stock:
Divdend Reinvestment Plan 101,321 194 603 - - 797
Stock Option Plan 4,675 9 14 - - 23
Cash dividends declared - - - (6,691) - (6,691)
Change in unrealized valuation of securities
available for sale - - - - (15,336) (15,336)
Balances at June 30, 1994 83,717,760 $160,738 $405,362 ($118,276) ($5,084) $442,740
<CAPTION>
Unrealized
Shares of Retained Gains (Losses)
Six Months Ended June 30, 1993 Common Common Earnings on Securities
Unaudited ($ in thousands) Stock Stock Surplus (Deficit) Available for Sale Total
Balances at December 31, 1992 82,397,009 $158,202 $403,528 ($192,602) - $369,128
Net income - - - 21,801 - 21,801
Issuance of Common Stock:
Divdend Reinvestment Plan 3,793 7 20 - - 27
Stock Option Plan 13,508 26 41 - - 67
Issuance of Common Stock pursuant to the
exercise of Common Stock Purchase Warrants 962,339 1,848 799 - - 2,647
Balances at June 30, 1993 83,376,649 $160,083 $404,388 ($170,801) - $393,670
See notes to consolidated financial statements.
</TABLE>
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<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
Hibernia Corporation and Subsidiary
<CAPTION>
Six Months Ended June 30
Unaudited ($ in thousands) 1994 1993
-------- -------
<S> <C> <C>
Oerating Activities
Net income $35,575 $21,801
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for possible loan losses - 8,800
Amortization of intangibles and deferred charges 2,546 3,797
Depreciation and amortization 5,567 5,501
Premium amortization, net of discount accretion 8,377 6,796
Gain on sale of assets (4,398) (3,610)
ORE and other valuation adjustments 113 3,850
Increase in interest receivable and other assets (6,844) (14,202)
Increase in interest payable and other liabilities 8,839 118,255
Net Cash Provided By Operating Activities 49,775 150,988
Investing Activities
Purchases of securities (244,057) (766,060)
Maturities of securities 204,373 240,976
Decrease in payables arising from securities transactions (50,875) (101,569)
Net decrease (increase) in loans (285,002) 85,787
Proceeds from sales of loans 113,663 28,850
Purchases of premises, equipment and other assets (9,043) (3,682)
Proceeds from sales of other real estate acquired 10,363 11,688
Net Cash Used By Investing Activities (260,578) (504,010)
Financing Activities
Net increase (decrease) in domestic deposits 47,621 (8,796)
Net increase in time deposits - foreign office 15,487 3,382
Net increase in short-term borrowings 28,211 9,858
Retirement of debt - (8,077)
Issuance of common stock 820 2,741
Dividends paid (6,691) -
Net Cash Provided (Used) By Financing Activities 85,448 (892)
Decrease in cash and cash equivalents (125,355) (353,914)
Cash and cash equivalents at beginning of year 436,675 832,419
Cash And Cash Equivalents at End of period $311,320 $478,505
See notes to consolidated financial statements.
</TABLE>
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Note 1 BASIS OF PRESENTATION The accompanying unaudited
consolidated financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10
of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been
included. Operating results for the six-month period ended June
30, 1994, are not necessarily indicative of the results that may
be expected for the year ending December 31, 1994. For further
information, refer to the consolidated financial statements and
notes included in the Registrant's annual report on Form 10-K for
the year ended December 31, 1993.
Note 2 STOCK OPTIONS The Company's stock option plans
provide incentive and non-qualified options to various key
employees and non-employee directors to purchase shares of Class A
Common Stock at no less than the fair market value of the stock at
the date of grant. All options granted prior to 1992 became
exercisable six months from the date of grant. The remaining
options granted under the 1987 Stock Option Plan, the Long-Term
Incentive Plan and the 1993 Directors' Stock Option Plan become
exercisable in the following increments: 50% after the expiration
of two years from the date of grant, an additional 25% three years
from the date of grant and the remaining 25% four years from the
date of grant.
Options granted under the 1987 Stock Option Plan generally
expire 10 years from the date granted. Options granted under the
Long-Term Incentive Plan and the 1993 Directors' Stock Option Plan
do not expire unless the holder dies, retires, becomes permanently
disabled or leaves the employ of the Company, at which time the
options expire at various times ranging from 30 to 180 days. All
options vest immediately upon a change in control of the Company.
At June 30, 1994, the number of shares available for grant
under the 1987 Stock Option Plan, the Long-Term Incentive Plan and
the 1993 Directors' Stock Option Plan amounted to 161,216;
1,155,032; and 845,000, respectively.
The table below summarizes the activity in the plans during
the second quarter of 1994:
Incentive Non-Qualified
1987 STOCK OPTION PLAN
Outstanding, March 31, 1994 190,741 1,368,248
Granted - 5,000
Canceled - (2,271)
Exercised - (4,227)
Outstanding, June 30, 1994 190,741 1,366,750
Exercisable, June 30, 1994 64,068 570,757
LONG-TERM INCENTIVE PLAN
Outstanding, March 31, 1994 12,598 2,530,137
Granted - -
Canceled - (37,680)
Outstanding, June 30, 1994 12,598 2,492,457
Exercisable, June 30, 1994 - -
Incentive Non-Qualified
DIRECTORS' STOCK OPTION PLAN
Outstanding, March 31, 1994 - 75,000
Granted - 80,000
Canceled - -
Outstanding, June 30, 1994 - 155,000
Exercisable, June 30, 1994 - -
Note 3 MERGER AGREEMENTS During 1993 and 1994 the Company
entered into merger agreements with five Louisiana financial
institutions. Mergers with Commercial Bancshares, Inc., and
Bastrop National Bank were effective July 1, 1994. Mergers with
First Bancorp of Louisiana, Inc., and First Continental Bancshares,
Inc., were effective August 1, 1994. A fifth merger, with Pioneer
Bancshares Corporation is expected to be consummated in the fourth
quarter of 1994 pending regulatory and shareholder approval. All
of these mergers will be accounted for as poolings of interests.
The following table shows Hibernia Corporation and Pro Forma
Hibernia Corporation results as of and for the six months ended
June 30, 1994 giving effect to the mergers with Commercial
Bancshares, Inc., Bastrop National Bank, First Bancorp of
Louisiana, Inc., and First Continental Bancshares, Inc.
As Reported Pro Forma
Total Assets $ 4,857,164 $ 5,691,868
Total Equity $ 442,740 $ 485,961
Net Income $ 35,575 $ 37,055
Average Shares Outstanding 83,662,494 96,683,988
Net Income Per Share $ .43 $ .38
Note 4 PER-SHARE DATA Income per common share data are
based on the weighted average number of shares outstanding of
83,662,494 and 83,689,537 for the six months and three months ended
June 30, 1994, and 82,825,792 and 83,247,288 for the six months and
three months ended June 30, 1993.
Note 5 EQUITY On April 26, 1994 the shareholders of the
Company approved an amendment to the Company's Articles of
Incorporation which increased the number of authorized shares of
Class A Common Stock to 200,000,000 and eliminated all Class B
Common Stock and Series A and B Preferred Stock.
Note 6 CONTINGENCIES The Company is a party to certain
pending legal proceedings arising from matters incidental to its
business.
In addition, the Company is a named defendant in a shareholder
class-action suit which alleges that, during the period March 19,
1990, to July 30, 1991, the market value of the Company's common
stock was artificially inflated due to false and misleading news
releases and public statements and the failure to disclose material
facts. This suit is in the discovery stage. The Company intends
to contest the suit vigorously.
The Company has established reserves for potential litigation
losses of approximately $11,580,000 at June 30, 1994. In the
opinion of management and counsel, the aggregate unreserved
liability or loss, if any, of legal proceedings will not have a
significant effect on the consolidated financial statements of the
Company.
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<TABLE>
QUARTERLY CONSOLIDATED SUMMARY OF INCOME
AND SELECTED FINANCIAL DATA (1)
Hibernia Corporation and Subsidiary
<CAPTION>
Three Months Ended Six Months Ended
($ in thousands, except June 30 March 31 June 30 June 30 June 30
per-share data) 1994 1994 1993 1994 1993
<S> <C> <C> <C> <C> <C>
Interest income $ 77,867 $ 74,854 $ 75,650 $152,722 $152,219
Interest expense 27,806 25,907 26,474 53,714 52,650
Net interest income 50,061 48,947 49,176 99,008 99,569
Provision for possible loan losses - - 3,800 - 8,800
Net interest income after provis 50,061 48,947 45,376 99,008 90,769
Noninterest income:
Noninterest income 17,840 17,200 17,792 35,039 33,488
Securities gains - - - - -
Noninterest income 17,840 17,200 17,792 35,039 33,488
Noninterest expense 48,691 48,031 51,650 96,721 102,456
Income before taxes 19,210 18,116 11,518 37,326 21,801
Income tax expense 771 980 - 1,751 -
Net Income $ 18,439 $ 17,136 $ 11,518 $ 35,575 $ 21,801
Income per common share (2) $ 0.22 $ 0.20 $ 0.14 $ 0.43 $ 0.26
Cash dividends declared per share $ 0.04 $ 0.04 $ - $ 0.08 $ -
Average shares outstanding (000s) 83,690 83,635 83,247 83,662 82,826
Selected Quarter-End Balances
($ in millions)
Loans $2,498.1 $2,347.5 $2,230.8
Total assets $4,857.2 $5,019.2 $4,668.0
Deposits $4,149.1 $4,316.9 $4,031.0
Debt $ - $ - $ -
Equity $ 442.7 $ 431.7 $ 393.7
Selected Average Balances
($ in millions)
Loans $2,430.4 $2,315.3 $2,247.6 $2,373.2 $2,259.1
Total assets $4,841.9 $4,872.4 $4,624.5 $4,857.1 $4,651.0
Deposits $4,148.3 $4,113.0 $4,009.5 $4,130.7 $4,010.0
Debt $ - $ - $ 3.7 $ - $ 5.9
Equity $ 436.1 $ 434.4 $ 388.5 $ 435.3 $ 381.1
Selected Ratios (%)
Return on average assets 1.52 1.41 1.00 1.46 0.94
Return on average equity 16.91 15.78 11.86 16.35 11.44
Net interest margin 4.53 4.42 4.64 4.48 4.69
Efficiency (3) 70.75 71.68 75.88 71.21 75.68
Tier 1 risk-based capital 15.45 15.63 14.96
Total risk-based capital 16.76 16.94 16.30
Leverage 8.54 8.17 7.68
(1) Prior periods have been conformed to current-period presentation.
(2) Income per share data were based on the weighted average number of common shares outstanding in the respective period.
Dividends per share are historical amounts.
(3) Noninterest expense as a percentage of net interest income (T.E.) plus noninterest income (excluding securities transactions).
</TABLE>
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MANAGERMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Management's Discussion presents a review of the major factors and trends
affecting the performance of Hibernia Corporation (the "Company") and its
bank subsidiary (the "Bank") and should be read in conjunction with the
accompanying consolidated financial statements, notes and tables.
SECOND QUARTER 1994 HIGHLIGHTS
Hibernia Corporation continued its strong performance by posting second
quarter 1994 results showing sharply increased earnings, growth in loans and
deposits and continued asset quality improvement.
* Net income totaled $18.4 million ($.22 per share), up 60% from $11.5
million ($.14 per share) in the second quarter of 1993 and up 8% over
the $17.1 million ($.20 per share) reported in the first quarter of
1994. Net income for the first six months of 1994 was $35.6 million
($.43 per share), up 63% from $21.8 million ($.26 per share) in
1993's first half.
* Returns on assets and equity were 1.52% and 16.91%, respectively,
compared to 1.00% and 11.86% in the second quarter of 1993. Six-
month returns on assets and equity were 1.46% and 16.35% in 1994
compared to .94% and 11.44% in 1993.
* Total loans grew at an annual rate of 26% during the second quarter
of 1994. Loans increased to $2.5 billion at the close of the latest
quarter, 12% higher than a year earlier, and more than 6% higher than
March 31, 1994.
* Nonperforming assets decreased 59% from a year ago and 23% from March
31, 1994 to $47.6 million at June 30, 1994. Nonperforming assets
stand at 1.89% of loans plus foreclosed assets, down from 5.11% at
June 30, 1993 and 2.59% at March 31 this year.
* There were no loan loss provisions in the second quarter or first six
months of 1994 compared to provisions of $3.8 million and $8.8
million in the same periods in 1993. Reserve coverage of
nonperforming loans improved to 629% compared to 237% a year ago.
* Merger activity is summarized below:
Assets
6/30/94
Bank Holding Company / Bank (millions) Merger Date
--------------------------- ------------ -----------
Commercial Bancshares, Inc. $165 July 1, 1994
First Commercial Bank
Bastrop National Bank $117 July 1, 1994
First Bancorp of Louisiana, Inc. $214 August 1, 1994
First National Bank of West Monroe
Southern National Bank at Tallulah
First Continental Bancshares, Inc. $375 August 1, 1994
First National Bank of Jefferson Parish
Pioneer Bancshares Corporation $362 Fourth Quarter, 1994*
Pioneer Bank & Trust Co.
* Estimated. Pending regulatory and shareholder approval.
Hibernia's board of directors in July raised the quarterly cash dividend
to $.05 per share. This follows the $.04 per share dividends declared in
April and January of 1994. The most recent dividend is payable August 23
to shareholders of record on August 5.
FINANCIAL CONDITION:
EARNING ASSETS
Earning assets averaged $4,506.5 million in the second quarter of 1994,
a $166.8 million (4%) increase from the second-quarter 1993 average of
$4,339.7 million. Compared to the second quarter of 1993, average loans
increased $182.8 million (8%) and securities held to maturity increased
$135.0 million (10%), while short-term investments decreased $138.2 million
(58%).
Loans. Average loans for the second quarter of 1994 of $2,430.4 million
were up $115.1 million (5%) over the first quarter of 1994 and up $182.8
million (8%) compared to the second quarter of 1993. For the first half of
1994, average loans increased $114.1 million (5%) to $2,373.2 million
compared to the same period in 1993.
Table 1 presents the Company's loan portfolio classified according to
industry concentration at June 30, 1994, March 31, 1994 and June 30, 1993.
Total loans increased $150.6 million (6%) during the second quarter of 1994.
Commercial loans increased $81.9 million (6%) in spite of the Company's
continuing successful efforts to reduce the level of nonperforming and
criticized assets. Consumer loans also increased in the second quarter of
1994, up $68.7 million (8%), primarily due to the continued growth in
indirect lending and revolving credit lines.
Compared to June 30, 1993, loans increased $267.3 million (12%) as consumer
loans were up $228.6 million (31%), and commercial loans increased $38.7
million (3%). The change in the mix during this period evidences the
Company's strategy of seeking growth in consumer lending while maintaining
preeminence in Louisiana commercial lending. Consumer loans comprised 38.8%
of the loan portfolio at June 30, 1994 compared to 33.2% at June 30, 1993.
Securities Available for Sale. Average securities available for sale
decreased $12.8 million from the second quarter of 1993 to $447.0 million.
For the first half of 1994 average securities available for sale decreased
$14.4 million (3%) to $458.7 million compared to the first half of 1993.
Both declines reflect the effects of contractual repayments and prepayments
of principal related to residential mortgage refinancings, partially offset
by purchases of adjustable-rate mortgage-backed securities. Securities
classified as "available for sale" are primarily mortgage-backed securities.
Beginning December 31, 1993, securities available for sale are stated at
fair value with the unrealized gains or losses, net of tax, reported as a
separate component of shareholders' equity. During 1993, securities
available for sale were stated at amortized cost.
Securities Held to Maturity. Average securities held to maturity for the
second quarter of 1994 increased $135.0 million (10%) compared to the same
period a year ago, while the year-to-date average increased $268.0 million
(21%) in 1994 compared to the first half of 1993. These increases reflect
the growth in investable funds in excess of opportunities for new loans that
the Company experienced in 1993.
Short-Term Investments. Average short-term investments (primarily
federal funds sold and reverse repurchase agreements) for the three months
ended June 30, 1994, decreased $138.2 million compared to the second quarter
of 1993 as the Company invested excess liquidity in higher-yielding loans
and securities. For the first six months of 1994, this shift in the
allocation of earning assets resulted in a $201.8 million decrease in
average short-term investments compared to the same period a year earlier.
ASSET QUALITY
Table 2 presents a summary of nonperforming assets at the end of the past
five quarters. Table 3 presents a summary of changes in nonperforming
assets for the second quarter and first six months of 1994 and 1993.
Nonperforming assets -- which include nonaccrual loans, restructured
loans and foreclosed assets (including in-substance foreclosures) -- totaled
$47.6 million at June 30, 1994, down 59% compared to $116.0 million at June
30, 1993. Foreclosed assets totaled $22.4 million at June 30, 1994, and
included $16.7 million of in-substance foreclosures. Nonperforming assets
declined $13.9 million during the second quarter of 1994, following a $20.9
million decrease in the first quarter of 1994. As illustrated in Table 3,
$22.3 million of the $34.8 million decline in 1994 was attributable to
payments on and sales of nonperforming assets. Also, $11.3 million of
nonperforming loans were returned to performing status. As a percentage of
total loans plus foreclosed assets, nonperforming assets at June 30, 1994,
improved to 1.89% from 5.11% at June 30, 1993, and 3.50% at year-end 1993.
In addition to the nonperforming assets discussed above, management has
identified other commercial loans for which payments are current that are
subject to potential future classification as nonperforming. As of June 30,
1994, there were $46.8 million of these loans, compared to $53.0 million at
March 31, 1994 and $33.7 million at year-end 1993. The bulk of the increase
versus year-end was due to a single large commercial real estate loan.
RESERVE AND PROVISION FOR POSSIBLE LOAN LOSSES
The Company made no provision to the reserve for possible loan losses
during the first half of 1994, compared to an $8.8 million provision a year
ago ($3.8 million in the second quarter). A $17.5 million negative
provision was recorded in the fourth quarter of 1993. The absence of a
provision in the current year reflects continued improvement in asset
quality, evidenced by declines in net charge-offs and lower levels of
nonperforming loans. Because net charge-offs in 1994 totaled just $.8
million, reserve coverage continued to strengthen as the level of
nonperforming assets declined. The reserve for possible loan losses as a
percentage of nonperforming loans increased to 629% at June 30, 1994
compared to 237% a year ago and 292% at year-end 1993.
Net charge-offs in the second quarter of 1994 declined $3.1 million (84%)
compared to a year ago. Gross charge-offs decreased $2.2 million (31%) and
recoveries on loans previously charged-off increased $.9 million (29%).
Year-to-date net charge-offs were down $7.9 million (91%). As a percentage
of average loans, annualized net loan charge-offs for the second quarter and
the first half of 1994 were .10% and .07%, respectively. The comparable
charge-off ratios in 1993 were .65% and .77%, respectively.
The reserve for possible loan losses totaled $158.3 million, or 6.3% of
total loans, at June 30, 1994, compared to $185.2 million, or 8.3%, a year
earlier. Table 4 presents an analysis of the activity in the reserve for
possible loan losses for the second quarter and first six months of 1994 and
1993.
FUNDING SOURCES:
DEPOSITS AND BORROWINGS
Deposits. Average deposits totaled $4,148.3 million in the second
quarter of 1994, a $138.8 million (3%) increase from the second quarter of
1993. Average core deposits were up $151.9 million (5%) due to increases
in demand, NOW, money-market and savings deposits. Noncore deposits
declined $13.1 million (2%) as public fund certificates of deposit decreased
$8.8 million, other large denomination certificates of deposits decreased
$13.2 million and foreign time deposits increased $8.9 million.
Table 5 presents the composition of average deposits for the second and
first quarters of 1994 and the second quarter of 1993.
Borrowings. Average borrowings (which include federal funds purchased,
securities sold under agreements to repurchase and debt) increased $24.5
million to $154.2 million for the second quarter of 1994 compared to the
second quarter of 1993. The increase resulted from an increase in
repurchase agreements with major customers, as well as the purchase of
federal funds by the Company from correspondent downstream banks.
INTEREST RATE SENSITIVITY
The primary objective of asset/liability management is controlling
interest rate risk. On a monthly basis, management monitors the sensitivity
of net interest income to changes in interest rates through methods that
include simulation and gap reports, and attempts to optimize the
asset/liability mix to minimize the impact of significant rate movements
within a broad range of interest rate scenarios. Management may limit
interest rate risk by alterations to the mix of floating- and fixed-rate
assets and liabilities, changes to pricing schedules and adjustment of
maturities through sales and purchases of securities. On a limited basis,
the Company enters into interest rate swap agreements in order to manage
interest rate exposure and not for speculative purposes.
RESULTS OF OPERATIONS:
NET INTEREST INCOME
Taxable-equivalent net interest income for the three months ended June
30, 1994, totaled $51.0 million, a $.7 million increase from the same period
in 1993 and a $1.2 million increase from the first quarter of 1994. The
increase over the second quarter of 1993 was primarily the result of the
positive effect of the change in the mix of earning assets from lower-
yielding short-term investments into loans and securities held to maturity,
accompanied by overall growth in earning assets. These factors were
partially offset by lower yields on securities and loans and higher rates
paid on deposits. The shift in the mix of earning assets was the primary
reason for the increase compared to the first quarter of 1994.
Net interest income decreased $1.1 million from the first six months of
1993 to $100.8 million for the first six months of 1994. The yields on both
loans and securities (primarily mortgage-backed securities) decreased in
spite of the rise in market rates experienced in the first six months of
1994 as the levels of prepayments and refinancings of consumer mortgages and
large commercial loans surged in anticipation of the increase in market
rates. The unfavorable effect of these lower yields offset the growth and
the change in the mix of earning assets, while deposit rates remained
relatively stable.
The net interest margin was 4.53% for the second quarter of 1994 compared
to 4.64% in the second quarter of 1993 and 4.42% in the first quarter of
1994. Table 6 details the net interest margin for the most recent five
quarters.
Table 7 presents an analysis of the Company's taxable-equivalent net
interest income and average balance sheets for the three months ended June
30, 1994, March 31, 1994, and June 30, 1993, and for the first six months
of 1994 and 1993. Table 8 presents an analysis of changes in taxable-
equivalent net interest income between the second quarter of 1994 and the
first quarter of 1994 and between the second quarter of 1994 and the second
quarter of 1993.
NONINTEREST INCOME
Noninterest income totaling $17.8 million for the second quarter of 1994
was unchanged compared to the same period of 1993. For the first six months
of 1994 compared to the same period in 1993, noninterest income increased
$1.6 million (5%) to $35.0 million. The major categories of noninterest
income for the three months and six months ended June 30, 1994, and the
comparable periods in 1993 are presented in Table 9. Service charges on
deposits increased $1.0 million (13%) for the quarter and $1.6 million (11%)
for the six months due to both pricing increases and an increase in fee-
generating deposit balances. Retail investment service income rose $.2
million (14%) and $.8 million (35%) for the three month and six month
periods, respectively. Included in other income are gains from the sale of
mortgage loans, which decreased $.8 million for the quarter and $.7 million
for the six months. The Company enters into "forward" contracts to
securitize and sell its expected production of mortgage loans at a "locked-
in" rate. The rise in mortgage loan rates in the second quarter led to an
excess in the volume of loans produced. That "overproduction" of mortgage
loans was sold in the secondary market at a loss.
NONINTEREST EXPENSE
For the second quarter of 1994, noninterest expense totaled $48.7
million, a $3.0 million (6%) decrease from the second quarter of 1993. For
the first half of 1994, noninterest expense compared to the same period in
1993, was down $5.7 million (6%) to $96.7 million. Noninterest expense for
the three months and six months ended June 30, 1994 and June 30, 1993, is
presented by major category in Table 10.
Staff costs, the largest component of noninterest expense, increased $2.1
million (10%) for the quarter compared to the same period a year ago, while
year-to-date staff costs were up $3.8 million (9%). Increases in the number
of full-time equivalent employees, annual merit increases effective
primarily in the second quarter of 1994, and management incentive programs
based on the Company's profitability were the primary reasons for the rise
in staff costs.
Outside data processing expenses for the second quarter of 1994 versus
the comparable period in 1993 increased $.2 million (5%) and year-to-date
expenses increased $1.3 million (16%) due to higher fees from its third-
party data processor, as well as to conversion efforts relating to merger
activities. In 1995, the Company's outside data processing will be provided
by a new vendor. The Company expects the change in vendors to result in
significant savings in 1995 and beyond.
Net foreclosed property expense decreased $.7 million in the second
quarter of 1994 compared to the same quarter a year ago. Year-to-date
expenses were down $7.6 million in 1994 versus 1993. The decreases resulted
from increased gains from the sale of foreclosed assets, lower costs
resulting from the reduced level of foreclosed assets and dramatic decreases
in charges to the valuation allowance for foreclosed assets. The second
quarter and first half of 1994 charges totaled just $.1 million compared to
charges in 1993 of $1.4 million for the second quarter and $3.9 million for
the first six months.
Deposit insurance premiums decreased over 15% for both the second quarter
and first six months of 1994 compared to the same periods a year ago, down
$.5 million for the quarter and $1.0 million year-to-date. Computed under
the risk-related premium system beginning in 1993, the deposit insurance
premium declined because of a reduction in the assessment rate used in the
calculation. This reduction reflects Hibernia's improved capital position
and management rating from the Office of the Comptroller of the Currency.
Amortization of intangibles during the second quarter of 1994 compared
to the second quarter of 1993 decreased $.9 million (40%), and decreased
$1.2 million (33%) for the first six months of 1994 compared to the same
period in 1993. Significant prepayments on mortgage loans for which the
Company had purchased the servicing rights resulted in unexpected writedowns
in 1993 of these intangible assets.
Other changes in noninterest expense in the second quarter and first half
of 1994 compared to the same period in 1993 related to a $3.1 million
expense in the second quarter of 1993 to establish litigation reserves.
The Company's efficiency ratio, defined as noninterest expense as a
percentage of taxable-equivalent net interest income plus noninterest income
(excluding securities transactions), was 70.75% for the second quarter of
1994, a significant improvement from 75.88% for the same period in 1993.
Similarly, for the first six months of 1994, the efficiency ratio was 71.21%
compared to 75.68% in 1993's first half. This improvement in efficiency
reflects continued cost control efforts and increased noninterest income.
INCOME TAXES
The Company recorded a $.8 million provision for state income taxes in
the second quarter of 1994 and a $1.8 million provision in the first six
months of 1994. The Bank is subject to a Louisiana shareholder tax based
partly on income. In the second quarter of 1994, the Company recorded a
deferred federal tax benefit equal to its current federal tax liability.
CAPITAL
Shareholders' equity totaled $442.7 million at June 30, 1994, compared
to $393.7 million at June 30, 1993. The increase is primarily the result of
net income over the most recent 12 months totaling $61.7 million, partially
offset by $9.2 million in cash dividends and $5.1 million in unrealized
losses on securities available for sale. Risk-based capital and leverage
ratios for Hibernia Corporation and Hibernia National Bank exceed the ratios
required for designation as a "well-capitalized" institution under
regulatory guidelines. Table 11 presents these ratios for the Company and
the Bank for the most recent five quarters.
LIQUIDITY
The Company's loan-to-deposit ratio, one measure of liquidity, increased
from 55.3% at June 30, 1993 to 60.2% at June 30, 1994. Management believes
that current and projected levels of short-term investments and securities
available for sale are adequate to meet the Company's liquidity needs. The
Company's continuing improvement in certificate of deposit ratings enhances
its ability to raise funds in the open market. In addition, membership in
the Federal Home Loan Bank of Dallas further enhances liquidity management
by providing a readily accessible source of funds.
<PAGE>
<TABLE>
TABLE 1 - LOAN COMPOSITION
<CAPTION>
June 30, 1994 March 31, 1994 June 30, 1993
Loans Percentage Loans Percentage Loans Percentage
($ in millions) Outstanding of Total Outstanding of Total Outstanding of Total
------------------------- ------------------------ ---------------------------
<S> <C> <C> <C> <C> <C> <C>
Commercial:
Energy $ 50.1 2.0 % $ 50.2 2.1 % $ 70.7 3.2 %
Transportation,
communications
and utilities 98.9 4.0 102.3 4.4 123.2 5.5
Commercial real estate 367.7 14.7 306.3 13.0 316.1 14.2
Health care 219.5 8.8 226.4 9.6 230.4 10.3
Services 266.6 10.7 246.6 10.5 186.8 8.4
Commercial and
industrial 379.2 15.1 374.8 16.0 416.9 18.7
Other commercial 146.2 5.9 139.7 6.0 145.4 6.5
Total commercial 1,528.2 61.2 1,446.3 61.6 1,489.5 66.8
Consumer:
Residential mortgage 387.4 15.5 380.0 16.2 328.2 14.7
Indirect 320.1 12.8 269.7 11.5 175.1 7.8
Student 69.7 2.8 72.4 3.1 59.3 2.7
Revolving credit 60.4 2.4 51.8 2.2 49.7 2.2
Other 132.3 5.3 127.3 5.4 129.0 5.8
Total consumer 969.9 38.8 901.2 38.4 741.3 33.2
Total Loans $2,498.1 100.0 % $2,347.5 100.0 % $2,230.8 100.0 %
</TABLE>
<PAGE>
<TABLE>
TABLE 2 - NONPERFORMING ASSETS
<CAPTION>
June 30 March 31 Dec. 31 Sept. 30 June 30
($ in thousands) 1994 1994 1993 1993 1993
-------- -------- -------- --------- --------
<S> <C> <C> <C> <C> <C>
Nonaccrual loans $ 25,189 $ 37,985 $ 52,613 $ 66,884 $ 78,282
Restructured loans - - 1,841 1,845 -
Total nonperforming loans 25,189 37,985 54,454 68,729 78,282
Foreclosed assets 22,403 23,470 27,920 30,464 37,742
Total nonperforming assets $ 47,592 $ 61,455 $ 82,374 $ 99,193 $116,024
Accruing loans past due
90 days or more $ 2,848 $ 2,809 $ 2,712 $ 2,660 $ 6,690
Reserve for possible loan losses $158,332 $158,922 $159,143 $183,925 $185,189
Nonperforming assets as a percentage
of loans plus foreclosed assets 1.89 % 2.59 % 3.50 % 4.37 % 5.11 %
Reserve for possible loan losses as a
percentage of nonperforming loans 628.58 % 418.38 % 292.25 % 267.61 % 236.57 %
</TABLE>
<PAGE>
<TABLE>
TABLE 3 - ANALYSIS OF CHANGES IN NONPERFORMING ASSETS
<CAPTION>
Three Months Six Months
Ended June 30 Ended June 30
($ in thousands) 1994 1993 1994 1993
------------------------- ---------------------------
<S> <C> <C> <C> <C>
Nonperforming assets
at beginning of period $ 61,455 $153,379 $ 82,374 $179,940
Additions 1,898 13,728 4,270 25,401
Gross charge-offs (3,596) (5,763) (5,374) (12,843)
Returned to performing status (8,565) (17,531) (11,301) (24,475)
OREO valuations (112) (1,350) (112) (3,850)
Payments and sales of assets (3,488) (26,439) (22,265) (48,149)
Nonperforming assets
at end of period $ 47,592 $116,024 $ 47,592 $116,024
</TABLE>
<PAGE>
<TABLE>
TABLE 4 - RESERVE FOR POSSIBLE LOAN LOSSES
<CAPTION>
Three Months Six Months
Ended June 30 Ended June 30
($ in thousands) 1994 1993 1994 1993
------------------------ -------------------------
<S> <C> <C> <C> <C>
Balance at beginning of period $158,922 $185,049 $159,143 $185,061
Loans charged off (4,692) (6,845) (7,303) (14,885)
Recoveries 4,102 3,185 6,492 6,213
Net loans charged off (590) (3,660) (811) (8,672)
Provision for possible loan losses - 3,800 - 8,800
Balance at end of period $158,332 $185,189 $158,332 $185,189
Reserve for possible loan losses
as a percentage of loans 6.34 % 8.30 % 6.34 % 8.30 %
Net charge-offs as a percentage
of average loans 0.10 % 0.65 % 0.07 % 0.77 %
</TABLE>
<PAGE>
<TABLE>
TABLE 5 - DEPOSIT COMPOSITION
<CAPTION>
Second Quarter 1994 First Quarter 1994 Second Quarter 1993
Average % of Average % of Average % of
($ in millions) Outstandings Deposits Outstandings Deposits Outstandings Deposits
----------------------- ----------------------- ------------------------
<S> <C> <C> <C> <C> <C> <C>
Demand, noninterest-bearing $ 761.7 18.4 % $ 781.9 19.0 % $ 667.2 16.6 %
NOW accounts 434.8 10.5 435.0 10.6 390.6 9.7
Money market deposit accounts 914.4 22.0 933.6 22.7 906.1 22.6
Savings accounts 164.2 4.0 162.1 3.9 155.0 3.9
Other consumer time deposits 1,143.9 27.6 1,119.3 27.2 1,148.2 28.7
Total core deposits 3,419.0 82.5 3,431.9 83.4 3,267.1 81.5
Public fund certificates of
deposit of $100,000 or more 627.0 15.1 587.6 14.3 635.8 15.9
Certificates of deposit of
$100,000 or more 88.0 2.1 84.4 2.1 101.2 2.5
Foreign time deposits 14.3 0.3 9.1 0.2 5.4 0.1
Total deposits $ 4,148.3 100.0 % $ 4,113.0 100.0 % $ 4,009.5 100.0 %
</TABLE>
<PAGE>
<TABLE>
TABLE 6 - NET INTEREST MARGIN (taxable-equivalent)
<CAPTION>
1994 1993
------------------------ ----------------------------------
Second First Fourth Third Second
Quarter Quarter Quarter Quarter Quarter
------------------------ ----------------------------------
<S> <C> <C> <C> <C> <C>
Yield on earning assets 7.01 % 6.74 % 6.83 % 6.88 % 7.08 %
Rate on interest-bearing liabilities 3.15 3.02 2.99 3.02 3.06
Net interest spread 3.86 3.72 3.84 3.86 4.02
Contribution of
noninterest-bearing funds 0.67 0.70 0.67 0.64 0.62
Net interest margin 4.53 % 4.42 % 4.51 % 4.50 % 4.64 %
Noninterest-bearing funds
supporting earning assets 21.43 % 23.37 % 22.38 % 21.19 % 19.91 %
</TABLE>
<PAGE>
<TABLE>
TABLE 7 - CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
Taxable-equivalent basis (1)
<CAPTION>
Second Quarter 1994 First Quarter 1994 Second Quarter 1993
Interest Interest Interest
(Average balances $ in millions, Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
interest income/expense $ in thousands) Balances Expense Rate Balances Expense Rate Balances Expense Rate
---------------------------- ----------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Interest-earning assets:
Loans (2) $2,430.4 $50,870 8.39 % $2,315.3 $47,612 8.33 % $2,247.6 $47,213 8.42 %
Securities available for sale 447.0 6,327 5.66 470.6 5,695 4.84 459.8 7,762 6.75
Securities held to maturity:
U.S. government securities and obligations
of U. S. government agencies 1,530.3 20,635 5.40 1,565.7 20,918 5.37 1,395.4 19,991 5.74
Other 0.1 2 6.44 - 2 - - 2 -
Total securities held to maturity 1,530.4 20,637 5.40 1,565.7 20,920 5.37 1,395.4 19,993 5.74
Short-term investments 98.7 954 3.88 188.9 1,488 3.19 236.9 1,785 3.02
Total interest-earning assets 4,506.5 $78,788 7.01 % 4,540.5 $75,715 6.74 % 4,339.7 $76,753 7.08 %
Reserve for possible loan losses (160.3) (159.7) (187.9)
Noninterest-earning assets:
Cash (excluding items in process
of collection) 115.4 114.3 99.6
Items in process of collection 109.3 108.9 91.0
Other assets 271.0 268.4 282.1
Total noninterest-earning assets 495.7 491.6 472.7
Total assets $4,841.9 $4,872.4 $4,624.5
LIABILITIES AND SHAREHOLDERS'
EQUITY
Interest-bearing liabilities:
Interest-bearing deposits:
NOW accounts $ 434.8 $ 1,645 1.52 % $ 435.0 $ 1,540 1.44 % $ 390.6 $ 1,392 1.43 %
Money market deposit accounts 914.4 5,128 2.25 933.6 5,426 2.36 906.1 5,505 2.44
Savings accounts 164.2 698 1.70 162.1 679 1.70 155.0 668 1.73
Other consumer time deposits 1,143.9 12,187 4.27 1,119.3 11,504 4.17 1,148.2 11,779 4.11
Public fund certificates of deposits
of $100,000 or more 627.0 5,934 3.80 587.6 4,836 3.34 635.8 5,167 3.26
Certificates of deposits
of $100,000 or more 88.0 865 3.95 84.4 768 3.69 101.2 902 3.58
Foreign time deposits 14.3 143 4.01 9.1 70 3.13 5.4 39 2.95
Total interest-bearing deposits 3,386.6 26,600 3.15 3,331.1 24,823 3.02 3,342.3 25,452 3.05
Short-term borrowings 154.2 1,206 3.14 148.5 1,084 2.96 129.7 937 2.90
Debt - - - - - - 3.7 85 9.17
Total interest-bearing liabilities 3,540.8 $27,806 3.15 % 3,479.6 $25,907 3.02 % 3,475.7 $26,474 3.06 %
Noninterest-bearing liabilities:
Demand deposits 761.7 781.9 667.2
Other liabilities 103.3 176.5 93.1
Total noninterest-bearing liabilities 865.0 958.4 760.3
Total shareholders' equity 436.1 434.4 388.5
Total liabilities and
shareholders' equity $4,841.9 $4,872.4 $4,624.5
SPREAD AND NET YIELD
Interest rate spread 3.86 % 3.72 % 4.02 %
Cost of funds supporting interest-earning assets 2.48 % 2.32 % 2.44 %
Net interest income/margin $50,982 4.53 % $49,808 4.42 % $50,279 4.64 %
(1) Based on the statutory income tax rate of 35%.
(2) Excludes unearned income. For purposes of yield computations, nonaccrual loans are included in loans outstanding.
</TABLE>
<PAGE>
<TABLE>
TABLE 7 - CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
Taxable-equivalent basis (1)
<CAPTION>
Six Months Ended Six Months Ended
June 30, 1994 June 30, 1993
Interest Interest
(Average balances $ in millions, Average Income/ Yield/ Average Income/ Yield/
interest income/expense $ in thousands) Balances Expense Rate Balances Expense Rate
----------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest-earning assets:
Loans (2) $2,373.2 $ 98,482 8.37 % $2,259.1 $ 95,282 8.50 %
Securities available for sale 458.7 12,022 5.24 473.1 16,694 7.06
Securities held to maturity:
U.S. government securities and obligations
of U. S. government agencies 1,547.9 41,553 5.38 1,280.0 37,229 5.83
Other 0.1 4 7.79 - 5 -
Total securities held to maturity 1,548.0 41,557 5.38 1,280.0 37,234 5.84
Short-term investments 143.5 2,443 3.43 345.3 5,330 3.11
Total interest-earning assets 4,523.4 $154,504 6.87 % 4,357.5 $154,540 7.13 %
Reserve for possible loan losses (160.0) (187.2)
Noninterest-earning assets:
Cash (excluding items in process of collection) 114.8 105.0
Items in process of collection 109.1 94.3
Other assets 269.8 281.4
Total noninterest-earning assets 493.7 480.7
Total assets $4,857.1 $4,651.0
LIABILITIES AND SHAREHOLDERS'
EQUITY
Interest-bearing liabilities:
Interest-bearing deposits:
NOW accounts $ 434.9 $ 3,185 1.48 % $ 390.3 $ 2,971 1.53 %
Money market deposit accounts 923.9 10,554 2.30 898.7 11,207 2.51
Savings accounts 163.2 1,377 1.70 153.3 1,385 1.82
Other consumer time deposits 1,131.7 23,691 4.22 1,156.6 22,936 4.00
Public fund certificates of deposits
of $100,000 or more 607.4 10,770 3.58 616.9 10,156 3.32
Certificates of deposits of $100,000 or more 86.2 1,633 3.82 105.1 1,853 3.56
Foreign time deposits 11.7 213 3.67 4.5 65 2.96
Total interest-bearing deposits 3,359.0 51,423 3.09 3,325.4 50,573 3.07
Short-term borrowings 151.3 2,291 3.05 124.7 1,798 2.91
Debt - - - 5.9 279 9.42
Total interest-bearing liabilities 3,510.3 $ 53,714 3.09 % 3,456.0 $ 52,650 3.07 %
Noninterest-bearing liabilities:
Demand deposits 771.7 684.7
Other liabilities 139.8 129.2
Total noninterest-bearing liabilities 911.5 813.9
Total shareholders' equity 435.3 381.1
Total liabilities and
shareholders' equity $4,857.1 $4,651.0
SPREAD AND NET YIELD
Interest rate spread 3.78 % 4.06 %
Cost of funds supporting interest-earning assets 2.39 % 2.44 %
Net interest income/margin $100,790 4.48 % $101,890 4.69 %
(1) Based on the statutory income tax rate of 35%.
(2) Excludes unearned income. For purposes of yield computations, nonaccrual loans are included in loans outstanding.
</TABLE>
<PAGE>
<TABLE>
TABLE 8 - CHANGES IN TAXABLE-EQUIVALENT NET INTEREST INCOME (1)
<CAPTION>
Second Quarter 1994 Compared to:
First Quarter 1994 Second Quarter 1993
------------------------------ ---------------------------------
Increase (Decrease) Due to Change In:
($ in thousands) Volume Rate Total Volume Rate Total
------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Taxable-Equivalent
Interest Earned On:
Loans $2,398 $860 $3,258 $3,826 $ (169) $ 3,657
Securities available for sale (295) 927 632 (210) (1,225) (1,435)
Securities held to maturity (474) 191 (283) 1,863 (1,219) 644
Short-term investments (821) 287 (534) (1,241) 410 (831)
Total 808 2,265 3,073 4,238 (2,203) 2,035
Interest Paid On:
NOW accounts (1) 106 105 164 89 253
Money market deposit accounts (110) (188) (298) 51 (428) (377)
Savings accounts 9 10 19 39 (9) 30
Other consumer time deposits 257 426 683 (45) 453 408
Public fund certificates of
deposit of $100,000 or more 339 759 1,098 (70) 837 767
Certificates of deposit
of $100,000 or more 33 64 97 (175) 138 (37)
Foreign time deposits 48 25 73 86 18 104
Short-term borrowings 43 79 122 187 82 269
Debt - - - (85) - (85)
Total 618 1,281 1,899 152 1,180 1,332
Taxable-Equivalent
Net Interest Income $ 190 $ 984 $1,174 $4,086 $(3,383) $ 703
(1)Change due to mix (both rate and volume) has been allocated to volume and rate changes in proportion to the
relationship of the absolute dollar amounts to the changes in each.
</TABLE>
<PAGE>
<TABLE>
TABLE 9 - NONINTEREST INCOME
<CAPTION>
Three Months Ended Six Months Ended
--------------------------------- ---------------------------------
Percentage Percentage
June 30 June 30 Increase June 30 June 30 Increase
($ in thousands) 1994 1993 (Decrease) 1994 1993 (Decrease)
---------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C>
Trust fees $ 3,272 $ 3,320 (1)% $ 6,223 $ 6,374 (2)%
Service charges on deposits 8,598 7,624 13 16,482 14,838 11
Other service, collection and
exchange charges:
Mortgage loan servicing income 1,365 1,452 (6) 2,734 3,004 (9)
Retail investment service income 1,528 1,340 14 3,293 2,448 35
Other 1,766 1,281 38 3,239 2,533 28
Gain on settlement of acquired loans 172 565 (70) 470 744 (37)
Other income:
Computer services 437 646 (32) 876 1,413 (38)
Other income 702 1,564 (55) 1,722 2,134 (19)
Total fee income 17,840 17,792 - 35,039 33,488 5
Securities gains, net - - - - - -
Total Noninterest Income $17,840 $17,792 - % $35,039 $33,488 5 %
</TABLE>
<PAGE>
<TABLE>
TABLE 10 - NONINTEREST EXPENSE
<CAPTION>
Three Months Ended Six Months Ended
--------------------------------- -----------------------------------
Percentage Percentage
June 30 June 30 Increase June 30 June 30 Increase
($ in thousands) 1994 1993 (Decrease) 1994 1993 (Decrease)
---------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Salaries $19,297 $17,375 11 % $37,918 $ 34,430 10 %
Benefits 3,461 3,279 6 7,249 6,967 4
Total staff costs 22,758 20,654 10 45,167 41,397 9
Occupancy, net 5,187 5,029 3 10,286 9,922 4
Equipment 2,599 2,648 (2) 5,432 5,385 1
Data processing 4,562 4,345 5 9,291 8,014 16
Foreclosed property expense, net (645) 68 N/M (4,900) 2,662 N/M
Deposit insurance and
examination fees 2,709 3,223 (16) 5,426 6,418 (15)
Postage 844 870 (3) 1,785 1,717 4
Stationery and supplies 740 833 (11) 1,641 1,708 (4)
Professional fees 1,574 1,880 (16) 3,155 4,211 (25)
Amortization of intangibles 1,273 2,124 (40) 2,516 3,748 (33)
Other 7,090 9,976 (29) 16,922 17,274 (2)
Total Noninterest Expense $48,691 $51,650 (6)% $96,721 $102,456 (6)%
Efficiency ratio (1) 70.75 % 75.88 % 71.21 % 75.68 %
N/M = Not meaningful
(1) Noninterest expense as a percentage of net interest income (T.E.) plus noninterest income (excluding secu
transactions).
</TABLE>
<PAGE>
<TABLE>
TABLE 11 - QUARTERLY SELECTED CAPITAL ADEQUACY RATIOS
<CAPTION>
June 30 March 31 Dec. 31 Sept. 30 June 30
1994 1994 1993 1993 1993
-------- -------- --------- --------- --------
<S> <C> <C> <C> <C> <C>
Hibernia National Bank:
Risk-based capital
Tier 1 risk-based capital ratio 13.66 % 13.59 % 13.35 % 12.82 % 12.12 %
Total risk-based capital ratio 14.96 % 14.91 % 14.67 % 14.15 % 13.45 %
Leverage ratio 7.55 % 7.09 % 7.04 % 6.61 % 6.21 %
Hibernia Corporation:
Risk-based capital
Tier 1 risk-based capital ratio 15.45 % 15.63 % 15.56 % 15.67 % 14.96 %
Total risk-based capital ratio 16.76 % 16.94 % 16.87 % 17.00 % 16.30 %
Leverage ratio 8.54 % 8.17 % 8.25 % 7.98 % 7.68 %
</TABLE>
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(b) Reports on Form 8-K
A report on Form 8-K dated June 27, 1994, was
filed by the registrant reporting Item 5 Other
Events.
<PAGE>
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 to sign on
behalf of the registrant.
HIBERNIA CORPORATION
(Registrant)
Date: August 12, 1994 By: /s/ Ron E. Samford, Jr.
Ron E. Samford, Jr.
Executive Vice President
and Controller (principal
accounting officer)
