As filed with the Securities and Exchange Commission on April 21, 1997
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
Date of Report (Date of Earliest Event Reported): April 14, 1997
NATIONSBANK CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
North Carolina 1-6523 56-0906609
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(State of Incorporation) (Commission (IRS Employer
File Number) Identification No.)
NationsBank Corporate Center, Charlotte, North Carolina 28255
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(Address of Principal Executive Offices) (Zip Code)
(704) 386-5000
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(Registrant's Telephone Number, including Area Code)
ITEM 5. OTHER EVENTS.
Release of First Quarter Earnings. On April 14, 1997, the Registrant
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announced financial results for the first quarter of fiscal 1997, reporting
earnings of $709 million and earnings per common share of $0.97. A copy of the
press release announcing the results of the Registrant's fiscal quarter ended
March 31, 1997 is filed as Exhibit 99.1 to this Current Report on Form 8-K.
ITEM 7. EXHIBITS.
The following exhibit is filed herewith:
Exhibit No. Description of Exhibit
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99.1 Press release dated April 14, 1997 with
respect to the Registrant's financial results for
the fiscal quarter ended March 31, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
NATIONSBANK CORPORATION
By: /s/ Marc D. Oken
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Marc D. Oken
Chief Accounting Officer
Dated: April 21, 1997
EXHIBIT INDEX
Exhibit No. Description of Exhibit
- ----------- ----------------------
99.1 Press release dated April 14, 1997 with
respect to the Registrant's financial results for
the fiscal quarter ended March 31, 1997.
FOR IMMEDIATE RELEASE EXHIBIT 99.1
NATIONSBANK EARNINGS PER SHARE INCREASED 14%
IN FIRST QUARTER 1997
CHARLOTTE, NC, April 14, 1997 -- NationsBank earnings rose 38 percent to $709
million in the first quarter of 1997, versus $513 million in the year-ago
quarter. Earnings per common share increased 14 percent to $.97, even after the
issuance of new shares for the acquisition of Boatmen's Bancshares Inc.
"This quarter was marked by continued focus on productivity initiatives and
substantial progress on the integration of the former Boatmen's franchise," said
Hugh L. McColl Jr., chief executive officer. "Our company is generating
substantial cash flows, which enhance our ability to invest in technology, our
businesses and future opportunities."
First quarter 1997 results include the impact of several acquisitions completed
in 1996 and early 1997, primarily the acquisition of Boatmen's Bancshares Inc.
on Jan. 7, 1997. Quarterly growth comparisons reflect the impact of
acquisitions in addition to internal growth.
Earnings Highlights (first quarter 1997 compared to first quarter 1996 operating
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results)
* Cash basis earnings (net income excluding amortization of intangibles)
were $1.10 per common share, up 8 percent from $1.02 per share
* Tangible return on average tangible common shareholders' equity increased
453 basis points to 26.38 percent, from 21.85 percent
* Net interest yield rose 40 basis points to 3.83 percent
Reported Earnings
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NationsBank earned $709 million in the first quarter of 1997. This represented
a 38-percent increase over the $513 million earned in the first quarter 1996.
Earnings per common share for the first quarter 1997 rose 14 percent to $.97,
from $.85 per common share in the year-ago quarter (all per share figures were
adjusted for a two-for-one stock split, which occurred on Feb. 27, 1997).
Return on average common shareholders' equity was 13.96 percent in the first
quarter 1997, down from the year-ago quarter due primarily to the equity issued
in the Boatmen's Bancshares Inc. acquisition.
Excluding a merger-related, after-tax charge of $77 million in the first quarter
of 1996, operating net income and earnings per share for that quarter were $590
million and $.98, respectively.
Cash Basis Earnings
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Cash basis earnings exclude the amortization of intangibles, the majority of
which is due to nearly $6.4 billion of intangibles resulting from the purchase
of Boatmen's Bancshares Inc. in the first quarter of 1997. Cash basis earnings
increased 31 percent to $810 million in the first quarter of 1997, or $1.10 per
common share, from operating results (excluding merger-related charge) of $616
million, or $1.02 per common share, in the first quarter 1996. The tangible
return on average tangible common shareholders' equity rose to 26.38 percent in
the first quarter 1997, from the operating level of 21.85 percent in the year-
ago quarter. In the year-ago quarter, reported cash basis results (including
merger-related charge) were $539 million, or $.89 per common share, equaling a
19.14 percent tangible return on average tangible common shareholders' equity.
Net Interest Income
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In the first quarter of 1997, net interest income increased 25 percent to $1.98
billion. The growth was achieved through a 19-percent increase in average loans
and leases and a 40-basis point expansion in the net interest yield. The
continuing improvement in the net interest yield to 3.83 percent from 3.43
percent is the result of initiatives which improved both the yield and the
composition of earning assets.
Noninterest Income
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Noninterest income rose 26 percent to $1.11 billion in the first quarter of
1997.
This growth was attributable primarily to higher levels of income from deposit
accounts and asset management and fiduciary service fees.
Efficiency
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In the first quarter of 1997, the cash basis efficiency ratio (excluding
amortization of intangibles) held steady at 55.3 percent, compared to 55.4
percent in the first quarter 1996. Including the amortization of intangibles,
the efficiency ratio was 58.6 percent in the first quarter 1997.
Credit Quality
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Total nonperforming assets were $1.22 billion on March 31, 1997, or .82 percent
of net loans, leases and factored receivables and other real estate owned,
compared to .79 percent of net levels on March 31, 1996. The allowance for
credit losses totaled $2.79 billion at quarter-end, equaling 265 percent of
nonperforming loans, compared to $2.25 billion, or 268 percent one year earlier.
In the first quarter of 1997, provision for credit losses was $190 million,
covering net charge-offs of $184 million. Net charge-offs for the quarter
equaled .50 percent of average net loans, leases and factored receivables,
unchanged when compared to the first quarter 1996.
Capital Strength
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Total shareholders' equity climbed to $20.7 billion on March 31, 1997. This
represented 8.65 percent of period-end assets, compared to 6.97 percent at March
31, 1996. Book value per common share rose to $28.22 at the end of the first
quarter 1997. In the first quarter of 1997, NationsBank repurchased
approximately 41 million common shares, plus an additional 16 million common
shares related to issuances for associate stock option plans and the conversion
of a series of Boatmen's Bancshares Inc. preferred stock.
NationsBank Corporation, headquartered in Charlotte, N.C., is a bank holding
company that provides financial products and services nationally and
internationally to individuals, businesses, corporations, institutional
investors and government agencies. NationsBank has primary retail and
commercial banking operations in 16 states and the District of Columbia. As of
March 31, 1997, NationsBank had total assets of $239 billion.
<TABLE>
NATIONSBANK CORPORATION FINANCIAL HIGHLIGHTS
<CAPTION>
THREE MONTHS
ENDED MARCH 31
1997 1996(1)
FINANCIAL SUMMARY
(In millions except per-share data)
<S> <C> <C>
Net income $709 $513
Earnings per common share .97 .85
Fully diluted earnings per common share .94 .84
Cash basis earnings (2) 810 539
Cash basis earnings per share 1.10 .89
Cash basis fully diluted earnings
per share 1.07 .88
Average common shares issued 730.413 600.558
Average fully diluted common shares issued 752.391 610.945
Price per share of common stock
at period end $55.500 $40.063
Common dividends paid 245 174
Common dividends paid per share .33 .29
Preferred dividends paid 4 4
EARNINGS SUMMARY
(Taxable-equivalent in millions)
Net interest income $1,978 $1,584
Provision for credit losses (190) (155)
Gains on sales of securities 43 14
Noninterest income 1,113 885
Other real estate owned income 2 -
Noninterest expense (1,810) (1,512)
Income before income taxes 1,136 816
Income taxes - including FTE adjustment* 427 303
Net income $709 $513
*FTE adjustment $28 $27
AVERAGE BALANCE SHEET SUMMARY
(In billions)
Loans and leases, net $146.679 $123.282
Managed loans and leases, net 152.256 126.003
Securities held for investment 1.920 4.292
Securities available for sale 20.740 22.997
Total securities 22.660 27.289
Earning assets 208.847 185.566
Total assets 242.206 208.617
Noninterest-bearing deposits 30.327 23.209
Interest-bearing deposits 104.649 83.697
Total deposits 134.976 106.906
Shareholders' equity 20.654 13.144
Common shareholders' equity 20.478 13.037
OTHER FINANCIAL DATA
Net interest yield 3.83% 3.43%
Return on average assets 1.19 .99
Return on average tangible assets 1.40 1.05
Return on average common
shareholders' equity 13.96 15.71
Return on average tangible common
shareholders' equity 26.38 19.14
Total equity to assets ratio (period-end) 8.65 6.97
Gross charge-offs (in millions) $251 $210
Net charge-offs (in millions) 184 155
% of average loans, leases and
factored accounts receivable, net .50% .50%
Managed credit card net charge-offs as a
% of average managed credit card receivables 6.09% 3.79%
Efficiency Ratio 58.56 56.44
Cash basis efficiency ratio 55.29 55.40
(1) 1996 results included a merger-related charge of $118
million($77 million, net of tax, or $.13 per common share).
(2) Cash basis earnings equal net income excluding amortization
of intangibles.
</TABLE>
<TABLE>
<CAPTION>
MARCH 31
1997 1996
BALANCE SHEET SUMMARY
(In billions)
<S> <C> <C>
Loans and leases, net $147.508 $123.169
Securities held for investment 1.836 4.104
Securities available for sale 20.010 17.771
Total securities 21.846 21.875
Earning assets 207.125 174.053
Factored accounts receivable 1.208 1.175
Mortgage servicing rights 1.194 .782
Goodwill, core deposit
and other intangibles 8.566 1.814
Total assets 238.958 194.375
Noninterest-bearing deposits 33.106 24.101
Interest-bearing deposits 103.701 85.521
Total deposits 136.807 109.622
Shareholders' equity 20.659 13.557
Common shareholders' equity 20.534 13.444
Per common share (not in billions) 28.22 22.46
Risk-based capital
Tier 1 capital $13.523 $11.479
Tier 1 capital ratio 7.06% 7.35%
Total capital $22.166 $18.280
Total capital ratio 11.58% 11.71%
Leverage ratio 6.20% 6.19%
Common shares issued (in millions) 727.575 598.636
Allowance for credit losses $2.785 $2.253
Allowance for credit losses
as a % of net loans, leases
and factored accounts receivable 1.87% 1.81%
Allowance for credit losses
as a % of nonperforming loans 264.82 267.71
Nonperforming loans $1.051 $.841
Nonperforming assets 1.219 .985
Nonperforming assets as a % of:
Total assets .51% .51%
Net loans, leases, factored accounts
receivable and other real estate owned .82 .79
OTHER DATA
Full-time equivalent headcount 81,000 61,070
Banking centers 2,634 2,005
ATMs 5,739 2,946
</TABLE>
<TABLE>
BUSINESS UNIT RESULTS - Three months ended March 31, 1997
(in millions)
<CAPTION>
General Bank Global Finance Financial Services
------------ -------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Total revenue $2,245 74% $603 20% $198 6%
Net income 440 62% 162 23% 51 7%
Return on average
tangible equity 26% 17% 22%
Average loans and
leases, net $96,855 66% $41,706 28% $8,303 6%
</TABLE>
