<PAGE> 1
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
Date of Report (Date of earliest event reported)
April 20, 1999
CHARTER ONE FINANCIAL, INC.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its Charter)
Delaware 0-16311 34-1567092
- --------------------------------------------------------------------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1215 Superior Avenue, Cleveland, Ohio 44114
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
(216) 566-5300
- --------------------------------------------------------------------------------
Registrant's telephone number, including area code
<PAGE> 2
ITEM 5. OTHER EVENTS
(1) Attached as Exhibits 99.1 and 99.2 are materials to be
presented at the Registrant's 1999 Annual Shareholder Meeting
to be held on April 21, 1999 and a related press release.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) The following exhibits are filed as part of this Report and
incorporated herein by reference:
99.1 Slide presentation to be delivered during Charter
One's 1999 Annual Shareholder Meeting
99.2 Press release announcing webcast of 1999 Annual
Meeting
<PAGE> 3
SIGNATURE
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.
CHARTER ONE FINANCIAL, INC.
Date: April 20, 1999 By: /s/ Richard W. Neu
---------------------------
Richard W. Neu
Chief Financial Officer
<PAGE> 4
EXHIBIT INDEX
Exhibit Number Description
99.1 Slide presentation to be delivered
during Charter One's 1999 Annual
Shareholder Meeting
99.2 Press release announcing webcast of
1999 Annual Meeting
<PAGE> 1
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
ANNUAL MEETING OF SHAREHOLDERS
APRIL 21, 1999
<PAGE> 2
FORWARD-LOOKING INFORMATION
This presentation contains a wide variety of historical information. There are a
number of important factors which could cause future results to differ
materially from historical performance. These include, but are not limited to,
financial condition, operating efficiencies, revenue creation, lending
origination, prepayment speeds, loan sale volumes, charge-offs and loan loss
provisions. Factors that might cause such a difference include, but are not
limited to: (1) expected cost savings from the ALBANK merger cannot be fully
realized or realized within the expected time frame; (2) revenues following the
ALBANK merger are lower than expected; (3) costs or difficulties related to the
integration of the business of Charter One and ALBANK are greater than expected;
(4) competitive pressures among depository institutions increase significantly;
(5) changes in the interest rate environment reduce interest margins; (6)
general economic conditions, either nationally or in the states in which the
Company does business, are less favorable than expected; and (7) legislation or
regulatory changes adversely affect the businesses in which the Company is
engaged.
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 3
COFI PROFILE
Nasdaq: COFI
<TABLE>
<CAPTION>
3/31/99
-----------
<S> <C>
Total assets $24.6 B
Total deposits $15.1 B
Book value per share $11.74
Equity to assets 7.95%
1st Q `99 operating: ROA 1.47%
ROE 18.64%
EPS $ .53
</TABLE>
NOW THE 35TH LARGEST BANK HOLDING COMPANY
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 4
WHAT A DIFFERENCE
A YEAR MAKES
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 5
WHAT A DIFFERENCE....
o CS Financial Corporation
o Acquired 10/16/98
o Added 4 branches in Cleveland area
o $343 M in deposits
o ALBANK Financial Corporation
o Acquired 11/30/98
o Added 109 branches in eastern NY, MA, VT
o $3.5 B in deposits
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 6
WHAT A DIFFERENCE....
<TABLE>
<CAPTION>
3/31/99 3/31/98
----------- -----------
<S> <C> <C>
Total assets $24.6 B $19.8 B
Total deposits 15.1 B 10.5 B
Checking accts 760 K 569 K
Households 1.3 M 850 K
Offices 339 220
States 5 3
</TABLE>
IS NOW THE 35TH LARGEST BANK HOLDING COMPANY,
A YEAR AGO WAS THE 6TH LARGEST THRIFT
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 7
COFI AT 3/31/98
220 RETAIL BANKING OFFICES IN 3 STATES
[MAP]
MICHIGAN, OHIO, NEW YORK
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 8
COFI AT 3/31/99
339 RETAIL BANKING OFFICES IN 5 STATES
[MAP]
MICHIGAN, OHIO, NEW YORK, VERMONT, MASSACHUSETTS
[ ] Charter One Bank (230)
[|] ALBANK (109)
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 9
NEW YORK UPDATE
o Senior management team in place
o Converted residential mortgage servicing 11/30/98
o Retail banking conversion on track for 5/29/99
o Product introductions underway, mail campaign scheduled mid-year
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 10
COFI EARNINGS GROWTH
COFI EARNINGS HAVE BEEN ACCELERATED THROUGH MERGERS
(ORIGINALLY REPORTED EPS)
COMPOUNDED ANNUAL
EARNINGS GROWTH OF 17%
<TABLE>
<CAPTION>
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share $.39 $.50 $.53 $.90 $.95 $1.15 $1.26 $1.38* $1.56 $1.77* $1.97*
</TABLE>
* 3 QTRS STAND ALONE, 4TH QTR MERGED
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 11
COFI INCREASES DIVIDEND
On April 21, 1999 -
The Board of Directors declared a 14% increase in the quarterly cash
dividend from $.14 per share to $.16 per share.
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 12
DIVIDEND GROWTH
DIVIDEND INCREASED
19 TIMES SINCE IPO
<TABLE>
<CAPTION>
CURRENT
'88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 RATE
--- --- --- --- --- --- --- --- --- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dividend $.08 $.09 $.11 $.12 $.13 $.18 $.25 $.32 $.39 $.45 $.53 $.64
</TABLE>
21% growth rate compounded annually
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 13
1998 WAS A
BREAKOUT YEAR
FOR CHARTER ONE!
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 14
1998 - A BREAKOUT YEAR
O TOP LINE REVENUE UP 15%
RECORD O ENERGIZED ASSETS UP 62%, 45% OVER GOAL
O CORE DEPOSITS UP 14%
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 15
SOOO
....WHAT HAPPENS
AFTER
A BREAKOUT YEAR??
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 16
YOU RAISE
THE BAR!!
[GRAPHIC] [GRAPHIC]
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 17
NEW PERFORMANCE GOALS
EPS growth 12-14%
ROE* 20%
ROA 1.50%
*Model supports equity of 7.5%
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 18
1ST QUARTER 1999 HIGHLIGHTS
O Operating net income $.53/share
o Up 23% over 3/31/98, as restated for pooling
o Up 15% over originally stated 3/31/98
O Operating returns
o 1.47% on assets
o 18.64% on equity
O Top line revenue - $243 M, up 9%
O Retail banking revenue up 41%
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 19
1ST QUARTER 1999 HIGHLIGHTS
O Energized assets 44% of portfolio, up from 40% @ 12/31/98
O Loan originations: $2.6 B, $1.2 B in energized assets
O Opened 61,000 new checking accts, 17,000 in NY divisions
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 20
1999 BUSINESS PLAN
MORE OF THE SAME
O Execute business plan in ALBANK franchise
O Pursue "Big 3" strategy . . . .
Grow:
o energized assets
o energized liabilities
o fee revenue
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 21
ENERGIZED ASSET PROGRESS
% OF TOTAL PORTFOLIO
GROWTH REFLECTS
ENERGIZED ASSET STRATEGY
<TABLE>
<CAPTION>
1995 1996 1997 1998 3/31/99
---- ---- ---- ---- -------
<S> <C> <C> <C> <C> <C>
31% 32% 32% 40% 44%
</TABLE>
1999 GOAL WAS 44%
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 22
ENERGIZED LIABILITY PROGRESS
<TABLE>
<CAPTION>
3/31/99 3/31/98
----------- -----------
<S> <C> <C> <C> <C>
Core deposits $ 6.6 B 44% $ 5.8 B 40%
CDs 8.5 B 56% 8.6 B 60%
----------- -----------
Total $ 15.1 B $ 14.4 B
=========== ===========
</TABLE>
CORE DEPOSITS UP 15% IN TWELVE MONTHS
DATA RESTATED FOR MERGERS
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 23
FEE REVENUE PROGRESS
o Retail banking revenue up 41% over 1st Q 1998
o Average revenue per checking acct (annualized)*:
<TABLE>
<CAPTION>
3/31/99 3/31/98 3/31/97
------- ------- -------
<S> <C> <C> <C>
OH $173 $145 $84
MI 196 138 98
NY 129 85 50
Combined 171 130 80
</TABLE>
*Excludes ALBK
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 24
COFI INTERNET STRATEGY
O 2 active sites
o charterone.com - features promotional offers to encourage
customer use
o on-line CD
o charteronemortgage.com - features customer data inquiry
O PC banking
o available since 1997
o 5,800 current users
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 25
COFI INTERNET STRATEGY
O Evaluating vendors to launch interactive banking
O Bank holding company status would facilitate forming a separate
internet bank, if desirable
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 26
1999 BUSINESS PLAN
OUR BUSINESS PLAN IS ACCELERATING
CHARTER ONE'S EVOLUTION INTO A
"REGIONAL BANK"
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 27
CHARTER ONE -- THE LONG VIEW
HOW CLOSE ARE WE TO
PERFORMING LIKE A
REGIONAL BANK?
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 28
PEER BANKS USED FOR COMPARISON
DATA AS OF 12/31/98
<TABLE>
<CAPTION>
Ticker Institution (State) Assets $ B
------ ----------------------------------------------------- ----------
<S> <C> <C>
UPC Union Planters (TN) 31.7
FITB Fifth Third (OH) 28.9
HBAN Huntington (OH) 28.3
COFI Charter One (OH) 24.5
FSCO First Security (UT) 21.8
MRIS Marshall & Ilsley (WI) 21.6
Index Lehman Regional Bank Index 21.6
FAM First American (TN) 20.7
MTB M&T Bank (NY) 20.6
ASO AmSouth (AL) 19.9
FTEN First Tennessee (TN) 18.7
OK Old Kent (MI) 16.6
</TABLE>
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 29
COFI COMPARED TO PEER BANKS
TANGIBLE EQUITY TO TANGIBLE ASSETS
<TABLE>
<CAPTION>
FTEN MTB HBAN ASO OK FSCO INDEX COFI FAM UPC MRIS FITB
---- --- ---- --- -- ---- ----- ---- --- --- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5.2 5.3 5.5 6.1 6.2 6.3 6.9 7.1 7.6 8.5 9.0 9.8
</TABLE>
SOURCE: SNL DATASOURCE FOR YEAR ENDED 12/31/98
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 30
COFI COMPARED TO PEER BANKS
OPERATING ROAE
<TABLE>
<CAPTION>
FTEN OK FITB ASO INDEX COFI FAM HBAN FSCO MTB MRIS UPC
---- -- ---- --- ----- ---- --- ---- ---- --- ---- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
22.4 18.0 17.9 16.8 16.8 16.7 16.7 16.5 16.2 15.0 13.9 10.4
</TABLE>
SOURCE: SNL DATASOURCE FOR YEAR ENDED 12/31/98
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 31
COFI COMPARED TO PEER BANKS
OPERATING ROAA
<TABLE>
<CAPTION>
FITB FAM MRIS INDEX FTEN OK COFI FSCO HBAN MTB ASO UPC
---- --- ---- ----- ---- -- ---- ---- ---- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1.85 1.45 1.43 1.38 1.34 1.32 1.29 1.28 1.27 1.23 1.22 1.00
</TABLE>
SOURCE: SNL DATASOURCE FOR YEAR ENDED 12/31/98
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 32
COFI COMPARED TO PEER BANKS
EFFICIENCY RATIO
<TABLE>
<CAPTION>
FITB COFI MTB HBAN FAM ASO UPC OK INDEX FSCO MRIS FTEN
---- ---- --- ---- --- --- --- -- ----- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
40.9 46.0 52.7 55.4 57.3 57.5 57.7 58.0 58.5 59.6 61.9 70.8
</TABLE>
SOURCE: SNL DATASOURCE FOR YEAR ENDED 12/31/98
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 33
COFI COMPARED TO PEER BANKS
QTRLY NET YIELD 12/98 FROM 12/97
<TABLE>
<CAPTION>
MTB FTEN UPC FSCO FAM MRIS INDEX ASO HBAN OK COFI FITB
--- ---- --- ---- --- ---- ----- --- ---- -- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CHANGE IN
BASIS POINTS (58) (57) (32) (24) (23) (15) (13) (13) (5) 4 17 23
</TABLE>
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 34
COFI COMPARED TO PEER BANKS
HOW THE MODEL STACKS UP
<TABLE>
<CAPTION>
LEHMAN INDEX
NEW MODEL 1998*
--------- ------------
<S> <C> <C>
SPREAD 3.25% 3.52%
PROVISION (.15) (.26)
--------- -----------
LOSS-ADJUSTED SPREAD 3.10 3.26
NONINTEREST INCOME 1.00 2.29
--------- -----------
REVENUE 4.10 5.55
OPERATING EXPENSES (1.65) (3.45)
--------- -----------
PRETAX OPERATING 2.45 2.10
AFTER-TAX OPERATING 1.60% 1.38%
========= ===========
</TABLE>
OPERATING EARNINGS AS % OF AVG TOTAL ASSETS
*COMPILED USING SNL DATASOURCE
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 35
COFI COMPARED TO PEER BANKS
10-YEAR AVERAGE RETURN
<TABLE>
<CAPTION>
COFI FITB FTEN MTB ASO OK FSCO INDEX MRIS HBAN UPC FAM
---- ---- ---- --- --- -- ---- ----- ---- ---- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
33.9 30.9 30.2 27.5 26.3 26.1 26.0 23.8 23.2 23.1 17.9 17.5
</TABLE>
COFI #1 THRIFT IN 1-YR, 5-YR AND 10-YR RETURN
Source: Wall Street Journal 2/25/99
[CHARTER ONE FINANCIAL, INC.(R) LOGO]
<PAGE> 36
COFI COMPARED TO PEER BANKS
P/E (1999 EST.) @ 4/9/99
<TABLE>
<CAPTION>
FITB OK FTEN ASO *INDEX MRIS HBAN MTB FAM COFI UPC FSCO
---- -- ---- --- ------ ---- ---- --- --- ---- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
28.4 20.2 19.7 19.6 18.6 18.0 16.6 15.1 13.8 13.3 12.9 12.5
</TABLE>
SOURCE: AMERICAN BANKER 4/12/99
*AS OF 4/1/99, PER SNL DATASOURCE
<PAGE> 1
Exhibit 99.2
INVESTOR CONTACT: ELLEN BATKIE (800) 262-6301
MEDIA CONTACT: WILLIAM DUPUY (216) 566-5311
CHARTER ONE TO ANNOUNCE EARNINGS 4/20/99
AND WEBCAST ANNUAL MEETING 4/21/99
CLEVELAND, Ohio, April 16, 1999 -- Charter One Financial, Inc. (NASDAQ: COFI),
announced today that it plans to announce results for the first quarter of 1999
on Tuesday, April 20, 1999. In addition, the company plans to make its 1999
annual meeting of shareholders available via a live webcast on Wednesday, April
21, 1999, starting at 2:00 p.m. EDT. Details of the webcast will be posted on
Charter One's website, www.charterone.com.
Charter One Bank has approximately $24.5 billion in total assets, making it
among the five largest thrifts in the country. The Bank currently has nearly
340 branch locations in Ohio, Michigan, New York, Massachusetts and Vermont.
Additionally, Charter One Mortgage Corp., the Bank's mortgage banking
subsidiary, operates 39 loan production offices across 12 states, and Charter
One Auto Finance, the Bank's indirect auto finance subsidiary, generates loans
in nine states.
