<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): July 13, 1995
THE BANK OF NEW YORK COMPANY, INC.
----------------------------------
(exact name of registrant as specified in its charter)
NEW YORK
--------
(State or other jurisdiction of incorporation)
1-6152 13-2614959
------ ----------
(Commission file number) (I.R.S. employer identification
number)
48 Wall Street, New York, NY 10286
---------------------------- -----
(Address of principal executive (Zip code)
offices)
212 - 495 - 1784
----------------
(Registrant's telephone number,
including area code)
<PAGE> 2
ITEM 5. Other Events
------------
Second Quarter Financial Results
--------------------------------
On July 13, 1995 The Bank of New York
Company, Inc. (the "Company") issued a press
release containing unaudited interim financial
information and accompanying discussion for the
second quarter of 1995. Exhibit 99 is a copy
of such press release and is incorporated herein
by reference.
ITEM 7. Financial Statements, Pro Forma Financial Information
and Exhibits
-----------------------------------------------------
(c) Exhibit Description
------- -----------
99 Unaudited interim financial
information and accompanying
discussion for the second quarter
of 1995 contained in the press
release dated July 13, 1995, of The
Bank of New York Company, Inc.
<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.
Dated: July 13, 1995
THE BANK OF NEW YORK COMPANY, INC.
(Registrant)
By: /s/ Robert E. Keilman
------------------------
Name: Robert E. Keilman
Title: Comptroller
<PAGE> 4
EXHIBIT INDEX
Exhibit No. Description
99 Unaudited interim financial
information and accompanying
discussion for the second quarter
of 1995 contained in the press
release dated July 13, 1995, of The
Bank of New York Company, Inc.
<PAGE> 1
Exhibit 99
The Bank of New York Company, Inc. NEWS
- -----------------------------------------------------------------------
48 Wall Street, New York, NY 10286
Contact:
For Release: PUBLIC AND INVESTOR RELATIONS DEPT.
IMMEDIATELY Paul J. Leyden, SVP
- ----------- (212) 495-1041
Andrew M. Merrill, VP
(212) 495-1721
Janet B. Stoner, VP
(212) 495-1619
THE BANK OF NEW YORK COMPANY, INC. REPORTS
RECORD SECOND QUARTER E.P.S.
----------------------------
Second Quarter E.P.S. Rises 25% to $1.09;
ROA of 1.68% Sets Quarterly Record
Common Stock Dividend Increased 13%
NEW YORK, N.Y., July 13, 1995 -- The Bank of New York Company, Inc. (NYSE:
BK) reported record second quarter fully diluted earnings per share of
$1.09, a 25% increase over the 87 cents earned in the second quarter of
1994. Net income rose by 28% to $226 million from $176 million earned in
the same period last year. Earnings per share, on a fully diluted basis,
were $2.11 for the first half of 1995 compared with $1.74 in 1994. Net
income for the first six months was $438 million, an increase of 23% over
last year's $355 million. Earnings per share for the second quarter and
first six months of 1995 were reduced by 3 and 7 cents for the dilutive
effect of stock warrants. During the second quarter of 1995, the Company
recorded an initial $11 million pre-tax gain ($6 million after-tax) on the
<PAGE> 2
sale of its ARCS Mortgage Inc. servicing portfolio.
Net interest income, on a taxable equivalent basis, totaled $514
million in the second quarter, a $93 million or 22% increase over the
second quarter of last year. Loan demand, in general, continued to
strengthen along with an ongoing shift toward higher yielding assets.
Revenues from the Company's securities processing business grew 15% over
the second quarter of 1994 and were led by strong performances from ADRs,
corporate trust, mutual funds custody, and master trust. Other processing
fees grew 12% over the same period. Operating expenses remained under
tight control.
As reported earlier this week, the Company's Board of Directors
approved a quarterly cash stock dividend of 36 cents per share, a 13%
increase over the 32 cents previously paid. This increase will result in
an annual rate of $1.44 per share, the highest in the Company's history,
surpassing the previous high of $1.28 per share. The new dividend is
payable on August 3, 1995 to holders of record as of July 21, 1995.
Return on average common equity was 19.85% in the second quarter of
1995, compared with 19.98% in the first quarter of 1995 and 17.67% in the
second quarter of last year. Return on average assets for the second
quarter was a record 1.68% versus 1.65% in the first quarter of 1995 and
1.42% in the second quarter of 1994.
The Company's estimated Tier 1 capital and Total capital ratios were
8.56% and 13.12% at June 30, 1995 compared with 8.56% and 13.31% at March
31, 1995, and 8.29% and 12.76% at June 30, 1994. Tangible common equity
as a percent of total assets was 7.67% at June 30, 1995 compared with
7.36% at March 31, 1995 and 6.49% one year ago.
<PAGE> 3
NET INTEREST INCOME
- -------------------
2nd 1st 2nd
Quarter Quarter Quarter Year-to-date
------- ------- ------- ------------
(In millions) 1995 1995 1994 1995 1994
----------------------------- ------------------
Net Interest Income $514 $502 $421 $1,017 $817
Net Interest Rate
Spread 3.34% 3.41% 3.26% 3.38% 3.21%
Net Yield on Interest
Earning Assets 4.45 4.49 3.98 4.47 3.94
On a taxable equivalent basis, net interest income amounted to a
record $514 million in the second quarter of 1995, compared with $421
million in the same period of 1994, an increase of 22%. The net interest
rate spread was 3.34% in the second quarter of 1995 compared with 3.41%
in the first quarter of 1995 and 3.26% one year ago. The net yield on
interest earning assets was 4.45% in the second quarter of 1995 down
slightly from the record 4.49% in the first quarter of 1995 but up
compared with 3.98% in last year's second quarter.
For the first six months of 1995, net interest income, on a taxable
equivalent basis, amounted to $1,017 million compared with $817 million
in the same period of 1994, an increase of 24%. The year-to-date net
interest rate spread was 3.38% in 1995 compared with 3.21% in 1994, while
the net yield on interest-earning assets was 4.47% in 1995 and 3.94% in
1994.
The Company's credit card business continued its strong performance.
Compared with last year's second quarter, managed outstandings were up 15%
to $7.7 billion from $6.7 billion and the number of card accounts
increased by 9% to 6.0 million from 5.5 million.
<PAGE> 4
NONINTEREST INCOME
- ------------------
2nd Quarter Year-to-date
----------- ------------
(In millions) 1995 1994 1995 1994
---------------- ----------------
Processing Fees
Securities $102 $ 89 $200 $178
Other 48 43 92 85
---- ---- ---- ----
150 132 292 263
Trust and Investment Fees 32 34 64 67
Income from Credit Card
Securitization - 11 3 24
Other Service Charges and Fees 109 105 219 210
Securities Gains 13 4 20 15
Foreign Exchange and
Other Trading Activities 13 13 25 29
Other 33 22 45 63
---- ---- ---- ----
Total Noninterest Income $350 $321 $668 $671
==== ==== ==== ====
Securities processing fees increased 15% to $102 million compared to
$89 million in the second quarter of 1994. In the first half of 1995
securities processing fees were $200 million compared to $178 million in
1994. The strongest performers in securities processing were ADRs,
corporate trust, mutual funds custody and master trust. In other
processing, trade finance revenue increased by 21% over the second quarter
of last year and in funds transfer, total revenues including balance
equivalents were up 20%. Credit card interchange income and syndication
fees also showed substantial strength.
An initial pre-tax gain of $11 million from the sale of ARCS Mortgage
Inc. servicing portfolio was included in other noninterest income in the
<PAGE> 5
second quarter of 1995. The balance will be recognized in the third
quarter. Other noninterest income in the first six months of 1994
included a $22 million pre-tax gain on the sale of a portion of the
Company's interest in Wing Hang Bank, Ltd.
The return of the securitized credit card receivables to the balance
sheet reduced noninterest income by $11 million compared to last year's
second quarter and by $21 million compared to last year's first half.
NONINTEREST EXPENSE AND INCOME TAXES
- ------------------------------------
The Company continued to control expenses in the second quarter of
1995. Total noninterest expense was up only 4% to $425 million from $410
million in the same period last year. Year-to-date noninterest expenses
were $841 million compared with $812 million in 1994. Salaries and
employee benefits increased 5% in the second quarter to $223 million from
$212 million in the same period last year due in part to acquisitions in
the Company's securities processing and factoring businesses. Occupancy
expense was down 2% compared with last year's second quarter. The
effective tax rates for the second quarter and first six months of 1995
were 38.4% and 38.3% compared with 37.4% for the second quarter and first
six months of 1994.
<PAGE> 6
NONPERFORMING ASSETS
- --------------------
Change
2Q 1995 vs
(Dollars in millions) 6/30/95 3/31/95 1Q 1995
--------------------------------------
Loans:
HLT $ 16 $ 23 $ (7)
Commercial Real Estate 54 67 (13)
Other Commercial 49 47 2
Foreign 19 31 (12)
LDC 21 34 (13)
Community Banking 73 79 (6)
---- ----
Total Loans 232 281 (49)
Other Real Estate 88 57 31
---- ----
Total $320 $338 (18)
==== ====
Nonperforming Assets Ratio 0.9% 1.0%
Allowance/Nonperforming Loans 307.3 266.5
Allowance/Nonperforming Assets 222.8 221.6
This was the sixteenth consecutive quarter of nonperforming assets
decreases. NPAs totaled $320 million at June 30, 1995, compared with $338
million at March 31, 1995. The increase in other real estate is
attributable to a $39 million California office complex that was
foreclosed on in the second quarter of 1995.
<PAGE> 7
LOAN LOSS PROVISION AND NET CHARGE-OFFS
- ---------------------------------------
2nd 1st 2nd
Quarter Quarter Quarter Year-to-date
------- ------- ------- ------------
(In millions) 1995 1995 1994 1995 1994
----------------------------- ----------------
Provision $ 62 $ 50 $ 39 $112 $ 84
---- ---- ---- ---- ----
Net Charge-offs:
HLT (5) - (8) (5) (8)
Commercial Real Estate (14) (2) (1) (16) (6)
Other Commercial (4) (4) (10) (8) (30)
Consumer (61) (63) (31) (124) (70)
Foreign - (13) (7) (13) (7)
Other (3) (3) (20) (6) (39)
---- ---- ---- ---- ----
Total (87) (85) (77) (172) (160)
Acquisition - 1 - 1 -
Credit Card Securitization 1 2 4 3 6
---- ---- ---- ---- ----
Decrease in Regular Allowance $(24) $(32) $(34) $(56) $(70)
==== ==== ==== ==== ====
Other Real Estate Expenses $ 2 $ 1 $ 2 $ 3 $ 3
The increase in the provision was principally related to growth in
the credit card portfolio, particularly in the Consumers Edge (registered
servicemark) product line. The allowance for loan losses was $713 million,
or 1.97% of loans at June 30, 1995, compared with $749 million, or 2.19% of
loans at March 31, 1995. The Company eliminated its exposure to
Yugoslavia in the second quarter with a $12 million charge-off.
***************************
(Financial highlights and detailed financial statements are attached.)
<PAGE> 8
THE BANK OF NEW YORK COMPANY, INC.
Financial Highlights
(Unaudited)
(Dollars in millions, except per share amounts)
1995 1994 Change
---- ---- ------
For the Three Months Ended June 30:
- -----------------------------------
Net Income $226 $176 28.4%
Per Common Share:
Primary Earnings $1.14 $0.92 23.9
Fully Diluted Earnings 1.09 0.87 25.3
Cash Dividends 0.32 0.275 16.4
Return on Average Common Shareholders'
Equity 19.85% 17.67%
Return on Average Assets 1.68 1.42
For the Six Months Ended June 30:
- ---------------------------------
Net Income $438 $355 23.4%
Per Common Share:
Primary Earnings $2.26 $1.85 22.2
Fully Diluted Earnings 2.11 1.74 21.3
Cash Dividends 0.64 0.50 28.0
Return on Average Common Shareholders'
Equity 19.92% 18.10%
Return on Average Assets 1.67 1.46
As of June 30:
- --------------
Assets $53,464 $52,347 2.1%
Loans 36,187 33,051 9.5
Securities 4,838 4,610 4.9
Deposits - Domestic 24,152 23,685 2.0
- Foreign 12,726 10,758 18.3
Long-Term Debt 1,710 1,526 12.1
Preferred Shareholders' Equity 117 135 -13.3
Common Shareholders' Equity 4,648 3,987 16.6
Common Shareholders' Equity Per Share 24.31 21.20 14.7
Market Value Per Share of Common Stock 40.38 28.88 39.8
Allowance for Loan Losses as a Percent
of Loans 1.97% 2.68%
Tier I Capital Ratio 8.56 8.29
Total Capital Ratio 13.12 12.76
Leverage Ratio 8.17 7.66
Tangible Common Equity Ratio 7.67 6.49
<PAGE> 9
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Statements of Income
(Unaudited)
(In millions, except per share amounts)
For the three For the six
months ended months ended
June 30, June 30,
1995 1994 1995 1994
---- ---- ---- ----
Interest Income
- ---------------
Loans $ 812 $ 561 $1,577 $1,073
Securities
Taxable 59 58 115 115
Exempt from Federal Income Taxes 12 15 24 30
----- ----- ------ ------
71 73 139 145
Deposits in Banks 30 15 60 23
Federal Funds Sold and Securities
Purchased Under Resale Agreements 62 35 128 54
Trading Assets 6 14 13 29
----- ----- ------ ------
Total Interest Income 981 698 1,917 1,324
----- ----- ------ ------
Interest Expense
- ----------------
Deposits 335 192 643 358
Federal Funds Purchased and
Securities Sold Under Repurchase
Agreements 36 27 68 54
Other Borrowed Funds 74 44 146 68
Long-Term Debt 32 26 65 52
---- ---- ------ ------
Total Interest Expense 477 289 922 532
---- ---- ------ ------
Net Interest Income 504 409 995 792
- -------------------
Provision for Loan Losses 62 39 112 84
----- ----- ------ ------
Net Interest Income After
Provision for Loan Losses 442 370 883 708
----- ----- ------ ------
Noninterest Income
- ------------------
Processing Fees
Securities 102 89 200 178
Other 48 43 92 85
----- ----- ------ ------
150 132 292 263
Trust and Investment Fees 32 34 64 67
Service Charges and Fees 109 116 222 234
Securities Gains 13 4 20 15
Other 46 35 70 92
----- ----- ------ ------
Total Noninterest Income 350 321 668 671
----- ----- ------ ------
Noninterest Expense
- -------------------
Salaries and Employee Benefits 223 212 444 423
Net Occupancy 43 44 87 91
Furniture and Equipment 21 21 43 43
Other 138 133 267 255
----- ----- ------ ------
Total Noninterest Expense 425 410 841 812
----- ----- ------ ------
Income Before Income Taxes 367 281 710 567
Income Taxes 141 105 272 212
----- ----- ------ ------
Net Income $ 226 $ 176 $ 438 $ 355
- ---------- ===== ===== ====== ======
Net Income Available to
Common Shareholders $ 223 $ 173 $ 433 $ 347
- ----------------------- ===== ===== ====== =====
Per Common Share Data:
- ----------------------
Primary Earnings $1.14 $0.92 $2.26 $1.85
Fully Diluted Earnings 1.09 0.87 2.11 1.74
Cash Dividends 0.32 0.275 0.64 0.50
Average Common Shares Outstanding 190 188 189 188
<PAGE> 10
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Statements of Condition
(Unaudited)
(Dollars in millions, except per share amounts)
June 30, December 31,
1995 1994
---- ----
Assets
- ------
Cash and Due from Banks $ 3,189 $ 2,903
Interest-Bearing Deposits in Banks 1,109 992
Securities:
Held to Maturity 2,801 2,930
Available for Sale 2,037 1,721
------- -------
Total Securities 4,838 4,651
Trading Assets at Fair Value 1,355 940
Federal Funds Sold and Securities Purchased
Under Resale Agreements 2,979 3,019
Loans (less allowance for loan losses
of $713 in 1995 and $792 in 1994) 35,474 32,291
Premises and Equipment 900 914
Due from Customers on Acceptances 1,126 810
Accrued Interest Receivable 280 290
Other Assets 2,214 2,069
------- -------
Total Assets $53,464 $48,879
======= =======
Liabilities and Shareholders' Equity
- ------------------------------------
Deposits
Noninterest-Bearing (principally
domestic offices) $ 8,905 $ 8,579
Interest-Bearing
Domestic Offices 15,319 14,871
Foreign Offices 12,654 10,641
------- -------
Total Deposits 36,878 34,091
Federal Funds Purchased and Securities
Sold Under Repurchase Agreements 2,709 1,502
Other Borrowed Funds 4,414 4,738
Acceptances Outstanding 1,128 812
Accrued Taxes and Other Expenses 1,167 1,049
Accrued Interest Payable 241 213
Other Liabilities 452 404
Long-Term Debt 1,710 1,774
------- -------
Total Liabilities 48,699 44,583
------- -------
Shareholders' Equity
Preferred Stock-no par value, authorized
5,000,000 shares, outstanding 184,000 shares 111 111
Class A Preferred Stock - par value $2.00
per share, authorized 5,000,000 shares,
outstanding 215,604 shares in 1995 and
322,104 shares in 1994 6 8
Common Stock-par value $7.50 per share,
authorized 350,000,000 shares, issued
195,176,810 shares in 1995 and
190,213,322 shares in 1994 1,464 1,427
Additional Capital 919 858
Retained Earnings 2,361 2,048
Securities Valuation Allowance 32 (58)
------- -------
4,893 4,394
Less: Treasury Stock (3,406,145 shares in
1995 and 2,566,071 shares in 1994), at cost 108 78
Loan to ESOP (712,695 shares in 1995
and 1994), at cost 20 20
------- -------
Total Shareholders' Equity 4,765 4,296
------- -------
Total Liabilities and Shareholders' Equity $53,464 $48,879
======= =======
<PAGE> 11
THE BANK OF NEW YORK COMPANY, INC.
Average Balances and Rates on a Taxable Equivalent Basis
Preliminary
(Dollars in millions)
For the three months For the three months
ended June 30, 1995 ended June 30, 1994
------------------------ -------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------- -------- ------- ------- -------- ------
ASSETS
- ------
Interest-Bearing
Deposits in Banks
(primarily foreign) $ 1,929 $ 30 6.32% $ 1,248 $ 15 4.96%
Federal Funds Sold and
Securities Purchased
Under Resale Agreements 4,074 62 6.06 3,508 35 3.98
Loans
Domestic Offices 24,239 609 10.09 21,236 430 8.12
Foreign Offices 10,990 204 7.46 10,264 132 5.17
------- ------ ------- ------
Total Loans 35,229 813 9.27 31,500 562 7.16
------- ------ ------- ------
Securities
U.S. Government
Obligations 2,911 42 5.74 3,207 44 5.46
U.S. Government Agency
Obligations 314 5 6.32 336 5 6.52
Obligations of States and
Political Subdivisions 664 18 10.89 969 23 9.55
Other Securities,
including Trading
Securities 1,260 21 6.58 1,712 26 5.96
------- ------ ------- ------
Total Securities 5,149 86 6.64 6,224 98 6.29
------- ------ ------- ------
Total Interest-Earning
Assets 46,381 991 8.57% 42,480 710 6.71%
------ ------
Allowance for Loan Losses (737) (934)
Cash and Due from Banks 2,782 2,754
Other Assets 5,456 5,620
------- -------
TOTAL ASSETS $53,882 $49,920
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Interest-Bearing Deposits
Money Market Rate
Accounts $ 3,406 39 4.54% $ 3,599 25 2.74%
Savings 7,787 62 3.18 8,303 46 2.22
Certificates of Deposit
$100,000 & Over 1,850 27 5.87 798 7 3.36
Other Time Deposits 2,588 34 5.33 2,268 22 4.02
Foreign Offices 12,056 173 5.75 9,826 92 3.74
------- ------ ------- ------
Total Interest-Bearing
Deposits 27,687 335 4.85 24,794 192 3.10
Federal Funds Purchased
and Securities Sold
Under Repurchase
Agreements 2,481 36 5.88 3,025 27 3.60
Other Borrowed Funds 4,680 74 6.29 4,188 44 4.23
Long-Term Debt 1,724 32 7.42 1,533 26 6.74
------- ------ ------- ------
Total Interest-Bearing
Liabilities 36,572 477 5.23% 33,540 289 3.45%
------ ------
Noninterest-Bearing
Deposits 8,686 8,679
Other Liabilities 4,000 3,629
Preferred Stock 117 137
Common Shareholders'
Equity 4,507 3,935
------- -------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $53,882 $49,920
======= =======
Net Interest Earnings
and Interest Rate Spread $ 514 3.34% $ 421 3.26%
====== ======
Net Yield on Interest-
Earning Assets 4.45% 3.98%
==== ====
<PAGE> 12
THE BANK OF NEW YORK COMPANY, INC.
Average Balances and Rates on a Taxable Equivalent Basis
Preliminary
(Dollars in millions)
For the six months For the six months
ended June 30, 1995 ended June 30, 1994
------------------------ -------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------- -------- ------- ------- -------- ------
ASSETS
- ------
Interest-Bearing
Deposits in Banks
(primarily foreign) $ 1,918 $ 60 6.31% $ 907 $ 23 5.09%
Federal Funds Sold and
Securities Purchased
Under Resale Agreements 4,335 128 5.96 2,979 54 3.67
Loans
Domestic Offices 23,673 1,185 10.09 21,272 828 7.85
Foreign Offices 10,773 396 7.41 10,135 248 4.93
------- ------ ------- ------
Total Loans 34,446 1,581 9.26 31,407 1,076 6.91
------- ------ ------- ------
Securities
U.S. Government
Obligations 2,892 83 5.78 3,446 92 5.38
U.S. Government Agency
Obligations 316 10 6.33 351 11 6.47
Obligations of States and
Political Subdivisions 688 37 10.80 996 48 9.55
Other Securities,
including Trading
Securities 1,246 40 6.41 1,767 45 5.13
------- ------ ------- ------
Total Securities 5,142 170 6.64 6,560 196 6.00
------- ------ ------- ------
Total Interest-Earning
Assets 45,841 1,939 8.53% 41,853 1,349 6.50%
------ ------
Allowance for Loan Losses (762) (952)
Cash and Due from Banks 2,720 2,876
Other Assets 5,288 5,369
------- -------
TOTAL ASSETS $53,087 $49,146
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Interest-Bearing Deposits
Money Market Rate
Accounts $ 3,410 74 4.40% $ 3,612 47 2.60%
Savings 7,740 118 3.09 8,343 91 2.20
Certificates of Deposit
$100,000 & Over 1,857 54 5.82 841 13 3.21
Other Time Deposits 2,539 66 5.20 2,268 47 4.20
Foreign Offices 11,736 331 5.68 9,286 160 3.48
------- ------ ------- ------
Total Interest-Bearing
Deposits 27,282 643 4.75 24,350 358 2.97
Federal Funds Purchased
and Securities Sold
Under Repurchase
Agreements 2,379 68 5.83 3,367 54 3.22
Other Borrowed Funds 4,686 146 6.27 3,403 68 4.00
Long-Term Debt 1,753 65 7.39 1,545 52 6.80
------- ------ ------ ------
Total Interest-Bearing
Liabilities 36,100 922 5.15% 32,665 532 3.29%
------ ------
Noninterest-Bearing
Deposits 8,721 9,057
Other Liabilities 3,763 3,369
Preferred Stock 117 189
Common Shareholders'
Equity 4,386 3,866
------- ------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $53,087 $49,146
======= =======
Net Interest Earnings
and Interest Rate Spread $1,017 3.38% $ 817 3.21%
====== ======
Net Yield on Interest-
Earning Assets 4.47% 3.94%
==== ====
