SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-6152
THE BANK OF NEW YORK COMPANY, INC.
(Exact name of registrant as specified in its charter)
New York 13-2614959
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
48 Wall Street, New York, New York 10286
(Address of principal executive offices) (Zip code)
(212) 495-1784
(Registrant's telephone number, including area code)
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 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
---- ----
The number of shares outstanding of the issuer's Common
Stock, $7.50 par value, was 194,811,790 shares as of April 30, 1996
<PAGE> 2
THE BANK OF NEW YORK COMPANY, INC.
FORM 10-Q
TABLE OF CONTENTS
PART 1. FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements
Consolidated Balance Sheets
At March 31, 1996 and December 31, 1995 3
Consolidated Statements of Income
For the Three Months Ended March 31,
1996 and 1995 4
Consolidated Statement of Changes In
Shareholders' Equity
For the Three Months Ended March 31, 1996 5
Consolidated Statements of Cash Flows
For the Three Months Ended March 31,
1996 and 1995 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART 2. OTHER INFORMATION
- --------------------------
Item 6. Exhibits and Reports on Form 8-K 17
SIGNATURE 18
<PAGE> 3
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
- ------------------------------------------------------------------------------
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Balance Sheets
(Dollars in millions, except per share amounts)
(Unaudited)
March 31, December 31,
1996 1995
---- ----
Assets
- ------
Cash and Due from Banks $ 2,634 $ 4,711
Interest-Bearing Deposits in Banks 1,152 982
Securities:
Held-to-Maturity (fair value of $1,197 in
1996 and $1,164 in 1995) 1,262 1,252
Available-for-Sale 3,915 3,618
------- -------
Total Securities 5,177 4,870
Trading Assets at Fair Value 728 762
Federal Funds Sold and Securities Purchased
Under Resale Agreements 985 936
Loans (less allowance for loan losses
of $742 in 1996 and $756 in 1995) 37,813 36,931
Premises and Equipment 898 902
Due From Customers on Acceptances 818 918
Accrued Interest Receivable 257 270
Other Assets 2,855 2,438
------- -------
Total Assets $53,317 $53,720
======= =======
Liabilities and Shareholders' Equity
- ------------------------------------
Deposits
Noninterest-Bearing (principally
domestic offices) $ 8,351 $10,465
Interest-Bearing
Domestic Offices 15,382 16,005
Foreign Offices 12,162 9,448
------- -------
Total Deposits 35,895 35,918
Federal Funds Purchased and Securities
Sold Under Repurchase Agreements 3,089 3,933
Other Borrowed Funds 4,387 3,706
Acceptances Outstanding 821 928
Accrued Taxes and Other Expenses 1,393 1,378
Accrued Interest Payable 180 190
Other Liabilities 378 587
Long-Term Debt 1,930 1,848
------- -------
Total Liabilities 48,073 48,488
------- -------
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 46,804 shares in 1996 and
49,504 shares in 1995 2 2
Common Stock - par value $7.50 per share,
authorized 350,000,000 shares, issued
205,847,437 shares in 1996 and
204,162,405 shares in 1995 1,544 1,531
Additional Capital 1,116 1,087
Retained Earnings 2,851 2,689
Securities Valuation Allowance 29 58
------- -------
5,653 5,478
Less: Treasury Stock - 8,961,644 shares in
1996 and 6,026,048 shares in 1995, at cost 391 228
Loan to ESOP - (658,530 shares), at cost 18 18
------- -------
Total Shareholders' Equity 5,244 5,232
------- -------
Total Liabilities and Shareholders' Equity $53,317 $53,720
======= =======
- ------------------------------------------------------------------------------
See accompanying Notes to Consolidated Financial Statements
<PAGE> 4
- ------------------------------------------------------------------------------
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Statements of Income
(Unaudited)
(In millions, except per share amounts)
For the three months ended
March 31,
1996 1995
---- ----
Interest Income
- ---------------
Loans $ 806 $ 765
Securities
Taxable 62 56
Exempt from Federal Income Taxes 5 12
----- -----
67 68
Deposits in Banks 22 30
Federal Funds Sold and Securities
Purchased Under Resale Agreements 29 66
Trading Assets 4 7
----- -----
Total Interest Income 928 936
----- -----
Interest Expense
- ----------------
Deposits 291 308
Federal Funds Purchased and
Securities Sold Under Repurchase
Agreements 51 32
Other Borrowed Funds 44 72
Long-Term Debt 33 33
---- ----
Total Interest Expense 419 445
---- ----
Net Interest Income 509 491
- -------------------
Provision for Loan Losses 90 50
----- -----
Net Interest Income After
Provision for Loan Losses 419 441
----- -----
Noninterest Income
- ------------------
Processing Fees
Securities 159 98
Other 50 44
----- -----
209 142
Trust and Investment Fees 37 32
Service Charges and Fees 106 113
Securities Gains 33 7
Other 35 25
----- -----
Total Noninterest Income 420 319
----- -----
Noninterest Expense
- -------------------
Salaries and Employee Benefits 247 222
Net Occupancy 44 44
Furniture and Equipment 22 22
Other 131 128
----- -----
Total Noninterest Expense 444 416
----- -----
Income Before Income Taxes 395 344
Income Taxes 152 131
----- -----
Net Income $ 243 $ 213
- ---------- ===== =====
Net Income Available to
Common Shareholders $ 241 $ 210
- ----------------------- ===== =====
Per Common Share Data:
- ----------------------
Primary Earnings $1.16 $1.12
Fully Diluted Earnings 1.13 1.06
Cash Dividends 0.40 0.32
Fully Diluted Shares Outstanding 214 201
- ------------------------------------------------------------------------------
See accompanying Notes to Consolidated Financial Statements
<PAGE> 5
- -------------------------------------------------------------------------------
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Statement of Changes in Shareholders' Equity
(Unaudited)
For the three months ended March 31, 1996
(In millions)
Class A
Pre- Pre- Addi- Securities Treas- Loan
ferred ferred Common tional Retained Valuation ury to
Stock Stock Stock Capital Earnings Allowance Stock ESOP
------ ------- ------ ------- -------- ---------- ------ ----
Balance,
January 1, 1996 $111 $ 2 $1,531 $1,087 $2,689 $ 58 $228 $18
Changes:
Net Income 243
Cash Dividends
Common Stock (79)
Preferred Stock (2)
Conversion of
Debentures 7 12
Issuance of
Common Stock 6 17 (35)
Treasury Stock
Acquired 198
Net Unrealized
Loss on
Securities
Available
for Sale (29)
---- --- ------ ------ ------ ---- ---- ---
Balance, March
31, 1996 $111 $ 2 $1,544 $1,116 $2,851 $ 29 $391 $18
==== === ====== ====== ====== ==== ==== ===
- -------------------------------------------------------------------------------
See accompanying Notes to Consolidated Financial Statements
<PAGE> 6
- -------------------------------------------------------------------------------
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Statements of Cash Flows
(In millions)
(Unaudited)
For the three months ended
March 31,
1996 1995
---- ----
Operating Activities
Net Income $ 243 $ 213
Adjustments to Determine Net Cash Provided (Used)
by Operating Activities
Provision for Losses on Loans and Other Real Estate 97 51
Depreciation and Amortization 57 48
Deferred Income Taxes 54 64
Securities Gains (33) (7)
Change in Trading Assets 34 (695)
Change in Accruals and Other, Net (341) 55
------- -------
Net Cash Provided (Used) by
Operating Activities 111 (271)
------- -------
Investing Activities
Change in Interest-Bearing Deposits in Banks (174) 69
Purchases of Securities Held-to-Maturity (80) (78)
Maturities of Securities Held-to-Maturity 64 159
Purchases of Securities Available-for-Sale (593) (38)
Sales of Securities Available-for-Sale 197 15
Maturities of Securities Available-for-Sale 70 7
Net Principal Disbursed on Loans to Customers (1,097) (1,377)
Sales of Loans 55 86
Sales of Other Real Estate 44 3
Change in Federal Funds Sold and Securities
Purchased Under Resale Agreements (49) (392)
Purchases of Premises and Equipment (14) (9)
Acquisitions, Net of Cash Acquired (296) 67
Other, Net (30) (44)
------- -------
Net Cash Used by Investing Activities (1,903) (1,532)
------- -------
Financing Activities
Change in Deposits - 594
Change in Federal Funds Purchased and Securities
Sold Under Repurchase Agreements (844) 447
Change in Other Borrowed Funds 681 1,620
Proceeds from the Issuance of Long-Term Debt 100 -
Repayments of Long-Term Debt - (2)
Issuance of Common Stock 58 42
Treasury Stock Acquired (198) (55)
Cash Dividends Paid (81) (63)
------- -------
Net Cash Provided (Used) by Financing Activities (284) 2,583
------- -------
Effect of Exchange Rate Changes on Cash (1) 40
------- -------
Change in Cash and Due From Banks (2,077) 820
Cash and Due from Banks at Beginning of Period 4,711 2,903
------- -------
Cash and Due from Banks at End of Period $ 2,634 $ 3,723
======= =======
- -----------------------------------------------------------------------------
Supplemental Disclosure of Cash Flow Information
Cash Paid During the Year for:
Interest $ 429 $ 412
Income Taxes 24 5
Noncash Investing Activity (Primarily Foreclosure
of Real Estate) 30 5
- -----------------------------------------------------------------------------
See accompanying Notes to Consolidated Financial Statements
<PAGE> 7
THE BANK OF NEW YORK COMPANY, INC.
Notes to Consolidated Financial Statements
1. General
-------
The accounting and reporting policies of The Bank of New York Company,
Inc. (the Company), a bank holding company, and its subsidiaries, conform
with generally accepted accounting principles and general practice within the
banking industry. Such policies, except as noted below, are consistent with
those applied in the preparation of the Company's annual financial
statements.
The accompanying financial statements are unaudited. In the opinion of
management, all adjustments necessary for a fair presentation of financial
position, results of operations and cash flows for the interim periods have
been made. Such adjustments are of a normal recurring nature.
2. Allowance for Loan Losses
-------------------------
Transactions in the allowance for loan losses are summarized as
follows:
Three months ended
March 31,
(In millions) 1996 1995
---- -----
Balance, Beginning of Period $ 756 $ 792
Charge-offs (124) (107)
Recoveries 20 11
----- -----
Net Charge-Offs (104) (96)
Acquisition - 1
Credit Card Securitization - 2
Provision 90 50
----- -----
Balance, End of Period $ 742 $ 749
===== =====
3. Commitments and Contingent Liabilities
--------------------------------------
In the ordinary course of business, there are various claims pending
against the Company and its subsidiaries. In the opinion of management,
liabilities arising from such claims, if any, would not have a material
effect upon the Company's consolidated financial statements.
<PAGE> 8
4. Acquisitions
------------
In the first quarter of 1996, the Company made acquisitions related to
its factoring and unit investment trust businesses. The pro forma effect of
these acquisitions is not material.
5. Capital Resources
-----------------
In 1995, the Company announced a plan to buy back through the end of
1996 up to 16 million shares of its common stock. As of April 30, 1996,
8.3 million shares had been repurchased.
<PAGE> 9
Management's Discussion and Analysis of Financial Condition
- -----------------------------------------------------------
and Results of Operations
- -------------------------
The Company reported record first quarter net income of $243 million, up 14%
from $213 million earned in the same period last year. First quarter fully
diluted earnings per share were a record $1.13, a 7% increase over the $1.06
earned in the first quarter of 1995. The dilutive effect of stock warrants,
which was partially offset by the Company's stock buyback program, reduced
earnings per share for the first quarter of 1996 by 5 cents.
Net interest income, on a taxable equivalent basis, totaled $517 million
in the first quarter, a $15 million or 3% increase over the first quarter of
last year reflecting modest loan growth. Revenues from the Company's
securities processing business grew 62% over the first quarter of 1995.
While this increase was largely due to the acquisitions of the corporate
trust business of NationsBank and the custody businesses of BankAmerica and
J.P. Morgan, all areas of securities processing continued to show strong
internal growth. Internally generated growth, which was in excess of 14%,
was led by ADRs, custody, corporate trust, and government clearance.
Amortization of goodwill associated with the Company's securities processing
acquisitions reduced earnings in the first quarter of 1996 by 2 cents per
share.
The Company completed conversion activities associated with the
BankAmerica custody acquisition during the first quarter of 1996. The J.P.
Morgan conversion was begun and is progressing on schedule.
Fees from other processing, which includes funds transfer, cash
management, and trade finance, grew 13% over last year's first quarter. The
largest contributor to this increase was fees from funds transfer, which were
up 28%.
Fees from trust and investment grew 15% in the first quarter of 1996
reflecting new business and generally strong markets.
As expected, the acquisition of Midlantic's factoring business in March
1996 immediately added to earnings in the first quarter.
Notwithstanding moderate growth in outstandings, earnings from the
Company's credit card business declined slightly in the first quarter of 1996
compared with 1995's first quarter, reflecting higher charge-offs. In the
first quarter of 1996, charge-offs were $96 million compared with $81 million
in the fourth quarter of 1995 and $61 million a year ago.
Return on average assets for the first quarter was a record 1.79% versus
1.77% in the fourth quarter and 1.65% in the first quarter of 1995.
Return on average common equity was 18.86% in the first quarter of 1996,
compared with 18.87% in the fourth quarter of 1995 and 19.98% in the first
quarter of last year.
<PAGE> 10
CAPITAL
- -------
The Company's estimated Tier 1 capital and Total capital ratios were
7.85% and 12.63% at March 31, 1996 compared with 8.42% and 13.08% at December
31, 1995, and 8.56% and 13.31% at March 31, 1995. Tangible common equity as
a percent of total assets was 7.58% at March 31, 1996 compared with 8.00% at
December 31, 1995 and 7.36% one year ago. The leverage ratio was 7.94% at
March 31, 1996 compared with 8.46% at December 31, 1995 and 8.06% one year
ago. The decline in the capital ratios reflects the goodwill associated with
the securities processing acquisitions and the repurchase of $198 million of
common stock in the first quarter of 1996.
NET INTEREST INCOME
- -------------------
1st 4th 1st
Quarter Quarter Quarter
------- ------- -------
(In millions) 1996 1995 1995
---------------------------
Net Interest Income $517 $531 $502
Net Interest Rate
Spread 3.43% 3.41% 3.41%
Net Yield on Interest-
Earning Assets 4.46 4.58 4.49
On a taxable equivalent basis, net interest income amounted to $517
million in the first quarter of 1996, compared with $502 million in the same
period of 1995, an increase of 3%. The net interest rate spread was 3.43% in
the first quarter of 1996, up 2 basis points from 3.41% in the fourth quarter
of 1995 and one year ago. The net yield on interest-earning assets was 4.46%
compared with 4.58% in the fourth quarter of 1995 and 4.49% in last year's
first quarter.
Interest lost on loans on nonaccrual status at March 31, 1996 and 1995
reduced net income by $5 million for the three months ended March 31, 1996
and 1995.
<PAGE> 11
NONINTEREST INCOME
- ------------------
1st Quarter
-----------
(In millions) 1996 1995
----------------
Processing Fees
Securities $159 $ 98
Other 50 44
---- ----
209 142
Trust and Investment Fees 37 32
Service Charges and Fees 106 113
Securities Gains 33 7
Foreign Exchange and
Other Trading Activities 10 12
Other 25 13
---- ----
Total Noninterest Income $420 $319
==== ====
Securities processing fees increased 62% to $159 million compared to
$98 million in the first quarter of 1995. Acquisitions and strong internal
growth in all areas contributed to the increase in revenue. Fees from other
processing increased 13% over the first quarter of last year. Service
charges and fees declined $7 million primarily due to lower syndication fees
and the absence of mortgage servicing fees related to the Company's ARCS
mortgage servicing portfolio, which was sold in the second quarter of 1995.
The Company reported $33 million of securities gains in the first quarter of
1996 compared with $7 million last year reflecting sales of securities held
in the Company's bond and bank stock portfolios as well as returns on certain
limited partnership interests. Revenues from foreign exchange and other
trading activities were disappointing, declining 17% to $10 million. Other
income increased significantly as a result of strong performance by the
Company's offshore banking subsidiaries.
NONINTEREST EXPENSE AND INCOME TAXES
- ------------------------------------
Total noninterest expense for the quarter was $444 million, up 7% from
$416 million in the same period last year. The rise in expenses in the first
quarter was principally due to salary and other expenses related to
acquisitions of securities processing businesses from J.P. Morgan,
BankAmerica, and NationsBank as well as the acquisition of the Putnam Trust
Company.
Despite the increases in noninterest expenses, the efficiency ratio for
the first quarter was 49.4% compared with 49.5% reported in the fourth
quarter of 1995 and substantially improved from 51.0% one year ago.
The effective tax rate for the first quarter of 1996 was 38.4%
compared with 38.2% for the first quarter of 1995.
<PAGE> 12
NONPERFORMING ASSETS
- --------------------
Change
1Q 1996 vs
(Dollars in millions) 3/31/96 12/31/95 4Q 1995
-------------------------------------
Loans:
Commercial Real Estate $ 11 $ 42 $(31)
Other Commercial 101 75 26
Foreign 19 20 (1)
LDC 21 21 -
Community Banking 78 67 11
---- ----
Total Loans 230 225 5
Other Real Estate 58 72 (14)
---- ----
Total $288 $297 (9)
==== ====
Nonperforming Assets Ratio 0.7% 0.8%
Allowance/Nonperforming Loans 322.4 335.5
Allowance/Nonperforming Assets 258.0 254.4
Nonperforming assets totaled $288 million at March 31, 1996, compared
with $297 million at December 31, 1995, a decrease of $9 million or 3%. This
was the nineteenth consecutive quarter of nonperforming asset decreases. The
largest decline was in real estate nonperforming assets due to the sale of a
large office complex in California. The increase in other commercial loans
reflects the addition of several smaller loans.
At March 31, 1996, impaired loans (nonaccrual loans over $1 million)
aggregated $167 million, of which $132 million exceeded their fair value by
$27 million. Impaired loans at March 31, 1995 totaled $209 million, of which
$170 million exceeded their fair value by $41 million. For the first quarter
of 1996 and 1995, the average amount of impaired loans was $164 million and
$213 million and interest income (cash received) recognized on them was $92
thousand and $1 million.
<PAGE> 13
LOAN LOSS PROVISION AND NET CHARGE-OFFS
- ---------------------------------------
1st 4th 1st
Quarter Quarter Quarter
------- ------- -------
(In millions) 1996 1995 1995
-----------------------------
Provision $ 90 $105 $ 50
---- ---- ----
Net Charge-offs:
Commercial Real Estate (3) - (4)
Other Commercial 1 (4) (4)
Credit Card (96) (81) (61)
Other Consumer (2) (2) (2)
Foreign (1) - (11)
Other (3) (8) (3)
---- ---- ----
Total (104) (95) (85)
Acquisition - - 1
Credit Card Securitization - - 2
---- ---- ----
Change in Regular Allowance $(14) $ 10 $(32)
==== ==== ====
Other Real Estate
Expenses (Recovery) $ (2) $ - $ 1
The allowance for loan losses was $742 million, or 1.91% of loans at
March 31, 1996, compared with $756 million, or 2.01% of loans at December 31,
1995.
<PAGE> 14
SECTOR PROFITABILITY
- --------------------
The Company has an internal information system used for management
purposes that produces sector performance data for Trust, and Securities and
Other Processing, Retail Banking, Corporate Banking, and Other Sectors. A
set of measurement principles has been developed to help correlate reported
results of the sectors with their economic performance.
Based on this system, the sectors contributed to the Company's
profitability for the first quarter as follows:
Trust, and
Securities
and Other Retail Corporate
Processing Banking Banking
---------- ---------- ----------
(In millions) 1996 1995 1996 1995 1996 1995
---- ---- ---- ---- ---- ----
Net Interest Income on a
Taxable Equivalent Basis $ 33 $ 36 $330 $305 $126 $133
Provision for Loan Losses - - 101 66 3 15
Noninterest Income 272 201 42 39 67 69
Noninterest Expense 193 151 164 173 56 58
---- ---- ---- ---- ---- ----
Income before Taxes $112 $ 86 $107 $105 $134 $129
==== ==== ==== ==== ==== ====
Other Total
---------- ----------
(In millions) 1996 1995 1996 1995
---- ---- ---- ----
Net Interest Income on a
Taxable Equivalent Basis $ 28 $ 28 $517 $502
Provision for Loan Losses (14) (31) 90 50
Noninterest Income 39 10 420 319
Noninterest Expense 31 34 444 416
---- ---- ---- ----
Income before Taxes $ 50 $ 35 $403 $355
==== ==== ==== ====
In the Trust, and Securities and Other Processing Sector, securities
processing fees increased 62% to $159 million compared to $98 million in the
first quarter of 1995. Acquisitions and strong internal growth contributed
to the increase in revenue. Internally generated growth, which was in excess
of 14%, was led by ADRs, custody, corporate trust, and government clearance.
Fee revenue from issuer services, custody and securities industry products
were $53 million, $60 million, and $46 million in the first quarter of 1996
compared with $35 million, $30 million, and $33 million in 1995. Fees from
other processing increased 13% over the first quarter of last year. The
largest contributor to this increase was fees from funds transfer, which were
up 28%. Fees from trust and investment grew 15% in the first quarter of 1996
reflecting new business and generally strong markets. The rise in
noninterest expense was principally due to salary and other expenses related
to acquisitions of securities processing businesses from J.P. Morgan,
BankAmerica and NationsBank.
The increase in net interest income in the Retail Banking Sector
principally reflects growth in the Company's credit card business compared to
last year. Managed outstandings were up 16% to $8.8 billion from $7.6
billion and the number of card accounts increased by 18% to 6.7 million from
5.7 million one year ago. The increases are primarily attributable to the
Company's Consumers Edge (registered trademark) card. Initial responses to
the Company's co-branded cards with Toys-R-Us (registered trademark) and
Stop & Shop (registered trademark) continue to exceed expectations. Credit
card interchange income increased 18% to $20 million in the first quarter
of 1996 from $17 million in the same period last year. Notwithstanding
this growth in outstandings, earnings from the Company's credit card business
declined slightly in the first quarter of 1996 compared with 1995's first
quarter, reflecting higher charge-offs. In the first
<PAGE> 15
quarter of 1996, net credit card charge-offs as a percentage of average
managed outstandings were 4.48% compared with 3.91% in the fourth quarter of
1995 and 3.31% in the first quarter of 1995. Credit card accounts past due
over 30 days were 4.32% of managed outstandings at the end of the first
quarter of 1996 compared with 4.50% at the end of the fourth quarter of 1995
and 3.53% at the end of the first quarter of 1995. Noninterest income for
the first quarter of 1995 includes servicing fees related to the Company's
ARCS mortgage servicing portfolio, which was sold in the second quarter of
1995. Lower FDIC insurance premiums contributed to the decline in
noninterest expense in the Retail Banking Sector.
Net interest income declined in the Corporate Banking Sector due to a
decline in the interest rate spread. Noninterest income benefitted from
strong performance in the Company's offshore banking subsidiaries, however,
syndication fees were lower in the first quarter of 1996 compared to last
year's first quarter.
The Other Sector reflects a credit for the difference between the
provision for loan losses and that allocated to the sectors. Securities
gains and foreign exchange and other trading activity increased $24 million
from the first quarter of 1995.
<PAGE> 16
THE BANK OF NEW YORK COMPANY, INC.
Average Balances and Rates on a Taxable Equivalent Basis
(Dollars in millions)
For the three months For the three months
ended March 31, 1996 ended March 31, 1995
------------------------ -------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------- -------- ------- ------- -------- ------
ASSETS
- ------
Interest-Bearing
Deposits in Banks
(primarily foreign) $ 1,577 $ 22 5.68% $ 1,907 $ 30 6.31%
Federal Funds Sold and
Securities Purchased
Under Resale Agreements 2,175 29 5.39 4,598 66 5.86
Loans
Domestic Offices 26,119 610 9.40 23,101 575 10.10
Foreign Offices 11,636 198 6.81 10,554 192 7.36
------- ------ ------- ------
Total Loans 37,755 808 8.60 33,655 767 9.24
------- ------ ------- ------
Securities
U.S. Government
Obligations 2,874 40 5.65 2,871 41 5.82
U.S. Government Agency
Obligations 452 7 6.32 318 5 6.33
Obligations of States and
Political Subdivisions 635 14 9.09 713 19 10.71
Other Securities,
including Trading
Securities 1,201 16 5.46 1,232 19 6.24
------- ------ ------- ------
Total Securities 5,162 77 6.09 5,134 84 6.63
------- ------ ------- ------
Total Interest-Earning
Assets 46,669 936 8.07% 45,294 947 8.48%
------ ------
Allowance for Loan Losses (725) (787)
Cash and Due from Banks 3,148 2,658
Other Assets 5,458 5,118
------- -------
TOTAL ASSETS $54,550 $52,283
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Interest-Bearing Deposits
Money Market Rate
Accounts $ 4,003 43 4.34% $ 3,414 36 4.26%
Savings 8,221 58 2.84 7,692 57 2.99
Certificates of Deposit
$100,000 & Over 1,120 15 5.42 1,863 26 5.76
Other Time Deposits 2,598 31 4.87 2,489 31 5.07
Foreign Offices 11,510 144 5.01 11,412 158 5.61
------- ------ ------- ------
Total Interest-Bearing
Deposits 27,452 291 4.27 26,870 308 4.65
Federal Funds Purchased
and Securities Sold
Under Repurchase
Agreements 3,874 51 5.34 2,277 32 5.76
Other Borrowed Funds 3,146 44 5.64 4,691 72 6.25
Long-Term Debt 1,881 33 6.94 1,781 33 7.36
------- ------ ------- ------
Total Interest-Bearing
Liabilities 36,353 419 4.64% 35,619 445 5.07%
------ ------
Noninterest-Bearing
Deposits 9,550 8,757
Other Liabilities 3,401 3,527
Preferred Stock 113 117
Common Shareholders'
Equity 5,133 4,263
------- -------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $54,550 $52,283
======= =======
Net Interest Earnings
and Interest Rate Spread $ 517 3.43% $ 502 3.41%
====== ======
Net Yield on Interest-
Earning Assets 4.46% 4.49%
==== ====
<PAGE> 17
PART 2. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) The exhibits filed as part of this report are as follows:
Exhibit 11 - Statement Re: Computation of Earnings Per Common Share for
the Three Months Ended March 31, 1996 and 1995.
Exhibit 12 - Statement Re: Ratio of Earnings to Fixed Charges and Ratio
of Earnings to Combined Fixed Charges and Preferred Stock Dividends for
the Three Months Ended March 31, 1996 and 1995.
Exhibit 27 - Statement Re: Financial Data Schedule containing selected
financial data at March 31, 1996 and for the Three Months Ended March
31, 1996.
(b) The Company filed the following reports on Form 8-K since December 31,
1995:
The Company filed a Form 8-K Current Report (Items 5 and 7), dated
January 16, 1996, which report included unaudited interim financial
information and accompanying discussion for the fourth quarter of 1995
contained in the Company's press release dated January 16, 1996.
The Company filed a Form 8-K Current Report (Item 4), as amended,
dated March 12, 1996, which report included the Company's disclosure
statement with respect to dismissing Deloitte & Touche LLP and
appointing Ernst & Young LLP as the Company's independent accountants.
The Company filed a Form 8-K Current Report (Items 5 and 7), dated
April 11, 1996, which report included unaudited interim financial
information and accompanying discussion for the first quarter of
1996 contained in the Company's press release dated April 11, 1996.
<PAGE> 18
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.
THE BANK OF NEW YORK COMPANY, INC.
----------------------------------
(Registrant)
Date: May 13, 1996 \s\ Deno D. Papageorge
----------------------------
Deno D. Papageorge,
Chief Financial Officer
<PAGE> 19
EXHIBIT INDEX
--------------
Exhibit Description
- ------- -----------
11 Computation of Earnings Per Common Share
for the Three Months Ended March 31, 1996
and 1995.
12 Ratio of Earnings to Fixed Charges and
Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends
for the Three Months Ended March 31, 1996
and 1995.
27 Financial Data Schedule containing selected
financial data at March 31, 1996 and for
the Three Months Ended March 31, 1996.
EXHIBIT 11
THE BANK OF NEW YORK COMPANY, INC.
Computation of Earnings Per Common Share
(In millions, except per share amounts)
For the Three Months Ended
March 31,
1996 1995
---- ----
Weighted Average Number of Shares 197 188
Shares Assumed to be issued on Conversion:
Warrants 11 -
----- -----
Weighted Average Number of Shares of
Common Stock for Primary Computation 208 188
Shares Assumed to be Issued on Conversion:
Debentures 5 12
Warrants 1 -
Cumulative Preferred Stock - 1
----- -----
Weighted Average Number of Shares of
Common Stock Assuming Full Dilution 214 201
===== =====
Net Income $ 243 $ 213
Dividend Requirements on Preferred Stock 2 3
----- -----
Net Income Available
to Common Shareholders 241 210
Interest on Convertible
Debentures, Net of Tax 1 2
----- -----
Net Income Available to Common
Shareholders, Assuming Full Dilution $ 242 $ 212
===== =====
Earnings Per Share:
Primary $1.16 $1.12
Fully Diluted 1.13 1.06
EXHIBIT 12
THE BANK OF NEW YORK COMPANY, INC.
Ratios of Earnings to Fixed Charges and Ratios
of Earnings to Combined Fixed Charges
and Preferred Stock Dividends
(Dollars in Millions)
For the three months ended
March 31,
1996 1995
EARNINGS ---- ----
- --------
Income Before Income Taxes $395 $344
Fixed Charges, Excluding Interest
on Deposits 136 145
---- ----
Income Before Income Taxes and Fixed
Charges, Excluding Interest on Deposits 531 489
Interest on Deposits 291 308
---- ----
Income Before Income Taxes and Fixed
Charges, Including Interest on Deposits $822 $797
==== ====
FIXED CHARGES
- -------------
Interest Expense, Excluding Interest
on Deposits $129 $137
One-Third Net Rental Expense* 7 8
---- ----
Total Fixed Charges, Excluding Interest
on Deposits 136 145
Interest on Deposits 291 308
---- ----
Total Fixed Charges, Including Interest
on Deposits $427 $453
==== ====
PREFERRED STOCK DIVIDENDS, PRE-TAX BASIS $ 4 $ 4
- ---------------------------------------- ==== ====
EARNINGS TO FIXED CHARGES RATIOS
- --------------------------------
Excluding Interest on Deposits 3.90x 3.37x
Including Interest on Deposits 1.93 1.76
EARNINGS TO COMBINED FIXED CHARGES
& PREFERRED STOCK DIVIDENDS RATIOS
- ----------------------------------
Excluding Interest on Deposits 3.79 3.28
Including Interest on Deposits 1.91 1.74
* The proportion deemed representative of the interest factor.
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information which is qualified
entirely by reference to The Bank of New York Company, Inc.'s Form 10-Q for
the period ended March 31, 1996
</LEGEND>
<CIK> 0000009626
<NAME> THE BANK OF NEW YORK COMPANY, INC.
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