<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 11, 1996
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
------------
First Quarter Financial Results
-------------------------------
On April 11, 1996 The Bank of New York Company,
Inc. (the "Company") issued a press release
containing unaudited interim financial information
and accompanying discussion for the first quarter
of 1996. 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 first quarter
of 1996 contained in the press
release dated April 11, 1996, 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: April 11, 1996
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 first quarter
of 1996 contained in the press
release dated April 11, 1996, 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
Gregory A. Burton, AT
(212) 495-1619
THE BANK OF NEW YORK COMPANY, INC. REPORTS RECORD
-------------------------------------------------
FIRST QUARTER NET INCOME, E.P.S. AND ROA
----------------------------------------
First Quarter Net Income Rises 14% to $243 Million;
First Quarter E.P.S. Rises 7% to $1.13;
ROA Rises to 1.79%
NEW YORK, N.Y., April 11, 1996 -- The Bank of New York Company, Inc.
(NYSE: BK) 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
<PAGE> 2
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.
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
<PAGE> 3
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.
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.
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 7.56% 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 (3.9 million shares) of
common stock in the first quarter of 1996 under the 16 million share
buyback program announced in the fourth quarter of 1995.
<PAGE> 4
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.
<PAGE> 5
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
<PAGE> 6
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> 7
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 successful sale of a large office complex in California. The
increase in other commercial loans reflects the addition of several
smaller loans.
<PAGE> 8
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.
***************************
(Financial highlights and detailed financial statements are attached.)
<PAGE> 9
THE BANK OF NEW YORK COMPANY, INC.
Financial Highlights
(Unaudited)
(Dollars in millions, except per share amounts)
For the Three Months Ended March 31: 1996 1995 Change
- ------------------------------------ ---- ---- ------
Net Income $ 243 $ 213 14.1%
Per Common Share:
Primary Earnings $ 1.16 $ 1.12 3.6
Fully Diluted Earnings 1.13 1.06 6.6
Cash Dividends 0.40 0.32 25.0
Return on Average Common Shareholders'
Equity 18.86% 19.98%
Return on Average Assets 1.79 1.65
As of March 31:
- ---------------
Assets $53,434 $52,280 2.2%
Loans 38,743 34,237 13.2
Securities 5,177 4,697 10.2
Deposits - Domestic 23,839 23,535 1.3
- Foreign 12,199 11,369 7.3
Long-Term Debt 1,930 1,732 11.4
Preferred Shareholders' Equity 113 117 -3.4
Common Shareholders' Equity 5,131 4,430 15.8
Common Shareholders' Equity Per Share 26.13 23.51 11.1
Market Value Per Share of Common Stock 51.50 33.00 56.1
Allowance for Loan Losses as a Percent
of Loans 1.91% 2.19%
Tier 1 Capital Ratio 7.85 8.56
Total Capital Ratio 12.63 13.31
Leverage Ratio 7.94 8.06
Tangible Common Equity Ratio 7.56 7.36
<PAGE> 10
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
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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
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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
<PAGE> 11
THE BANK OF NEW YORK COMPANY, INC.
Consolidated Balance Sheets
(Unaudited)
(Dollars in millions, except per share amounts)
March 31, December 31,
1996 1995
---- ----
Assets
Cash and Due from Banks $ 2,587 $ 4,711
Interest-Bearing Deposits in Banks 1,155 982
Securities:
Held-to-Maturity 1,262 1,252
Available-for-Sale 3,915 3,618
------- -------
Total Securities 5,177 4,870
Trading Assets at Fair Value 702 762
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) 38,001 36,931
Premises and Equipment 898 902
Due from Customers on Acceptances 818 918
Accrued Interest Receivable 257 270
Other Assets 2,854 2,438
------- -------
Total Assets $53,434 $53,720
======= =======
Liabilities and Shareholders' Equity
Deposits
Noninterest-Bearing (principally
domestic offices) $ 8,491 $10,465
Interest-Bearing
Domestic Offices 15,385 16,005
Foreign Offices 12,162 9,448
------- -------
Total Deposits 36,038 35,918
Federal Funds Purchased and Securities
Sold Under Repurchase Agreements 3,089 3,933
Other Borrowed Funds 4,361 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 48,190 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 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 $53,434 $53,720
======= =======
<PAGE> 12
THE BANK OF NEW YORK COMPANY, INC.
Average Balances and Rates on a Taxable Equivalent Basis
Preliminary
(Dollars in millions)
For the three For the three
months ended months ended
March 31, 1996 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%
==== =====
