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
July 15, 1998
-----------------------------------------------
Date of report (Date of earliest event reported)
BankAmerica Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-7377 94-1681731
----------------------------------------------------------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
Bank of America Center
555 California Street
San Francisco, California 94104
---------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
415-622-3530
--------------------------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
------------
Attached hereto as Exhibit 99 is a copy of BankAmerica
Corporation's press release dated July 15, 1998 titled "BankAmerica
Second Quarter Earnings."
Item 7. Financial Statements, Pro Forma
-------------------------------
Financial Information and Exhibits.
-----------------------------------
(c) Exhibits
Exhibit
Number Description
- - ------ -----------
99 BankAmerica Corporation press release dated July 15, 1998
titled "BankAmerica Second Quarter Earnings."
<PAGE>
SIGNATURES
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.
BANKAMERICA CORPORATION
(Registrant)
Date: July 15, 1998
By /s/ JOHN J. HIGGINS
------------------------------
John J. Higgins
Executive Vice President
and Chief Accounting Officer
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- - ------- -----------
99 BankAmerica Corporation press release dated
July 15, 1998 titled "BankAmerica Second
Quarter Earnings."
[BANKAMERICA CORPORATION LOGO APPEARS HERE]
Exhibit 99
NEWS
For release:
Contact: Mike Zampa
(415) 622-4524
BANKAMERICA SECOND QUARTER EARNINGS
SAN FRANCISCO, July 15, 1998 -- BankAmerica Corporation (BAC)
today reported second-quarter 1998 diluted earnings per common share of
$1.24, up 16 percent from $1.07 for the same period a year ago. Net income
for the period was $890 million, up 11 percent from $799 million for the
second quarter of 1997. The return on average common equity for the
second quarter of 1998 was 18.20 percent, an increase of 147 basis points
from the same period in 1997.
Second quarter net income includes an $84 million pre-tax gain
on the sale of Columbia Seafirst Center and a pre-tax accrual of
a $45 million estimated loss associated with the decision to sell
Robertson Stephens Investment Management. Excluding the effects of
these items and their related tax impact, diluted earnings per common
share and net income for the second quarter of 1998 would have been
$1.21 and $866 million, respectively.
BAC's diluted earnings per common share for the first six
months of 1998 was $2.41, an increase of 15 percent from $2.10 for the
first six months of 1997. Net income for the first six months of
1998 was $1,725 million, an increase of 9 percent from $1,579
million for the same period in 1997. The return on average common
equity for the first six months of 1998 was 18.05 percent, an increase
of 143 basis points from the same period in 1997.
Diluted cash earnings per common share for the second quarter
of 1998 was $1.34, up 16 percent from $1.16 for the second quarter of
1997. Diluted cash earnings per common share for the first six months
of 1998 was $2.60, an increase of 14 percent from $2.28 for the
first six months of 1997.
"I am gratified by these strong results," said David A.
Coulter, Chairman and Chief Executive Officer. "They reflect solid
performance at a time when we are diligently preparing for our historic
merger with NationsBank, and demonstrate our core competency in
risk management. We must maintain our discipline and continue to
make customers our number one priority during this important period.
That is exactly what we are doing, as demonstrated by this
quarter's earnings."
- more -
<PAGE>
FINANCIAL HIGHLIGHTS:
o Net interest income for the second quarter of 1998 was
down $104 million from the same period in 1997. BAC's
net interest margin for the second quarter of 1998
was 3.86 percent, an increase of 2 basis points from
the previous quarter, and a decrease of 26 basis
points from the comparable period in 1997.
o Noninterest income for the second quarter of 1998
was $1,843 million, an increase of $417 million, or
29 percent, from the same period in 1997. The second-
quarter 1998 amount included growth in other fees and
commissions of $234 million, primarily attributable
to the operations of Robertson Stephens and Company
that was acquired in the fourth quarter of 1997 and
higher loan servicing fees. In addition, other income
increased $181 million, in part due to the previously
discussed gain on the sale of Columbia Seafirst
Center. Furthermore, the net gain on sales of loans
increased $105 million. However, these increases were
partially offset by a decrease of $99 million in trading
income resulting primarily from volatility in emerging
markets, and the accrual of a $45 million estimated
loss associated with the decision to sell Robertson
Stephens Investment Management.
o Noninterest expense for the second quarter of 1998
was $2,303 million, an increase of $256 million from the
same period in 1997. This increase was largely
attributable to increased salaries expense of
$134 million, primarily due to the acquisition of
Robertson Stephens and Company.
o The provision for credit losses was $230 million for the
second quarter of 1998, down $15 million from the previous
quarter and $20 million from the second quarter of 1997.
Net credit losses were $230 million for the second quarter
of 1998, a decrease of $9 million from the previous quarter,
and an increase of $6 million from the second quarter
of 1997.
- Page 2 -
<PAGE>
o Nonaccrual assets were $951 million at June 30, 1998, a
decrease of $85 million, or 8 percent, from their
March 31, 1998 level, and an increase of $90 million,
or 10 percent, from their June 30, 1997 level. The
increase from the same period a year ago was primarily
due to an increase in the foreign nonaccrual portfolio,
concentrated in Asia.
o On June 29, 1998, BAC redeemed all outstanding shares
of its Cumulative Adjustable Preferred Stock, Series A
and B, which reduced stockholders' equity by $614 million.
(end of text, tables follow)
This earnings report and other material of interest to investors can
be found on the shareholder resources section of BankAmerica's
Internet web site (http://www.BankAmerica.com/shareholder)
- Page 3 -
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 1
SUMMARY OF RESULTS AND STATISTICAL DATA
Second First Second
(dollar amounts in millions, Quarter Quarter Quarter
except per share data) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
1 Net income $ 890 $ 835 $ 799
2 Earnings per common share 1.29 1.21 1.10
3 Diluted earnings per common share 1.24 1.17 1.07
Rate of return (based on net income) on:
4 Average common equity 18.20% 17.89% 16.73%
5 Average total assets 1.37 1.28 1.26
6 Net interest margin/a/ 3.86 3.84 4.12
7 Full-time-equivalent staff
at period end (in thousands) 77.1 76.5 77.4
8 Employees at period
end (in thousands) 89.3 89.9 91.0
<CAPTION>
Six Months Ended
June 30
----------------------
1998 1997
------- -------
9 Net income $1,725 $1,579
10 Earnings per common share 2.49 2.15
11 Diluted earnings per common share 2.41 2.10
Rate of return (based
on net income) on:
12 Average common equity 18.05% 16.62%
13 Average total assets 1.33 1.26
14 Net interest margin/a/ 3.85 4.14
- ------------------------------------------------------------------------
</TABLE>
/a/The net interest margin is computed on a tax-equivalent
basis. The taxable-equivalent basis adjustments to net interest
income were $7 million, $5 million, and $6 million, for the second
quarter of 1998, the first quarter of 1998, and the second quarter
of 1997, respectively, and $12 million in both six-month periods
ended June 30, 1998 and 1997.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 2
SUMMARY OF RESULTS
EXCLUDING AMORTIZATION OF INTANGIBLES/a/
Second First Second
(dollar amounts in millions, Quarter Quarter Quarter
except per share data) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
1 Net income excluding
amortization of intangibles $ 956 $ 902 $ 865
2 Diluted cash earnings per
common share 1.34 1.26 1.16
3 Rate of return on average
common equity 19.58% 19.35% 18.17%
<CAPTION>
Six Months Ended
June 30
----------------------
1998 1997
------- -------
<S> <C> <C>
4 Net income excluding
amortization of intangibles $1,858 $1,711
5 Diluted cash earnings per
common share 2.60 2.28
6 Rate of return on average
common equity 19.47% 18.06%
----------------------------------------------------------------------
</TABLE>
/a/For purposes of this table, amortization amounts are related to those
intangibles that are deducted from Tier 1 capital under regulatory
guidelines. Amortization amounts excluded from this table totaled
$66 million, $67 million, and $66 million, for the second quarter
of 1998, the first quarter of 1998, and the second quarter of
1997, respectively, and $133 million and $132 million for the
six-month periods ended June 30, 1998 and 1997, respectively.
========================================================================
<TABLE>
<CAPTION>
TABLE 3
TIER 1 CAPITAL GENERATION
Six Months Ended
June 30
----------------------
(in millions) 1998 1997
------- -------
<S> <C> <C>
Tier 1 generation:
1 Net income $ 1,725 $ 1,579
2 Amortization of intangibles 133 132
3 Common stock issuances and other 241 190
4 Trust preferred securities issued 339 396
------- -------
5 Total generation 2,438 2,297
Tier 1 applications:
6 Common stock dividends (472) (430)
7 Preferred stock dividends (19) (64)
8 Common stock repurchased (600) (950)
9 Preferred stock redeemed (614) (764)
------- -------
10 Total applications (1,705) (2,208)
11 Capital attributed to growth
in risk-weighted assets (1,002)/abc/ (200)
------- -------
12 Net capital applied $ (269) $ (111)
======= =======
- -------------------------------------------------------------------------
</TABLE>
/a/ Includes the effect of market risk as required by the regulators
effective January 1, 1998.
/b/ Includes BAC's broker/dealer subsidiary.
/c/ Amount is preliminary.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 4
STOCK AND CAPITAL DATA
(dollar amounts in millions, June 30 March 31 June 30
except per share data) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
1 Book value per common share $29.26 $28.23 $26.88
Common stock cash dividends:
2 Quarter ended 236 236 214
3 Year-to-date 472 236 430
Preferred stock cash dividends:
4 Quarter ended 9 10 30
5 Year-to-date 19 10 64
6 Number of common shares
outstanding (in thousands) 684,766 682,704 698,407
Average number of common shares
outstanding (in thousands):
7 Quarter ended 683,790 684,737 701,458
8 Year-to-date 684,264 684,737 705,022
Average number of diluted
common shares outstanding
(in thousands):
9 Quarter ended 709,064 706,481 719,514
10 Year-to-date 707,773 706,481 723,157
11 Common equity to total
assets 7.59% 7.26% 7.27%
12 Tier 1 risk-based capital
ratio 7.38/abc/ 7.49/ab/ 7.72
13 Total risk-based capital
ratio 11.10/abc/ 11.41/ab/ 11.66
14 Tier 1 risk-based capital $ 17,969/abc/ $ 17,764/ab/ $ 17,145
15 Total risk-based capital 27,009/abc/ 27,054/ab/ 25,901
16 Risk-weighted assets 243,431/abc/ 237,127/ab/ 222,149
- -----------------------------------------------------------------------
</TABLE>
/a/ Includes the effect of market risk as required by the regulators
effective January 1, 1998. The new requirements decreased Tier 1
and total risk-based capital ratios by 19 basis points and
25 basis points, respectively, at June 30, 1998, and 20 basis
points and 27 basis points, respectively, at March 31, 1998.
/b/ Includes BAC's broker/dealer subsidiary.
/c/ Amounts are preliminary.
======================================================================
TABLE 5
SELECTED AVERAGE BALANCE SHEET COMPONENTS
<TABLE>
<CAPTION>
Second First Second
Quarter Quarter Quarter
(in millions) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
1 Available-for-sale securities $ 12,403 $ 12,817 $ 11,277
2 Held-to-maturity securities 3,510 3,622 3,918
3 Loans 166,347 167,352 168,095
4 Earning assets 219,480 219,870 215,558
5 Total assets 261,267 263,527 255,131
6 Deposits 172,380 171,680 168,994
7 Interest-bearing liabilities 184,212 188,334 175,768
8 Common equity 19,400 18,704 18,459
9 Total equity 20,000 19,318 20,055
</TABLE>
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 6
BUSINESS SECTORS
Six Months Ended June 30, 1998
--------------------------------------
Global Global
(dollar amounts Retail Wholesale All
in millions) Bank Bank Other Total
------- --------- ------ --------
<S> <C> <C> <C> <C>
1 GAAP net income available
to common shareholders $ 1,113 $ 584 $ 9 $ 1,706
2 RAROC economic profit 580 294 (65) 809
3 ROIC economic profit 418 214 (67) 565
4 Average total assets 118,426 122,995 20,975 262,396
5 Average total deposits 118,622 49,927 3,488 172,037
6 GAAP avg. common equity 8,641 9,028 1,386 19,055
7 RAROC avg. economic capital 8,011 7,241 916 16,168
8 ROIC avg. invested capital 11,654 8,499 1,087 21,240
9 GAAP return on average
common equity 26.0% 13.0% NM 18.1%
10 Risk adjusted return
on capital 26.6% 20.2% NM 22.1%
11 Return on invested capital 19.2% 17.2% NM 17.4%
12 Expense/revenue 56.0% 51.7% NM 55.2%
13 Net interest margin 5.44% 2.20% NM 3.85%
<CAPTION>
Six Months Ended June 30, 1997
---------------------------------------
Global Global
Retail Wholesale All
Bank Bank Other Total
------- --------- ------ --------
<S> <C> <C> <C> <C>
1 GAAP net income available
to common shareholders $ 866 $ 732 $ (82) $ 1,516
2 RAROC economic profit 453 259 (140) 572
3 ROIC economic profit 296 260 (137) 419
4 Average total assets 124,088 111,259 18,302 253,649
5 Average total deposits 114,288 49,074 4,402 167,764
6 GAAP avg. common equity 9,083 8,109 1,195 18,387
7 RAROC avg. economic capital 8,303 6,062 867 15,232
8 ROIC avg. invested capital 12,391 7,269 847 20,507
9 GAAP return on average
common equity 19.2% 18.2% NM 16.6%
10 Risk adjusted return
on capital 23.0% 20.6% NM 19.6%
11 Return on invested capital 16.8% 19.0% NM 16.1%
12 Expense/revenue 54.2% 45.9% NM 53.2%
13 Net interest margin 6.03% 2.32% NM 4.14%
- ------------------------------------------------------------------------
</TABLE>
See notes following business sectors table.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
NOTES TO BUSINESS SECTORS TABLE
BAC examines the financial performance of its businesses from multiple
capital return perspectives to facilitate meeting various decision
support needs of managers. Each measure reflects a different level
of capital, treatment of intangible assets, and basis for recognition
of credit losses. The key return on capital measures are:
- - GAAP Return on Average Common Equity - Reflects total common
equity allocated to businesses on the basis of their relative share
of BAC's total assets and an apportionment of the corporate
provision and reserve for credit losses. Income is derived in a
manner consistent with externally reported financial statement
results. This measure is oriented toward external performance
comparisons and does not allocate capital based on the risks
inherent in a specific business. Net interest margin and expense
to revenue ratios for a business are calculated using the generally
accepted accounting principles (GAAP) return on average common equity
perspective.
- - Risk-Adjusted Return on Capital (RAROC) - Capital is allocated to
businesses on the basis of economic capital assignments of
credit, country, market/interest rate and business/operating risks.
The assignments are based on empirical analysis of the risks that
are inherent in the operation of each business. Credit losses
reflect the statistically derived expected losses within a given
portfolio. Goodwill is not amortized in deriving this measure.
This measure includes only the capital necessary to cover the risks
of unexpected losses, and represents that which is incrementally
attributable to businesses for individual transactions.
RAROC is most often used for incremental decision analysis.
- - Return on Invested Capital (ROIC) - Risk based economic capital as
assigned through the RAROC process described above is increased by
an amount equal to the intangibles assigned to a business. Capital
is thereby assumed to cover unexpected losses plus an amount of
capital necessary to fully fund growth by acquisition. Loan losses
in this measure represent net charge-offs. Goodwill is not
amortized for purposes of calculating ROIC. The Return on Invested
Capital is an all-in return concept based on a quasi-cash
derivation of net income. This measure enables managers to
evaluate their overall business performance on a comprehensive,
fully allocated basis that is oriented toward cash flows.
Interest revenue is adjusted for each return calculation to reflect
changes in the debt to equity mix under each measure.
Economic Profit, which reflects net income available to common
shareholders less a 12% charge for capital, is calculated for the RAROC
and ROIC measurements.
Expense to revenue percent excludes net other real estate owned
expense, amortization of intangibles, and expenses associated with
trust preferred securities.
All Other column includes results of the Global Asset Management Group,
Community Development Banking, and Asset/Liability management activities.
All amounts are preliminary. For comparability purposes, both 1998
and 1997 amounts reflect BAC's internal allocation and classification
methodologies in effect at June 30, 1998.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 7
TRADING-RELATED INCOME
Second First Second
Quarter Quarter Quarter
(in millions) 1998/a/ 1998 1997
------- ------- -------
<S> <C> <C> <C>
Trading income:
1 Interest rate products $ 28 $ 45 $ 17
2 Foreign exchange contracts 163 158 107
3 Debt instruments (72) 48 94
---- ---- ----
4 Total trading income $119 $251 $218
==== ==== ====
Other trading-related income:
5 Interest rate products/b/ $ 7 $ 6 $ 12
6 Foreign exchange contracts (3) 2 2
7 Debt instruments/b/ 65 88 47
---- ---- ----
8 Total other trading-related
income $ 69 $ 96 $ 61
==== ==== ====
<CAPTION>
Six Months Ended
June 30
--------------------
1998/a/ 1997
------ ------
<S> <C> <C>
Trading income:
9 Interest rate products $ 73 $ 29
10 Foreign exchange contracts 321 199
11 Debt instruments (24) 178
---- ----
12 Total trading income $370 $406
==== ====
Other trading-related income:
13 Interest rate products/b/ $ 13 $ 22
14 Foreign exchange contracts (1) 6
15 Debt instruments/b/ 153 97
---- ----
16 Total other trading-related
income $165 $125
==== ====
- ------------------------------------------------------------------------
</TABLE>
/a/ Detailed breakouts of total amounts are preliminary.
/b/ Primarily includes the net interest revenue associated with the
respective products.
<PAGE>
<TABLE>
<CAPTION>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
TABLE 8
IMPACT OF CREDIT CARD SECURITIZATIONS
Second Quarter 1998/a/
---------------------------------------------
Before Impact of
(dollar amounts Credit Card Credit Card
in millions) Securitizations Securitizations Reported
--------------- --------------- --------
<S> <C> <C> <C>
Operating Results:
1 Net interest income $ 2,238 $ (132) $ 2,106
2 Credit card fees 126 (26) 100
3 Other noninterest income 1,680 63 1,743
-------- ------- --------
4 Total revenue 4,044 (95) 3,949
5 Noninterest expense 2,303 - 2,303
-------- ------- --------
6 Income before provision
for credit losses and
income taxes 1,741 (95) 1,646
7 Provision for credit
losses 322 (92)/b/ 230
-------- ------- --------
8 Income before income
taxes $ 1,419 $ (3) $ 1,416
======== ======= ========
9 Net interest margin 4.00% (0.14)% 3.86%
Balance Sheet Data at
Period End:
10 Credit card loans
outstanding $ 10,772 $(5,621) $ 5,151
11 Total assets 269,506 (5,621) 263,885
Average Balance
Sheet Data:
12 Credit card loans 10,579 (5,324) 5,255
13 Earning assets 224,804 (5,324) 219,480
14 Total assets 266,591 (5,324) 261,267
15 Net credit losses - credit
card portfolio 176 (92)/b/ 84
Selected Financial Ratios:
16 Annualized ratio of net
credit losses on credit
card loans to average credit
card loans outstanding 6.62% (0.27)% 6.35%
17 Delinquent credit card
loan ratio/c/ 4.33 (0.48) 3.85
- -----------------------------------------------------------------------
</TABLE>
/a/ Includes the effects of accumulated credit card securitizations
of $5,621 million at June 30, 1998, which includes a $500 million
purchased credit card portfolio.
/b/ Represents charge-offs on the investor's share.
/c/ 30 days or more past due.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 9
LOAN OUTSTANDINGS
June 30 March 31 June 30
(in millions) 1998 1998 1997
-------- -------- --------
<S> <C> <C> <C>
DOMESTIC
Consumer:
1 Residential first mortgages $ 31,600 $ 31,711 $ 37,163
2 Residential junior mortgages 12,561 12,920 13,700
3 Other installment 17,818 18,179 18,410
4 Credit card/a/ 5,151 5,680 7,624
5 Other individual lines of credit 955 1,833 1,961
6 Other 360 353 413
-------- -------- --------
7 Total consumer 68,445 70,676 79,271
Commercial:
8 Commercial and industrial 40,036 37,765 35,621
9 Loans secured by real estate 12,783 12,968 12,669
10 Financial institutions 3,724 3,571 2,947
11 Lease financing 2,767 2,861 2,809
12 Loans for purchasing or carrying
securities 2,970 2,794 2,616
13 Construction and development
loans secured by real estate 2,434 2,350 2,262
14 Agricultural 1,651 1,641 1,560
15 Other 1,859 1,904 1,738
-------- -------- --------
16 Total commercial 68,224 65,854 62,222
-------- -------- --------
17 Total domestic loans 136,669 136,530 141,493
FOREIGN
18 Commercial and industrial 18,478 18,939 17,762
19 Banks and other financial
institutions 4,533 3,815 4,818
20 Governments and official
institutions 810 723 851
21 Other 6,131 5,513 5,237
-------- -------- --------
22 Total foreign loans 29,952 28,990 28,668
-------- -------- --------
23 Total loans $166,621 $165,520 $170,161
======== ======== ========
- -----------------------------------------------------------------------
</TABLE>
/a/ Excludes outstanding securitized credit card receivables of
$5,621 million, $4,871 million, and $2,221 million, at June 30,
1998, March 31, 1998, and June 30, 1997, respectively.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 10
SELECTED CREDIT QUALITY DATA
June 30 March 31 June 30
(dollar amounts in millions) 1998 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Nonaccrual assets:
1 Commercial and industrial $166 $ 258 $228
2 Commercial loans secured by real
estate 67 90 120
3 Construction and development
loans secured by real estate 24 29 59
4 Consumer 333 374 373
5 Foreign 361 285 81
---- ------ ----
6 Total nonaccrual assets $951 $1,036 $861
==== ====== ====
7 Restructured loans $251 $ 258 $302
8 Loans past due 90 days or more
and still accruing interest/a/ 159 171 214
9 Other real estate owned 175 163 242
10 Allowance for credit losses to
total loans 2.11% 2.13% 2.11%
11 Allowance for credit losses to
total nonaccrual assets 369.66 339.67 413.99
Annualized ratio of net credit
losses to average total loan
outstandings:
12 Quarter ended 0.55 0.58 0.54
13 Year-to-date 0.57 0.58 0.52
- ----------------------------------------------------------------------
</TABLE>
/a/ Includes consumer loans of $124 million, $153 million, and
$190 million at June 30, 1998, March 31, 1998, and June 30, 1997,
respectively.
=====================================================================
<TABLE>
<CAPTION>
TABLE 11
ANALYSIS OF CHANGE IN NONACCRUAL ASSETS
Second First
Quarter Quarter
(in millions) 1998 1998
------- --------
<S> <C> <C>
1 Balance, beginning of period $1,036 $ 899
Additions:
2 Loans placed on nonaccrual status 166 290
Deductions:
3 Sales (38) (50)
4 Restored to accrual status (43) (6)
5 Foreclosures (18) -
6 Charge-offs (76) (38)
7 Other, primarily payments (76) (59)
------ ------
8 Balance, end of period $ 951 $1,036
====== ======
</TABLE>
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 12
NET CREDIT LOSSES (RECOVERIES)
Second First Second
Quarter Quarter Quarter
(in millions) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
Domestic consumer:
1 Residential first mortgages $ 3 $ 4 $ 7
2 Residential junior mortgages 2 6 8
3 Credit card 84 111 124
4 Other installment 39 62 49
5 Other individual lines of credit 18 21 20
6 Other 7 5 4
Domestic commercial:
7 Commercial and industrial 23 8 19
8 Loans secured by real estate - (1) -
9 Construction and development
loans secured by real estate - - (8)
10 Financial institutions, lease
financing, loans for
purchasing or carrying
securities, and agricultural - - (1)
---- ---- ----
11 Total domestic 176 216 222
12 Foreign 54 23 2
---- ---- ----
13 Total net credit losses $230 $239 $224
==== ==== ====
</TABLE>
========================================================================
<TABLE>
<CAPTION>
TABLE 13
DOMESTIC CONSUMER LOAN DELINQUENCY INFORMATION/a/
June 30 March 31 June 30
(dollar amounts in millions) 1998 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Delinquent consumer loans:
1 Residential first mortgages $ 752 $ 810 $ 907
2 Residential junior mortgages 109 119 144
3 Credit card 198 251 322
4 Other 280 304 352
------ ------ ------
5 Total delinquent consumer loans $1,339 $1,484 $1,725
====== ====== ======
Delinquent consumer loan ratios/b/:
6 Residential first mortgages 2.38% 2.55% 2.44%
7 Residential junior mortgages 0.87 0.92 1.05
8 Credit card 3.85 4.42 4.23
9 Other 1.46 1.49 1.69
10 Total delinquent consumer
loan ratio 1.96% 2.10% 2.18%
==== ==== ====
- ------------------------------------------------------------------------
</TABLE>
/a/ 30 days or more past due.
/b/ Ratios represent delinquent balances expressed as a percentage
of total loans for that loan category.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 14
ALLOCATION OF ALLOWANCE FOR CREDIT LOSSES BY LOAN TYPE/a/
June 30, 1998 March 31, 1998
------------------ ------------------
Percent Percent
(dollar amounts of Loan of Loan
in millions) Allowance Category Allowance Category
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Domestic consumer:
1 Residential first
mortgages $ 61 0.19% $ 78 0.24%
2 Residential junior
mortgages 87 0.69 98 0.76
3 Credit card 320 6.22 373 6.56
4 Other consumer 749 3.92 801 3.93
Domestic commercial:
5 Commercial and industrial/b/ 528 1.18 538 1.27
6 Loans secured by
real estate 180 1.41 184 1.42
7 Financial institutions 4 0.10 11 0.31
8 Lease financing 34 1.22 33 1.16
9 Construction and
development loans
secured by real estate 52 2.13 50 2.12
10 Agricultural 22 1.36 22 1.36
11 Foreign 1,148 3.83 1,109 3.83
12 Unallocated 332 - 220 -
------ ------
13 Total $3,517 2.11% $3,517 2.13%
====== ======
- ------------------------------------------------------------------------
</TABLE>
/a/ Includes the allowance for credit losses on impaired loans of
$158 million and $171 million at June 30, 1998 and March 31, 1998,
respectively. While management has allocated the allowance to various
portfolio segments, it is general in nature and is available for
the loan portfolio in its entirety.
/b/ Includes the allowance for credit losses for commercial and
industrial loans, loans for purchasing or carrying securities,
and other commercial loans.
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
TABLE 15
REGIONAL FOREIGN EXPOSURES
(in millions) June 30, 1998/a/
----------------------------------------
Total Gross
Cross- Local
Total border Country
Region/Country Exposure/b/ Loans Claims/c/ Other/d/
-------- ------- ------- -------
<S> <C> <C> <C> <C>
ASIA
1 China $ 494 $ 209 $ 102 $ 183
2 Hong Kong 5,131 74 4,744 313
3 India 2,231 317 1,630 284
4 Indonesia 713 259 233 221
5 Japan 3,346 201 1,487 1,658
6 Korea (South) 2,510 796 412 1,302
7 Malaysia 898 9 824 65
8 Pakistan 433 8 419 6
9 Philippines 585 216 173 196
10 Singapore 1,846 112 1,623 111
11 Taiwan 1,637 404 1,134 99
12 Thailand 1,232 130 854 248
13 Other 77 - 77 -
------- ------ ------ ------
14 Total 21,133 2,735 13,712 4,686
CENTRAL AND EASTERN EUROPE
15 Russia Federation 668 84 12 572
16 Other 648 242 102 304
-------- ------ ------ ------
17 Total 1,316 326 114 876
LATIN AMERICA
18 Argentina 1,594 273 908 413
19 Brazil 2,637 1,064 1,039 534
20 Chile 1,933 1,254 587 92
21 Colombia 557 472 53 32
22 Mexico 3,872 1,916/e/ 486 1,470
23 Venezuela 569 129 83 357
24 Other 266 3 - 263
------ ------- ------ ------
25 Total 11,428 5,111 3,156 3,161
26 Total $33,877 $8,172/f/ $16,982 $8,723
======= ====== ======= ======
- -------------------------------------------------------------------
</TABLE>
/a/ Amounts are preliminary.
/b/ Includes the following foreign assets: loans, accrued interest,
acceptances, interest-bearing deposits in banks,trading account
securities, available-for-sale and held-to-maturity securities,
other interest-bearing investments, and other monetary assets.
Amounts also include unrealized gains on off-balance-sheet
instruments, unused commitments, and available-for-sale
and held-to-maturity securities that are collateralized by
U.S. Treasury securities.
/c/ Represents claims of BAC's foreign offices on local country
residents, including trading account securities, derivative
products, unused commitments, and available-for-sale and
held-to-maturity securities regardless of the currency.
/d/ Includes: accrued interest receivable, acceptances, interest-
bearing deposits in banks, trading account securities, other
interest-earning investments, other short-term monetary assets,
unrealized gains on off-balance-sheet instruments, unused
commitments, and available-for-sale and held-to-maturity securities,
including securities that are collateralized by U.S. Treasury
securities as follows: Mexico - $1,058 million, Venezuela -
$252 million, Philippines - $22 million, and Latin America Other -
$89 million. Held-to-maturity securities amounted to $1,117 million
with a fair value of $1,062 million.
/e/ Includes a $30 million loan that is collateralized by zero-coupon
U.S. Treasury securities.
/f/ Amounts also include nonaccrual loans of $325 million.
<PAGE>
<TABLE>
<CAPTION>
BANKAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
Second First Second
Quarter Quarter Quarter
(in millions) 1998 1998 1997
------- ------- -------
<S> <C> <C> <C>
INTEREST INCOME
1 Loans, including fees $3,367 $3,388 $3,513
2 Interest-bearing deposits in banks 99 108 105
3 Federal funds sold 10 8 9
4 Securities purchased under
resale agreements 259 233 180
5 Trading account assets 387 383 298
6 Available-for-sale and held-to-
maturity securities 275 283 270
------ ------ ------
7 TOTAL INTEREST INCOME 4,397 4,403 4,375
INTEREST EXPENSE
8 Deposits 1,453 1,489 1,424
9 Federal funds purchased 25 27 19
10 Securities sold under repurchase
agreements 280 251 178
11 Other short-term borrowings 283 293 287
12 Long-term debt 250 248 257
------ ------ ------
13 TOTAL INTEREST EXPENSE 2,291 2,308 2,165
------ ------ ------
14 NET INTEREST INCOME 2,106 2,095 2,210
15 Provision for credit losses 230 245 250
------ ------ ------
16 NET INTEREST INCOME AFTER
PROVISION FOR CREDIT LOSSES 1,876 1,850 1,960
NONINTEREST INCOME
17 Deposit account fees 357 338 361
18 Credit and other card fees 100 91 93
19 Trust fees 82 75 61
20 Other fees and commissions 651 562 417
21 Trading income 119 251 218
22 Equity investment activities 125 190 98
23 Net gain on sales of loans 149 115 44
24 Net gain (loss) on available-for-sale
debt securities 12 61 (1)
25 Net gain (loss) on sales of
subsidiaries and operations (41) 20 27
26 Other income 289 110 108
------ ------ ------
27 TOTAL NONINTEREST INCOME 1,843 1,813 1,426
NONINTEREST EXPENSE
28 Salaries 1,007 1,050 873
29 Employee benefits 181 179 189
30 Occupancy 195 191 183
31 Equipment 179 171 173
32 Professional services 134 112 82
33 Communications 98 97 96
34 Amortization of intangibles 90 91 89
35 Other expense 419 397 362
------ ------ ------
36 TOTAL NONINTEREST EXPENSE 2,303 2,288 2,047
------ ------ ------
37 INCOME BEFORE INCOME TAXES 1,416 1,375 1,339
38 Provision for income taxes 526 540 540
------ ------ ------
39 NET INCOME $ 890 $ 835 $ 799
====== ====== ======
</TABLE>
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
June 30
----------------------
(in millions) 1998 1997
------- -------
<S> <C> <C>
INTEREST INCOME
1 Loans, including fees $6,755 $6,951
2 Interest-bearing deposits in banks 207 204
3 Federal funds sold 18 17
4 Securities purchased under
resale agreements 492 335
5 Trading account assets 770 567
6 Available-for-sale and held-to-
maturity securities 558 556
------ ------
7 TOTAL INTEREST INCOME 8,800 8,630
INTEREST EXPENSE
8 Deposits 2,942 2,790
9 Federal funds purchased 52 32
10 Securities sold under repurchase
agreements 531 327
11 Other short-term borrowings 576 562
12 Long-term debt 498 520
------ ------
13 TOTAL INTEREST EXPENSE 4,599 4,231
------ ------
14 NET INTEREST INCOME 4,201 4,399
15 Provision for credit losses 475 470
------ ------
16 NET INTEREST INCOME AFTER
PROVISION FOR CREDIT LOSSES 3,726 3,929
NONINTEREST INCOME
17 Deposit account fees 695 721
18 Credit and other card fees 191 180
19 Trust fees 157 118
20 Other fees and commissions 1,213 792
21 Trading income 370 406
22 Equity investment activities 315 204
23 Net gain on sales of loans 264 103
24 Net gain on available-for-sale
debt securities 73 12
25 Net gain (loss) on sales of
subsidiaries and operations (21) 40
26 Other income 399 220
------ ------
27 TOTAL NONINTEREST INCOME 3,656 2,796
NONINTEREST EXPENSE
28 Salaries 2,057 1,712
29 Employee benefits 360 378
30 Occupancy 386 369
31 Equipment 350 355
32 Professional services 246 157
33 Communications 195 189
34 Amortization of intangibles 181 180
35 Other expense 816 740
------ ------
36 TOTAL NONINTEREST EXPENSE 4,591 4,080
------ ------
37 INCOME BEFORE INCOME TAXES 2,791 2,645
38 Provision for income taxes 1,066 1,066
------ ------
39 NET INCOME $1,725 $1,579
====== ======
</TABLE>
<PAGE>
BANKAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
June 30 March 31 June 30
(in millions) 1998 1998 1997
-------- -------- --------
<S> <C> <C> <C>
ASSETS
1 Cash and due from banks $ 14,053 $ 14,699 $ 14,884
2 Interest-bearing deposits in banks 5,566 5,737 7,037
3 Federal funds sold 688 1,748 270
4 Securities purchased under resale
agreements 11,532 11,179 7,272
5 Trading account assets 19,314 21,328 16,765
6 Available-for-sale securities 12,574 12,328 11,959
7 Held-to-maturity securities 3,420 3,645 3,858
8 Loans 166,621 165,520 170,161
9 Less: Allowance for credit losses 3,517 3,517 3,563
-------- -------- --------
10 Net loans 163,104 162,003 166,598
11 Customers' acceptance liability 2,688 3,374 3,230
12 Accrued interest receivable 1,693 1,625 1,567
13 Goodwill, net 3,740 3,790 3,842
14 Identifiable intangibles, net 1,381 1,420 1,499
15 Unrealized gains on off-balance-
sheet instruments 9,147 9,347 7,319
16 Premises and equipment, net 3,528 3,831 3,944
17 Other assets 11,457 9,382 8,319
-------- -------- --------
18 TOTAL ASSETS $263,885 $265,436 $258,363
======== ======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
Deposits in domestic offices:
19 Interest-bearing $ 94,535 $ 95,387 $ 83,308
20 Noninterest-bearing 35,392 33,628 41,434
Deposits in foreign offices:
21 Interest-bearing 46,594 43,249 46,667
22 Noninterest-bearing 1,573 1,626 1,759
-------- -------- --------
23 Total deposits 178,094 173,890 173,168
24 Federal funds purchased 702 810 1,730
25 Securities sold under repurchase
agreements 12,701 13,500 9,699
26 Other short-term borrowings 16,293 18,333 18,327
27 Acceptances outstanding 2,689 3,374 3,230
28 Accrued interest payable 988 1,004 958
29 Unrealized losses on off-balance-
sheet instruments 8,093 8,792 7,157
30 Other liabilities 8,553 9,626 7,117
31 Long-term debt 13,521 14,011 14,736
-------- -------- --------
32 TOTAL LIABILITIES 241,634 243,340 236,122
33 Corporation obligated mandatorily
redeemable preferred securities
of subsidiary trusts holding
solely junior subordinated
deferrable interest debentures
of the corporation (trust
preferred securities) 2,212 2,212 1,873
STOCKHOLDERS' EQUITY
34 Preferred stock - 614 1,596
35 Common stock 1,210 1,210 1,210
36 Additional paid-in capital 8,022 7,994 7,872
37 Retained earnings 14,922 14,292 12,598
38 Net unrealized gain on
available-for-sale securities 81 66 13
39 Common stock in treasury, at cost (4,196) (4,292) (2,921)
-------- -------- --------
40 TOTAL STOCKHOLDERS' EQUITY 20,039 19,884 20,368
-------- -------- --------
41 TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $263,885 $265,436 $258,363
======== ======== ========
- ------------------------------------------------------------------------
</TABLE>
