First Union Corp. of Charlotte, the nation's sixth-largest bank company, said yesterday that earnings for the second quarter dropped 9.3 percent from a year earlier, the result of a decline in mortgage fees and equity investments and a general difficulty integrating new acquisitions.
The company, which is the third-largest bank in the Washington area, said it earned $873 million, or 90 cents per share, including a one-time gain from the sale of a factoring business. Excluding the gain, earnings amounted to 82 cents per share, roughly in line with the company's most recent earnings forecast and down from $883 million (92 cents) in operating earnings for the same quarter a year earlier. The second quarter of 1999, while having a special one-time charge, did not have any merger-related or restructuring charges as the year-earlier quarter did.
The operating earnings exclude the one-time merger-related and restructuring charges that appeared in second-quarter earnings last year.
Net earnings, including those one-time charges, for the second quarter were $873 million (90 cents), up from $249 million (26 cents) for the second quarter of 1998.
The company has had difficulty reaping profits from its acquisition of CoreStates Financial Corp., its heavy investment in its online business and the reorganization of its branch system.
For the first six months of 1999, the company had operating earnings of $1.8 billion ($1.90), down from $1.7 billion ($1.75) for the first six months of 1998. Net income, including one-time charges, for the first six months was $1.6 billion ($1.63), compared with net income of $1 billion ($1.07) for the first six months of 1998.
First Union's stock closed yesterday at $46.81 1/4, up 12 1/2 cents, on the New York Stock Exchange.
Riggs National Corp., the largest bank headquartered in the District, said earnings declined 34.2 percent in the second quarter of the 1999 compared with a year ago.
The company said it earned $9.6 million (33 cents a share) for the quarter ended June 30, compared with earnings of $14.5 million (37 cents) for the same period last year. The company attributed the decline to larger than usual gains last year, when the second quarter results benefited from a sizable one-time gains in securities and tax advantages.
For the first half of the year the company said it earned $17.3 million (59 cents), down from $30.2 million (78 cents) in the first half of 1998.
F&M National Corp. of Winchester, Va., said earnings for the second quarter were $9.6 million (43 cents a share), up 9.6 percent from $8.8 million (39 cents) for the same period a year earlier.
The firm earned $20.6 million (91 cents) for the first six months of 1999, up from $17.8 million (78 cents) a year earlier.
Mercantile Bankshares Corp. of Baltimore said it earned $38.9 million (55 cents), up 6.4 percent from net income of $36.6 million (50 cents) in the second quarter of 1998.
For the first six month of 1999, the firm earned $76.1 million ($1.08), up from $72.1 million ($1.00) for the first six months of 1998.
Equitable Federal Savings Bank reported a 12 percent increase in earnings for its fiscal third quarter ended June 30. Net income for the period rose to $609,000 (47 cents a share) from $544,000 (41 cents) during same period last year.
Net interest income climbed 24 percent from $1.8 million to $2.24 million and the loan portfolio grew to $281 million from $225 million in third quarter 1998.
The net interest income was affected by increases in loan loss provision (from $31,000 to $51,000), income tax (from $311,000 to $382,000) and non-interest expense (from $1.33 million to $1.38 million) and a decrease in non-interest income to $182,000 from $418,000 in last year's third quarter.