1st Union, 1st Fidelity hit records Profits also surge at Crestar, Citizens, Columbia Bancorp


Higher loan demand coupled with reduced deposit premiums, and increased profits from fee-related businesses boosted third-quarter earnings at First Union Corp., Crestar Financial Corp. and First Fidelity Bancorp.

First Union, based in Charlotte, N.C., earned a record $255 million in the quarter, up 9 percent from a year ago. The company earned $1.55 a share, compared with $1.35 a year ago.

"We are seeing the results of our investments in capital markets, capital management and other business that expand our traditional banking base, and we are optimistic about our financial results for 1995 and 1996," said Edward Crutchfield, chairman and chief executive of First Union.

First Union, which has $87 billion in assets, earned $734 million during the first nine months of the year, or $4.27 a share, compared with earnings of $675 million, or $3.94 a share during the comparable period a year ago.

First Union will become the nation's sixth largest banking company in January when it merges with First Fidelity, of Newark, N.J. It will have $126 billion in assets and nearly 2,000 branches in 12 states and Washington. First Union will take over First Fidelity's 52 branches and $2.6 billion in deposits in the Baltimore area.

First Fidelity reported record earnings of $126 million in the quarter, up 9.2 percent from a year ago. Earnings a share were up 11.5 percent from a year ago, to $1.45.

The company said reduced Federal Deposit Insurance Corp. premiums added $9.8 million to net income. It also said the number of full-time employees fell to 11,705 from 13,071 at year-end 1994.

The robust earnings for the quarter didn't surprise analysts, although some have been expecting the strong numbers to tail off because banks have been making money at unprecedented levels for the past three years.

"A lot of analysts have probably underestimated what is going on here," said Tony Davis, a banking analyst with Dean Witter Reynolds. "You've just got better management."

In fact, analysts remain optimistic that earnings will continue to be strong.

"I don't think that they [earnings] peaked out by any means," said Merrill Ross, a banking analyst with Wheat First Butcher Singer in Richmond.

Richmond-based Crestar Financial's earnings grew to a record $48.4 million in the quarter, up 9 percent from a year ago. Earnings per share increased to $1.27, up 11 percent.

Income was boosted from fee-generating business and the fact that the company kept a lid on expenses, said Richard G. Tilghman, Crestar's chairman and chief executive officer.

Noninterest income, excluding securities gains, increased 13 percent to $71.8 million for the quarter, while noninterest expenses grew by 3 percent to $133.6 million.

Other banks reporting earnings this week include Citizens Bancorp of Laurel, which earned $9.4 million in the quarter, up 17 percent from the prior year.

Citizens earned nearly $27 million for the nine-month period, up 16.5 percent. Loans grew 10.5 percent to $2.1 billion and deposits were up 6.7 percent to $2.99 billion for the nine months.

Citizens is one of the largest independently owned banks in the state with $3.8 billion in assets and 100 branches.

Columbia Bancorp posted record earnings of $1 million for the third quarter, up 56 percent from a year ago. For the nine-month period, Columbia earned $2.4 million, up 35 percent. The bank attributed its robust earnings to strong loan demand. Loans grew 15 percent to $178 million, and deposits were up 14 percent to $214 million.

At Annapolis Bancshares Inc., earnings increased nearly 37 percent to $308,372 for the quarter. Net income was boosted by an increase in interest income of $161,126, and a reduction of $35,634 in FDIC insurance premiums. The bank's assets grew to $76.4 million, up 14 percent from a year ago.

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