1st Chicago Net Rises; Mellon Suffers Loss

First Chicago Corp. reported a 3% rise in its first-quarter net income, while Mellon Bank Corp. posted a previously announced net loss, its first quarterly loss ever.

First Chicago, the nation’s 11th-largest bank holding company, reported a profit of $65 million, or $1.08 per share, in the three months ended March 31. That compared to net income of $63 million, or $1.06 per share, in the same period last year.

Mellon, the 12th-largest U.S. banking concern, lost $60 million, compared to a profit of $60 million, or $2.13 per share, in its first quarter of 1986. The company previously said it expected to post a loss because of an increase in bad loans and in its provision for more possible loan losses.

First Chicago had net interest income of $277.9 million, down from $283.5 million a year earlier. Non-interest income also fell, to $173.1 million from $187.1 million.

Non-interest expenses rose to $265.4 million from $255.9 million.

The company took a first-quarter loan loss provision of $75 million, compared to $100 million a year earlier. Its total allowance for bad loans as of March 31 was $595.5 million, or 2.4% of loans outstanding, compared to $459.9 million, or 1.87% of loans.

Mellon Chairman J. David Barnes last week had announced that the Pittsburgh-based banking company would post the first quarterly loss in its 118-year history.

Mellon’s net interest revenue fell to $248 million from $264 million in the first quarter of 1986, while non-interest revenue fell to $162.7 million from $177.8 million. Operating expenses rose to $292.8 million from $241.4 million.

The latest quarter included a $175-million provision for possible credit losses, $95 million of that reflecting actual losses and an $80-million addition to the bank’s reserve for possible losses.