B of A Profit Climbs 12%; Fees Make Up for Sluggish Lending
BankAmerica Corp. said Wednesday that its second-quarter earnings rose 12%, as higher fees and lower costs offset sluggish profit from lending.
The nation’s third-largest bank said net income rose to $723 million, or $1.84 a share, from $645 million, or $1.56, a year earlier.
The earnings exceeded the average forecast of $1.79 a share in a survey of analysts.
Though San Francisco-based BankAmerica benefited from higher revenue from securities and some fees, it was hit by a tough quarter for lending. The bottom line got a boost from lower expenses, mainly because of a onetime break on federal deposit insurance premiums.
Credit card losses, which are plaguing banks around the country as more overextended consumers fail to pay their bills, hurt BankAmerica’s bottom line. U.S. credit card losses rose to $108 million from $87 million in the same quarter last year. Analysts were encouraged that losses were almost unchanged from $103 million in the first quarter.
Also Wednesday, Beverly Hills-based City National reported that second-quarter earnings rose 38% partly as a result of its merger with First Los Angeles Bank.
The parent of City National Bank--the largest independent bank based in Southern California--said net income rose to $16 million, or 36 cents per share, compared with $11.6 million, or 25 cents, in the year-ago quarter.
Meanwhile, H.F. Ahmanson, the Irwindale-based parent of Home Savings of America, said its second-quarter earnings rose 6.7%, helped by a lower tax rate.
Ahmanson, the biggest U.S. thrift, said net income rose in the quarter to $68.7 million, or 50 cents a share, from $64.4 million, or 43 cents, a year ago. It matched analysts’ expectations.
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General Electric’s profit rose 11% in the second quarter, helped by strong profits from its finance arm, GE Capital Services.
Net income was $1.91 billion, or $1.15 per share, compared with $1.73 billion, or $1.02 per share, in the same period a year ago, beating analysts’ expectations by a penny.
GE said eight of its 12 businesses had increased earnings, led by a 19% increase at GE Capital, which invests GE’s cash and runs one of the world’s biggest commercial jet leasing operations.
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Northrop Grumman’s second-quarter earnings rose 74%, reflecting the March acquisition of Westinghouse Electric’s defense electronics businesses.
The Los Angeles-based maker of the B-2 bomber reported profit from operations of $78.5 million, or $1.54 a share, for the quarter ended June 30, up from $45 million, or $1.14, in the 1995 quarter. The earnings exceeded the $1.22 per-share estimate of Wall Street analysts
At a Glance:
Sizzler International reported a fiscal fourth-quarter loss as it tries to reorganize in bankruptcy court and faces tougher competition from other steakhouse chains.
The Los Angeles-based operator of self-serve steak restaurants reported a loss from operations of $12.7 million, or 46 cents a share, for the quarter ended April 30. In the year-ago quarter, it had net income of $1.39 million, or 5 cents.
Trans World Airlines reported a 400% gain in the second quarter, earning $25.3 million, or 46 cents a share, from $5.2 million a year earlier. The St. Louis-based carrier emerged from Chapter 11 bankruptcy protection last August.
AMR, parent of American Airlines, earned $293 million, or $3.35 per share, compared with $178 million, or $2.31, last year.
Pfizer reported a 24% boost in second-quarter earnings of $394 million, or 61 cents per share, compared with $317 million, or 50 cents, in the year-ago quarter.
Pacific Gas & Electric said its second-quarter earnings fell 51% to $190.7 million, or 44 cents a share, from $392.7 million, or 89 cents, in the year-earlier period.
Harrah’s Entertainment said second-quarter earnings rose 3.3% to $36.6 million, or 35 cents a share, from $35.4 million, or 35 cents a year earlier.
Weyerhaeuser said its second-quarter earnings fell a less-than-expected 58% to $103.2 million, or 52 cents a share, from $246.7 million, or $1.21, a year earlier.
Charles Schwab said its second-quarter earnings rose 59% to $70.1 million, or 39 cents a share, compared with $44.4 million, or 25 cents a share, in the 1995 period.
Seagate Technology reported net income for its fiscal fourth quarter fell 10% to $101 million, or 92 cents a share, from $113 million, or $1.14 a share, in the year-ago quarter.
Computer Associates reported a surprisingly strong 35% climb in profit to $119.79 million, or 32 cents per share, versus $88.55 million, or 23 cents, in the year-ago period.
Black & Decker said its second-quarter earnings rose 61% to $45.3 million, or 47 cents a share, from profit from continuing operations of $28.1 million, or 29 cents, a year earlier.
Tribune reported higher profits from its broadcasting and entertainment divisions helped earnings rise 2.6% to $84.3 million, $1.30 a share, up from $82.1 million, $1.19 a share, a year ago.
