BankAmerica’s Net Income Rises 8.7%
BankAmerica Corp. said Wednesday that fourth-quarter earnings rose 8.7%, meeting analyst forecasts, as gains in the U.S. overshadowed a drop in trading revenue from Asia’s tumbling financial markets.
The largest West Coast bank said net income rose to $812 million, or $1.12 a diluted share, from $747 million, or 96 cents, a year earlier. Profit from fees and other non-interest earnings rose 8.8% to $1.63 billion, and trading income declined 53% to $63 million.
“The quarter was a validation of BankAmerica’s diversified business mix,” said Mark Brennan, an analyst at Lord, Abbett & Co. “They didn’t get killed by the Asian crisis.”
U.S. banks with international lending and trading businesses suffered losses in Asia after economies from South Korea to Indonesia slowed, causing regional financial markets to plunge. Shares of San Francisco-based BankAmerica fell $2 to close at $67.06 on the New York Stock Exchange.
The bank’s revenue of $3.518 billion rose 3.2% from the previous year, but fell 2.4% from the third quarter.
Per-share earnings rose more than net income because BankAmerica bought back 31.7 million shares of its common stock during the year.
In the face of falling currency, stock and bond markets in Asia, BankAmerica retrenched, cutting its outstanding assets in the region by 13% to $14.1 billion during the period, while earmarking about $400 million in existing loan-loss reserves to cover its Asian exposure.
The bank charged off about $45 million in Asian assets during the quarter, mainly in Thailand.
BankAmerica said it lost $48 million trading bonds and $28 million trading interest rate products during the quarter.
* Los Angeles-based Imperial Bank reported fourth-quarter net income of $21.4 million, including a gain, or 52 cents per diluted share, compared with $10.9 million, or 25 cents, a year ago. The most recent quarterly results include a 3-for-2 stock split.
* Oakland-based Golden West Financial Corp.’s fourth-quarter earnings surged 25% on higher loan volume, to $93.5 million, or $1.62 a diluted share, from $75.9 million, or $1.30, a year earlier, beating analysts’ forecasts of $1.60.
* Santa Monica Bank reported fourth-quarter net income of $2.9 million, including a merger charge, or 41 cents per diluted share, compared with $2.9 million, or 40 cents, a year ago.
Aerospace: Northrop Grumman Corp.’s fourth-quarter earnings rose 79% because strong deliveries of commercial airline parts and business jet planes more than offset lower sales of the B-2 bomber and F-18 fighter. Profit from operations was $135 million, or $1.97 a diluted share, compared with $65.3 million, or $1.03, in the year-earlier quarter. Los Angeles-based Northrop beat the consensus estimate of $1.75 a share.
Technology: Thousand Oaks-based Xircom Inc. reported fiscal first-quarter net income of $2.4 million, or 11 cents per share, compared with $4.1 million, or 20 cents, a year ago.
* Fremont-based Cirrus Logic Inc. reported fiscal third-quarter profit of $12.9 million, including a gain, or 18 cents per diluted share, compared with $10.3 million, including a gain, or 15 cents, a year ago.
* Fremont-based Lam Research Corp.’s fiscal second-quarter earnings rose 7.6%, matching expectations, though it said several customers in Asia will trim plans to build new plants. Net income rose to $3.53 million, or 9 cents a diluted share, from $3.28 million, or 9 cents, a year ago.
* Milpitas-based Read-Rite Corp. reported fiscal first-quarter profit before charges of $925,000, or 2 cents a diluted share, down from net income of $5.79 million, or 12 cents, a year ago.
* San Jose-based Altera Corp. reported fourth-quarter earnings that fell just short of expectations as sales slumped in Asia. Net income was $36.7 million, or 38 cents a diluted share, compared with $29.3 million, or 31 cents, in the year-ago period.
* Milpitas-based California Micro Devices reported a loss of $885,000, or 9 cents per share, for its fiscal third quarter, contrasted with net income of $79,000, or 1 cent, a year ago.
Also: Irvine-based Day Runner reported fiscal second-quarter net income of $5.5 million, or 90 cents per diluted share, compared with $4.5 million, or 67 cents, in the same period last year.
* More Earnings: D3
