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TheStreet Open House

First Citizens BancShares Reports Earnings For First Quarter 2014

Stocks in this article: FCNCA

RALEIGH, N.C., April 30, 2014 (GLOBE NEWSWIRE) -- First Citizens BancShares Inc. (Nasdaq:FCNCA) reports earnings for the quarter ended March 31, 2014, of $22.4 million, compared to $27.2 million for the fourth quarter of 2013 and $55.6 million for the corresponding period of 2013, according to Frank B. Holding, Jr., chairman of the board.

Per share income for the first quarter of 2014 totaled $2.33, compared to $2.83 for the fourth quarter of 2013 and $5.78 for the same period a year ago. First quarter results generated an annualized return on average assets of 0.41 percent and an annualized return on average equity of 4.33 percent, compared to respective returns of 1.07 percent and 12.01 percent for the same period of 2013.

The decrease in earnings for the first quarter of 2014 compared to the same quarter in the prior year is driven by sustained runoff in the acquired loan portfolio and nonrecurring FDIC-assisted acquisition accounting adjustments recorded during the first quarter of 2013. The overall decrease in earnings was partially offset by improved investment yields and continued reduction of funding costs.

FIRST QUARTER FINANCIAL HIGHLIGHTS

  • Asset quality remains strong. BancShares recorded a credit to the provision for loan and lease losses of $1.9 million during the first quarter of 2014, reflecting continued credit quality improvements. Net charge-offs totaled $8.5 million for the first quarter of 2014, compared to $27.4 million during the same period of 2013. Total nonperforming assets decreased by $87.8 million to $185.4 million as of March 31, 2014 compared to March 31, 2013.  
  • BancShares completed the merger of Hendersonville, N.C.-based 1 st Financial and its wholly-owned banking subsidiary Mountain 1 st Bank & Trust Company, providing additional earning assets and interest income during the quarter.  
  • Nonrecurring adjustments for loans acquired in FDIC-assisted transactions recognized in the first quarter of 2013 contribute to a majority of interest income differences when comparing to the current quarter.  
  • Acquired loan portfolio runoff continues as expected.  
  • Liquidity position is strong as our free liquidity position exceeded $3.94 billion. Average investment securities increased $409.8 million, or 7.9 percent, compared to the first quarter of 2013.  
  • BancShares remains well-capitalized with a tier 1 leverage capital ratio of 9.66 percent, tier 1 risk-based capital ratio of 14.56 percent and total risk-based capital ratio of 16.05 percent at March 31, 2014.

LOANS AND DEPOSITS

Total loans increased $337.3 million, or 2.6 percent, to $13.47 billion compared to December 31, 2013. Originated loans totaled $12.20 billion at March 31, 2014, an increase of $95.9 million, or 0.8 percent, from December 31, 2013, and an increase of $691.1 million, or 6.0 percent, from March 31, 2013. During the first quarter of 2014, originated loan demand was particularly strong for commercial and industrial loans.

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