The biggest U.S. banks reported strong first-quarter profits Tuesday, beating Wall Street's expectations as trading and core business operations showed solid growth and financial markets soared.
Chase Manhattan Corp., the nation's largest bank-holding company, said profit from operations rose 11% to $1.05 billion, or $2.35 a diluted share, from $949 million, or $2.02, in the year-ago quarter. The latest results beat the average forecast of $2.26 a share, based on a survey by First Call Corp.
Non-interest revenue increased 19% to $2.47 billion. Corporate finance and loan syndication fees more than doubled to $361 million, while trading revenue advanced 23% and revenue from equity investments increased 75%. Credit card revenue rose 17% to $931 million.
Citicorp, the nation's second-largest bank company, saw first-quarter profits rise 7% to meet analysts' forecasts, as higher profits from corporate banking and trading offset declining income from consumer banking in the emerging markets.
Citicorp, which recently struck a massive merger deal with Travelers Group Inc., said net income rose to $1.07 billion, or $2.23 a diluted share, in line with analyst estimates of $2.22, from $995 million, or $2.01, a year earlier.
Citicorp said earnings from lending and other services for companies rose 16% to $753 million. That more than made up for the 34% decline in profit from consumer banking in emerging markets, to $164 million.
San Francisco-based Wells Fargo & Co. reported earnings of $315 million, or $3.58 a diluted share, down 7% from $339 million, or $3.58 a share, a year earlier but well ahead of analyst expectations of $3.41 a share.
The results are a sign of progress for the 10th-largest U.S. bank, which disappointed investors with its mishandled acquisition of Los Angeles-based First Interstate Bancorp in 1996.
Wells received a boost from improved credit quality, as net write-offs fell to $178 million, or 1.11% of average loans, from $201 million, or 1.23%, a year ago.
Net interest income fell 7% to $1.13 billion as the bank's average loans decreased 1% to $65.1 billion.
Banc One Corp., which last week announced a blockbuster merger with First Chicago NBD Corp., said first-quarter earnings surged 36%, fueled by fee income and increased credit card lending.
The nation's eighth-largest banking company said net income rose to $517.6 million, or 79 cents a diluted share, matching analyst estimates, from $381.9 million, or 58 cents, a year earlier.
Mellon Bank Corp.'s first-quarter earnings rose 13%, led by an increase in fees from mutual funds, investment management and trust services.
Mellon, the 23rd-biggest U.S. bank in terms of assets, said net income rose to $206 million, or 78 cents a diluted share, a penny above analyst forecasts, from $182 million, or 69 cents, a year ago.