CULLEN/FROST BANKERS INC Stock Forecasts | CFR EPS & Price Predictions

EX-99.1 2 a4q19form8-kxexhibit99.htm EXHIBIT 99.1 - 2019 FOURTH QUARTER EARNINGS RELEASE Exhibit

Exhibit 99.1

A.B. Mendez

Investor Relations

210.220.5234

Bill Day

Media Relations

210.220.5427

FOR IMMEDIATE RELEASE

January 30, 2020

CULLEN/FROST REPORTS 4^th QUARTER AND 2019 ANNUAL RESULTS

Board declares first quarter dividend on common and preferred stock

SAN ANTONIO -- Cullen/Frost Bankers, Inc. (NYSE:CFR) today reported fourth quarter and annual results for 2019. Cullen/Frost reported net income available to common shareholders for the fourth quarter of 2019 of $101.7 million, or $1.60 per diluted common share, compared to $117.2 million, or $1.82 per common diluted share, for the fourth quarter 2018. For the fourth quarter of 2019, returns on average assets and common equity were 1.21 percent and 10.74 percent, respectively, compared to 1.48 percent and 14.85 percent for the same period in 2018.

The company also reported 2019 annual net income available to common shareholders of $435.5 million, a decrease of 2.5 percent compared to 2018 earnings of $446.9 million. On a per-share basis, 2019 earnings were $6.84 per diluted common share compared to $6.90 per diluted common share reported in 2018. For the year 2019, returns on average assets and common equity were 1.36 percent and 12.24 percent respectively, compared to 1.44 percent and 14.23 percent reported in 2018.

“These earnings show the result of consistent execution of our sustainable organic growth strategy,” said Phil Green, Cullen/Frost chairman and CEO. “As illustrated by our Houston expansion, where we have opened 10 of the 25 planned new financial centers, we are investing for steady, long-term growth while maintaining our quality standards.

“We saw deposit growth rebound in the second half of 2019 after a more challenging environment earlier in the year,” Green said.

For the fourth quarter of 2019, net interest income on a taxable-equivalent basis was $275.0 million, up 0.4 percent compared to the same quarter in 2018. Average loans for the fourth quarter of 2019 increased $755.3 million, or 5.4 percent, to $14.7 billion, from the $13.9 billion reported for the fourth quarter a year earlier. Average deposits for the quarter were $27.2 billion, an increase of 2.6 percent or $678.4 million compared to $26.5 billion in last year's fourth quarter.

For 2019, average total loans were $14.4 billion, an increase of approximately $822.6 million, or 6.0 percent, from the $13.6 billion reported the previous year. Average total deposits for 2019 increased to $26.4 billion, up 0.5 percent, or $124.2 million, over the $26.3 billion reported in 2018.

Noted financial data for the fourth quarter:


•	The Common Equity Tier 1, Tier 1 and Total Risk-Based Capital Ratios for Cullen/Frost at the end of the fourth quarter of 2019 were 12.36 percent, 12.99 percent, and 14.57 percent, respectively. Current capital ratios continue to be in excess of well-capitalized levels and exceed Basel III requirements.


•	Net interest income for the fourth quarter totaled $251.1 million, an increase of 0.8 percent compared to the $249.2 million reported for the fourth quarter of 2018. The net interest margin was 3.62 percent for the fourth quarter compared to 3.72 percent for the fourth quarter of 2018 and 3.76 percent for the third quarter of 2019.

•

Non-interest income for the fourth quarter of 2019 was $95.3 million, up $8.1 million or 9.3 percent from the $87.1 million reported a year earlier. Trust and investment management fees increased by $3.0 million, or 10.2 percent, compared to the fourth quarter of 2018. The increase in trust and investment management fees was primarily the result of higher average equity valuations and an increase in the number of accounts. Other income increased $3.0 million, primarily driven by a $1.6 million increase in public finance underwriting fees.

•

Non-interest expense for the fourth quarter of 2019 was $220.8 million, up $21.1 million, or 10.6 percent, compared to the $199.7 million reported for the fourth quarter of 2018. Net occupancy expense increased $7.2 million, primarily driven by a $5.6 million increase in lease expenses associated with our downtown San Antonio headquarters move and our Houston expansion. Salaries and wages expense increased $7.1 million due to an increase in the number of employees and normal annual merit and market increases and, to a lesser extent, an increase in stock compensation. Employee benefits expense increased $2.6 million, or 13.6 percent, impacted by higher expenses related to our profit sharing/401(k) plan (up $1.1 million), defined benefit retirement plan (up $585,000), and payroll tax (up $554,000). Technology, furniture and equipment expense was up $3.8 million, or 17.3 percent, compared to the fourth quarter of 2018. The increase was primarily driven by a $3.8 million increase in software maintenance and cloud services expense.

•

For the fourth quarter of 2019, the provision for loan losses was $8.4 million, compared to net charge-offs of $12.7 million. For the fourth quarter of 2018, the provision for loan losses was $3.8 million, compared to net charge-offs of $9.2 million. The allowance for loan losses as a percentage of total loans was 0.90 percent at December 31, 2019, compared to 0.93 percent last quarter and 0.94 percent at year-end 2018. Non-performing assets were $109.5 million at year end, compared to $105.0 million the previous quarter, and $74.9 million at year-end 2018.

The Cullen/Frost board declared a first-quarter cash dividend of $0.71 per common share, payable March 13, 2020 to shareholders of record on February 28 of this year. The board of directors also declared a cash dividend of $0.3359375 per share of the Noncumulative Perpetual Preferred Stock, Series A, which is traded on the NYSE under the symbol "CFR PrA." The Series A Preferred Stock dividend is payable on March 16, 2020, to shareholders of record on February 28 of this year.

Cullen/Frost Bankers, Inc. will host a conference call on Thursday, January 30, 2020, at 10 a.m. Central Time (CT) to discuss the results for the quarter and the year. The media and other interested parties are invited to access the call in a “listen only” mode at 800-944-6430. Digital playback of the conference call will be available after 12 p.m. CT on the day of the call until midnight Sunday, February 2, 2020 at 855-859-2056, with the Conference ID# of 1379608. A replay of the call will also be available by webcast at the URL listed below after 2 p.m. CT on the day of the call.

Cullen/Frost investor relations website: www.frostbank.com/investor-relations/

Cullen/Frost Bankers, Inc. (NYSE: CFR) is a financial holding company, headquartered in San Antonio, with $34.0 billion in assets at December 31, 2019. One of the 60 largest U.S. banks, Frost provides a wide range of banking, investments and insurance services to businesses and individuals across Texas in the Austin, Corpus Christi, Dallas, Fort Worth, Houston, Permian Basin, Rio Grande Valley and San Antonio regions. Founded in 1868, Frost has helped clients with their financial needs during three centuries. Additional information is available at frostbank.com.

Forward-Looking Statements and Factors that Could Affect Future Results

Certain statements contained in this Earnings Release that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”), notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the SEC, in press releases, and in oral and written statements made by us or with our approval that are not statements of historical fact and constitute forward-looking statements within the meaning of the Act. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statements of plans, objectives and expectations of Cullen/Frost or its management or Board of Directors, including those relating to products, services or operations; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes”, “anticipates”, “expects”, “intends”, “targeted”, “continue”, “remain”, “will”, “should”, “may” and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:


•	Local, regional, national and international economic conditions and the impact they may have on us and our customers and our assessment of that impact.


•	Volatility and disruption in national and international financial and commodity markets.


•	Government intervention in the U.S. financial system.


•	Changes in the mix of loan geographies, sectors and types or the level of non-performing assets and charge-offs.


•	Changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements.


•	The effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board.


•	Inflation, interest rate, securities market and monetary fluctuations.


•	The effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) with which we and our subsidiaries must comply.


•	The soundness of other financial institutions.


•	Political instability.


•	Impairment of our goodwill or other intangible assets.


•	Acts of God or of war or terrorism.


•	The timely development and acceptance of new products and services and perceived overall value of these products and services by users.


•	Changes in consumer spending, borrowings and savings habits.


•	Changes in the financial performance and/or condition of our borrowers.


•	Technological changes.


•	The cost and effects of failure, interruption, or breach of security of our systems.


•	Acquisitions and integration of acquired businesses.


•	Our ability to increase market share and control expenses.


•	Our ability to attract and retain qualified employees.


•	Changes in the competitive environment in our markets and among banking organizations and other financial service providers.


•	The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters.


•	Changes in the reliability of our vendors, internal control systems or information systems.


•	Changes in our liquidity position.


•	Changes in our organization, compensation and benefit plans.


•	The costs and effects of legal and regulatory developments, the resolution of legal proceedings or regulatory or other governmental inquiries, the results of regulatory examinations or reviews and the ability to obtain required regulatory approvals.


•	Greater than expected costs or difficulties related to the integration of new products and lines of business.


•	Our success at managing the risks involved in the foregoing items.

Forward-looking statements speak only as of the date on which such statements are made. We do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events.



Cullen/Frost Bankers, Inc.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except per share amounts)

	2019												2018
	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr
CONDENSED INCOME STATEMENTS
Net interest income	$	251,098		$	253,007		$	253,431		$	246,469		$	249,209
Net interest income ⁽¹⁾	275,038			276,618			277,751			271,179			273,810
Provision for loan losses	8,355			8,001			6,400			11,003			3,767
Non-interest income:
Trust and investment management fees	32,928			31,649			30,448			31,697			29,882
Service charges on deposit accounts	23,454			22,941			21,798			20,790			21,632
Insurance commissions and fees	12,138			11,683			10,118			18,406			11,394
Interchange and debit card transaction fees	3,608			4,117			3,868			3,280			3,774
Other charges, commissions and fees	9,020			10,108			8,933			9,062			9,371
Net gain (loss) on securities transactions	28			96			169			—			(43		)
Other	14,079			8,630			7,304			13,550			11,108
Total non-interest income	95,255			89,224			82,638			96,785			87,118

Non-interest expense:
Salaries and wages	97,951			93,812			90,790			92,476			90,878
Employee benefits	21,651			21,002			20,051			23,526			19,066
Net occupancy	24,864			24,202			21,133			19,267			17,699
Technology, furniture and equipment	25,759			22,415			22,157			21,664			21,960
Deposit insurance	2,374			2,491			2,453			2,808			2,219
Intangible amortization	264			274			305			325			331
Other	47,943			44,668			46,320			41,734			47,544
Total non-interest expense	220,806			208,864			203,209			201,800			199,697
Income before income taxes	117,192			125,366			126,460			130,451			132,863
Income taxes	13,511			13,530			14,874			13,955			13,610
Net income	103,681			111,836			111,586			116,496			119,253
Preferred stock dividends	2,016			2,016			2,015			2,016			2,016
Net income available to common shareholders	$	101,665		$	109,820		$	109,571		$	114,480		$	117,237

PER COMMON SHARE DATA
Earnings per common share - basic	$	1.61		$	1.74		$	1.73		$	1.80		$	1.84
Earnings per common share - diluted	1.60			1.73			1.72			1.79			1.82
Cash dividends per common share	0.71			0.71			0.71			0.67			0.67
Book value per common share at end of quarter	60.11			59.76			57.39			54.64			51.19

OUTSTANDING COMMON SHARES
Period-end common shares	62,669			62,537			62,638			63,081			62,986
Weighted-average common shares - basic	62,609			62,566			62,789			63,009			63,441
Dilutive effect of stock compensation	625			593			765			819			811
Weighted-average common shares - diluted	63,234			63,159			63,554			63,828			64,252

SELECTED ANNUALIZED RATIOS
Return on average assets	1.21		%	1.35		%	1.40		%	1.48		%	1.48		%
Return on average common equity	10.74			11.83			12.60			14.08			14.85
Net interest income to average earning assets ⁽¹⁾	3.62			3.76			3.85			3.79			3.72

(1) Taxable-equivalent basis assuming a 21% tax rate.



Cullen/Frost Bankers, Inc.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)

	2019												2018
	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr
BALANCE SHEET SUMMARY
($ in millions)
Average Balance:
Loans	$	14,705		$	14,471		$	14,375		$	14,205		$	13,949
Earning assets	30,621			29,693			29,114			28,954			29,153
Total assets	33,314			32,248			31,491			31,356			31,330
Non-interest-bearing demand deposits	10,772			10,316			10,148			10,193			10,740
Interest-bearing deposits	16,414			16,036			15,845			15,919			15,767
Total deposits	27,186			26,352			25,993			26,112			26,507
Shareholders' equity	3,900			3,828			3,632			3,441			3,277

Period-End Balance:
Loans	$	14,750		$	14,635		$	14,459		$	14,406		$	14,100
Earning assets	31,281			30,358			29,216			29,281			29,894
Goodwill and intangible assets	657			658			658			658			659
Total assets	34,027			33,098			31,817			31,663			32,293
Total deposits	27,640			27,084			25,985			26,295			27,149
Shareholders' equity	3,912			3,881			3,739			3,592			3,369
Adjusted shareholders' equity ⁽¹⁾	3,644			3,576			3,520			3,498			3,433

ASSET QUALITY
($ in thousands)
Allowance for loan losses:	$	132,167		$	136,559		$	134,929		$	136,350		$	132,132
As a percentage of period-end loans	0.90		%	0.93		%	0.93		%	0.95		%	0.94		%

Net charge-offs:	$	12,747		$	6,371		$	7,821		$	6,785		$	9,213
Annualized as a percentage of average loans	0.34		%	0.17		%	0.22		%	0.19		%	0.26		%

Non-performing assets:
Non-accrual loans	$	102,303		$	97,446		$	71,521		$	92,162		$	73,739
Restructured loans	6,098			6,160			3,973			4,028			—
Foreclosed assets	1,084			1,427			907			1,175			1,175
Total	$	109,485		$	105,033		$	76,401		$	97,365		$	74,914
As a percentage of:
Total loans and foreclosed assets	0.74		%	0.72		%	0.53		%	0.68		%	0.53		%
Total assets	0.32			0.32			0.24			0.31			0.23

CONSOLIDATED CAPITAL RATIOS
Common Equity Tier 1 Risk-Based Capital Ratio⁽²⁾	12.36		%	12.35		%	12.29		%	12.34		%	12.27		%
Tier 1 Risk-Based Capital Ratio⁽²⁾	12.99			12.99			12.94			13.00			12.94
Total Risk-Based Capital Ratio⁽²⁾	14.57			14.63			14.60			14.68			14.64
Leverage Ratio	9.28			9.36			9.40			9.35			9.06
Equity to Assets Ratio (period-end)	11.50			11.73			11.75			11.34			10.43
Equity to Assets Ratio (average)	11.71			11.87			11.53			10.97			10.46

(1) Shareholders' equity excluding accumulated other comprehensive income (loss).
(2) After a review of risk-weight classifications during the first quarter of 2019, risk-weightings for certain loans were reclassified. Amounts
reported prior to March 31, 2019 have been revised to reflect these reclassifications.



Cullen/Frost Bankers, Inc.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except per share amounts)

	Year Ended December 31,
	2019			2018			2017			2016			2015
CONDENSED INCOME STATEMENTS
Net interest income	$	1,004,005		$	957,892		$	866,422		$	776,336		$	736,632
Net interest income ⁽¹⁾	1,100,586			1,052,564			1,043,431			939,958			888,035
Provision for loan losses	33,759			21,613			35,460			51,673			51,845
Non-interest income:
Trust and investment management fees	126,722			119,391			110,675			104,240			105,512
Service charges on deposit accounts	88,983			85,186			84,182			81,203			81,350
Insurance commissions and fees	52,345			48,967			46,169			47,154			48,926
Interchange and debit card transaction fees ⁽²⁾	14,873			13,877			23,232			21,369			19,666
Other charges, commissions and fees	37,123			37,231			39,931			39,623			37,551
Net gain (loss) on securities transactions	293			(156		)	(4,941		)	14,975			69
Other	43,563			46,790			37,222			41,144			35,656
Total non-interest income ⁽²⁾	363,902			351,286			336,470			349,708			328,730

Non-interest expense:
Salaries and wages	375,029			350,312			337,068			318,665			310,504
Employee benefits	86,230			77,323			74,575			72,615			69,746
Net occupancy	89,466			76,788			75,971			71,627			65,690
Technology, furniture and equipment	91,995			83,102			74,335			71,208			64,373
Deposit insurance	10,126			16,397			20,128			17,428			14,519
Intangible amortization	1,168			1,424			1,703			2,429			3,325
Other ⁽²⁾	180,665			173,538			175,289			178,988			165,561
Total non-interest expense ⁽²⁾	834,679			778,884			759,069			732,960			693,718
Income before income taxes	499,469			508,681			408,363			341,411			319,799
Income taxes	55,870			53,763			44,214			37,150			40,471
Net income	443,599			454,918			364,149			304,261			279,328
Preferred stock dividends	8,063			8,063			8,063			8,063			8,063
Net income available to common shareholders	$	435,536		$	446,855		$	356,086		$	296,198		$	271,265

PER COMMON SHARE DATA
Earnings per common share - basic	$	6.89		$	6.97		$	5.56		$	4.73		$	4.31
Earnings per common share - diluted	6.84			6.90			5.51			4.70			4.28
Cash dividends per common share	2.80			2.58			2.25			2.15			2.10
Book value per common share at end of quarter	60.11			51.19			49.68			45.03			44.30

OUTSTANDING COMMON SHARES
Period-end common shares	62,669			62,986			63,476			63,474			61,982
Weighted-average common shares - basic	62,742			63,705			63,694			62,376			62,758
Dilutive effect of stock compensation	700			982			968			593			715
Weighted-average common shares - diluted	63,442			64,687			64,662			62,969			63,473

SELECTED ANNUALIZED RATIOS
Return on average assets	1.36		%	1.44		%	1.17		%	1.03		%	0.97		%
Return on average common equity	12.24			14.23			11.76			10.16			9.86
Net interest income to average earning assets ⁽¹⁾	3.75			3.64			3.69			3.56			3.45

(1) Taxable-equivalent basis assuming a 21% tax rate for 2019 and 2018 and 35% tax rate for 2015-2017.
(2) Beginning in 2018, in connection with the adoption of a new accounting standard, interchange and debit card transaction fees are reported net of related network costs. Prior to 2018, such network costs were reported separately as a component of other non-interest expense. For comparative purposes, interchange and debit card transaction fees reported net of related network costs would have totaled $11,289 in 2017 and $8,473 in 2016.



Cullen/Frost Bankers, Inc.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)

	Year Ended December 31,
	2019			2018			2017			2016			2015⁽¹⁾
BALANCE SHEET SUMMARY ($ in millions)
Average Balance:
Loans	$	14,441		$	13,618		$	12,460		$	11,555		$	11,267
Earning assets	29,600			28,900			28,359			26,717			25,955
Total assets⁽¹⁾	32,086			31,030			30,450			28,832			28,061
Non-interest-bearing demand deposits	10,358			10,757			10,819			10,034			10,180
Interest-bearing deposits	16,055			15,532			15,085			14,478			13,861
Total deposits	26,413			26,289			25,905			24,512			24,041
Shareholders' equity	3,702			3,284			3,173			3,059			2,895

Period-End Balance:
Loans	$	14,750		$	14,100		$	13,146		$	11,975		$	11,487
Earning assets	31,281			29,894			29,595			28,025			26,431
Goodwill and intangible assets	657			659			660			662			663
Total assets⁽¹⁾	34,027			32,293			31,748			30,196			28,566
Total deposits	27,640			27,149			26,872			25,812			24,344
Shareholders' equity	3,912			3,369			3,298			3,003			2,890
Adjusted shareholders' equity ⁽²⁾	3,644			3,433			3,218			3,027			2,776

ASSET QUALITY ($ in thousands)
Allowance for loan losses:	$	132,167		$	132,132		$	155,364		$	153,045		$	135,859
As a percentage of period-end loans	0.90		%	0.94		%	1.18		%	1.28		%	1.18		%

Net charge-offs:	$	33,724		$	44,845		$	33,141		$	34,487		$	15,528
Annualized as a percentage of average loans	0.23		%	0.33		%	0.27		%	0.30		%	0.14		%

Non-performing assets:
Non-accrual loans	$	102,303		$	73,739		$	150,314		$	100,151		$	83,467
Restructured loans	6,098			—			4,862			—			—
Foreclosed assets	1,084			1,175			2,116			2,440			2,255
Total	$	109,485		$	74,914		$	157,292		$	102,591		$	85,722
As a percentage of:
Total loans and foreclosed assets	0.74		%	0.53		%	1.20		%	0.86		%	0.75		%
Total assets	0.32			0.23			0.50			0.34			0.30

CONSOLIDATED CAPITAL RATIOS
Common Equity Tier 1 Risk-Based Capital Ratio⁽³⁾	12.36		%	12.27		%	12.42		%	12.52		%	11.37		%
Tier 1 Risk-Based Capital Ratio⁽³⁾	12.99			12.94			13.16			13.33			12.38
Total Risk-Based Capital Ratio⁽³⁾	14.57			14.64			15.15			14.93			13.85
Leverage Ratio	9.28			9.06			8.46			8.14			7.79
Equity to Assets Ratio (period-end)	11.50			10.43			10.39			9.94			10.12
Equity to Assets Ratio (average)	11.54			10.58			10.42			10.61			10.32

(1) Certain items in the 2015 financial statements have been reclassified to conform to the current presentation in connection with the adoption
of an accounting standard in 2016 that requires unamortized debt issuance costs related to a recognized debt liability be presented in the
balance sheet as a direct deduction from the carrying amount of that debt liability.
(2) Shareholders' equity excluding accumulated other comprehensive income (loss).
(3) After a review of risk-weight classifications during the first quarter of 2019, risk-weightings for certain loans were reclassified. Amounts
reported at December 31, 2018 have been revised to reflect these reclassifications.



Cullen/Frost Bankers, Inc.
TAXABLE-EQUIVALENT YIELD/COST AND AVERAGE BALANCES (UNAUDITED)

	2019												2018
	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr
TAXABLE-EQUIVALENT YIELD/COST
Earning Assets:
Interest-bearing deposits	1.64		%	2.19		%	2.64		%	2.50		%	2.35		%
Federal funds sold and resell agreements	1.71			2.21			2.48			2.58			2.41
Securities	3.37			3.43			3.42			3.37			3.39
Loans, net of unearned discounts	4.88			5.16			5.34			5.33			5.20
Total earning assets	3.98			4.21			4.33			4.27			4.15

Interest-Bearing Liabilities:
Interest-bearing deposits:
Savings and interest checking	0.04			0.07			0.08			0.09			0.08
Money market deposit accounts	0.66			0.93			1.03			1.09			1.00
Time accounts	1.72			1.74			1.66			1.43			1.14
Public funds	1.05			1.34			1.51			1.39			1.31
Total interest-bearing deposits	0.49			0.63			0.68			0.69			0.63

Total deposits	0.29			0.39			0.41			0.42			0.37

Federal funds purchased and repurchase agreements	1.21			1.53			1.69			1.72			1.56
Junior subordinated deferrable interest debentures	3.83			4.18			4.34			4.40			4.24
Subordinated notes payable and other notes	4.71			4.71			4.71			4.72			4.72
Total interest-bearing liabilities	0.59			0.75			0.80			0.81			0.74

Net interest spread	3.39			3.46			3.53			3.46			3.41
Net interest income to total average earning assets	3.62			3.76			3.85			3.79			3.72

AVERAGE BALANCES
($ in millions)
Assets:
Interest-bearing deposits	$	2,000		$	1,566		$	1,171		$	1,729		$	2,452
Federal funds sold and resell agreements	275			212			246			250			317
Securities	13,641			13,444			13,322			12,770			12,435
Loans, net of unearned discount	14,705			14,471			14,375			14,205			13,949
Total earning assets	$	30,621		$	29,693		$	29,114		$	28,954		$	29,153

Liabilities:
Interest-bearing deposits:
Savings and interest checking	$	6,850		$	6,712		$	6,774		$	6,774		$	6,673
Money market deposit accounts	7,905			7,763			7,588			7,696			7,792
Time accounts	1,069			1,023			970			895			836
Public funds	590			538			513			554			467
Total interest-bearing deposits	16,414			16,036			15,845			15,919			15,767

Total deposits	27,186			26,352			25,993			26,112			26,507

Federal funds purchased and repurchase agreements	1,418			1,291			1,242			1,180			1,138
Junior subordinated deferrable interest debentures	136			136			136			136			136
Subordinated notes payable and other notes	99			99			99			99			99
Total interest-bearing funds	$	18,067		$	17,562		$	17,322		$	17,334		$	17,140