Associated Bank returns to profitability; PNC caps strong quarter; U.S. Bancorp’s quarterly earnings surpass $1 billion
Associated Bank returns to profitability
Associated Banc-Corp., parent company of Associated Bank and soon to be Wisconsin’s largest bank, reported first quarter net income of $22.9 million, or 9 cents per share, which was a vast improvement over a net loss of $26.4 million, or 20 cents per share, in the same period a year ago.
The Green Bay-based bank’s credit quality metrics improved for the fifth consecutive quarter. Nonaccrual loans declined $86 million, or 15 percent from the prior quarter. Loans 30-89 days past due were down 12 percent, and potential problem loans were down 5.4 percent from prior quarter. Net charge-offs were $53 million, down from $108 million in the prior quarter
The company also repurchased half, or $262.5 million of the preferred stock it owes through the Troubled Asset Relief Program (TARP).
"We are pleased to report our fifth consecutive quarter of improving profitability. We realized significant improvements in our credit quality metrics and our results are progressing as planned," said Philip Flynn, president and chief executive officer. "While generating new loan growth in a slow economy continues to be a challenge, we continue to see improving core lending activity and look forward to more positive results in the periods to come. We are pleased with the progress we have made and continue to be highly positive about the future of our company. Our pro forma capital ratios following the notes offering and partial repurchase of the TARP preferred stock continue to exceed the requirements of our regulators and standards for well-capitalized banks. This strong capital position provides us with flexibility as we continue to execute our strategic plans for growth," said Flynn. "We remain confident we will achieve our goal of repaying all of the TARP funds in 2011 and will do so in the most shareholder-friendly manner possible."
Flynn said Associated has hired "more than a few bankers" from Marshall & Ilsley Corp., the Milwaukee-based parent company of M&I Bank that will soon be acquired by BMO Financial Group of Canada.
Flynn added that any future acquisitions by Associated would not be outside the Upper Midwest.
PNC caps strong quarter
The PNC Financial Services Group Inc., the Pittsburgh-based company of PNC Bank, which has locations in Milwaukee, reported first quarter net income of $832 million, or $1.57 per share, up from $671 million, or 66 cents per share, in the same period a year ago.
The company’s quarterly revenue dipped to $3.6 billion from $3.8 billion a year earlier.
“PNC delivered exceptional performance in the opening quarter of 2011,” said James Rohr, chairman and chief executive officer of the firm. “Confidence is returning to the economy, and our strong balance sheet, capital position and sales momentum create tremendous opportunities for PNC to increase market share. We recently enhanced the return on shareholder investment through a significant increase in our second quarter dividend. Going forward, PNC will continue to invest in our businesses for growth across the franchise.”
U.S. Bancorp’s quarterly earnings surpass $1 billion
U.S. Bancorp, the Minneapolis-based parent company of U.S. Bank, reported first quarter net income of $1.046 billion, or 52 cents per share, up from $974 million, or 49 cents per share, in the same period a year ago.
The company’s earnings were driven by year-over-year growth in total net revenue and a reduction in the provision for credit losses. Included in the first quarter of 2011 was a $46 million gain related to the acquisition of First Community Bank of New Mexico in a transaction with the Federal Deposit Insurance Corporation (FDIC).
U.S. Bancorp chairman, president and chief executive officer Richard Davis said, "Our results for the first quarter of 2011 reflected our proven business model during a recovering, yet still uncertain, economic environment. Total net revenue grew by 4.6 percent over the first quarter of 2010, and we achieved year-over-year average loan growth of 2.4 percent and linked quarter average loan growth of just over one percent. Deposit growth was exceptionally strong. The growth in total net revenue and significantly lower credit costs resulted in earnings of over $1.0 billion for the quarter.
