EX-99.1 2 g68679ex99-1.txt PRESS RELEASE DATED APRIL 19, 2001 1 EXHIBIT 99.1 Union Planters Corporation Press Release dated April 19, 2001 announcing operating results for the three months ended March 31, 2001 2 APRIL 19, 2001 UNION PLANTERS CORPORATION ANNOUNCES RECORD FIRST QUARTER CASH OPERATING EARNINGS OF $.87 PER SHARE Memphis, TN -- Union Planters Corporation (NYSE: UPC) today reported cash operating earnings for the first quarter of 2001 of $120.3 million, or $.87 per diluted share, an increase of 4.8% over the $.83 per diluted share for the same period in 2000. Cash operating earnings exclude goodwill and other intangibles amortization and nonoperating items, net of taxes. These earnings provided a return on average assets of 1.39%, a return on average common equity of 16.44%, and a return on average tangible common equity of 24.38%. Net earnings for the first quarter 2001 were $106.4 million, or $.77 per diluted share, an increase of 5.5% compared to $.73 per diluted share for the same period in 2000. Net earnings represented a return on average assets of 1.23% and a return on average common equity of 14.54%. The results for the first quarter of 2001 include the acquisition of Jefferson Savings Bancorp, Inc., the parent company of Jefferson Heritage Bank, a federal savings bank. Jefferson is headquartered in Ballwin, Missouri and has locations in Missouri and Texas. The acquisition was completed on February 12, 2001 and accounted for as a purchase. "We are pleased to report a solid first quarter," said Jackson W. Moore, Chairman and Chief Executive Officer. "We are especially pleased with the quality and sources of our earnings this quarter. We continue to focus on the basics, increasing noninterest income as a percentage of total revenue, improving our operating performance, and keeping our credit quality strong. Our net interest margin was up from last quarter due to 3 the recent decline in interest rates, and we expect this trend to continue. We made impressive strides in the growth of our noninterest income and our operating efficiency ratio for the quarter continued to improve. Given the current economic environment, industry nonperforming assets are increasing. We are impacted primarily in the residential mortgage portfolio. We have historically experienced very low losses relative to nonperforming assets and we expect this trend to continue." NET INTEREST INCOME Net interest income on a fully taxable-equivalent basis was $320.3 million for the first quarter of 2001, an increase of $10.5 million or 3.4% over the $309.8 million reported for the prior quarter, and down slightly from the $323.9 million recorded in the same quarter of last year. The increase compared to prior quarter is attributable to continued growth in loan production, improved pricing of loan products and an overall decline in interest rates. The interest-rate spread and net interest margin for the first quarter of 2001 improved to 3.34% and 4.05%, respectively, from the 3.20% and 3.95%, respectively, reported for the fourth quarter of 2000. Average loans (excluding FHA/VA loans) were $24.9 billion for the first quarter of 2001 compared to $21.5 billion for the same period in 2000 and compared to $23.7 billion for the fourth quarter of 2000. Net of loan divestitures and the Jefferson acquisition, average loans increased during the first quarter by 12.7% compared to the same quarter last year. This increase was driven by 22.2% growth in residential real estate loans and 11.8% growth in commercial, financial and agricultural loans. Consistent with current economic conditions, a slight decline in commercial and consumer loan growth was experienced in the first quarter of 2001 compared to the prior quarter. This was offset, however, by the continued increase in production of residential mortgage loans. 4 Average deposits were $23.1 billion for the first quarter of 2001 compared to $23.0 billion for the fourth quarter of 2000 and $23.3 billion for the same quarter last year. The decline in total deposits has stabilized but the environment continues to be very competitive, which will require continual, close monitoring of the overall deposit pricing strategy. NONINTEREST INCOME Growth in noninterest income continues to be a priority. Noninterest income was $164.9 million for the first quarter of 2001, an increase of $18.9 million, or 13.0%, from the prior quarter and an increase of $37.3 million, or 29.3%, from the same quarter last year. The strong growth in noninterest income is attributable to successful efforts in several areas. A more consistent administration of competitive pricing and collections on all account relationships across the entire franchise resulted in a 27.1%, or $11.4 million, increase in customer fee income in the first quarter of 2001, compared to the same quarter in 2000. In addition, the lower interest-rate environment and the divestiture of home mortgage loans resulted in double digit growth in mortgage banking revenues in the first quarter. Bank card income, primarily merchant servicing income, trust fees, factoring commissions and income from an investment in a broker dealer operation also showed good growth compared to the first quarter of 2000. Strategic Outsourcing Inc. (SOI), which was acquired in April 2000, accounted for $6.0 million of the increase in noninterest income over the same quarter last year. Noninterest income as a percent of total revenue increased to 34.7% in the first quarter of 2001, compared to 28.8% in the same quarter last year. 5 EFFICIENCY The efficiency ratio for the first quarter of 2001 was 56.31%, compared to 57.1% for the fourth quarter of 2000 and 56.68% for the same quarter in 2000. Noninterest expense for the first quarter of 2001 was $289.7 million, compared to $276.2 million in the prior quarter, and $271.7 million in the same quarter last year. The Jefferson and SOI acquisitions accounted for $7.8 million of the increase in noninterest expense over the first quarter of 2000. The lower interest-rate environment resulted in increased amortization of mortgage servicing rights as well as a valuation adjustment, which increased noninterest expense by $5.7 million over the same quarter last year. Increases in goodwill and other intangibles amortization related primarily to the Jefferson and SOI acquisitions. CREDIT QUALITY As expected, nonperforming assets increased to $232.3 million, or .95% of loans and foreclosed properties at March 31, 2001, compared to $177.9 million, or .75%, respectively, at December 31, 2000 and $172.4 million, or .79%, as of March 31, 2000. The Jefferson acquisition accounted for 25% of the increase, while the majority of the remaining increase was within the residential mortgage portfolio. Given the current economy, nonperforming assets are expected to continue to trend upward over the next few quarters. However, the risk of losses will be mitigated by the diversity of the loan portfolio and the conservative underwriting practices across the banking franchise. The provision for losses on loans for the first quarter of 2001 was $25.3 million, or .41% of average loans, compared to $20.1 million, or .34% of average loans, for the fourth quarter 2000 and compared to $17.3 million, or .32% of average loans, for the first quarter last year. Net charge-offs as a percentage of average loans were .37% for the first 6 quarter of 2001, a decrease from the .42% reported in fourth quarter 2000, and an increase from .26% over the same quarter in 2000. The allowance for losses on loans totaled $342.1 million at March 31, 2001, equal to 1.41% of loans and 195% of nonperforming loans. CAPITAL STRENGTH Total shareholders' equity was $3.1 billion at March 31, 2001. This represented 8.72% of period-end assets of $35.4 billion. The leverage ratio was 6.61%. SHARE PURCHASE PLAN In February 2000, the Board of Directors approved a plan to purchase 7.1 million shares of common stock, of which 1,610,000 shares have been purchased to date. In addition, management announced its intent to repurchase the shares issued in the Jefferson acquisition. As of March 31, 2001, 2,191,000 shares of the 4,371,000 shares issued had been repurchased. THE COMPANY Union Planters Corporation, headquartered in Memphis, Tennessee, is a multi-state bank holding company with 1,068 ATMs and 835 banking offices in Alabama, Arkansas, Florida, Illinois, Indiana, Iowa, Kentucky, Louisiana, Mississippi, Missouri, Tennessee, and Texas. At December 31, 2000, Union Planters Corporation was the 27th largest bank holding company in the United States based on total assets. The Company's common stock is traded on the New York Stock Exchange under the symbol UPC and is included in the S & P 500 Index. This press release contains forward-looking statements relating to management's expectations regarding the impact of the reduction in interest rates on the net interest margin and expected trends in nonperforming assets and the related risk of losses. These statements are deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and the current economic environment. Union Planters' actual strategies and results in future periods may differ materially from those currently expected due to various risks and uncertainties. A discussion of factors affecting business and prospects is contained in Union Planters' filings with the Securities and Exchange Commission, 7 specifically "Risk Factors" in the 2000 Annual Report on Form 10-K and "Cautionary Statement Regarding Forward-Looking Information" in Union Planters' 2000 Annual Report to Shareholders. Union Planters undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the forward-looking statement is made or to reflect the occurrence of unanticipated events. -O0O- FOR ADDITIONAL INFORMATION, INCLUDING SUPPLEMENTAL FINANCIAL INFORMATION FOR THE FIRST QUARTER OF 2001, VISIT UNION PLANTERS' WEB SITE AT http://www.unionplanters.com, ACCESS UNION PLANTERS CURRENT REPORT ON FORM 8-K DATE APRIL 19, 2001 WHICH WAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, OR CONTACT: BOBBY L. DOXEY SENIOR EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER (901) 580-4565 [TWO PAGE FINANCIAL ATTACHMENT FOLLOWS] 8 UNION PLANTERS CORPORATION FINANCIAL HIGHLIGHTS (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED MARCH 31, 2001 2000 ----------- ------------- INCOME STATEMENT AMOUNTS Net interest income Actual $ 311,026 $ 314,750 Taxable-equivalent basis 320,292 323,872 Provision for losses on loans 25,300 17,303 Noninterest income Investment securities gains 25 -- Other 164,889 127,569 Noninterest expense 289,672 271,705 Earnings before income taxes 160,968 153,311 Income taxes 54,601 51,974 NET EARNINGS 106,367 101,337 NET EARNINGS APPLICABLE TO COMMON SHARES 105,981 100,925 OPERATING EARNINGS (1) 106,352 101,337 CASH OPERATING EARNINGS (2) 120,272 114,659 PER COMMON SHARE DATA Net earnings - basic $ .78 $ .74 - diluted .77 .73 Operating earnings (1) - basic .78 .74 - diluted .77 .73 Cash operating earnings (2) - basic .88 .84 - diluted .87 .83 Cash dividends .50 .50 Book value 22.39 19.77 BALANCES AT END OF PERIOD Loans, excluding FHA/VA government-insured/guaranteed loans $24,294,794 $ 21,730,479 Allowance for losses on loans 342,138 345,821 Nonperforming assets Nonaccrual loans 174,027 130,483 Restructured loans 1,401 1,811 Foreclosed properties 56,835 40,098 Loans 90 days past due 109,705 81,738 FHA/VA government-insured/guaranteed loans 303,177 479,255 Nonaccrual 3,216 5,767 90 days past due 129,776 216,185 Available for sale investment securities Amortized cost 6,432,965 7,572,300 Fair value 6,523,197 7,341,647 Unrealized gain (loss), net of taxes 56,881 (145,837) Total assets 35,423,470 33,350,510 Total deposits 23,605,227 23,370,070 Total shareholders' equity 3,088,107 2,698,580 Total common equity 3,068,662 2,678,038 Tier 1 capital 2,255,613 2,093,134
9 UNION PLANTERS CORPORATION FINANCIAL HIGHLIGHTS (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED MARCH 31, 2001 2000 ----------- ------------- AVERAGE BALANCES Loans, excluding FHA/VA government-insured/ guaranteed loans $24,904,776 $ 21,531,467 FHA/VA government-insured/guaranteed loans 290,423 499,234 Investment securities 6,633,985 7,645,215 Earning assets 32,103,877 30,048,208 Total assets 35,103,823 33,252,814 Total deposits 23,114,141 23,286,293 Interest-bearing liabilities 27,546,058 25,781,245 Demand deposits 3,890,023 4,027,414 Shareholders' equity 2,976,605 2,841,875 Common equity 2,957,073 2,821,109 OTHER SUPPLEMENTAL INFORMATION Net earnings Return on average assets 1.23% 1.23% Return on average common equity 14.54 14.39 Cash operating earnings (2) Return on average assets 1.39 1.39 Return on average common equity 16.44 16.29 Return on average tangible assets 1.43 1.43 Return on average tangible common equity 24.38 24.77 Allowance for losses on loans to loans (3) 1.41 1.59 Nonperforming loans to loans (3) .72 .61 Nonperforming assets to loans and foreclosed properties (3) .95 .79 Net charge-offs of loans $ 22,600 $ 13,782 Net charge-offs as a percentage of average loans (3) .37% .26% Common shares outstanding (end of period, in thousands) 137,051 135,487 Weighted average shares outstanding (in thousands) Basic 136,600 136,546 Diluted 138,179 138,073 Yield on earning assets (taxable-equivalent basis) 8.31% 8.17% Rate on interest-bearing liabilities 4.97 4.47 Interest rate spread (taxable-equivalent basis) 3.34 3.70 Net interest income as a percentage of average earning assets (taxable-equivalent basis) 4.05 4.34 Shareholders' equity to total assets 8.72 8.09 Leverage ratio 6.61 6.48
(1) Earnings before nonoperating items, net of taxes (2) Earnings before goodwill and other intangibles amortization and nonoperating items, net of taxes (3) Excludes FHA/VA government-insured/guaranteed loans.