First Interstate Profits Up 15% in Quarter; U.S. Bancorp Soars 66%; Golden West Off
Crockett, Barton, American Banker
Expense control and solid lending helped boost first quarter earnings at two big West Coast banks that reported results Monday, but a large California thrift suffered a decline because of rising interest rates.
First Interstate Bancorp, Los Angeles, posted a 15.2% rise in first quarter net income, to $212 million. Profits at U.S. Bancorp, Portland, Ore., shot up nearly 66%, to $66 million.
"We feel very, very good about our financial performance for the quarter," said First Interstate president and chief executive William E.B. Siart.
Loans at the $57 billion-asset institution totaled $35.1 billion at March 31, $8 billion more than a year earlier.
Mr. Siart said acquisitions of banks and thrifts accounted for $5.8 billion of the loan growth. Strong economic conditions also helped, as nonperforming assets dropped 20%, to $262 million.
Mr. Siart added that First Interstate continues to be interested in buying banks and thrifts in the West. But he warned that good bargains are getting harder to find.
"There aren't many sellers these days of the type we're interested in," Mr. Siart said.
On the expense front, First Interstate is enjoying the first fruits of a difficult cost-cutting campaign begun last year, aimed at trimming payrolls and reducing computer expenses.
Mr. Siart said First Interstate has made only about a fifth of the cost reductions planned, even though the bank is halfway through the 30 months it allotted for the project. But these cost cuts helped reduce to 60. …