Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, February 19, 1993 TAG: 9302190195
SECTION: BUSINESS PAGE: A-5 EDITION: METRO
SOURCE: DANIEL HOWES STAFF WRITER
DATELINE: LENGTH: Medium
DOMINION'S '92 LOSS NO SURPRISE
Dominion Bankshares Corp. on Thursday reported a $103.3 million loss for 1992 - its last full year of operations before First Union Corp. completes its acquisition of the Roanoke-based company on March 1.The loss included a previously announced $65.7 million restructuring charge the company agreed to take under its merger agreement with First Union. Without the charge, it would have posted a $37.6 million loss on operations for the year.
"The restructuring charge is kind of a paper charge," Chief Financial Officer James Adams said. "That includes some software costs . . . . First Union doesn't have the same kind of computer system we do."
Some $10 million of the merger charge will offset the computer costs; $5 million has been set aside for replacing Dominion's red signs across Virginia with green-and-white First Union signs; $10 million has been earmarked to continue lease payments on office space the bank expects to vacate.
"Any time you go through a merger, you have those kinds of charges," Adams said.
Excluding the restructuring charge, Dominion lost $1.8 million in last year's fourth quarter, compared to $4.7 million in net income for the 1991 period. Dominion lost money in two of last year's four quarters.
The news caps a tumultuous year for Roanoke's flagship bank: Last March, federal regulators forced a strict operating agreement on the company; a month later, Dominion reported a devastating first-quarter loss of $41.3 million that turned several of its directors against Chairman Warner Dalhouse.
In May, the board considered several "feelers" from banking companies interested in merging with Dominion or acquiring it outright. Those offers were not pursued.
Two months later, Dalhouse and his key board ally, James Webb of Nashville, Tenn., began quiet negotiations with one of the earlier suitors, culminating in the announcement in September that Dominion would be acquired by First Union of Charlotte, N.C.
The 1992 earnings report suggests a company still grappling with troubled real estate investments in Northern Virginia and Washington, D.C.
For example, non-interest expense in the fourth quarter rose 23 percent over the same period in 1991 because of Dominion's plans to auction 20 properties next month in and around Washington. The properties, normally carried on the books at market value, were marked down to liquidation value.
For the year ended Dec. 31, non-accruing loans and foreclosed properties totaled $270 million, 26 percent below the $363 million posted for 1991. Stockholders' equity at year end was $473 million, compared to $566 million for 1991.