THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Tuesday, July 12, 1994 TAG: 9407120353
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: By TOM SHEAN, STAFF WRITER
LENGTH: Medium: 59 lines
Blaming the effects of a higher tax rate, First Virginia Banks Inc. said Monday that its net income for the June 30 quarter slipped slightly from the year-earlier quarter when it chalked up record profits.
Separately, Bank of Tidewater in Virginia Beach said its net income for the April-through-June quarter jumped 28 percent because of stronger loan demand and higher earnings from fees and other non-interest sources.
First Virginia, the Falls Church-based parent of First Virginia Bank of Tidewater, said it earned $29.03 million for the April-through-June period, a 1 percent decline from $29.29 million in the comparable three months of 1993.
Its per-share earnings fell 1 percent to 89 cents, from 90 cents in the '93 quarter.
A sustained upturn in loans enabled the company's banks to shift their funds into loans and out of lower-yielding government securities, First Virginia said.
The company's net loans on June 30 totaled $4.45 billion, a 15 percent increase from $3.88 billion at mid-1993.
``Our loan demand has been very strong,'' said Richard F. Bowman, First Virginia's treasurer and chief financial officer. This demand for commercial loans, something First Virginia had not seen in a long time, indicated a resurgence in the economy of its Virginia-Washington-Maryland market, Bowman said.
Results included a $2.4 million gain from the sale of servicing rights on mortgage loans it had already made.
The company's return on average assets - a yardstick for bank earnings - slipped to a still robust 1.62 percent for the recent quarter from an unusually high 1.71 percent in the 1993 second quarter.
For the six months through June 30, First Virginia earned $57.85 million, a 1 percent decline from $58.51 million in the first half of 1993. Per-share earnings were $1.78, down from $1.80 in last year's first half.
Meanwhile in Virginia Beach, Bank of Tidewater reported net income of $424,522 for the June 30 quarter, up from $332,855 in the year-earlier quarter.
Per-share earnings were 31 cents, compared with 26 cents in the '93 quarter.
Due largely to a 19 percent increase in loans since mid-1993, the bank's net interest income jumped almost 20 percent to $1.49 million. In addition, income from non-interest sources climbed 11 percent to $484,902, the bank said.
Bank of Tidewater attributed some of its loan growth to refund-anticipation loans that it made through a local tax-preparation company. Most of the increase in non-interest income came from greater activity in its bank-card merchant accounts, the bank said.
Its return on average assets advanced to 1.41 percent in the recent quarter from 1.23 percent in the 1993 second quarter.
The Bank of Tidewater also reported that its non-performing assets on June 30 had dropped almost 70 percent to $224,999 from $730,012 at mid-year 1993. by CNB