First Citizens' parent sees profits down 15%

Jul 29, 2008 (The News & Observer - McClatchy-Tribune News Service via COMTEX) -- FCIS | Quote | Chart | News | PowerRating -- Jul. 29--The corporate parent of First Citizens Bank posted a 15 percent decline in second-quarter profit Monday, a performance that garnered praise from analysts given the current environment.

"It [appears] like they are doing a real good job navigating through the storm," said Tony Plath, a finance professor at UNC-Charlotte. "They are clearly doing much better than their peer banks are doing."

Profit in the second quarter at Raleigh-based First Citizens BancShares totaled $26.2 million, or $2.51 per share. A year ago the bank posted a profit of $30.9 million.

The quality of the bank's assets, although down from a year ago, are pretty good, said Buddy Howard of Equity Research Services, a Raleigh firm that tracks the banking industry.

The bank's problem loans and foreclosed real estate totaled 0.35 percent of total assets in the second quarter, he said, versus 0.59 percent in the first quarter for publicly traded North Carolina banks with assets of more than $1 billion.

"Overall, our asset quality measurements are favorable," bank spokeswoman Barbara Thompson said. "We are pleased with that."

Plath said the company's financials position it to expand through acquisition in markets such as Texas and Florida, where its operations are relatively small. "I would expect them to be a buyer, big-time, in the next few years," he said.

"At the end of the day, they know their borrowers better than the average super-regional bank," Plath said. "They didn't go out on a limb and make a lot of funky real estate loans."

First Citizens BancShares had $16.4 billion in assets as of June 30. Its subsidiaries, First Citizens and IronStone banks, have 401 branch offices.

The parent company released its latest results Monday after the stock markets closed. Earlier, its shares fell $8.63 to $133.51. The stock is down 26 percent in the past year.

david.ranii@newsobserver.com or (919) 829-4877

To see more of The News & Observer, or to subscribe to the newspaper, go to http://www.newsobserver.com. Copyright (c) 2008, The News & Observer, Raleigh, N.C. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

More News:   Market Updates | Stock Alerts | All Trading News | Stock Index