[clari.biz.finance.services] BankAmerica caps rebound with record year

clarinews@clarinet.com (BRIAN ROONEY, UPI Business Writer) (01/19/90)

	 SAN FRANCISCO (UPI) -- BankAmerica Corp., California's largest
bank, capped its financial rebound Thursday with record earnings of $1.1
billion, or $5.19 a share, for 1989.
	Net income for the year jumped 52 percent from $726 million in
1988, while earnings per share climbed 37 percent from $3.79.
	The bank, pushing forward with growth in consumer loans and home
mortgages, said fourth quarter net income rose 2 percent to $270
million, compared with $265 million in the same quarter of 1988.
	Earnings per share slipped in the quarter to $1.21 from $1.36 in
the year-earlier quarter, largely because of new stock issued through
shareholder reinvestment and employee benefits programs.
	The bank's results were up 48 percent in the quarter if one-time
items were taken out of the comparison, particularly a $351 million
Brazilian debt payment received in the fourth quarter of 1988, Vice
Chairman Frank Newman said. Newman is the company's chief financial
	The results fell in line with analyst expectations. Bank of
America's stock dropped 12.5 cents to $26.50 a share by late afternoon
Thursday in a generally down market.
	``Improved credit quality, increased loan and deposit volume, and
growing fee revenue, coupled with continuing control over operating
expenses, have produced an excellent finish to a turbulent decade for
the corporation,'' said Chairman A.W. Clausen.
	The bank's return on average assets, a common measure of bank
profitability, climbed to a healthy 1.14 percent in 1989 and 1.07 for
the fourth quarter, Newman said. Disregarding special items and tax
savings, the ROA climbed to 1.0 for the year, he said.
	During 1989, Bank of America reduced its portfolio of loans to
developing countries by $1.4 billion. Simultaneously, it increased its
reserves against Third World losses to 47 percent of exposure.
	BankAmerica expanded into Nevada through its newly acquired
subsidiary, Bank of America Nevada, while its Seafirst Corp. unit added
12 new branches in Washington State's Pierce County, Clausen said.
	The bank substantially increased its ratio of equity to assets and
is now positioned to take on larger acquisitions, Newman said.
	Newman declined to comment on speculation the bank might go after
ailing First Interstate Bancorp of Los Angeles. ``We'll look at a number
of alternatives but do not have anything big in the works,'' he said.
	Net credit losses stemming from Third World loans totaled $89
million in the last quarter and $263 million for the full year, it said.
	Aside from loans to the developing world, BankAmerica said,
nonaccrual assets totaled $1.28 billion at year end, virtually unchanged
from a year earlier. Nonperforming real estate loans totaled $375
million, down $167 million from their level at the end of 1988.
	BankAmerica's total assets at year end were $98.8 billion, compared
with $94.6 billion at the end of 1988.