Tuesday, Jan. 20, 2004 | 11:24 a.m.
SUN STAFF AND WIRE REPORTS
Citigroup Inc., the world's largest financial company, Wells Fargo & Co., U.S. Bancorp and Bank One Corp. today said fourth-quarter profit rose on higher fees from credit cards and money management and a decline in loan losses.
Citigroup, whose fourth-quarter profit a year ago was crimped by a $1.55 billion reserve for loan losses and lawsuits, said quarterly profit almost doubled to $4.76 billion.
Wells Fargo, the fourth-biggest U.S. bank, had a 10 percent rise to $1.62 billion; U.S. Bancorp's profit rose 19 percent to $977 million, and Bank One's increased 16 percent to $978 million.
The banks' profits from lending to individuals may slow as mortgage financing ebbs. Corporate lending lagged as companies held back on building plants or buying equipment, with Citigroup reporting an 11-percent drop in corporate loans on its balance sheet.
Wells Fargo reported "relatively flat" corporate and commercial loan growth. "The big challenge is corporate loan demand," said Wayne Bopp, who helps manage about $35 billion of investments at Fifth Third Investment Advisors, including 2.3 million Wells Fargo and 1.4 million Citigroup shares.
Despite the national trends, banking business in Southern Nevada has remained strong, said Ken Ladd, president of U.S. Bank's Nevada operations.
"Las Vegas is still growing and still a very vibrant market for us," he said, adding that growth has kept demand strong for both retail and commercial banking products. "It's across the board in all business lines."
That growth has pushed U.S. Bank to expand it's Las Vegas presence, Ladd said. The bank currently has 25 branches and 295 employees in Las Vegas. It will add five grocery store branches this year and two new traditional branches, including a downtown branches scheduled to open within weeks.
Kirk Clausen, president of Wells Fargo's Nevada operations, said that as mortgage refinancing fades the bank will look to grow its Las Vegas-area business in through commercial banking, taking advantage of the area's recent economic development successes.
"You are starting to hear some significant announcements now of businesses relocating or expanding to Southern Nevada," he said.
Citigroup reported that revenue increased 13 percent to $20.2 billion, while expenses declined 6 percent. The provision for credit losses stood at billion, an 18 percent decline from a year ago.
The company operates 12 Citibank branches in the Las Vegas Valley with 130 local employees.
Citibank also operates a credit card center in valley with about 2,000 employees. It added about 200 employees in 2003 as the company increased its credit card business with the management of credit card business from Home Depot Inc. and Sears, Roebuck and Co. At San Francisco-based Wells Fargo, revenue from mortgage banking increased 23 percent to $636 million, as the value of the bank's mortgage servicing unit increased. Rising interest rates boosted the unit's value because a decline in refinancing makes it likely that the bank will bring in fees from handling mortgage paperwork for a longer period.
Chicago-based Bank One, the sixth-largest U.S. bank by assets, said fourth-quarter net income was $978 million, or 87 cents a share, compared with $842 million, or 72 cents, a year earlier.
In other earnings news, Washington Federal savings reported reported fiscal first-quarter net income of $32.8 million, or 46 cents per share.
The results were off 11.6 percent from the $37 million, or 52 cents per share, earned in the same 2002 period. Seattle-based Washington Federal, which has two local branches, reported assets at the end of the quarter of $7.5 billion.
Las Vegas-based Nevada First Bank, which has four local branches, reported fourth-quarter net income of $352,907, up from $162,821 in the same 2002 quarter.
Assets for the bank were $265 million as of Dec. 31, up about 20 percent from $220 million reported a year ago.
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