Citizens Financial Group Inc., the Rhode Island-based holding company of Citizens Bank, reported a record 79 percent increase in earnings for the first half of 2005, due primarily to added income from acquiring Charter One Financial Inc. a year ago, according to a company statement.
The bank is the eighth-largest commercial bank in the United States in terms of total consumer deposits.
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Citizens, owned by The Royal Bank of Scotland Group plc, said its pre-tax net profit for the first half increased to $1.4 billion, up from $784 million recorded for the same period a year ago.
The foreign-owned bank’s earnings statement follows international standards, reported biannually, according to the statement.
Citizens’ acquisition last August of Cleveland-based Charter One – which added $41 billion in assets and expanded its branches to Ohio, New York, Illinois, Indiana and Vermont – caused the bank’s income to surge in all major categories.
The increase in loans and deposits from Charter One and organic growth boosted Citizens’ net income from interest by 57 percent to $1.92 billion, according to the bank. The bank’s total loan volume grew $8 billion – or 17 percent – to $96.1 billion during the six-month period. And net deposits rose by $6 billion to finish the half at $102 billion, up 9 percent.
Non-interest income from service and transactional fees surged 113 percent – mostly on the strength of the Charter One acquisition – to $985 million, the bank reported.
Lawrence K. Fish, president and CEO of Citizens Financial, said in the statement that the conversion of Charter One branches to Citizens banking houses was completed in late July, five months earlier than planned.
“We seamlessly moved more than 3 million customer accounts to Citizens’ systems over the past nine months,” he noted.
Besides Charter One, Citizens has broadened its product base through two other major purchases since 2004. The bank bought the credit card segment of Bridgeport, Conn.-based People’s Bank March 2004, and last September it acquired Atlanta-based electronic processing company Lynk Systems Inc.
Joseph J. MarcAurele, president and CEO of Citizens’ Rhode Island market, said the earnings in his banking footprint were consistent with the bank’s national figures.
“Citizens in Rhode Island continues to grow and be successful because we have” a large focus “on customer service in our branches, and we also have very solid relationships with our commercial customers,” MarcAurele said in an Aug. 9 interview.
As of June 30, Citizens Financial reported having $149.7 billion in assets.
