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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

             
(Mark One)   [X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 		   
             
        For the quarterly period ended September 30, 2002    
    [   ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934		    

For the transition period from ________ to _________

Commission File Number 0-9756

RIGGS NATIONAL CORPORATION

(Exact name of registrant as specified in its charter)
     
Delaware   52-1217953
 
(State or other jurisdiction of
incorporation or organization)		   (I.R.S. Employer
Identification No.)
     
1503 Pennsylvania Avenue, N.W., Washington, D.C.   20005
 
(Address of principal executive offices)   (Zip Code)

(202) 835-4309

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes [X] No [   ]

Indicate the number of shares outstanding of each of the issuer’s classes of
common stock, as of the latest practicable date.

     
Common Stock, $2.50 par value   28,505,354
 
(Title of Class)   (Outstanding at October 31, 2002)

 

 

RIGGS NATIONAL CORPORATION

TABLE OF CONTENTS

                   
              PAGE NO.
PART I.  
FINANCIAL INFORMATION
        
Item 1.  
Financial Statements
        
          Consolidated Statements of Operations (Unaudited)
Three and nine months ended September 30, 2002 and 2001		     3  
          Consolidated Statements of Condition (Unaudited)
September 30, 2002 and 2001, and December 31, 2001		     4  
          Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)
Nine months ended September 30, 2002 and 2001		     5  
          Consolidated Statements of Cash Flows (Unaudited)
Nine months ended September 30, 2002 and 2001		     6  
         
Notes to the Consolidated Financial Statements (Unaudited)
     7-16  
Item 2.  
Management’s Discussion and Analysis of Financial Condition and Results of Operations
     17-26  
Item 3.  
Quantitative and Qualitative Disclosures about Market Risk
     26-28  
Item 4.  
Controls and Procedures
     28  
PART II.  
OTHER INFORMATION
        
Item 1.  
Legal Proceedings
     29  
Item 2.  
Change in Securities
     29  
Item 3.  
Defaults Upon Senior Securities
     29  
Item 4.  
Submission of Matters to a Vote of Security Holders
     29  
Item 5.  
Other Information
     29  
Item 6.  
Exhibits and Reports on Form 8-K
     29  
Signatures and Certifications     29  

Unless otherwise indicated, all references in this Quarterly Report on form 10-Q to “we,” “us,” “our,” “Riggs” and the “Company” refer to Riggs National Corporation and its subsidiaries.

2

 

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS-UNAUDITED

                                       
RIGGS NATIONAL CORPORATION   THREE MONTHS ENDED    NINE MONTHS ENDED 
CONSOLIDATED STATEMENTS OF OPERATIONS   SEPTEMBER 30,   SEPTEMBER 30,
(UNAUDITED)  
 
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)   2002   2001   2002   2001
 
 
 
 
INTEREST INCOME
                                
 
Interest and Fees on Loans
   $ 44,432     $ 51,076     $ 132,221     $ 156,438  
 
Interest and Dividends on Securities Available for Sale
     17,537       17,522       53,562       53,008  
 
Interest on Time Deposits with Other Banks
     784       2,750       1,999       11,444  
 
Interest on Federal Funds Sold and Reverse Repurchase Agreements
     2,169       3,851       6,478       12,601  
 
 
    
     
     
     
 
 
Total Interest Income
     64,922       75,199       194,260       233,491  
INTEREST EXPENSE
                                
 
Interest on Deposits:
                                
   
Savings and NOW Accounts
     233       394       793       1,331  
   
Money Market Deposit Accounts
     4,928       5,958       14,129       21,495  
   
Time Deposits in Domestic Offices
     7,358       8,389       19,852       24,891  
   
Time Deposits in Foreign Offices
     1,638       6,806       5,828       22,840  
 
 
    
     
     
     
 
 
Total Interest on Deposits
     14,157       21,547       40,602       70,557  
 
 
    
     
     
     
 
 
Interest on Short-Term Borrowings and Long-Term Debt:
                                
   
Repurchase Agreements and Other Short-Term Borrowings
     1,742       3,736       5,444       14,905  
   
Long-Term Debt
     1,618       1,618       4,854       4,854  
 
 
    
     
     
     
 
 
Total Interest on Short-Term Borrowings and Long-Term Debt
     3,360       5,354       10,298       19,759  
 
 
    
     
     
     
 
 
Total Interest Expense
     17,517       26,901       50,900       90,316  
 
 
    
     
     
     
 
 
Net Interest Income
     47,405       48,298       143,360       143,175  
 
Provision for Loan Losses
     1,400       838       (268 )     953  
 
 
    
     
     
     
 
 
Net Interest Income after Provision for Loan Losses
     46,005       47,460       143,628       142,222  
NONINTEREST INCOME
                                
 
Trust and Investment Advisory Income
     10,206       11,549       33,462       37,562  
 
Service Charges and Fees
     11,557       11,620       33,892       32,979  
 
Venture Capital Investment Losses, Net
     (3,155 )     (7,785 )     (13,743 )     (21,662 )
 
Other Noninterest Income
     2,549       2,390       7,701       7,498  
 
Securities Gains, Net
     5,973       25       7,395       11,410  
 
 
    
     
     
     
 
 
Total Noninterest Income
     27,130       17,799       68,707       67,787  
NONINTEREST EXPENSE
                                
 
Salaries and Employee Benefits
     28,389       27,105       83,610       79,420  
 
Occupancy, Net
     5,658       5,025       16,255       15,402  
 
Data Processing Services
     5,281       5,184       15,850       15,959  
 
Furniture, Equipment and Software
     3,795       4,857       11,091       14,219  
 
Other Noninterest Expense
     16,182       15,353       49,146       46,205  
 
 
    
     
     
     
 
 
Total Noninterest Expense
     59,305       57,524       175,952       171,205  
 
 
    
     
     
     
 
 
Income before Taxes and Minority Interest
     13,830       7,735       36,383       38,804  
 
Applicable Income Tax Expense
     4,424       3,198       12,560       14,590  
 
Minority Interest in Income of Subsidiaries, Net of Taxes
     4,015       4,932       13,005       14,815  
 
 
    
     
     
     
 
 
Net Income (Loss)
   $ 5,391     $ (395 )   $ 10,818     $ 9,399  
EARNINGS (LOSSES) PER SHARE-
Basic   $ 0.19     $ (0.01 )   $ 0.38     $ 0.33  
     
Diluted
     0.19       (0.01 )     0.37       0.32  
DIVIDENDS DECLARED AND PAID PER SHARE
   $ 0.05     $ 0.05     $ 0.15     $ 0.15  

The Accompanying Notes Are An Integral Part Of These Statements

3

 

                                                       
RIGGS NATIONAL CORPORATION                        
CONSOLIDATED STATEMENTS OF CONDITION                        
(UNAUDITED)   SEPTEMBER 30,   DECEMBER 31,   SEPTEMBER 30,
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)   2002   2001   2001
 
 
 
ASSETS
                        
 
Cash and Due from Banks
   $ 191,227     $ 179,743     $ 183,389  
 
Federal Funds Sold and Reverse Repurchase Agreements
     555,000       629,000       429,000  
 
 
    
     
     
 
 
Total Cash and Cash Equivalents
     746,227       808,743       612,389  
 
Time Deposits with Other Banks
     163,937       289,464       329,849  
 
Securities Available for Sale (at Market Value)
     2,192,874       1,718,638       1,454,395  
 
Venture Capital Investments
     49,205       56,320       62,423  
 
Loans
     2,843,720       2,859,921       2,899,478  
 
Reserve for Loan Losses
     (26,140 )     (29,540 )     (33,002 )
 
 
    
     
     
 
 
Total Net Loans
     2,817,580       2,830,381       2,866,476  
 
Premises and Equipment, Net
     191,598       197,018       210,195  
 
Loans Held for Sale
     5,838       8,671       10,489  
 
Other Assets
     209,799       190,167       193,140  
 
 
    
     
     
 
 
Total Assets
   $ 6,377,058     $ 6,099,402     $ 5,739,356  
LIABILITIES
                        
 
Deposits:
                        
 
Noninterest-Bearing Demand Deposits
   $ 614,205     $ 661,823     $ 528,230  
 
Interest-Bearing Deposits:
                        
   
Savings and NOW Accounts
     261,102       305,839       254,744  
   
Money Market Deposit Accounts
     2,133,625       1,955,483       1,766,813  
   
Time Deposits in Domestic Offices
     1,723,579       1,132,200       1,032,807  
   
Time Deposits in Foreign Offices
     289,423       466,938       685,990  
 
 
    
     
     
 
 
Total Interest-Bearing Deposits
     4,407,729       3,860,460       3,740,354  
 
 
    
     
     
 
 
Total Deposits
     5,021,934       4,522,283       4,268,584  
 
Repurchase Agreements and Other Short-Term Borrowings
     402,158       596,620       499,234  
 
Other Liabilities
     219,385       203,151       152,656  
 
Long-Term Debt
     66,525       66,525       66,525  
 
 
    
     
     
 
 
Total Liabilities
     5,710,002       5,388,579       4,986,999  
GUARANTEED PREFERRED BENEFICIAL INTERESTS IN JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
     281,584       350,000       350,000  
 
 
    
     
     
 
COMMITMENTS AND CONTINGENCIES
                        
SHAREHOLDERS’ EQUITY
                        
 
Common Stock-$2.50 Par Value
                        
 
     9/30/2002       12/31/2001       9/30/2001                          
 
    
     
     
                         
     
Authorized
     50,000,000       50,000,000       50,000,000                          
     
Issued
     31,807,152       31,795,703       31,795,703                          
     
Outstanding
     28,505,354       28,494,905       28,494,905       79,518       79,489       79,489  
 
Additional Paid in Capital
     169,639       163,125       163,125  
 
Retained Earnings
     204,087       197,545       231,745  
 
Accumulated Other Comprehensive Gain (Loss)
     3,597       (7,979 )     (645 )
 
Treasury Stock - 3,301,798 shares at September 30, 2002 and 3,300,798 shares at September 30 and December 31, 2001
     (71,369 )     (71,357 )     (71,357 )
 
 
    
     
     
 
 
Total Shareholders’ Equity
     385,472       360,823       402,357  
 
 
    
     
     
 
 
Total Liabilities and Shareholders’ Equity
   $ 6,377,058     $ 6,099,402     $ 5,739,356  

The Accompanying Notes Are An Integral Part Of These Statements

4

 

RIGGS NATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

                                                     
        COMMON