Higher fee income and expense control should help Midwestern banks — including some of Ohio's largest financial institutions — post an 8.3 percent gain in fourth-quarter profits from a year ago, an industry analyst predicts.

        But the results will be mixed, as some of the 18 banks and thrifts meet or beat earnings expectations while others post decreases, said Fred Cummings of McDonald Investments Inc. in Cleveland.

        Some banks with sizable Tristate operations — including Fifth Third, Provident, PNC and Huntington — this week are expected to report earnings for the past three months and 2000.

        Mr. Cummings expects that quarterly fee income for the group should increase 10 percent to 12 percent. He expects banks' expense growth should be limited to 3 percent to 4 percent. He also said declining margins and slower loan growth will result in a gain of only 1 percent to 3 percent in net interest margin.

        Net interest margin is the difference in what banks charge on loans and pay on deposits. It's a key source of revenue for many banks.

        Here's a quick glance at Mr. Cummings' share earnings outlook for fourth quarter 2000 and from a year ago of what some of Ohio's largest banks originally reported:

        • Fifth Third, 50 cents versus 43 cents.

        • Firstar, 41 cents versus 33 cents.

        • Provident 67 cents versus 89 cents.

        • Huntington, 31 cents versus 43 cents.

        • First Financial, 33 cents versus 30 cents.

        • Bank One, 50 cents versus 78 cents.
       

Do homework
before refinancing

               With interest rates falling, borrowers might consider shopping around before deciding to refinance their mortgage.

        Locally, the average for a 30- year fixed-rate $100,000 mortgage was 7.27 percent, the lowest in about two years, says the Cincinnati Area Board of Realtors. And nine out of 24 lenders surveyed are offering mortgage rates at or below 7 percent. Lower rates also are prompting many Tristate borrowers to rush to refinance.

        But homeowners should assess their circumstances before deciding to refinance, experts say. A new mortgage would typically include upfront closing costs, and it's worthwhile to figure out how long it will take to break even with lower payments.

        Families who plan to sell their home in the near future could lose money by refinancing.

        Still, a lending executive suggested refinancing in the Queen City might be more advantageous than other parts of the country.

        Snow Cimaglio, regional manager at Third Federal Savings and Loan in Cincinnati, said because some local lenders don't require title insurance, closing costs in Cincinnati are much lower than other U.S. cities.

        For example, Ms. Cimaglio said, closing costs in Cincinnati can run about $1,000 with no title insurance. In contrast, those same costs can run about $2,000 in other markets with title insurance.

        In that scenario, she said, it would take local borrowers about nine months to recoup closing costs, versus 18 months in other markets. Yet, she said, many Cincinnati lenders are beginning to charge title insurance — but some do not, including Third Federal.
       

Key Bank teams
with DealForce

               Hoping to generate extra fee income, KeyCorp will use an Internet-based investment bank to offer merger and acquisition services to business customers.

        The parent of Key Bank, with 25 branches in Cincinnati, will offer divestitures, acquisitions and financing by teaming with DealForce, which offers such services online.

        The alliance with DealForce will allow KeyCorp to offer merger and acquisition help to clients the Cleveland-based banking company does not handle in-house.

        DealForce provides investment-banking services to companies under $100 million in market value.

Mixed reviews for Aronoff
Intelliseek has its ear on Web
Retailers' topics wilt in slowdown
Retailers see sales growth, but slow
Tristate Summary
What's the Buzz?
Industry notes: Banking
Boston hails new taxi ads
OPEC appears primed to curtail production