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LOS ANGELES--(BUSINESS WIRE)--Oct. 19, 2004--City NationalCorporation (NYSE:CYN), parent company of wholly owned City NationalBank, today reported net income of $53.5 million, or $1.04 per share,for the third quarter of 2004 compared with $52.5 million, or $1.05per share, for the third quarter of 2003 and $52.2 million, or $1.03per share, for the second quarter of 2004 on a greater number ofshares outstanding. Third-quarter 2003 results included $2.6 millionin net income, or $0.05 per share, from tax benefits of the company'stwo real estate investment trusts ("REITS"). As previously disclosed,in 2004 the company is continuing its practice, adopted in the fourthquarter of 2003, of not recognizing tax benefits associated with itsREITS.

For the first nine months of 2004, City National Corporationrecorded net income of $156.6 million, or $3.07 per share, comparedwith $142.2 million, or $2.85 per share, reported for the first ninemonths of 2003. First-nine-months 2003 results included $8.1 millionin net income, or $0.16 per share, from tax benefits of the company'stwo REITS.

The following table shows the growth of earnings per share withand without the 2003 REITS tax benefits:

 For the three For the nine months ended months ended September 30, September 30, ----------------- % ----------------- % 2004 2003 Change 2004 2003 Change-------------------- --------- ------- ------ --------- ------- ------Without REIT tax benefits $1.04 $1.00 4 $3.07 $2.69 14With REIT tax benefits 1.04 1.05 (1) 3.07 2.85 8
 HIGHLIGHTS - Average deposits were up 11 percent with average core deposits up 15 percent for the third quarter of 2004 from the third quarter a year ago due to continued bank-wide growth. Average core deposits represented 93 percent of the total average deposit base for the third quarter of 2004, compared with 90 percent for the third quarter of 2003 and 93 percent for the second quarter of 2004. New clients contributed to the year-over-year growth of deposits. - Third-quarter average loans were up 8 percent from the same period last year. Period-end loan balances at September 30, 2004 of $8.2 billion increased $291.4 million, or 4 percent from $7.9 billion at December 31, 2003 primarily due to an increase in real estate-related loans. - No provision for credit losses was recorded for the third quarter of 2004, a result of continued strong credit quality and an adequate current level of allowance for credit losses. There was no provision for credit losses in the year-ago quarter. Nonaccrual loans as of September 30, 2004 were $35.3 million, down 35 percent from September 30, 2003, and down 16 percent from June 30, 2004. - Average securities for the third quarter of 2004 were up 16 percent from the same period a year ago as deposit growth outpaced loan growth. Third-quarter average securities increased 2 percent from the second quarter of 2004, and period-end securities increased $282.9 million from June 30, 2004 to September 30, 2004 due partially to a $72.7 million improvement in the mark-to-market adjustment. - Revenue for the third quarter of 2004 rose 6 percent over the same period a year ago and 2 percent over the second quarter of 2004.

"Higher revenues, sound credit quality and strong growth indeposits continued to produce double-digit net income growth for thefirst nine months of this year and enabled City National to reachtotal assets of $14 billion for the first time, a milestone thatunderscores the bank's position as California's Premier Private andBusiness Bank," said Chief Executive Officer Russell Goldsmith.

 For the three For the three months months ended ended Dollars in millions, September 30, % June 30, % except per share 2004 2003 Change 2004 Change----------------------- ---------- ---------- ------ ---------- ------Earnings Per Share $1.04 $1.05 (1) $1.03 1Net Income 53.5 52.5 2 52.2 2Average Assets (1) 13,612.4 12,428.3 10 13,223.4 3Return on Average Assets (1) 1.56 % 1.68 % (7) 1.59 % (2)Return on Average Equity 16.80 18.28 (8) 17.07 (2)(1) As of September 30, 2004, the company has reclassified thereserve for unfunded credit commitments from the allowance for loanlosses to other liabilities. Amounts presented prior to the thirdquarter of 2004 have been reclassified to conform to the presentationin the third quarter of 2004.

The Bank's prime rate was 4.75 percent as of September 30, 2004,an increase of 75 basis points over last year.

ASSETS

Average assets for the third quarter of 2004 were higher than thethird quarter of 2003, primarily due to an increase in average federalfunds sold, securities, and loans. Total assets at September 30, 2004increased 9 percent to $14.0 billion from $12.8 billion at September30, 2003, and 4 percent from $13.5 billion at June 30, 2004.

REVENUES

Revenues (net interest income plus noninterest income) for thethird quarter of 2004 increased 6 percent to $185.0 million comparedwith $173.9 million for the third quarter of 2003 due to higher netinterest income and wealth management fees. Revenues were up 2 percentfrom the second quarter of 2004, or 10 percent annualized.

NET INTEREST INCOME

Fully taxable-equivalent net interest income for the third quarterof 2004 of $140.8 million was up 6 percent from $132.4 million for thethird quarter of 2003. Compared to the second quarter of 2004, netinterest income was up 4 percent or 15 percent annualized from $135.6million. This was due to an increase in loan yields of 17 basispoints, and increased holdings of liquid assets. The net interestmargin was 3 basis points lower than the second quarter of 2004. Thedecline was due to increased holdings of lower yielding federal fundssold and securities as strong deposit growth continued to exceed thedemand for loans, and a 4-basis-point increase in the average cost oftotal deposits. The change from the third quarter of 2004 compared tothe same quarter a year ago was also due to the holding of loweryielding federal funds sold and securities as strong deposit growthcontinued to exceed the demand for loans.

 For the three For the three months months ended ended September 30, % June 30, % Dollars in millions 2004 2003 Change 2004 Change----------------------- ---------- ---------- ------ ---------- ------Average Loans $8,173.9 $7,558.8 8 $8,053.9 1Average Securities 3,677.0 3,180.5 16 3,601.0 2Average Deposits 11,496.7 10,320.8 11 11,121.5 3Average Core Deposits 10,685.8 9,323.5 15 10,310.7 4Fully Taxable- EquivalentNet Interest Income 140.8 132.4 6 135.6 4Net Interest Margin 4.46 % 4.61 % (3) 4.49 % (1)

Period-end September 30, 2004 loans increased $48.6 million fromJune 30, 2004, reflecting modest growth in real estate-related loans.

Compared with the prior-year third-quarter averages, residentialmortgage loans rose 22 percent, real estate construction loans rose 24percent, commercial real estate mortgage loans rose 7 percent, andcommercial loans decreased 3 percent partially due to the payoff ofseveral dairy loans. Compared with the prior quarter, commercial loansdecreased slightly while all other categories increased.

The company's "plain vanilla" interest rate swaps which are partof its long-standing asset-liability management strategy of hedgingloans, deposits and borrowings were $1.0 billion in notional value,which was down $0.1 billion from the notional value at June 30, 2004and September 30, 2003.

NONINTEREST INCOME

Third-quarter 2004 noninterest income was 5 percent higher thanthe third quarter of 2003 due primarily to higher wealth managementincome. However, it fell 1 percent from the second quarter of 2004. Asa percentage of total revenues, noninterest income was 26 percent forthe third quarter of 2004, compared with 26 percent and 27 percent forthe third quarter of 2003 and the second quarter of 2004,respectively.

Wealth Management

Trust and investment fees increased 19 percent over the thirdquarter of 2003 primarily due to higher balances under management oradministration. Assets under management at September 30, 2004 alsoincreased 19 percent from the same period last year primarily due tonew business, strong relative investment performance and higher marketvalues. Increases in market values are reflected in fee incomeprimarily on a trailing-quarter basis.

 At or for the At or for three the months three months ended ended September 30, % June 30, %Dollars in millions 2004 2003 Change 2004 Change-------------------------- --------- --------- ------ --------- ------Trust and Investment Fee Revenue $16.9 $14.1 19 $16.7 1Brokerage and Mutual Fund Fees 9.7 9.3 4 9.4 3Assets Under Administration 33,171.1 27,485.8 21 31,749.9 4Assets Under Management (1)(2) 15,101.1 12,653.0 19 14,567.2 4(1) Included above in assets under administration(2) Excludes $3,603 and $3,275 million of assets under managementfor the CCM minority owned asset managers as of September 30, 2004 andJune 30, 2004, respectively

Other Noninterest Income

Cash management and deposit transaction fees decreased 5 percentfor the third quarter of 2004 from the same quarter last year.Compared with the second quarter of 2004, third-quarter 2004 cashmanagement and deposit transaction fees decreased 6 percent dueprimarily to an increase in the earnings credit for deposits underanalysis.

International service fees for the third quarter of 2004 were 7percent higher over the prior-year quarter and increased 3 percentfrom the second quarter of 2004 primarily due to higher letter ofcredit fees.

Other income for the third-quarter of 2004 was 12 percent lowerthan the third quarter of 2003 primarily due to the absence ofparticipating mortgage loan fees in the current quarter and wasessentially unchanged from the second quarter of 2004. Participatingmortgage loan fees are earned upon completion and repayment of debt ofcertain real estate construction projects. In these cases, CityNational participates in the profits of the project by funding aportion of the equity requirement.

For the third quarter of 2004, the company recorded $0.3 millionin gains on the sale of loans, assets and debt repurchase and gains onthe sale of securities, compared to essentially no gain or loss forthe third quarter of 2003 and $0.9 million in gains for the secondquarter of 2004.

NONINTEREST EXPENSE

Third-quarter 2004 noninterest expense of $97.8 million was up 6percent compared to $92.3 million for the third quarter of 2003 and up2 percent from $95.7 million for the second quarter of 2004. Theyear-over-year increase primarily related to higher staff costs.Compared with the prior quarter, the increase was due primarily tohigher net occupancy of premises and higher professional fees.

For the third quarter of 2004, the efficiency ratio was 52.68percent compared with 52.92 percent for the third quarter of 2003, and52.72 percent for the second quarter of 2004.

INCOME TAXES

The third-quarter 2004 effective tax rate was 37.6 percent,compared with 36.6 percent for all of 2003. The effective tax ratereflects changes in the mix of tax rates applicable to income beforetax. Quarterly comparisons with the first three quarters of 2003 wereaffected by the real estate investment trust ("REIT") state taxbenefits which were included in net income in the first three quartersof 2003 and were reversed in the fourth quarter of 2003.

As previously reported, the California Franchise Tax Board ("FTB")has taken the position that certain REIT and registered investmentcompany ("RIC") tax deductions will be disallowed under new Californialaw adopted in the fourth quarter of 2003. While management continuesto believe that the tax benefits realized in previous years wereappropriate, the company deemed it prudent to participate in thestatutory Voluntary Compliance Initiative-Option 2, requiring paymentof all California taxes and interest on these disputed 2000 through2002 tax benefits, and permitting the company to claim a refund forthese years while avoiding certain potential penalties. The company'sstrategic and financial positions remain unchanged from the previouslyreported period.

FIRST-NINE-MONTHS NET INCOME

First-nine-months 2004 net income of $156.6 million, or $3.07 pershare, rose from $142.2 million, or $2.85 per share, in the first ninemonths of 2003 attributable to the following:

 - Average deposits grew 12 percent and core deposits went up 16 percent. - Average loans increased by $267.7 million, or 3 percent. Residential mortgage loans rose 17 percent, commercial real estate mortgage loans rose 5 percent, real estate construction loans rose 14 percent and commercial loans decreased 7 percent partially due to the payoff of dairy loans previously announced. - Revenues increased 6 percent attributable to the rise of both net interest income and noninterest income. The margin for the first nine months of 2004 declined to 4.54 percent from 4.82 percent for the same period a year ago due to the holding of lower yielding federal funds sold and securities as strong deposit growth continues to exceed the demand for loans. - No provision for credit losses was recorded for the first nine months of 2004 due to continued strong credit quality compared with $29.0 million for the first nine months of 2003. - Noninterest income grew 10 percent from $129.3 million to $142.5 million. This increase is attributable to increased trust and investment fees from higher assets under management or administration and the operations of Convergent Capital Management, LLC ("CCM"). Results for 2004 include CCM's operation for the entire nine months while 2003 results only include the operations of CCM beginning April 1, 2003, the date the acquisition was completed. Noninterest income as a percentage of total revenues was 26 percent for the first nine months of 2004 compared with 25 percent for the first nine months of 2003. - Noninterest expense was up 7 percent from $269.1 million to $287.9 million partly because of the acquisition of CCM. CREDIT QUALITY

The company made no provision for credit losses in the first ninemonths of 2004. This was attributable to the continued strong creditquality of its portfolio, low level of net charge-offs, management'songoing assessment of the credit quality of the portfolio, modest loangrowth and an improving economic environment. Nonaccrual loans as ofSeptember 30, 2004 were $35.3 million, down 35 percent from September30, 2003, and down 16 percent from June 30, 2004.

At September 30, 2004, the allowance for loan losses was $148.1million or 1.81 percent of outstanding loans. This was after thecompany reclassified $12.3 million for $4.3 billion of unfunded creditcommitments from the allowance for loan losses to other liabilities.Unfunded credit commitments increased by approximately $234 millionduring the third quarter of 2004. The process used in thedetermination of the adequacy of the reserve for unfunded creditcommitments is consistent with the process for the allowance for loanlosses. Prior to the reclassification, the allowance for loan losseswas $160.4 million or 1.96 percent of outstanding loans. Thispresentation does not lower the total reserve for credit losses.Management believes the allowance for credit losses is adequate tocover risks in the loan portfolio at September 30, 2004.

 At or for the At or for three the months three months ended ended June September 30 % 30, % Dollars in millions 2004 2003 Change 2004 Change---------------------------- --------- -------- ------ -------- ------Provision For Credit Losses $- $- 0 $- 0Net Loan Charge-Offs 4.8 4.7 1 - N/MAnnualized Percentage of Net Charge-offs to Average Loans 0.23 % 0.25 % (8) - % N/MNonperforming Assets $35.3 $54.7 (35) $41.8 (16)Percentage of Nonaccrual Loansand ORE to Total Loans and ORE 0.43 % 0.72 % (40) 0.51 % (16)Allowance for Loan Losses (1) $148.1 $156.6 (5) $153.3 (3)Reserve for Off-Balance SheetCredit Commitments (1) $12.3 $9.6 27 $11.8 4Percentage of Allowance for Loan Losses to Outstanding Loans (1) 1.81 % 2.08 % (13) 1.89 % (4)Percentage of Allowance for Loan Losses to Nonaccrual Loans (1) 419.79 286.44 47 366.39 15Percentage of Allowance for CreditLosses to Nonaccrual Loans (2) 454.65 304.08 50 394.71 15(1) As of September 30, 2004, the company has reclassified thereserve for unfunded credit commitments from the allowance for loanlosses to other liabilities. Amounts presented prior to the thirdquarter of 2004 have been reclassified to conform to the presentationin the third quarter of 2004.(2) Allowance for credit losses equals allowance for loan losses andreserves for off-balance sheet credit commitments.

At September 30, 2004, approximately 29.4 percent of thenonperforming assets were loans to Northern California clients, and15.1 percent were 4 dairy credits. At September 30, 2004, thecompany's loan portfolio included approximately $460.7 million ofloans managed in Northern California offices. In addition, theportfolio included approximately $26.7 million in outstanding dairyloans, an industry which, as previously announced, the company expectsto exit, at relatively minimal cost, over the next three months.

OUTLOOK

Management now expects the growth of net income per share for 2004to be approximately 9 to 11 percent higher than net income per sharefor 2003 compared to its earlier guidance of 8 to 10 percent. This isbased on current economic conditions and the outlook for the remainderof 2004, the 25-basis-point increase in interest rates effectiveSeptember 21, 2004, and the updated business indicators below:

 - Average loan growth 4 to 6 percent - Average deposit growth 9 to 11 percent - Net interest margin 4.50 to 4.60 percent - Provision for credit losses $0 million to $5 million - Noninterest income growth 6 to 8 percent - Noninterest expense growth 6 to 8 percent - Effective tax rate 36 to 38 percent CAPITAL LEVELS

Total risk-based capital and Tier 1 risk-based capital ratios atSeptember 30, 2004 were 14.99 percent and 11.35 percent, compared withthe minimum "well capitalized" capital ratios of 10 percent and 6percent, respectively. The company's Tier 1 leverage ratio atSeptember 30, 2004 was 7.80 percent. Total risk-based capital, Tier 1risk-based capital and the Tier 1 leverage ratios at June 30, 2004were 14.77 percent, 11.08 percent and 7.68 percent, respectively whichreflect the reclassification of the off-balance sheet creditcommitments.

Average shareholders' equity to average assets for the thirdquarter of 2004 was 9.3 percent compared to 9.2 percent for the thirdquarter of 2003 and 9.3 percent for the second quarter of 2004.

Accumulated other comprehensive income at September 30, 2004 was$3.7 million compared with income of $21.4 million at September 30,2003 and a loss of $38.4 million at June 30, 2004. The increase duringthe third quarter related primarily to the impact of the decrease inlong and medium-term interest rates on the securities portfolio duringthe period. A decrease in long-term securities also contributed to theaverage duration of total available-for-sale securities at September30, 2004 decreasing to 3.1 years compared to 3.8 years at June 30,2004 and 3.2 years at September 30, 2003.

STOCK REPURCHASE

The company has authorization to repurchase 1,009,500 of itsoutstanding shares as of September 30, 2004. On March 24, 2004, CityNational Corporation's Board of Directors authorized the repurchase ofone million additional shares of City National Corporation stock,following completion of the company's previous buyback initiatives. OnJanuary 22, 2003, the Board of Directors had authorized aone-million-share stock buyback program. This program was completedduring the first quarter of 2004 with the repurchase of 249,900 sharesat an average cost of $58.23 per share. The average cost for theentire one-million-share buyback program was $46.41 per share. On July15, 2003, the Board of Directors authorized the repurchase of 500,000additional shares of City National Corporation stock, followingcompletion of the company's January 22, 2003 buyback initiative. Underthis plan, 490,500 shares have been repurchased at an average cost of$59.68 per share leaving 9,500 shares remaining for repurchase beforethe initiation of the new one-million-share program. There were noshares repurchased during the third quarter of 2004. The sharespurchased under the buyback programs will be reissued foracquisitions, upon the exercise of stock options, and for othergeneral corporate purposes. There were 1,157,468 treasury shares atSeptember 30, 2004.

CONFERENCE CALL

City National Corporation will host a conference call thisafternoon to discuss results for the third quarter of 2004. The callwill begin at 2:00 p.m. PDT. Analysts and investors may dial in andparticipate in the question/answer session. To access the call, pleasedial 800-599-9816 and enter pass code 36903977. A listen-only livebroadcast of the call also will be available on the investor relationspage of the company's website at www.cnb.com. There, it will bearchived and available for 12 months.

ABOUT CITY NATIONAL

City National Corporation is a financial services company with$14.0 billion in total assets. Its wholly owned subsidiary, CityNational Bank, is California's Premier Private and Business Bank(SM).The bank provides banking, investment, and trust services through 52offices, including 12 full-service regional centers, in SouthernCalifornia, the San Francisco Bay Area, and New York City. The companyand its affiliates manage or administer more than $33 billion inclient trust and investment assets, including more than $15 billionunder management.

For more information about City National, visit the company's Website at cnb.com http://www.cnb.com/.

This news release contains forward-looking statements about thecompany for which the company claims the protection of the safe harborprovisions contained in the Private Securities Litigation Reform Actof 1995.

Forward-looking statements are based on management's knowledge andbelief as of today and include information concerning the company'spossible or assumed future financial condition, and its results ofoperations, business and earnings outlook. These forward-lookingstatements are subject to risks and uncertainties. A number offactors, some of which are beyond the company's ability to control orpredict, could cause future results to differ materially from thosecontemplated by such forward-looking statements. These factors include(1) the unknown economic impact of state, county and city budgetissues, (2) changes in interest rates, (3) significant changes inbanking laws or regulations, (4) the costs associated with therequirements to address Sarbanes-Oxley 404 and Bank Secrecy Actregulatory compliance principles including Anti-Money Laundering, USAPatriot Act and Know Your Client, (5) increased competition in thecompany's market, (6) other-than-expected credit losses, (7)earthquake or other natural disasters impacting the condition of realestate collateral, (8) the effect of acquisitions and integration ofacquired businesses, and (9) the impact of changes in regulatory,judicial, or legislative tax treatment of business transactions.Management cannot predict at this time the extent of the economicrecovery, and a slowing or reversal could adversely affect ourperformance in a number of ways including decreased demand for ourproducts and services and increased credit losses. Likewise, changesin deposit interest rates, among other things, could slow the rate ofgrowth or put pressure on current deposit levels. Forward-lookingstatements speak only as of the date they are made, and the companydoes not undertake to update forward-looking statements to reflectcircumstances or events that occur after the date the statements aremade, or to update earnings guidance including the factors thatinfluence earnings.

For a more complete discussion of these risks and uncertainties,see the company's Quarterly Report on Form 10-Q for the quarter-endedJune 30, 2004, and particularly the section of Management's Discussionand Analysis therein titled "Cautionary Statement for Purposes of the'Safe Harbor' Provisions of the Private Securities Litigation ReformAct of 1995."

CITY NATIONAL CORPORATION----------------------------------------------------------------------CONSOLIDATED BALANCE SHEET (unaudited)(Dollars in thousands, except per share amount)---------------------------------------------------------------------- September 30, June 30, --------------------------------- 2004 2003 % Change 2004 ---------------------------------------------AssetsCash and due from banks $410,694 $497,392 (17) $485,208Federal funds sold 890,000 717,200 24 595,000Due from banks - interest bearing 37,890 33,646 13 76,890Securities 3,830,502 3,467,752 10 3,547,650Loans (net of allowance for loan losses of $148,056; $156,563 and $153,271) (1) 8,026,081 7,385,584 9 7,972,225Other assets 786,233 738,600 6 808,773 ------------------------ ------------Total assets (1) $13,981,400 $12,840,174 9 $13,485,746 ======================== ============Liabilities and Shareholders' EquityNoninterest-bearing deposits $5,922,689 $5,365,335 10 $5,809,241Interest-bearing deposits 5,942,864 5,420,366 10 5,645,678 ------------------------ ------------Total deposits 11,865,553 10,785,701 10 11,454,919Federal funds purchased and securities sold under repurchase agreements 71,570 103,346 (31) 94,898Other short-term borrowed funds 50,125 15,125 231 50,125Subordinated debt 291,073 303,393 (4) 286,896Other long-term debt 231,882 278,664 (17) 224,488Reserve for off-balance sheet credit commitments (1) 12,295 9,646 27 11,846Other liabilities / minority interest 145,675 160,500 (9) 134,765 ------------------------ ------------Total liabilities (1) 12,668,173 11,656,375 9 12,257,937Shareholders' equityCommon stock, paid-in capital, retained earnings, treasury shares and deferred equity compensation 1,309,544 1,162,353 13 1,266,227Accumulated other comprehensive income (loss) 3,683 21,446 (83) (38,418) ------------------------ ------------Total shareholders' equity 1,313,227 1,183,799 11 1,227,809 ------------------------ ------------Total liabilities and shareholders' equity (1) $13,981,400 $12,840,174 9 $13,485,746 ======================== ============Book value per share $26.73 $24.29 10 $25.05Number of shares at period end 49,127,167 48,740,418 1 49,015,117(1) As of September 30, 2004, the company has reclassified the reserve for unfunded credit commitments from the allowance for loan losses to other liabilities. Amounts presented prior to the third quarter of 2004 have been reclassified to conform to the presentation in the third quarter of 2004.CONSOLIDATED STATEMENT OF INCOME (unaudited)(Dollars in thousands, except per share amount)---------------------------------------------------------------------- For the three months For the nine months ended ended September 30, September 30, ------------------------------------------------------------ % % 2004 2003 Change 2004 2003 Change ------------------------------------------------------------Interest income $152,431 $142,361 7 $441,406 $432,370 2Interest expense (15,090) (13,700) 10 (40,818) (48,368) (16) ---------------------- ----------------------Net interest income 137,341 128,661 7 400,588 384,002 4Provision for credit losses - - - - (29,000) (100) ---------------------- ----------------------Net interest income after provision for credit losses 137,341 128,661 7 400,588 355,002 13Noninterest income 47,640 45,268 5 142,476 129,296 10Noninterest expense (97,761) (92,333) 6 (287,947) (269,061) 7Minority interest (1,502) (1,717) (13) (4,408) (3,257) 35 ---------------------- ----------------------Income before taxes 85,718 79,879 7 250,709 211,980 18Income taxes (32,240) (27,376) 18 (94,133) (69,741) 35 ---------------------- ----------------------Net income $53,478 $52,503 2 $156,576 $142,239 10 ====================== ======================Net income per share, diluted $1.04 $1.05 (1) $3.07 $2.85 8 ====================== ======================Dividends paid per share $0.32 $0.28 14 $0.96 $0.69 39 ====================== ======================Shares used to compute per share net income, diluted 51,182,083 50,176,559 50,969,910 49,941,668CITY NATIONAL CORPORATION----------------------------------------------------------------------SELECTED FINANCIAL INFORMATION (unaudited) (Dollars in thousands)---------------------------------------------------------------------- For the three months For the nine months ended ended September 30, September 30, -------------------------------------------------------- % % 2004 2003 Change 2004 2003 Change ----------- ----------- ------ --------- --------- -----Average BalancesLoansCommercial $3,100,553 $3,191,405 (3)$3,134,153 $3,383,367 (7)Commercial real estate mortgage 1,837,590 1,715,400 7 1,819,488 1,730,310 5Residential mortgage 2,135,972 1,754,877 22 2,041,912 1,748,237 17Real estate construction 786,576 634,300 24 748,275 659,157 14Equity lines of credit 221,105 175,596 26 206,366 171,807 20Installment 92,086 87,221 6 88,344 77,970 13 ----------- ----------- ----------- -----------Total loans $8,173,882 $7,558,799 8 $8,038,538 $7,770,848 3 =========== =========== =========== ===========Securities $3,676,953 $3,180,542 16 $3,580,520 $2,825,919 27Due from banks - interest bearing 38,992 66,477 (41) 53,381 40,231 33Interest- earning assets 12,549,195 11,390,370 10 12,097,769 10,960,019 10Assets (1) 13,612,389 12,428,306 10 13,152,721 11,950,447 10Core deposits 10,685,832 9,323,541 15 10,207,652 8,808,012 16Deposits 11,496,659 10,320,828 11 11,052,186 9,826,659 12Shareholders' equity 1,266,651 1,139,440 11 1,239,710 1,129,645 10Noninterest incomeTrust and investment fees $16,850 $14,148 19 $49,102 $32,878 49Brokerage and mutual fund fees 9,675 9,264 4 $27,768 $27,519 1Cash management and deposit transaction fees 10,322 10,885 (5) 32,362 32,868 (2)International services 5,191 4,845 7 15,359 14,192 8Bank owned life insurance 588 747 (21) 2,134 2,192 (3)Other 4,678 5,327 (12) 13,915 16,991 (18) ----------- ----------- ----------- ----------- Subtotal - core 47,304 45,216 5 140,640 126,640 11Gain on sale of loans and assets/debt repurchase 9 16 NM 9 118 (92)Gain on sale of securities 327 36 808 1,827 2,538 (28) ----------- ----------- ----------- -----------Total $47,640 $45,268 5 $142,476 $129,296 10 =========== =========== =========== ===========Total revenue $184,981 $173,929 6 $543,064 $513,298 6 =========== =========== =========== ===========Noninterest expenseSalaries and employee benefits $59,675 $55,261 8 $178,657 $161,582 11 ----------- ----------- ----------- -----------All OtherNet occupancy of premises 8,124 8,142 - 23,081 22,973 -Professional 7,582 6,821 11 20,418 20,026 2Information services 4,522 4,749 (5) 13,632 13,304 2Depreciation 3,614 3,315 9 10,116 9,453 7Marketing and advertising 3,666 3,060 20 10,985 9,725 13Office services 2,444 2,504 (2) 7,350 7,472 (2)Amortization of intangibles 1,763 2,365 (25) 5,282 6,568 (20)Equipment 478 528 (9) 1,879 1,832 3Other operating 5,893 5,588 5 16,547 16,126 3 ----------- ----------- ----------- -----------Total all other 38,086 37,072 3 109,290 107,479 2 ----------- ----------- ----------- -----------Total $97,761 $92,333 6 $287,947 $269,061 7 =========== =========== =========== ===========Selected RatiosFor the PeriodReturn on average assets (1) 1.56 % 1.68 % (7) 1.59 % 1.59 % -Return on average shareholders' equity 16.80 18.28 (8) 16.87 16.83 -Efficiency ratio (2) 52.68 52.92 - 52.92 51.93 2Dividend payout ratio 29.51 25.94 14 30.08 23.58 28Period End (1)Tier 1 risk- based capital ratio 11.35 10.75 6Total risk- based capital ratio 14.99 14.92 -Tier 1 leverage ratio 7.80 7.36 6(1) As of September 30, 2004, the company has reclassified the reserve for unfunded credit commitments from the allowance for loan losses to other liabilities. Amounts presented prior to the third quarter of 2004 have been reclassified to conform to the presentation in the third quarter of 2004.(2) The efficiency ratio is defined as noninterest expense excluding ORE expense divided by total revenue (net interest income on a tax-equivalent basis and noninterest income).CITY NATIONAL CORPORATION----------------------------------------------------------------------SELECTED FINANCIAL INFORMATION (unaudited) (Dollars in thousands)----------------------------------------------------------------------Period end September 30, June 30, --------------------------------- 2004 2003 % Change 2004 ---------------------------------------------LoansCommercial $3,020,235 $3,143,489 (4) $3,077,689Commercial real estate mortgage 1,852,472 1,707,822 8 1,842,956Residential mortgage 2,167,623 1,803,424 20 2,114,335Real estate construction 797,109 622,941 28 782,435Equity lines of credit 242,050 179,601 35 214,533Installment 94,648 84,870 12 93,548 ------------------------ ------------Total loans $8,174,137 $7,542,147 8 $8,125,496 ======================== ============DepositsNoninterest-bearing $5,922,689 $5,365,335 10 $5,809,241Interest-bearing, core 5,083,550 4,451,820 14 4,854,545 ------------------------ ------------Total core deposits 11,006,239 9,817,155 12 10,663,786Time deposits - $100,000 and over 859,314 968,546 (11) 791,133 ------------------------ ------------Total deposits $11,865,553 $10,785,701 10 $11,454,919 ======================== ============ For the three months For the nine months ended ended September 30, September 30, ---------------------------------------------------- 2004 2003 % Change 2004 2003 % Change --------- -------- ------- -------- ------- -------Yields and Rates for the Period Loans 5.54 % 5.73 % (3) 5.46 % 5.83 % (6) Securities 4.27 4.41 (3) 4.43 4.79 (8) Interest- earning assets 4.94 5.09 (3) 4.99 5.41 (8) Interest- bearing deposits 0.77 0.73 5 0.72 0.91 (20) Other borrowings 2.30 2.02 14 2.06 2.22 (7) Total interest bearing liabilities 0.91 0.87 5 0.85 1.06 (20) Net interest margin 4.46 4.61 (3) 4.54 4.82 (6) September 30, June 30, ------------------------------------ 2004 2003 % Change 2004 ------------ ------------ ---------- ------------Credit Quality Nonaccrual loans and ORE Nonaccrual loans $35,269 $54,659 (35) $41,833 ORE - - - - ------------ ------------ ------------Total nonaccrual loans and ORE $35,269 $54,659 (35) $41,833 ============ ============ ============Total nonaccrual loans and ORE to total loans and ORE 0.43 0.72 (40) 0.51Loans past due 90 days or more on accrual status $3,586 $3,023 19 $153 ============ ============ ============ For three months For the nine months ended ended September 30, September 30, -------- ----------------- ---------- ----------------- % % 2004 2003 Change 2004 2003 Change -------- ---------------- ---------- ----------------Allowance for Loan LossesBeginning balance $153,271 $161,947 (5)$ 156,015 $156,598 - Provision for credit losses (449) (666) (33) (2,324) 27,258 (109) Charge-offs (8,238) (7,599) 8 (22,187) (36,692) (40) Recoveries 3,472 2,881 21 16,552 9,399 76 -------- -------- ---------- --------Net charge- offs (4,766) (4,718) 1 (5,635) (27,293) (79) -------- -------- ---------- --------Ending Balance$148,056 $156,563 (5)$ 148,056 $156,563 (5) ======== ======== ========== ========Reserve for Off-Balance Sheet Credit CommitmentsBeginning balance $ 11,846 $ 8,980 32 $ 9,971 $ 7,904 26 Provision 449 666 (33) 2,324 1,742 33 -------- -------- ---------- --------Ending Balance$ 12,295 $ 9,646 27 $ 12,295 $ 9,646 27 ======== ======== ========== ========Total net charge-offs to average loans (annualized) (0.23) (0.25) (8) (0.09) (0.47) (81)Allowance for loan losses to total loans 1.81 2.08 (13)Allowance for loan losses to nonaccrual loans 419.79 286.44 47Allowance for credit losses to nonaccrual loans (1) 454.65 304.08 50As of September 30, 2004, the company has reclassified the reserve forunfunded credit commitments from the allowance for loan losses toother liabilities. Amounts presented prior to the third quarter of2004 have been reclassified to conform to the presentation in thethird quarter of 2004.(1) Allowance for credit losses equals allowance for loan losses and reserves off-balance sheet credit commitments.CITY NATIONAL CORPORATION----------------------------------------------------------------------Reclassification of Off-Balance Sheet Credit Commitments---------------------------------------------------------------------- Reserve for Off-Balance Allowance Sheet Credit Combined for Loan Losses Commitments Total ------------ ------------ ------------Balances, December 31, 2002 $156,598 $7,904 $164,502Net Charge-offs (12,522) - (12,522)Provision 17,172 328 17,500 ------------ ------------ ------------Balances, March 31, 2003 161,248 8,232 169,480Net Charge-offs (10,053) - (10,053)Provision 10,752 748 11,500 ------------ ------------ ------------Balances June 30, 2003 161,947 8,980 170,927Net Charge-offs (4,718) - (4,718)Provision (666) 666 - ------------ ------------ ------------Balances, September 30, 2003 156,563 9,646 166,209Net Charge-offs (223) - (223)Provision (325) 325 - ------------ ------------ ------------Balances, December 31, 2003 156,015 9,971 165,986Net Charge-offs (914) - (914)Provision (603) 603 - ------------ ------------ ------------Balances, March 31, 2004 154,498 10,574 165,072Net Charge-offs 45 - 45Provision (1,272) 1,272 - ------------ ------------ ------------Balances, June 30, 2004 153,271 11,846 165,117Net Charge-offs (4,766) - (4,766)Provision (449) 449 - ------------ ------------ ------------Balances, September 30, 2004 $148,056 $12,295 $160,351 ============ ============ ============

CONTACT: City National Corporation
Christopher J. Carey, 310-888-6777 (IR)
Cary Walker, 213-833-4715 (Media)

SOURCE: City National Corporation