<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 March 31, 1997
--------------
or
[_] 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 0-26960
------------------------------
ITLA CAPITAL CORPORATION
-------------------------
(Exact name of registrant as specified in its charter)
Delaware 95-4596322
- ---------------------------- ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
7979 Ivanhoe Ave., Suite 100, La Jolla, California 92037
- -------------------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
(818) 551-0600
- --------------------------------------------------
(Registrant's telephone number, including
area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 12, 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for 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 [_]
Number of shares of common stock of the registrant: 7,829,250 outstanding as of
April 30, 1997.
<PAGE>
ITLA CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31,
1997 December 31,
(Unaudited) 1996
------------ -------------
(in thousands except share amounts)
Assets
<S> <C> <C>
Cash and cash equivalents $40,503 $48,881
Investment securities available for sale, at approximate market value 60,180 50,292
Stock in Federal Home Loan Bank 8,483 8,349
Mortgage-backed securities held to maturity, at amortized cost
(market value $29,121 and $31,319 for 1997 and 1996, respectively) 29,871 31,870
Loans held for investment, net (net of allowance for credit losses of
$10,847 and $10,885 in 1997 and 1996, respecitvely) 653,142 649,836
Loans held for sale, at market value 933 1,130
Interest receivable 4,834 4,411
Other real estate owned, net 3,656 5,416
Income taxes receivable 420 2,007
Premises and equipment, net 2,808 2,610
Deferred income taxes 3,871 3,613
Other assets 1,793 2,028
------------ -------------
$810,494 $810,443
============ =============
Liabilities and Shareholders' Equity
Liabilities:
Deposit accounts $669,582 $670,336
Federal Home Loan Bank advances 39,500 43,500
Accounts payable and other liabilities 9,235 7,289
------------ -------------
Total liabilities 718,317 721,125
------------ -------------
Commitments and contingencies - -
Shareholders' equity:
Preferred stock, 5,000,000 shares authorized, none issued - -
Contributed capital - common stock, $.01 par value; 20,000,000 shares
authorized, 7,829,250 and 7,824,000 issued and outstanding in 1997
and 1996, respectively 53,398 53,345
Retained earnings 38,879 35,973
Unrealized loss on investment securities available for sale, net (100) -
------------ -------------
Total shareholders' equity 92,177 89,318
------------ -------------
$810,494 $810,443
============ =============
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
2
<PAGE>
ITLA CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended
--------------------------
March 31,
--------------------------
1997 1996
------------ ------------
(in thousands except per
share amounts)
<S> <C> <C>
Interest income:
Loans receivable, including fees $ 17,795 $ 15,109
Investment securities 1,504 945
Mortgage-backed securities 457 627
------------ ------------
Total interest income 19,756 16,681
------------ ------------
Interest expense:
Deposit accounts 9,480 7,472
Federal Home Loan Bank advances 589 747
------------ ------------
Total interest expense 10,069 8,219
------------ ------------
Net interest income before provision for estimated credit losses 9,687 8,462
Provision for estimated credit losses 600 1,721
------------ ------------
Net interest income after provision for estimated credit losses 9,087 6,741
------------ ------------
Noninterest income 348 237
Noninterest expense:
Compensation and benefits 2,080 1,135
Occupancy and equipment 563 474
FDIC assessment 144 121
Other 1,724 1,009
------------ ------------
Total general and administrative 4,511 2,739
------------ ------------
Real estate operations, net 8 87
Provision for estimated losses on other real estate owned - 592
Loss (gain) on sale of other real estate owned, net 7 (65)
------------ ------------
Total real estate operations, net 15 614
------------ ------------
Total noninterest expense 4,526 3,353
------------ ------------
Income before provision for income taxes 4,909 3,625
Provision for income taxes 2,003 1,385
------------ ------------
NET INCOME $ 2,906 $ 2,240
============ ============
EARNINGS PER SHARE $ 0.36 $ 0.37
============ ============
</TABLE>
See accompnaying notes to the unaudited consolidated financial statements.
3
<PAGE>
ITLA CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
--------------------------
1997 1996
--------- --------
(in thousands)
<S> <C> <C>
Cash Flows From Operating Activities:
Net income $ 2,906 $ 2,240
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 162 218
Provision for estimated credit losses 600 1,721
Provision for estimated losses on other real estate owned - 592
Loss (gain) on sales of other real estate owned 7 (65)
Increase in interest receivable (423) (676)
Decrease in income taxes receivable 1,587 1,383
Increase in deferred income taxes (188) -
Decrease (increase) in other assets 201 (429)
Increase in accounts payable and other liabilities 1,946 676
-------- --------
Net cash provided by operating activities 6,798 5,660
-------- --------
Cash Flows From Investing Activities:
Increase in net loans receivable (4,369) (57,188)
Purchases of investment securities available for sale (102,610) -
Proceeds from the maturity of investment securities available for sale 92,627 -
Purchases of investment securities held to maturity - (170,495)
Proceeds from the maturity of investment securities held to maturity - 143,462
(Increase) decrease in stock in Federal Home Loan Bank (134) 4,404
Repayment of principal on mortgage-backed securities 1,965 1,645
Proceeds from sale of other real estate owned 1,753 2,186
Proceeds from sale of real estate loans 660 -
Proceeds from sale of automobile finance contracts - 50,050
Cash paid for capital expenditures (376) (27)
Other, net 9 (1)
-------- --------
Net cash used in investing activities (10,475) (25,964)
-------- --------
Cash Flows From Financing Activities:
Common stock options exercised 53 5
(Decrease) increase in deposit accounts (754) 41,931
Decrease in Federal Home Loan Bank advances (4,000) -
-------- --------
Net cash (used in) provided by financing activities (4,701) 41,936
-------- --------
Net (decrease) increase in cash and cash equivalents (8,378) 21,632
Cash and cash equivalents at beginning of period 48,881 22,106
-------- --------
Cash and cash equivalents at end of period $ 40,503 $ 43,738
======== ========
Supplemental Cash Flow Information:
Cash paid during the period for interest $ 9,672 $ 7,706
Cash paid during the period for income taxes $ 900 $ 2
Noncash Investing Transactions:
Loans transferred to other real estate owned $ 140 $ 3,159
Loans to facilitate the sale of other real estate owned $ 435 $ 1,036
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
4
<PAGE>
ITLA CAPITAL CORPORATION
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
NOTE 1 - BASIS OF PRESENTATION
The unaudited consolidated financial statements of ITLA Capital Corporation
(the "Company") included herein reflect all normal recurring adjustments, which
are in the opinion of management, necessary to present a fair statement of the
results for the interim periods indicated. The unaudited consolidated financial
statements include the accounts of the Company and its two wholly-owned
subsidiaries, Imperial Thrift and Loan Association ("Imperial" or "the
Association") and ITLA Funding Corporation ("ITLA Funding"). All material
intercompany transactions and balances have been eliminated. Certain
reclassifications have been made to the financial statements for 1996 to conform
to the 1997 presentation. Certain information and disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules and
regulations of the U.S. Securities and Exchange Commission. The results of
operations for the three months ended March 31, 1997, are not necessarily
indicative of the results of operations to be expected for the remainder of the
year.
These unaudited financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's annual report
on Form 10-K for the year ended December 31, 1996.
NOTE 2 - EARNINGS PER SHARE
Earnings per share is calculated on the basis of weighted average number of
shares of common stock and common stock equivalents outstanding during the
period, which was 7,975,442 and 6,124,610 for the three month period ended
March 31, 1997 and 1996, respectively. Fully diluted earnings per share has not
been reported in these interim financial statements as the dilutive effect of
common stock equivalents for outstanding options is less than three percent.
Statement of Financial Accounting Standards Number 128 ("SFAS 128"),
"Earnings Per Share", which will supersede APB Opinion 15, becomes effective for
periods ending after December 15, 1997. Under SFAS 128, primary earnings per
share will be replaced with basic earnings per share. Basic earnings per share
is computed by dividing reported earnings available to common shareholders by
weighted average shares outstanding. No dilution for any potentially dilutive
securities is included. The impact of SFAS 128 on the Company's earnings per
share has not been determined.
NOTE 3 - IMPAIRED LOANS RECEIVABLE
As of March 31, 1997, the recorded investment in loans receivable that were
considered impaired under Statement of Financial Accounting Standards No. 114
was $3.8 million. The average recorded investment in these loans during the
three month period ended March 31, 1997 was $5.1 million. Interest income
recognized on impaired loans on a cash basis was $.1 million during both of the
three month periods ended March 31, 1997 and 1996.
5
<PAGE>
ITLA CAPITAL CORPORATION
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
NOTE 4 - SUBSEQUENT EVENT
On April 14, 1997, the Company announced that it has approved a stock
repurchase program of up to 5 percent of its outstanding shares, not to exceed
$10 million over the next 18 months. Under this program, the Company may
acquire, at its discretion, shares of its outstanding common stock through
purchases in the open market.
6
<PAGE>
ITLA CAPITAL CORPORATION
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis is intended to identify the major
components that influenced the financial condition and results of operations of
the Company as of and for the three month period ended March 31, 1997.
Certain statements may be used in this Form 10-Q or future filings by the
Company with the Securities and Exchange Commission, in the Company's press
releases or other public or shareholder communications, or in oral statements
made with the approval of an authorized executive officer. Such words may
include "will likely result," "are expected to," "will continue," "is
anticipated," "estimate," "project," "believe," or similar expressions are
intended to identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. The Company wishes to caution
readers not to place undue reliance on any such forward-looking statements,
which speak only as of the date made, and to advise readers that various
factors, including regional and national economic conditions, changes in levels
of market interest rates, credit risks of lending activities, and competitive
and regulatory factors, could affect the Company's financial performance and
could cause the Company's actual results for future periods to differ materially
from those anticipated or projected.
The Company does not undertake, and specifically disclaims any obligation,
to revise any forward-looking statements to reflect the occurrence of
anticipated or unanticipated events or circumstances after the date of such
statements.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1997 COMPARED TO THREE MONTHS ENDED MARCH 31, 1996
NET INCOME
Net income totaled $2.9 million for the three months ended March 31, 1997
compared to $2.2 million for the first quarter of 1996. The increase in net
earnings was primarily due to an increase in net interest income, a reduced
provision for estimated credit losses and lower other real estate owned
expenses, offset by an increase in general and administrative expenses and an
increase in the provision for income taxes. Earnings per share was $.36 for the
first quarter of 1997 compared to $.37 per share for the same period in 1996, as
the average number of shares outstanding was higher in the first quarter of 1997
compared to the same period in 1996 as a result of the April 1996 stock
offering.
NET INTEREST INCOME
The table on the following page sets forth a summary of the changes in
interest income and interest expense resulting from changes in average interest-
earning asset and interest-bearing liability balances (volume) and changes in
average interest rates (rate). The change in interest due to both volume and
rate have been allocated to change due to volume and rate in proportion to the
relationship of absolute dollar amounts in each.
7
<PAGE>
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED MARCH 31,
1997 VERSUS 1996
----------------------------------------------------------------
VOLUME RATE TOTAL
------------------- -------------------- -------------------
(in thousands)
<S> <C> <C> <C>
Increase (decrease) in net interest
income:
Loans receivable, net $ 4,364 $ (1,678) $ 2,686
Cash and investment securities 463 96 559
Mortgage-backed securities (178) 8 (170)
------------------- -------------------- -------------------
Total increase (decrease) 4,649 (1,574) 3,075
Deposit accounts 2,063 (55) 2,008
FHLB Advances (158) - (158)
------------------- -------------------- -------------------
Total increase (decrease) 1,905 (55) 1,850
Increase (decrease) in net
interest income $ 2,744 $ (1,519) $ 1,225
======= ======== =======
</TABLE>
Total interest income increased by $3.1 million in the 1997 first quarter
compared to the same period in 1996 due to increases in the average balances of
loans and investments, offset by lower overall yields on loans receivable and
the lower average balance of mortgage-backed securities compared to the first
quarter of 1996. The average balance of loans receivable increased $154.8
million, or 30.3 percent, due to growth in the Company's real estate loan
portfolio. The weighted average yield on loans receivable declined to 10.85
percent for the 1997 first quarter compared to 12.00 percent for the same period
in 1996 primarily as a result of the sale of higher yielding automobile loans in
the first quarter of 1996. This sale and the origination of lower yielding real
estate loans is expected to result in the Company achieving lower average yields
in future operating periods.
Total interest expense increased by $1.9 million in the 1997 first quarter
compared to the same period in 1996 due to an increase in the average balance of
deposit accounts, offset by a decline in the average balance of FHLB advances
and a decline in the average rate paid on deposit accounts. The average balance
of deposit accounts increased $151.9 million during the first quarter of 1997 as
compared to the 1996 first quarter. The average rate paid on these accounts
declined to 5.71 percent in the 1997 first quarter from 5.81 percent during the
same period in 1996.
PROVISION FOR ESTIMATED CREDIT LOSSES
Management periodically assesses the adequacy of the allowance for credit
losses by reference to many factors which may be weighted differently at various
times depending on prevailing conditions. These factors include, among other
elements, general portfolio trends relative to asset and portfolio size, asset
categories, potential credit concentrations, nonaccrual loan levels, historical
loss experience and risks associated with changes in economic, social and
business conditions. Accordingly, the calculation of the adequacy of the
allowance for credit losses is not based solely on the level of nonperforming
assets. Management believes that the Company's allowance for credit losses as of
March 31, 1997 was adequate to absorb the known and inherent risks of loss in
the loan portfolio at that date. While management believes the estimates and
assumptions used in its determination of the adequacy of the allowance are
reasonable, there can be no assurance that such estimates and assumptions will
not be proven incorrect in the future, or that the
8
<PAGE>
actual amount of future provisions will not exceed the amount of past provisions
or that any increased provisions that may be required will not adversely impact
the Company's financial condition and results of operations. In addition, the
determination of the amount of the allowance for credit losses is subject to
review by the Association's regulators, as part of the routine examination
process, which may result in the establishment of additional reserves based upon
their judgment of information available to them at the time of their
examination.
The provision for estimated credit losses declined to $.6 million in the 1997
first quarter from $1.7 million in the same period in 1996, reflecting both the
decline in nonperforming loans and net charge-offs as compared to previous
periods. Nonperforming assets to total assets declined to 1.5 percent as of
March 31, 1997 from 1.6 percent as of December 31, 1996. The aggregate amount of
nonperforming assets declined to $12.3 million as of March 31, 1997 from $12.6
million at December 31, 1996. At March 31, 1997, the total allowance for credit
losses was $10.8 million or 1.6 percent of total loans receivable held for
investment. See also "Financial Condition - Nonperforming Assets and Allowance
for Credit Losses."
NONINTEREST EXPENSE
Noninterest expense totaled $4.5 million for the three months ended March 31,
1997 compared to $3.4 million for the same period in 1996. The increase in
noninterest expense in 1997 was due primarily to an increase in compensation and
benefits expense of $.9 million, an increase in occupancy and equipment expense
of $.1 million and an increase in other expenses of $.7 million, offset by a
reduction in the costs associated with other real estate owned ("OREO"), which
totaled $15,000 in 1997, compared to $.6 million in 1996. Compensation and
benefits expense increased in 1997 due to an increase in the number of full time
equivalent employees ("FTE's") to 151 at March 31, 1997 compared to 130 in the
prior year, as well as due to a non recurring benefit in the prior year which
reduced the amount of expense recognized by $.4 million. The increase in FTE's
in 1997 compared to 1996 was due primarily to the additional staffing at ITLA
Funding. The increase in other expense was due primarily to an increase in
advertising expense totaling approximately $.2 million, costs associated with
the commencement of operations of ITLA Funding of $.2 million, and increases in
other miscellaneous general and administrative costs of $.3 million. The
reduction in OREO expense was commensurate with the reduction in the number of
OREO properties held by the Company. At March 31, 1997, the Company held 20
OREO properties, compared to 36 at March 31, 1996.
For the quarter ended March 31, 1997, the Company's consolidated ratio of
general and administrative expense to average assets was 2.2 percent, compared
to 1.7 percent in the prior year, however, the ratio excluding the costs of ITLA
Funding was 1.9 percent in the first quarter of 1997.
9
<PAGE>
FINANCIAL CONDITION
NONPERFORMING ASSETS AND ALLOWANCE FOR CREDIT LOSSES
The following table sets forth the Company's nonperforming assets by
category at the dates indicated.
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1997 1996
----------- -------------
<S> <C> <C>
(DOLLARS IN THOUSANDS)
Nonaccrual Loans:
Loans secured by real estate, net $ 8,193 $ 6,422
Other 495 783
------- -------
Total nonaccrual loans 8,688 7,205
Real estate owned 3,656 5,416
------- -------
Total nonperforming assets $12,344 $12,621
======= =======
Troubled debt restructurings $ 2,102 $ 2,106
Nonaccrual loans held for investment to
total gross loans held for investment 1.23% 0.96%
Nonperforming assets to total assets 1.52% 1.56%
The following table provides certain information regarding the Company's allowance for credit losses.
THREE MONTHS ENDED YEAR ENDED
MARCH 31, DECEMBER 31,
---------- ------------
1997 1996
---- ----
(IN THOUSANDS)
ALLOWANCE FOR CREDIT LOSSES:
Balance, beginning of period $10,885 $ 8,105
Provision for estimated credit losses 600 4,871
Less net charge-offs on real estate loans 638 2,091
------- -------
Balance, end of period $10,847 $10,885
======= =======
</TABLE>
LIQUIDITY AND DEPOSIT ACCOUNTS
Liquidity refers to the Company's ability to maintain cash flow adequate to
fund operations and meet obligations and other commitments on a timely basis,
including the payment of maturing deposits and the origination or purchase of
new loan receivables. The Company maintains a cash and investment securities
portfolio designed to satisfy operating and regulatory liquidity requirements
while preserving capital and maximizing yield. As of March 31, 1997, the Company
held approximately $60.2 million of investment securities classified as
available for sale. All investment securities held by the Company were fixed
income instruments which were rated "AAA" or better by nationally recognized
rating agencies. As of March 31, 1997 and December 31, 1996, the Association's
liquidity ratios were 13.7 percent and 13.3 percent, respectively, exceeding the
regulatory requirement of 1.5 percent. In addition, the Company's liquidity
position
10
<PAGE>
is supported by a credit facility with the FHLB of San Francisco. As
of March 31, 1997, the Company had available borrowing capacity under this
credit facility of 102.0 million.
Total deposit accounts declined to $669.6 million at March 31, 1997, from
$670.3 million at December 31, 1996. The Company retained 83 percent and 74
percent of the funds from maturing investment certificates through rollover of
the certificates in the first quarter of 1997 and 1996, respectively. Although
the Company competes for deposits primarily on the basis of rates, based on its
historical experience regarding retention of deposits, management believes that
a significant portion of deposits will remain with the Company upon maturity on
an ongoing basis.
CAPITAL RESOURCES
At March 31, 1997, the Association's Leverage (Core), Tier I and Total Risk-
Based capital ratios were 11.5 percent, 13.0 percent and 14.2 percent,
respectively. At December 31, 1996 Leverage (Core), Tier I and Total Risk-Based
capital ratios were 10.6 percent, 12.0 percent and 13.3 percent, respectively.
The minimum regulatory requirement for Leverage (Core), Tier I and Risk-Based
capital are 4.0 percent, 4.0 percent and 8.0 percent, respectively. As of March
31, 1997, the Association's capital position was designated as "well
capitalized" for regulatory purposes.
The Company's shareholders' equity increased $2.9 million from December 31,
1996 to March 31, 1997 due to the accumulation of $2.9 million in net income as
retained earnings and a $.1 million increase from the exercise of employee stock
options, offset by a $.1 million reduction due to a decline in the fair market
value of investment securities available for sale, net of the applicable income
tax benefit. There were no dividends declared or paid during the first three
months of 1997.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS
The Company is party to certain legal proceedings incidental to its
business. Management believes that the outcome of such proceedings,
in the aggregate, will not have a material effect on the Company's
business or financial condition.
ITEM 2 CHANGES IN SECURITIES
Not applicable.
ITEM 3 DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4 SUBMISSION OF MATTERS OF SECURITY HOLDERS
Not applicable.
ITEM 5 OTHER INFORMATION
Not applicable.
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 27 - Financial Data Schedule.
(b) A report was filed on April 14, 1997 announcing that the Company had
approved a stock repurchase plan. No financial statements were
filed as part of this report.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ITLA CAPITAL CORPORATION
Date: May 14, 1997 /s/ George W. Haligowski
------------ ---------------------------
George W. Haligowski
Chairman of the Board, President
and Chief Executive Officer
Date: May 14, 1997 /s/ Michael A. Sicuro
------------ ---------------------------
Michael A. Sicuro
Managing Director and Chief
Financial Officer
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 40,503
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 60,180
<INVESTMENTS-CARRYING> 29,871
<INVESTMENTS-MARKET> 29,121
<LOANS> 664,922
<ALLOWANCE> 10,847
<TOTAL-ASSETS> 810,494
<DEPOSITS> 669,582
<SHORT-TERM> 33,500
<LIABILITIES-OTHER> 9,235
<LONG-TERM> 6,000
0
0
<COMMON> 53,398
<OTHER-SE> 38,779
<TOTAL-LIABILITIES-AND-EQUITY> 810,494
<INTEREST-LOAN> 17,795
<INTEREST-INVEST> 1,961
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 19,756
<INTEREST-DEPOSIT> 9,480
<INTEREST-EXPENSE> 10,069
<INTEREST-INCOME-NET> 9,687
<LOAN-LOSSES> 600
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,526
<INCOME-PRETAX> 4,909
<INCOME-PRE-EXTRAORDINARY> 2,906
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,906
<EPS-PRIMARY> 0.36
<EPS-DILUTED> 0.36
<YIELD-ACTUAL> 9.90
<LOANS-NON> 8,688
<LOANS-PAST> 0
<LOANS-TROUBLED> 2,102
<LOANS-PROBLEM> 8,829
<ALLOWANCE-OPEN> 10,885
<CHARGE-OFFS> 648
<RECOVERIES> 10
<ALLOWANCE-CLOSE> 10,847
<ALLOWANCE-DOMESTIC> 10,847
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,000
</TABLE>
