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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
January 16, 1998
CLASSIC BANCSHARES, INC.
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(Exact name of Registrant as specified in its Charter)
Delaware 0-27170 61-1289391
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(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification
No.)
344 17th Street, Ashland, Kentucky 41101
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (606) 325-4789
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events
On January 16, 1998, the Registrant issued the press release attached
hereto as Exhibit 99 announcing its earnings for the quarter ended
December 31, 1997 and the declaration of a cash dividend.
Item 7. Financial Statements and Exhibits
(a) Exhibits
99 Press release dated January 16, 1998.
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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.
CLASSIC BANCSHARES, INC.
Date: January 27, 1998 By: /s/Lisah M. Frazier
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Lisah M. Frazier, Vice President,
Treasurer and Chief Financial
Officer
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EXHIBIT 99
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CLASSIC BANCSHARES, INC.
FOR IMMEDIATE RELEASE
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For Additional Information Contact:
David B. Barbour, President and Chief Executive Officer
Lisah Frazier, Vice President, Treasurer and Chief Financial Officer
(606) 325-4789
Fax (606) 324-1307
CLASSIC BANCSHARES, INC. ANNOUNCES THIRD QUARTER EARNINGS
AND DECLARES A CASH DIVIDEND
Ashland, Kentucky, -- January 16, 1998 -- Classic Bancshares, Inc.
(NASDAQ - CLAS) had net income for the third quarter ended December 31, 1997
of $281,000 compared to net income in the same quarter of 1996 of $258,000
and net income of $792,000 for the nine months ended December 31, 1997
compared to net income of $292,000 for the nine months ended December 31,
1996. Return on average assets was .8% for the quarter and nine months ended
December 31, 1997 compared to .8% and .4% for the quarter and nine months
ended December 31, 1996. Earnings per share were $.23 for the quarter ended
December 31, 1997 and $.65 for the nine months ended December 31, 1997 up
from $.21 and $.24 for the same periods in 1996.
Classic Bancshares' assets increased $1.2 million from $131.6 million at
March 31, 1997 to $132.8 million at December 31, 1997. The increase in
assets was due to an increase in loans partially offset by a decrease in cash
and investment securities. Loans increased $7.4 million from $81.7 million
at March 31, 1997 to $89.1 million at December 31, 1997. The increase in
loans is primarily the result of aggressive origination efforts and strong
loan demand within the Company's market areas. Deposits decreased $800,000
from $100.5 million at March 31, 1997 to $99.7 million at December 31, 1997.
Non-performing assets decreased from .7% of total assets at March 31, 1997 to
.4% at December 31, 1997.
President and Chief Executive Officer, David B. Barbour, stated that,
"Earnings continue to meet expectations as we continue to implement our
strategic plan objectives. Core earnings remain strong and continue to have
a positive impact on earnings per share. Aggressive pricing strategies
continue to increase non-interest income. Construction is almost complete on
two additional full service banking offices with one location scheduled to
open in mid February 1998 and the other location scheduled to open in March
1998. While the opening of these offices will be costly in the short term,
the addition of these offices positions us to attract lower cost deposits
through transaction accounts while increasing higher yielding loans through
a greater emphasis on commercial and consumer lending. The increased loan
yields and decreased cost of interest-bearing liabilities should result in an
increase in the net interest margin in future periods. In view of the strong
loan demand exhibited in recent quarters, we are pleased that non-performing
assets remain significantly below that of our peers."
Net interest income was $1.2 million for the quarter ended December 31,
1997 and $3.5 million for the nine months ended December 31, 1997 as compared
to $1.2 million for the quarter ended December 31, 1996 and $2.3 million for
the nine months ended December 31, 1996. The increase in net interest income
for the nine month period resulted primarily from the inclusion of the
earnings of the First National Bank of Paintsville for the entire nine month
period ended December 31, 1997 compared to the inclusion of only three months
of earnings for First National for the nine months ended December 31, 1996.
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The acquisition of First National was completed on September 30, 1996 and was
accounted for under the purchase method of accounting. The net interest
margin was 3.9% for the quarter and nine months ended December 31, 1997 as
compared to 4.0% for the quarter ended December 31, 1996 and 3.8% for the
nine months ended December 31, 1996.
Non-interest income was $156,000 for the quarter ended December 31, 1997
and $682,000 for the nine months ended December 31, 1997 compared to $105,000
for the quarter ended December 31, 1996 and $114,000 for the nine months
ended December 31, 1996. The increase between quarters was due to an
increase in fees and service charges on deposits. The increase in
non-interest income for the nine month period was primarily the result of a
$330,000 gain recorded from the settlement of First National's pension plan.
The settlement of the pension plan is the result of merging First National's
plan into Classic Bank's pension plan thereby creating one pension plan for
the Company. Non-interest income for the nine month period also increased
due to an increase in fees and service charges on deposit accounts.
Total non-interest expense for the quarter ended December 31, 1997 was
$911,000 and $3.0 million for the nine months ended December 31, 1997
compared to $822,000 for the quarter ended December 31, 1996 and $1.9 million
for the nine months ended December 31, 1996. The increase between quarters
resulted from increased personnel costs due to a net increase in the number
of employees, an increase in occupancy expense and an increase in marketing
and advertising and other general and administrative expenses. The increase
for the nine month period was primarily the result of the inclusion of First
National's expenses for the entire nine month period ended December 31, 1997
compared to the inclusion of only three months of expenses for the nine
months ended December 31, 1996.
Stockholders' equity was $19.9 million at December 31, 1997 as compared
to $19.4 million at March 31, 1997. The book value per share was $16.55 at
December 31, 1997 up from $15.73 per share at December 31, 1996.
Classic Bancshares, Inc. also announced that the Company will pay a
quarterly cash dividend of $.07 per share. The dividend will be payable on
February 9, 1998 to shareholders of record on January 26, 1998.
Classic Bancshares, Inc. is headquartered in Ashland, Kentucky and has
two subsidiaries, Classic Bank (formerly Ashland Federal Savings Bank) and
First National Bank of Paintsville. Classic Bank operates at 344 Seventeenth
Street, Ashland, Kentucky. First National Bank of Paintsville operates at
240 Main Street, Paintsville, Kentucky.
When used in this press release, the words or phrases "should result,"
"will likely result", "are expected to", "will continue", "is anticipated",
"estimate", "project" or similar expressions are intended to identify
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are subject to certain risks
and uncertainties, including changes in economic condition in the Company's
market area, changes in policies by regulatory agencies, fluctuations in
interest rates, demand for loans in the Company's market area and
competition, that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. The
Company wishes to caution readers not to place undue reliance on such
forward-looking statements, which speak only as of the date made. The
Company wishes to advise readers that the factors listed could affect the
Company's financial performance and could cause the Company's actual results
for future periods to differ materially from any opinions or statements
expressed with respect to future periods in any current statements.
The Company does not undertake-and specifically declines any
obligation-to publicly release the result of any revisions which may be made
to any forward-looking statements to reflect events or circumstances after
the date of such statements or to reflect the occurrence of anticipated or
unanticipated events.
SELECTED FINANCIAL DATA
The following tables set forth selected financial data of Classic
Banchares, Inc. as of December 31, 1997 and March 31, 1997 and for the
three and nine months ended December 31, 1997 and 1996.
<TABLE>
<CAPTION>
Dec. 31 March 31,
1997 1997
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(In Thousands)
Selected Financial Condition
Data:
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<S> <C> <C>
Total Assets $ 132,793 $ 131,554
Cash and other interest bearing deposits
with other financial institutions 3,418 9,127
Loans receivable, net 89,073 81,728
Investment securities:
Available for sale 21,625 23,375
Mortgage-backed securities:
Available for sale 8,230 7,885
Goodwill 2,933 3,026
Deposits 99,719 100,519
Securities sold under agreement to repurchase 3,529 4,956
FHLB advances 6,760 4,750
Stockholders' Equity, subject to certain restrictions 19,995 19,370
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<CAPTION>
Three Months Ended Nine Months Ended
December 31, December 31,
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1997 1996 1997 1996
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(In Thousands)
Selected Operations Data:
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<S> <C> <C> <C> <C>
Total interest income $2,391 $2,341 $7,145 $4,733
Total interest expense 1,216 1,190 3,614 2,464
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Net interest income 1,175 1,151 3,531 2,269
Provision for loan losses 25 37 127 67
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Net interest income after provision
for losses on loans 1,150 1,114 3,404 2,202
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Fees and service charges 111 61 269 66
Gain on sale of securities 10 8 28 8
Other noninterest income 35 36 385 40
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Total noninterest income 156 105 682 114
SAIF Assessment - - - - - - 316
Total noninterest expense 911 822 2,974 1,611
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Income before income taxes 395 397 1,112 389
Income tax expense (benefit) 114 139 320 97
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Net income $ 281 $ 258 $ 792 $ 292
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<CAPTION>
At or for the At or for the
Three Months Ended Nine Months Ended
December 31, December 31,
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1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Other Data:
Return on average assets (ratio of net
income to total average assets)* .8% .8% .8% .4%
Return on average equity (ratio of net
income to total average assets)* 5.7 5.4 5.4 2.0
Net interest margin** 3.9 4.0 3.9 3.8
Non-performing assets to total assets 0.4 0.9 0.4 0.9
Allowance for loan losses to non-
performing loans 252.4 102.5 252.4 102.5
Equity to total assets at end of period 15.1 14.9 15.1 14.9
Efficiency ratio*** 68.4 62.3 70.6 79.9
Basic earnings per share $0.23 $0.21 $0.65 $0.24
Number of full service offices 3 3 3 3
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* Annualized
** Net interest income annualized divided by average-earning assets.
*** Non-interest expenses divided by the total of net interest income and
non-interest income.
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