SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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):
October 10, 1996
MARK TWAIN BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
MISSOURI
(State or other jurisdiction of incorporation)
0-4543
----------------------
Commission file Number
43-0895344
----------------------------------
IRS Employer Identification Number
8820 Ladue Road, St. Louis, Missouri 63124
----------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(314) 727-1000
----------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE>
ITEM 5. OTHER EVENTS
- --------------------
The earning release dated October 10, 1996 announcing earnings for
the third quarter and year ending September 30, 1996 is contained
in Exhibit 99 and is incorporated by reference herein.
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.
MARK TWAIN BANCSHARES, INC.
(Registrant)
Date: October 10, 1996 /s/ KEVIN J. CODY
-------------------------------
Kevin J. Cody
Vice President, Treasurer/
Assistant Secretary
(Principal Accounting Officer)
EXHIBIT INDEX
99. Earnings release for the third quarter and year
ending September 30, 1996.
EXHIBIT 99
CONTACT: Keith Miller
(314) 889-0799
FOR IMMEDIATE RELEASE
MARK TWAIN'S THIRD QUARTER EARNINGS INCREASE 10.2%
TO SET 22ND CONSECUTIVE QUARTERLY RECORD
St. Louis, Mo., October 10, 1996 . . . Mark Twain Bancshares, Inc. today
announced a 10.2% increase in third quarter 1996 earnings over third quarter
1995. Income from the period was $13.46 million, the 22nd consecutive quarterly
record for the 32-year-old company.
Fully diluted earnings per share increased 12.3% to $.82 for the same period,
compared to $.73 for the third quarter 1995. Primary earnings per share for the
third quarter grew 10.7% to $.83, up from $.75 in the third quarter 1995.
Return on average assets was 1.82% in the third quarter, compared to 1.74% in
the third quarter 1995 and 1.78% in the second quarter 1996. Return on average
realized common shareholders' equity was 18.86% for the third quarter, compared
to 18.49% for the third quarter 1995 and 18.77% for second quarter 1996.
For the nine months of 1996, Mark Twain's earnings totaled $38.97 million, an
increase of 10.7% from $35.22 million earned for the same period in 1995. Fully
diluted earnings per share totaled $2.35, an 11.4% increase over 1995 results
of $2.11 per share. Primary earnings per common share for the nine-month period
were $2.38, up 9.7% compared to $2.17 for the same period in 1995.
Return on average assets for the first nine months of 1996 was 1.77%, compared
to 1.72% for the same period last year. Return on average realized
shareholders' equity was 18.58%, compared to 18.45% a year ago.
"Our third quarter results give every indication that Mark Twain is headed for
yet another record year," says John P. Dubinsky, Mark Twain Bancshares president
and chief executive officer. "We continually strive to achieve new standards
of excellence. It's this philosophy that has placed Mark Twain among the top-
performing banks in the country."
Net interest income, on a fully tax equivalent basis, was $32.00 million for the
third quarter 1996, compared to $32.47 million for the third quarter 1995 and
$31.60 million in the second quarter of 1996. Net interest income for the first
nine months of 1996 was $95.25 million, compared to $97.29 million for the same
period in 1995. Net interest margin for the third quarter 1996 was 4.61%,
compared to 4.98% in the third quarter 1995 and 4.62% for the second quarter
1996. For the nine-month period, net interest margin was 4.62%, compared to
5.10% for the same nine months of 1995.
In September 1996, Mark Twain acquired Northland Bancshares, Inc., owner of
First National Bank of Platte County. First National Bank of Platte County
operates four locations in the Kansas City north area and has total assets of
$71.538 million, total loans of $39.431 million and total deposits of $62.113
million. The transaction was accounted for under
- more -
<PAGE> 2
Mark Twain Earnings - Add One
the pooling-of-interests method of accounting. Prior financial information was
not restated as the transaction was not material to the consolidated financial
position or results of operations of Mark Twain.
Mark Twain's total assets, including First National Bank of Platte County, were
$3.148 billion at September 30, 1996, an increase of 11.1% over the end of third
quarter last year. Average loans for the third quarter 1996 were $2.042
billion, compared to $1.939 billion for the third quarter 1995. Average earning
assets for the third quarter 1996 were $2.761 billion, an increase of 6.8% over
the third quarter 1995 average.
Mark Twain's asset quality remained strong in the third quarter of 1996 with
non-performing assets representing .53% of total loans plus foreclosed real
estate, compared to 1.00% a year ago and 1.00% at year-end 1995. Non-performing
assets at the end of third quarter 1996 were $11.386 million compared to $19.464
million at the end of third quarter last year. Mark Twain continues to
experience low loan loss levels. The loan loss reserve represents 1.50% of
total loans and 374.80% of non-performing loans, compared to 1.55% and 323.90%,
respectively, at the end of third quarter 1995. Net charge-offs for the nine-
month period were .05% of average loans (annualized rate of .07%) down from .11%
(.15% annualized rate) for the first nine months of 1995 and .18% for all of
1995.
The Capital Markets Group, which includes bond and brokerage operations, while
showing a slight decrease in revenues for the third quarter 1996, compared to
the same period last year, recorded a 10.8% increase in revenues for the first
nine months of 1996, compared to the same period last year.
For the first nine months of 1996, Mark Twain's efficiency ratio was 48.66%,
compared to 51.85% for the first nine months of 1995.
On September 19, 1996, Mark Twain began trading its common stock on the New York
Stock Exchange under the symbol MTB. "The NYSE is the most widely recognized
exchange in the world," says Dubinsky. "Given our company's growth and global
presence, we believe this move represents another step in the evolution of Mark
Twain. Moreover, we are confident that this forum will provide the most orderly
trading for our stock, will increase the liquidity of our common stock, and will
broaden our recognition within the investment community."
Mark Twain Bancshares, Inc. is a 32-year-old bank holding company with 39
banking locations in three states: 20 throughout St. Louis, St. Louis County,
and St. Charles County, as well as 15 in the Kansas City metropolitan area, and
4 in the Illinois communities of Belleville and Edwardsville. Related financial
services include: Mark Twain Capital Markets Group; Mark Twain Brokerage
Services, Inc.; Mark Twain Commercial Finance Division; Mark Twain International
Division; Mark Twain Leasing Division; and Mark Twain Trust Division. Mark
Twain stock is traded on the New York Stock Exchange under the symbol MTB. Mark
Twain Banks' World Wide Web address is at http://www.marktwain.com.
###
<PAGE> 3
MARK TWAIN BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
September 30, December 31,
-------------------------
(in thousands of dollars) 1996 1995 1995
- ------------------------------------------------------------------------------------ ------------ ------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 169,932 $ 122,380 $ 156,207
Federal funds sold and securities
purchased under resale agreements 15,879 4,528 7,900
Held to maturity securities 225,384 351,325 244,094
Available for sale securities 459,690 245,312 445,808
Trading securities 43,669 62,697 63,579
Loans, net of allowance for loan losses of
$32,068, $30,048 and $30,508, respectively 2,111,150 1,908,537 1,941,431
Premises and equipment 21,283 21,538 20,764
Accrued income receivable 18,096 18,500 17,830
Other assets 82,850 99,101 70,618
- ---------------------------------------------------------------------------------- ---------- ----------
Total assets $3,147,933 $2,833,918 $2,968,231
- ------------------------------------------------------------------------========== ========== ==========
LIABILITIES
Non-interest bearing deposits $ 449,001 $ 428,686 $ 519,155
Interest bearing deposits 1,983,483 1,905,133 1,938,237
- ---------------------------------------------------------------------------------- ---------- ----------
Total deposits 2,432,484 2,333,819 2,457,392
- ---------------------------------------------------------------------------------- ---------- ----------
Short-term borrowings 359,192 146,393 165,731
Other liabilities 64,399 70,422 50,712
Long-term debt 2,425 19,423 18,490
- ---------------------------------------------------------------------------------- ---------- ----------
Total liabilities 2,858,500 2,570,057 2,692,325
- ---------------------------------------------------------------------------------- ---------- ----------
SHAREHOLDERS' EQUITY
Common stock, $1.25 par value, authorized
30,000,000 shares, issued 16,871,183,
16,449,510 and 16,508,220 shares, respectively 21,089 20,562 20,635
Surplus 67,077 62,423 63,630
Undivided profits 219,932 186,743 194,888
Net unrealized gains (losses) on available
for sale securities (3,981) (1,628) 1,026
- ---------------------------------------------------------------------------------- ---------- ----------
304,117 268,100 280,179
Less common treasury stock at cost, 486,461,
389,579, and 362,685 shares, respectively 14,684 4,239 4,273
- ---------------------------------------------------------------------------------- ---------- ----------
Total shareholders' equity 289,433 263,861 275,906
- ---------------------------------------------------------------------------------- ---------- ----------
Total liabilities and shareholder's equity $3,147,933 $2,833,918 $2,968,231
- ------------------------------------------------------------------------========== ========== ==========
</TABLE>
<PAGE> 4
MARK TWAIN BANCSHARES, INC.
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
<CAPTION>
For the Nine Months For the Three Months
Ended September 30, Ended September 30,
(in thousands of dollars except per share data) 1996 1995 1996 1995
- ------------------------------------------------------------------------------------------------ ---------------------
<S> <C> <C> <C> <C>
INTEREST FROM EARNING ASSETS
Interest and fees on loans $134,902 $135,477 $45,679 $46,251
Interest on held to maturity securities:
Taxable 11,543 17,235 3,682 5,744
Non-taxable 101 142 33 33
Interest on available for sale securities 20,903 11,139 6,863 3,730
Interest on trading securities 4,401 2,113 544 678
Interest on federal funds sold and securities
purchased under resale agreements 359 563 130 264
- ------------------------------------------------------------------------------------------------ --------------------
Total interest income 170,209 166,669 56,931 56,700
- ------------------------------------------------------------------------------------------------ --------------------
INTEREST EXPENSE
Interest on deposits 66,012 62,196 22,011 22,512
Interest on short-term borrowings 9,482 6,938 3,206 1,624
Interest on long-term debt 309 1,165 35 381
- ------------------------------------------------------------------------------------------------ --------------------
Total interest expense 75,803 70,299 25,252 24,517
- ------------------------------------------------------------------------------------------------ --------------------
Net interest income 94,406 96,370 31,679 32,183
Provision for loan losses 2,001 3,344 506 713
- ------------------------------------------------------------------------------------------------ --------------------
Net interest income after provision for loan losses 92,405 93,026 31,173 31,470
- ------------------------------------------------------------------------------------------------ --------------------
OTHER INCOME
Service charges on deposit accounts 6,061 5,220 2,056 1,803
Securities transactions 234 46 - -
Other income 22,905 22,123 7,673 7,281
- ------------------------------------------------------------------------------------------------ --------------------
Total other income 29,200 27,389 9,729 9,084
- ------------------------------------------------------------------------------------------------ --------------------
OTHER EXPENSES
Salaries 31,692 31,098 10,333 10,530
Employee benefits 5,276 5,202 1,424 1,569
Net occupancy expense 6,716 7,040 2,257 2,326
Furniture and equipment expense 2,581 2,894 831 917
Other expenses 14,173 18,386 4,646 5,398
- ------------------------------------------------------------------------------------------------ --------------------
Total other expenses 60,438 64,620 19,491 20,740
- ------------------------------------------------------------------------------------------------ --------------------
Income before income taxes 61,167 55,795 21,411 19,814
Applicable income taxes 22,197 20,579 7,947 7,591
- ------------------------------------------------------------------------------------------------ --------------------
Net income $ 38,970 $ 35,216 $13,464 $12,223
- ---------------------------------------------------------------------------===================== ====================
NET INCOME PER SHARE
- ------------------------------------------------------------------------------------------------ --------------------
Primary $2.38 $2.17 $0.83 $0.75
- ------------------------------------------------------------------------------================== ====================
Fully diluted $2.35 $2.11 $0.82 $0.73
- ------------------------------------------------------------------------------================== ====================
COMMON DIVIDENDS PAID PER SHARE $0.93 $0.81 $0.31 $0.27
- ------------------------------------------------------------------------------================== ====================
</TABLE>
<PAGE> 5
MARK TWAIN BANCSHARES, INC.
CONSOLIDATED BALANCE SHEET AND NET INTEREST MARGIN
<TABLE>
<CAPTION>
Nine Months Ended September 30, 1996 Nine Months Ended September 30, 1995
------------------------------------- -------------------------------------
Average Yield/ Average Yield/
(in thousands of dollars) Balance Interest Rate Balance Interest Rate
- ----------------------------------------------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest earning assets:
Loans <F1><F2> $2,007,793 $135,647 9.02% $1,908,842 $136,259 9.54%
Taxable held to maturity securities 237,914 11,543 6.48% 342,340 17,235 6.73%
Non-taxable held to maturity securities<F1> 2,581 155 8.02% 3,450 218 8.45%
Available for sale securities<F1> 449,195 20,948 6.23% 241,718 11,198 6.19%
Trading securities 50,411 2,401 6.36% 43,462 2,113 6.50%
Federal funds sold and securities
purchased under resale agreements 7,726 359 6.21% 12,506 563 6.02%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest earning assets 2,755,620 171,053 8.29% 2,552,318 167,586 8.78%
- ------------------------------------------------------------------------------ ----------------------------------
Cash and due from banks 109,394 107,416
Other assets 110,738 122,492
FASB No. 115 allowance (4,435) (7,483)
Allowance for loan losses (31,033) (29,559)
- ------------------------------------------------------ ----------
Total $2,940,284 $2,745,184
- --------------------------------------------========== ==========
LIABILITIES AND SHAREHOLDER'S EQUITY
Interest bearing demand deposits $ 226,066 3,350 1.98% $ 227,050 3,631 2.14%
Savings and money market deposits 686,381 18,715 3.64% 677,893 19,401 3.83%
Time deposits 1,038,722 43,947 5.65% 956,563 39,164 5.47%
Short-term borrowings 252,711 9,482 5.01% 168,407 6,938 5.51%
Long-term debt 6,133 309 6.73% 19,986 1,165 7.79%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest bearing liabilities 2,210,013 75,803 4.58% 2,049,899 70,299 4.59%
- ------------------------------------------------------------------------------ ----------------------------------
Non-interest bearing deposits 405,756 394,997
Other liabilities 47,052 49,764
Shareholders' equity 277,463 250,524
- ------------------------------------------------------ ----------
Total $2,940,284 $2,745,184
- --------------------------------------------========== ==========
Net interest income $ 95,250 $ 97,287
- -----------------------------------------------------------======== ========
Net interest margin 4.62% 5.10%
- -------------------------------------------------------------------------===== =====
<FN>
<F1>Adjusted to a fully taxable basis using federal statutory rate of 35% in 1996 and 1995.
<F2>Includes non-accrual loans.
</FN>
</TABLE>
<PAGE> 6
MARK TWAIN BANCSHARES, INC.
CONSOLIDATED BALANCE SHEET AND NET INTEREST MARGIN
<TABLE>
<CAPTION>
Three Months Ended September 30, 1996 Three Months Ended September 30, 1995
------------------------------------- -------------------------------------
Average Yield/ Average Yield/
(in thousands of dollars) Balance Interest Rate Balance Interest Rate
- ----------------------------------------------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest earning assets:
Loans <F1><F2> $2,042,291 $45,962 8.95% $1,938,629 $46,499 9.52%
Taxable held to maturity securities 228,066 3,682 6.42% 340,321 5,744 6.70%
Non-taxable held to maturity securities<F1> 2,536 51 8.00% 2,469 50 8.03%
Available for sale securities<F1> 445,451 6,878 6.14% 243,887 3,749 6.10%
Trading securities 35,437 544 6.11% 43,060 678 6.25%
Federal funds sold and securities
purchased under resale agreements 7,690 130 6.73% 17,839 264 5.87%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest earning assets 2,761,471 57,247 8.25% 2,586,205 56,984 8.74%
- ------------------------------------------------------------------------------ ----------------------------------
Cash and due from banks 109,029 109,197
Other assets 108,292 124,735
FASB No. 115 allowance (8,792) (2,955)
Allowance for loan losses (31,218) (30,105)
- ------------------------------------------------------ ----------
Total $2,938,782 $2,787,077
- --------------------------------------------========== ==========
LIABILITIES AND SHAREHOLDER'S EQUITY
Interest bearing demand deposits $ 218,393 1,090 1.99% $ 223,681 1,212 2.15%
Savings and money market deposits 692,645 6,356 3.65% 668,569 6,539 3.88%
Time deposits 1,035,331 14,565 5.60% 1,023,558 14,761 5.72%
Short-term borrowings 256,941 3,206 4.96% 124,524 1,624 5.17%
Long-term debt 2,580 35 5.40% 19,716 381 7.67%
- ------------------------------------------------------------------------------ ----------------------------------
Total interest bearing liabilities 2,205,890 25,252 4.55% 2,060,048 24,517 4.72%
- ------------------------------------------------------------------------------ ----------------------------------
Non-interest bearing deposits 410,448 407,513
Other liabilities 43,807 59,032
Shareholders' equity 278,637 260,484
- ------------------------------------------------------ ----------
Total $2,938,782 $2,787,077
- --------------------------------------------========== ==========
Net interest income $31,995 $32,467
- ------------------------------------------------------------======= =======
Net interest margin 4.61% 4.98%
- -------------------------------------------------------------------------===== =====
<FN>
<F1>Adjusted to a fully taxable basis using federal statutory rate of 35% in 1996 and 1995.
<F2>Includes non-accrual loans.
</FN>
</TABLE>
<PAGE> 7
MARK TWAIN BANCSHARES, INC.
SUMMARY OF ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
--------------------------- -----------------------------
(in thousands of dollars) 1996 1995 1996 1995
- ----------------------------------------------------------------------------------- -----------------------------
<S> <C> <C> <C> <C>
Allowance at beginning of period $30,508 $28,894 $31,198 $29,961
Allowance of acquired banks 586 - 586 -
Charge-offs (1,981) (2,957) (397) (910)
Recoveries 954 767 175 284
- ----------------------------------------------------------------------------------- ----------------------------
Net charge-offs (1,027) (2,190) (222) (626)
- ----------------------------------------------------------------------------------- ----------------------------
Additions to allowance charged to expense 2,001 3,344 506 713
- ----------------------------------------------------------------------------------- ----------------------------
Allowance at end of period $32,068 $30,048 $32,068 $30,048
- ----------------------------------------------------------========================= ============================
Loans, net of unearned income at end of period $2,143,218 $1,938,585 $2,143,218 $1,938,585
Average loan balance for the period $2,007,793 $1,908,842 $2,042,291 $1,938,629
Allowance as % of loans at end of period 1.50% 1.55%
Allowance as % of non-performing loans 374.80% 323.90%
Net charge-offs as % of average loans for the period 0.05% 0.11% 0.01% 0.03%
Annualized net charge-offs as % of average loans
for the period 0.07% 0.15% 0.04% 0.13%
</TABLE>
<PAGE> 8
MARK TWAIN BANCSHARES, INC.
NON-PERFORMING ASSETS
<TABLE>
<CAPTION>
September 30, June 30, March 31, December 31,
(in thousands of dollars) 1996 1996 1996 1995
- ------------------------------ ----------------- ----------- ------------ --------------
<S> <C> <C> <C> <C>
Non-accrual loans $ 5,596 $ 6,531 $ 7,764 $13,663
Restructured loans 2,275 2,100 109 109
Foreclosed property 3,515 4,436 6,105 6,099
------- ------- ------- -------
Total non-performing assets $11,386 $13,067 $13,978 $19,871
======= ======= ======= =======
Percentage of non-performing assets
to loans plus foreclosed property 0.53% 0.65% 0.69% 1.00%
Loans contractually past due ninety
days or more $685 $691 $836 $530
Percentage of non-performing assets
plus ninety days past due to loans
plus foreclosed property 0.56% 0.68% 0.73% 1.03%
Percentage of allowance to
non-performing loans 374.80% 334.67% 358.23% 213.31%
Percentage of allowance to total
non-performing assets 281.64% 238.75% 223.19% 153.53%
Percentage of allowance to
risk elements<F1> 265.66% 226.76% 210.60% 149.54%
Percentage of risk elements<F1>
to total average assets 0.41% 0.47% 0.50% 0.74%
<FN>
<F1> Risk elements include total non-performing assets plus loans contractually past due ninety days or more.
</FN>
</TABLE>
<PAGE> 9
MARK TWAIN BANCSHARES, INC.
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
For The Nine Months Ended For The Three Months Ended
September 30, September 30,
(in thousands of dollars except per share data) 1996 1995 1996 1995
- ------------------------------------------------------------------------------------- ---------------------------
<S> <C> <C> <C> <C>
PRIMARY
Earnings:
Net income $38,970 $35,216 $13,464 $12,223
- ----------------------------------------------------------=========================== ===========================
Shares:
Weighted average number of common shares outstanding 16,091,880 16,037,190 16,023,402 16,034,868
Weighted average number of common share equivalents 276,747 210,972 276,378 252,493
- ------------------------------------------------------------------------------------- ---------------------------
16,368,627 16,248,162 16,299,780 16,287,361
- ----------------------------------------------------------=========================== ===========================
Primary earnings per common share $2.38 $2.17 $0.83 $0.75
- ----------------------------------------------------------=========================== ===========================
ASSUMING FULL DILUTION
Earnings:
Net income $38,970 $35,216 $13,464 $12,223
After tax interest applicable to convertible notes 95 277 23 88
After tax amortization of capital note fees 58 34 12 13
- ------------------------------------------------------------------------------------- ---------------------------
Fully diluted net income $39,123 $35,527 $13,499 $12,324
- ----------------------------------------------------------=========================== ===========================
Shares:
Weighted average number of common shares outstanding 16,091,880 16,037,190 16,023,402 16,034,868
Assuming conversion of Convertible Notes and dilutive
stock options 574,331 791,370 505,473 769,089
- ------------------------------------------------------------------------------------- ---------------------------
16,666,211 16,828,560 16,528,875 16,803,957
- ----------------------------------------------------------=========================== ===========================
Earnings per common share assuming full dilution $2.35 $2.11 $0.82 $0.73
- ----------------------------------------------------------=========================== ===========================
</TABLE>
