<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from to .
Commission File Number: 000-21553
METROPOLITAN BANK AND TRUST
COMPANY 401(K) PLAN
(Full title of the plan)
METROPOLITAN FINANCIAL CORP.
6001 LANDERHAVEN DRIVE
Mayfield Heights, Ohio 44124
(440) 646-1111
(Name of issuer of the securities held pursuant to the
plan and address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
Financial Statements. The following financial statements and schedules are filed
as part of this annual report and appear immediately after the signature page
hereof:
1. Independent Auditors' Report
2. Statement of Net Assets Available for Benefits
3. Statement of Changes in Net Assets Available for Benefits
4. Notes to Financial Statements
5. Schedule of Assets Held for Investment Purposes at the End of
Year
6. Schedule of Reportable Transactions
Exhibits. The following exhibit is filed as part of this annual report:
Exhibit 23 - Consent of Crowe, Chizek and Company LLP
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
administrator of the employee benefit plan has duly caused this annual report to
be signed on its behalf by the undersigned hereunto duly authorized.
METROPOLITAN BANK AND TRUST COMPANY
401(K) PLAN
By: METROPOLITAN BANK AND TRUST
COMPANY
By: /s/ Donald Smith
-------------------------------
Donald Smith, Chief Financial Officer
Date: November 9, 2000
<PAGE> 3
REPORT OF INDEPENDENT AUDITORS
Plan Administrator
Metropolitan Bank and Trust 401(k) Plan
Cleveland, Ohio
We have audited the accompanying statements of net assets available for benefits
of the Metropolitan Bank and Trust 401(k) Plan as of December 31, 1999 and 1998,
and the related statement of changes in net assets available for benefits for
the year ended December 31, 1999. These financial statements and schedules are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 1999 and 1998 and the changes in net assets available for benefits
for the year ended December 31, 1999 in conformity with generally accepted
accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes and of reportable transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedules
have been subjected to the auditing procedures applied in the audit of the basic
financial statements and in our opinion, are fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
Crowe, Chizek and Company LLP
Cleveland, Ohio
August 4, 2000
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3.
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METROPOLITAN BANK AND TRUST
401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 1999 and 1998
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<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
ASSETS
Short-term investments $ 818,920 $ 717,294
Mutual funds 3,612,825 2,971,292
Metropolitan Financial Corp. common stock 168,592 --
Participant loans 120,768 94,556
---------- ----------
Total investments 4,721,105 3,783,142
Receivables
Employer contribution 57,514 21,097
Employee contribution 22,615 50,621
Loan payments -- 4,595
---------- ----------
Total assets 4,801,234 3,859,455
---------- ----------
LIABILITIES
Accounts payable 8,321 --
Distributions payable -- 20,228
---------- ----------
Total liabilities 8,321 20,228
---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $4,792,913 $3,839,227
========== ==========
</TABLE>
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See accompanying notes to financial statements.
4.
<PAGE> 5
METROPOLITAN BANK AND TRUST
401(k) PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year ended December 31, 1999
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<TABLE>
<CAPTION>
1999
----
<S> <C>
Investment income
Net appreciation in fair value
of investments $ 7,359
Interest and dividends 376,323
----------
Total investment income 383,682
Contributions:
Employer 246,821
Participant 621,683
Rollover 94,852
----------
Total contributions 963,356
Deductions:
Distributions to participants 376,942
Fees and expenses 16,410
----------
Total deductions 393,352
----------
NET INCREASE 953,686
Net assets available for benefits
Beginning of year 3,839,227
----------
End of year $4,792,913
==========
</TABLE>
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See accompanying notes to financial statements.
5.
<PAGE> 6
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The policies and principles of the Metropolitan Bank and Trust 401(k) Plan
(Plan) which significantly affect the determination of net assets and changes in
net assets are summarized below.
Basis of Accounting: The financial statements of the Plan are prepared under the
accrual method of accounting.
Estimates: The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Significant estimates include the fair values of the mutual
funds. Actual results could differ from those estimates.
Investment Valuation and Income Recognition: The Plan's investments are stated
at fair value. If available, quoted market prices are used to value investments.
The amounts shown in Note 3 for securities that have no quoted market price
represent estimated fair value.
Interest income is recorded on the accrual basis.
Net Appreciation in Fair Value of Investments: In accordance with the policy of
stating investments at fair value, the change in the net appreciation for the
year is reflected in the statement of changes in net assets available for
benefits. It consists of both net appreciation realized on purchases and sales
of investments and net unrealized appreciation resulting from the change in the
difference between market value and cost of investments at the beginning and end
of the year.
NOTE 2 - DESCRIPTION OF PLAN
The following description of the Plan provides only general information.
Participants should refer to the Plan document for a more complete description
of the Plan's provisions.
General: The Plan is a defined contribution plan covering all eligible employees
of Metropolitan Bank and Trust (the Bank). Any employee who has completed 30
days of service and is at least 21 years old is eligible to participate. The
Plan is subject to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA). The plan was amended on April 27 1999 to allow the participants
to purchase qualifying employer securities and qualifying employer real
property. The plan was also amended on May 25, 1999 which changed the terms and
conditions of the plan. Significant plan amendments included a change in the
definition of compensation, a change in the eligibility requirements for the
plan and a change in the employer discretionary contribution.
Contributions: Participants may make salary deferral contributions at their
discretion of up to 20% of annual compensation. Matching contributions are made
by the employer on behalf of participants with at least one year of service who
make elective compensation deferrals, at the rate of 50% of the first 6% of
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(Continued)
6.
<PAGE> 7
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 2 - DESCRIPTION OF PLAN (Continued)
the participant's compensation deferred under the plan. In addition to the
employer matching contribution as described above, the Board of Directors of the
Bank can provide for an additional contribution on a discretionary basis. The
additional contribution is allocated based on annual compensation. To be
eligible to receive the additional contribution, an employee must work 1,000
hours and be employed on the last day of the plan year.
Participant Accounts: Each participant's account is credited with the
participant's contributions, the Employer's matching contribution and an
allocation of the amount of a) the Employer's discretionary contribution b) plan
earnings, and c) forfeitures of terminated participants' nonvested accounts.
Forfeitures are allocated based on the employee's compensation. Plan earnings
are allocated based on account balances, as defined in the Plan.
Vesting: Participants are immediately vested in their salary deferral
contribution, special compliance contributions, rollover contributions and any
earnings or losses thereon. Employer matching and discretionary contributions
and earnings or losses thereon vest based on years of credited service.
Participants vest 20% per year of credited service and are 100% vested after
five years of credited service.
Benefits and Withdrawals: Distributions of a participant's interest will be made
upon death, permanent disability, retirement, or termination. A participant may
request a distribution from the participant's accounts to meet an immediate
financial hardship pursuant to guidelines by the Internal Revenue Service.
Loans: Participants may borrow 50% of their vested account balance up to a
maximum of $50,000 minus any loan amounts repaid in the last 12 months. The
minimum loan request is $1,000.
Separate Investment Programs: Plan participants direct the investment of their
account balances among several investment alternatives made available by the
Plan Administrator. Employer contributions are allocated based upon each
participant's investment direction.
American Funds Bond Fund of America: Funds are invested in a portfolio
of bonds and fixed-income obligations.
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(Continued)
7.
<PAGE> 8
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 2 - DESCRIPTION OF PLAN (Continued)
American Funds Income Fund of America: Funds are invested in a
portfolio of stocks and bonds.
American Funds Investment Company of America: Funds are invested
primarily in common stocks.
American Funds Fundamental Investors: Funds are invested primarily in
large, well-known U.S. companies in areas such as broadcasting,
publishing, banking, manufacturing, business, public services and
utilities.
American Funds Washington Mutual Investors Fund: Funds are invested
only in securities that meet the fund's strict "Eligible List"
criteria, which eliminates all but about 300 of the more than 2,700
companies currently traded on the New York Stock Exchange.
American Funds Smallcap World Fund: Funds are invested in a diverse
group of the world's smaller companies, representing both high-growth
industries as well as companies with above average performance in more
mature industries.
American Funds EuroPacific Growth Fund: Funds are invested in non-U.S.
companies which appear to offer above-average growth potential.
American Funds U.S. Treasury Money Fund of America: Funds are invested
in U.S. Treasury securities maturing in one year or less.
Metropolitan Stock Fund: Funds are invested in Metropolitan Financial
Corp. stock
Metropolitan Bank Fund: Funds are invested in a money market fund and
certificates of deposit at the Bank. The mix of investments within this
fund is at the sole-discretion of the Plan Administrator.
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(Continued)
8.
<PAGE> 9
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 3 - INVESTMENTS
The following table presents the fair value of investments.
<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
Investments at fair value as determined by quoted
market price:
American Funds:
Bond Fund of America $ 74,803 $ 70,942
Income Fund of America 292,644 314,282
Investment Company of America 1,416,759 1,291,533
Fundamental Investors 518,468 361,776
Washington Mutual Investors Fund 881,022 711,882
Smallcap World Fund 219,365 153,393
U.S. Treasury Money Fund 4,523 --
Europacific Growth Fund 205,241 67,484
---------- ----------
3,612,825 2,971,292
Metropolitan Financial Corp. common stock 168,592 --
Investments at estimated fair value:
Metropolitan Bank Fund:
Metropolitan Money Market Fund 15,096 147,694
Metropolitan Deposit Accounts 803,824 569,600
---------- ----------
818,920 717,294
Participant Loans 120,768 94,556
---------- ----------
Total Investments $4,721,105 $3,783,142
========== ==========
</TABLE>
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(Continued)
9.
<PAGE> 10
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 3 - INVESTMENTS (Continued)
During 1999, the Plan's investments (including gains and losses on investments
bought and sold, as well as held during the year) appreciated in value as
follows:
Investments at fair value as determined by quoted
market price:
American Funds:
Bond Fund of America $ (3,801)
Income Fund of America (28,672)
Investment Company of America 65,187
Fundamental Investors 51,261
Washington Mutual Investors Fund (88,678)
Smallcap World Fund 83,267
U.S. Treasury Money Fund 51
Europacific Growth Fund 52,806
Metropolitan Financial Corp. common stock (124,062)
---------
Net appreciation in fair value $ 7,359
=========
Subsequent to December 31, 1999, the investment alternatives made available by
the Plan Administrator were changed.
NOTE 4 - TAX STATUS
The Plan has received a favorable determination letter from the Internal Revenue
Service as to the tax qualified status of the Plan.
NOTE 5 - PARTY-IN-INTEREST TRANSACTIONS
Parties-in-interest are defined under Department of Labor Regulations as any
fiduciary of the plan, any party rendering services to the plan, the employer,
and certain others. Transactions during the year with parties-in-interest
included investments in a money market fund and certificates of deposit of the
employer and investments in common stock with the parent company of the
employer.
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(Continued)
10.
<PAGE> 11
METROPOLITAN BANK AND TRUST
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
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NOTE 5 - PARTY-IN-INTEREST TRANSACTIONS (Continued)
The plan permits the Trustee to pool the assets of the Metropolitan Bank and
Trust 401(k) Plan Trust Fund with assets belonging to any other qualified
employee pension benefit trust created by an affiliated company of the Plan
sponsor. The Trustee has pooled the assets of the Plan with the assets of a plan
covering the employees of Planned Residential Communities Management Company,
Inc., an affiliated company of the Plan sponsor. Each plan has an undivided
interest in the pooled assets of the two trusts in accordance with their
respective interests. The amounts presented in these financial statements
represent the portion attributable to this plan only.
NOTE 6 - PLAN TERMINATION
Although it has not expressed any intent to do so, the Bank has the right under
the Plan to discontinue its contributions at any time and to terminate the Plan
subject to the provisions of ERISA. In the event of plan termination,
participants will become 100 percent vested in their accounts.
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11.
<PAGE> 12
METROPOLITAN BANK AND TRUST
401(k) PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
December 31, 1999
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ATTACHMENT TO FORM 5500, SCHEDULE H, PART IV, LINE 4I
Name of plan sponsor: Metropolitan Bank and Trust
Employer identification number: 34-0847574
Three-digit plan number: 002
<TABLE>
<CAPTION>
(c)
(b) Description of Investment
Identity of Issue, Including Maturity Date, (e)
Borrower, Lessor, Rate of Interest, Collateral, (d) Current
(a) or Similar Party Par or Maturity Value Cost Value
--- ---------------- --------------------- ---- -----
<S> <C> <C> <C> <C>
American Funds:
Bond Fund of America 5,763 units # $ 74,803
Income Fund of America 18,592 units # 292,644
Investment Company of America 43,646 units # 1,416,759
Fundamental Investors 15,909 units # 518,468
Washington Mutual Investors Fund 29,805 units # 881,022
Smallcap World Fund 5,605 units # 219,365
U.S. Treasury Fund 4,523 units # 4,523
Europacific Growth Fund 4,811 units # 205,241
Metropolitan Bank Fund:
* Metropolitan Money Market Fund 15,096
* Metropolitan Passbook, 4.89% 803,824
* Metropolitan Financial Corp. Stock 168,592
Participant Loans 120,768
----------
Total $4,721,105
==========
</TABLE>
# Cost basis not provided by American Funds.
* Considered parties-in-interest to the Plan.
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12.
<PAGE> 13
METROPOLITAN BANK AND TRUST
401(k) PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
Year ended December 31, 1999
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ATTACHMENT TO FORM 5500, SCHEDULE H, PART IV, LINE 4J
Name of plan sponsor: Metropolitan Bank and Trust
Employer identification number: 34-0847574
Three-digit plan number: 002
<TABLE>
<CAPTION>
(b)
Description (f) (h)
of asset Expense Current
(a) (including interest (c) (d) (e) incurred (g) value of asset (i)
Identity of rate and maturity Purchase Selling Lease with Cost on transaction Net gain
party involved in case of loan) price price rental transaction of asset date or (loss)
-------------- ---------------- ----- ----- ------ ----------- -------- ---- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
* Metropolitan Financial
Corp. Common stock $275,617 $275,617
</TABLE>
* Considered parties-in-interest to the Plan.
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13.
