<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
450 5TH STREET, N. W.
WASHINGTON, D. C. 20549
_________________________
FORM 10-QSB
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934
For the quarterly period ended December 31, 1996
-----------------
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 No. 0-27624
-------- --------
RELIANCE BANCSHARES, INC.
-------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-1834823
--------- ----------
(State of other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3140 South 27th Street, Milwaukee, Wisconsin 53215
- -------------------------------------------- -----
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (414) 671-2222
--------------
Not applicable
- --------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 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 .
--- ---
Indicate the number of shares outstanding of the issuer's classes of common
stock as of the latest practicable date.
Class Outstanding December 31, 1996
----- -----------------------------
Common Stock, par value $1.00 per share 2,528,499 shares
<PAGE> 2
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
FORM 10-QSB
FOR THE QUARTER ENDED DECEMBER 31, 1996
INDEX
PAGE NO.
PART I - Financial Information
Consolidated Statements of Financial Condition 1
Consolidated Statements of Income 2
Consolidated Statements of Stockholders' Equity 3
Consolidated Statements of Cash Flows 4 - 5
Notes to Consolidated Financial Statements 6
Management's Discussion and Analysis of Financial Condition
and Results of Operations 7 - 9
PART II - Other Information 10 - 11
<PAGE> 3
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Consolidated Statements of Financial Condition
(Dollars in Thousands)
<TABLE>
<CAPTION>
December 31, June 30,
1996 1996
------------ --------
(Unaudited)
<S> <C> <C>
Assets:
Cash $ 399 $ 98
Cash equivalent interest-bearing deposits 2,600 3,957
------- -------
Total cash and cash equivalents 2,999 4,055
Investments
Certificates of deposit - at cost 294 294
Investment securities available for sale,
at fair value 8,690 7,882
Investment securities held to maturity
(estimated market value of $6,200 at
December 31, 1996 and $11,161 at
June 30, 1996) 6,183 11,178
Mortgage-backed and related securities
(estimated market value of $791 at
December 31, 1996 and $852 at
June 30, 1996) 735 800
Federal Home Loan Bank stock - at cost 157 157
Loans receivable - net 25,085 22,931
Accrued interest receivable 153 173
Office properties and equipment 96 84
Prepaid expenses and other assets 213 198
------- -------
Total assets $44,605 $47,752
======= =======
Liabilities and Equity:
Deposit accounts $17,927 $18,200
Borrowed funds 4,000 -
Income taxes:
Current 24 5
Deferred 185 94
Accrued and other liabilities:
Interest 29 33
Other 104 72
------- -------
Total liabilities 22,269 18,404
Commitments and contingencies - -
Stockholders' equity:
Common stock, $1.00 par value; 6,000,000 shares authorized;
2,562,344 shares issued 2,562 2,562
Additional paid-in-capital 9,861 17,225
Unearned ESOP compensation (449) (713)
Unrealized gain on securities available for sale, net of
applicable deferred income taxes 378 227
Retained earnings - substantially restricted 10,267 10,047
Treasury stock, at cost, 33,845 shares (283) -
------- -------
Total stockholders' equity 22,336 29,348
------- -------
Total liabilities and stockholders' equity $44,605 $47,752
======= =======
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE> 4
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Consolidated Statements of Income
(Dollars in Thousands)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
December 31, December 31,
-------------------- ---------------------
1996 1995 1996 1995
---------- ------- ---------- --------
(Unaudited)
<S> <C> <C> <C> <C>
Interest and dividend income:
Mortgage loans $ 530 $460 $ 1,051 $ 913
Investment securities 341 136 636 279
Mortgage-backed and related securities 18 22 35 45
Other loans - - - -
Dividends on stock in Federal Home Loan Bank 2 2 5 5
---------- ---- ---------- ------
Total interest and dividends 891 620 1,727 1,242
---------- ---- ---------- ------
Interest expense:
Deposits and escrows 231 291 462 585
Notes payable and other borrowings 21 - 21 -
---------- ---- ---------- ------
Total interest expense 252 291 483 585
---------- ---- ---------- ------
Net interest income 639 329 1,244 657
Provision for loan losses 6 6 11 11
---------- ---- ---------- ------
Net interest income after provision for loan losses 633 323 1,233 646
---------- ---- ---------- ------
Noninterest income:
Gain (loss) on sale of investments 2 (3) 2 (3)
Other income - 2 - 8
Loan fees and service charges 3 3 6 5
---------- ---- ---------- ------
Total noninterest income 5 2 8 10
---------- ---- ---------- ------
Operating income 638 325 1,241 656
---------- ---- ---------- ------
Noninterest expense:
Compensation and benefits 107 92 207 174
Occupancy 7 7 14 16
Advertising 2 3 4 4
Furniture and equipment - 7 7 13
Federal insurance premiums 1 12 157 25
Professional services 34 8 57 15
Data processing 17 17 34 33
Stationery, communications, and other operating 36 16 47 24
Directors' fees and expenses of directors, officers
and employees 25 23 48 46
---------- ---- ---------- ------
Total noninterest expense 229 185 575 350
---------- ---- ---------- ------
Income before income taxes 409 140 666 306
---------- ---- ---------- ------
Income taxes:
Current 159 57 260 125
Deferred (3) (2) (6) (5)
---------- ---- ---------- ------
Total income taxes 156 55 254 120
---------- ---- ---------- ------
Net income $ 253 $ 85 $ 412 $ 186
========== ==== ========== ======
Net earnings per share $ 0.10 N/A $ 0.17 N/A
========== ==== ========== ======
Weighted-average shares outstanding 2,442,163 N/A 2,454,203 N/A
========== ==== ========== ======
Dividends per share $ 3.00 N/A $ 3.00 N/A
========== ==== ========== ======
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 5
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Consolidated Statement of Stockholders' Equity
(Dollars in Thousands)
<TABLE>
<CAPTION>
Unrealized
Gain or (Loss)
on
Securities
Available
for Sale, Net
Additional Unearned of Applicable
Common Paid-in ESOP Deferred
Stock Capital Compensation Income Taxes
-------- ---------- ------------ -------------
(unaudited)
<C> <C> <C> <C> <C>
Balance at June 30, 1996 $ 2,562 $ 17,225 $ (713) $ 227
Net income - - - -
Purchase of treasury stock - - - -
Amortization of unearned ESOP compensation - 10 15 -
Change in unrealized gain (loss) on securities
available for sale, net of applicable deferred
income taxes - - - 151
Cash dividend declared - (7,374) 249 -
-------- ---------- --------- ---------
Balance at December 31, 1996 $ 2,562 $ 9,861 $ (449) $ 378
======== ========== ========= =========
<CAPTION>
Total
Retained Treasury Stockholders'
Earnings Stock Equity
-------- -------- ------------
<S> <C> <C> <C>
Balance at June 30, 1996 $ 10,047 $ - $ 29,348
Net income 412 - 412
Purchase of treasury stock - (283) (283)
Amortization of unearned ESOP compensation - - 25
Change in unrealized gain (loss) on securities
available for sale, net of applicable deferred
income taxes - - 151
Cash dividend declared (192) - (7,317)
-------- ---------- ---------
Balance at December 31, 1996 $ 10,267 $ (283) $ 22,336
======== ========== =========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 6
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Dollars in Thousands)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1996 1995
-------- ------
(Unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income $ 412 $ 186
Adjustments to reconcile net income to net cash provided (used)
by operating activities:
Provision for depreciation 8 15
Provision for loan losses 11 11
Amortization of premiums, discounts and fees - net (40) (10)
ESOP expenses 25 -
Increase (decrease) in income taxes payable 19 (88)
Provision for (reduction of) deferred income taxes (6) (5)
(Increase) decrease in interest receivable 20 (16)
Net increase (decrease) in accrued/other liabilities 28 15
Net (increase) decrease in prepaid expense and (15) (179)
other assets
Loss (gain) on investments (2) 3
-------- ------
Net cash provided (used) by operating activities 460 (68)
Cash Flows from Investing Activities:
Purchases of Federal Home Loan Bank stock - -
Proceeds from sale of Federal Home Loan Bank stock - -
Proceeds from sale/maturities of investment securities 9,652 1,185
Purchase of investment securities (5,210) -
Net (increase) decrease in loans (2,131) (965)
Principal payments collected on mortgage-backed
securities 66 93
Purchase of fixed assets (20) -
Investment in real estate in judgment - -
Proceeds from real estate in judgment - -
-------- ------
Net cash provided (used) by investing activities 2,357 313
Cash Flows from Financing Activities:
Repayments of short-term borrowing - -
Proceeds from short-term borrowing 2,000 400
Proceeds from securities sold under repurchase agreements 3,990 -
Payments on securities sold under repurchase agreements (1,990) -
Increase (decrease) in advance payments by borrowers - (172)
Increase (decrease) in deposit accounts (273) (856)
Payment of cash dividend (7,317) -
Purchase of treasury stock (283) -
-------- ------
Net cash provided (used) by financing activities (3,873) (628)
-------- ------
Increase (decrease) in cash and cash equivalents (1,056) (383)
Cash and Cash Equivalents at beginning of period 4,055 777
-------- ------
Cash and Cash Equivalents at end of period $ 2,999 $ 394
======== ======
</TABLE>
4
<PAGE> 7
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Dollars in Thousands)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1996 1995
------ ------
(Unaudited)
<S> <C> <C>
Supplemental Cash Flow Information:
Cash paid during the period for:
Interest on deposit accounts $ 57 $ 102
Income taxes 241 213
Interest on borrowings - -
Noncash investing activities:
Loans transferred to foreclosed properties and real
estate in judgment - -
Total increase in unrealized gain on securities available
for sale 248 296
Accounting Policies Note: Cash equivalents include demand deposits at other financial institutions and
the Federal Home Loan Bank.
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE> 8
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
(Unaudited)
1. The information contained in the accompanying consolidated financial
statements is unaudited. In the opinion of management, the financial
statements contain all adjustments (none of which were other than normal
recurring entries) necessary for a fair statement of the results of
operations for the interim periods. The results of operations for the
interim periods are not necessarily indicative of the results which may be
expected for the entire fiscal year. The accompanying consolidated
financial statements should be read in conjunction with consolidated
financial statements for the year ended June 30, 1996 contained in the
Annual Report to stockholders and as an exhibit filed with Form 10-KSB.
2. A special one-time Federal Deposit Insurance Assessment was assessed
against the Bank as of September 30, 1996. The date of enactment of
legislation by the U.S. Congress to recapitalize the Savings Association
Insurance Fund. The assessment was 65.7 cents per $100 of deposits on
March 31, 1995. For the Bank, this amounted to a charge against earnings
of $144,000. The after-tax impact on earnings amounted to $87,000.
Starting in 1997, deposit insurance premiums are expected to decrease by
approximately 72% due to the recapitalization of the insurance fund.
3. The Company initiated a stock repurchase program upon approval by the
FDIC of up to 5% of common stock issued in the Company's initial common
stock offering. During September 1996, the Company repurchased 33,845
shares of common stock at a price of $8.375 per share.
4. Earnings per share are based on the weighted-average shares outstanding.
Earnings per share are not presented for the six months ended December 31,
1995, as Reliance Bancshares, Inc. first issued stock on April 18, 1996.
ESOP shares which have been committed to be released are considered
outstanding.
5. The Company announced on October 25, 1996 the Board of Directors of the
Company authorized payment of a special distribution of $3.00 per share
payable on November 15, 1996 to shareholders of record on November 6,
1996. Approximately $0.075 of the per share distribution represents a
taxable dividend and the remaining $2.925 represents a return of capital.
6
<PAGE> 9
RELIANCE BANCSHARES, INC. AND SUBSIDIARY
Management's Discussion and Analysis of
Financial Condition and Results of Operations
General
Reliance Bancshares, Inc. (Company) has no significant assets other than common
stock of Reliance Savings Bank (Bank), cash and cash equivalents, securities
and the loan to the ESOP. The Company's principal business is the business of
the Bank. Therefore, the information in the Management's Discussion and
Analysis of Financial Condition and Results of Operations relates to the Bank
and its operations.
Certain statements in this report which relate to the Company's plans,
objectives or future performance, may be deemed to be forward-looking
statements within the meaning of the Private Securities Litigation Act of
1996. Such statements are based on management's current expectations. Actual
strategies and results in future periods may differ materially from those
currently expected because of various risks and uncertainties. Additional
discussion of factors affecting the Company's business and prospects is
contained in periodic filings with the Securities and Exchange Commission.
Lending Activities
The Bank originates first mortgage loans secured by one-to-four family
owner-occupied residences and residential construction loans within the Bank's
primary lending area. All of the Bank's first mortgage loans are originated
for the Bank's own loan portfolio. The Bank originated $5,877,000 mortgage
loans at an average rate of 8.67% during the six months ended December 31, 1996
compared to $2,728,000 at an average rate of 8.71% during the six months ended
December 31, 1995. The primary reason for the increase in loan origination
volume is due to the proceeds generated from the mutual to stock conversion of
the Bank on April 18, 1996.
Liquidity and Capital Resources
The Bank's principal sources of funds are cash receipts from deposits,
principal collections on loans and mortgage-backed and related securities,
borrowings, proceeds from maturities of securities, and net earnings. The Bank
has an agreement with the Federal Home Loan Bank to provide cash advances, of
which $2,000,000 are currently outstanding, should the need for additional
funds be required. The financial institution industry historically has
accepted interest rate risk as a part of its operating philosophy. The Bank
continues to actively manage its interest rate risk, with strategies such as
originating mortgage loans which permit adjustment of the interest rate
annually after an initial fixed-rate term of three years in order to reduce
inherent interest rate risk.
The Company made a special distribution of $3.00 per share on November 15, 1996
to shareholders of record on November 6, 1996. Stockholders' Equity was
reduced by approximately $7,300,000 as the result of this payment. It is
anticipated the Company's return on equity will improve as the result of the
distribution while not significantly impairing its strong capital position.
The Bank is required to maintain minimum amounts of capital to total
"risk-weighted" assets, as defined by banking regulators. At December 31,
1996, the Bank is required to have a minimum of 3% Tier 1 capital to total
assets, a minimum of 4% Tier 1 capital to risk-weighted assets ratio and a
minimum 8% of qualifying total capital to risk-weighted assets ratio. The
Bank's actual ratios at that date were 47.86%, 81.54% and 82.12%, respectively.
Wisconsin-chartered savings banks are also required to maintain a minimum
capital to assets ratio of 6%. The Bank's capital exceed all minimum standards
required by federal and state regulations.
7
<PAGE> 10
For regulatory purposes, liquidity is measured as a ratio of cash and certain
investments to withdrawable deposits and short-term borrowings. The minimum
level of liquidity required by regulation is 5%. The Bank's liquidity ratio
was over 73% at December 31, 1996.
There were no commitments to originate mortgage loans at December 31, 1996.
Financial Condition
Total assets decreased $3,147,000 to $44,605,000 at December 31, 1996 from
$47,752,000 at June 30, 1996. Investment securities decreased $4,187,000 to
$14,873,000 at December 31, 1996 from $19,060,000 at June 30, 1996 and cash and
cash equivalent deposits decreased $1,056,000 to $2,999,000 at December 31,
1996 from $4,055,000 at June 30, 1996. The decrease in these funds and the
$4,000,000 in funds borrowed during the six months ended December 31, 1996 were
primarily as a result of the $7,317,000 return of capital distribution.
Proceeds from the sale and maturity of securities were also used to fund loans
and purchase securities. An unrealized gain on securities available for sale,
net of tax effect, of $378,000 has been recognized as a component of
stockholder's equity as of December 31, 1996. Debt securities of the Company
remain in the held to maturity classification. Stockholders' equity is
expected to increase or decrease in the future to the extent, net of income tax
effect, that the market value of securities held for sale increase or decrease.
Accrued interest on loans and securities decreased and accrued interest on
certificates of deposit decreased due to timing of interest receipts. Other
assets and income taxes payable fluctuated due to timing of corporate income
tax payments. Advances from borrowers for taxes and insurance are no longer
required by the Bank.
Net Earnings
The Company had net earnings of $412,000 for the six months ended December 31,
1996 compared to net earnings of $186,000 for the six months ended December 31,
1995. The primary reason for the improvement in net earnings was due to
increased income on loans and investment securities, offset by higher federal
insurance premiums, higher professional services, and higher compensation
related to stock benefit plans. The Bank established an Employee Stock
Ownership Plan (ESOP) in connection with the conversion from mutual to stock
form. Net earnings for the 1996 period was also affected by lower interest
expense and lower noninterest income.
Net earnings increased $168,000 to $253,000 for the three months ended December
31, 1996 compared to $85,000 for the three months ended December 31, 1995. The
primary reason for the improvement was due to increased income on investment
securities and loans along with a decrease in interest expense on deposits
offset by higher professional services, and higher compensation related to
stock benefit plans.
The federal insurance premiums are a special one-time, industry-wide assessment
by the Federal Deposit Insurance Corporation (FDIC) to recapitalize the Savings
Association Insurance Fund (SAIF) at a rate of 65.7 basis points per $100 of
SAIF-assessable deposits held as of March 31, 1995. After the assessment, the
SAIF insurance premium will be reduced from 23 basis points to 6.4 basis points
per $100 of SAIF-assessable deposits for the years 1997 through 1999, with a
further reduction in the premium to 2.43 basis points per $100 of
SAIF-assessable deposits scheduled to begin in the year 2000. The special
assessment resulted in an after-tax charge to net income of $87,000, or $0.04
per share, for the six months ended December 31, 1996.
Net Interest Income
Net interest income increased from $657,000 for the six months ended December
31, 1995 to $1,244,000 for the six months ended December 31, 1996. Net
interest income increased from $329,000 for the three months ended December 31,
1995 to $639,000 for the three months
8
<PAGE> 11
ended December 31, 1996. The increase in interest income was due to higher
interest income on loans and investment securities. Interest income on loans
increased as a result of a higher portfolio average balance. Interest income
on investment securities increased due to a large increase in the average
balance as a result of Conversion proceeds being invested, which offset a lower
portfolio yield. Interest expense on deposits decreased for the three months
and for the six months ended December 31, 1996 as compared to the same period
in 1995 due to a lower average balance and a lower weighted-average rate.
Provision for Loan Losses
Provision for loan losses is based upon management's consideration of economic
conditions which may affect the ability of borrowers to repay the loans.
Management also reviews individual loans for which full collectibility may not
be reasonably assured and considers, among other matters, the risks inherent in
the Bank's portfolio and the estimated fair value of the underlying collateral.
This evaluation is ongoing and results in variations in the Bank's provision
for loan losses. There were no nonperforming loans at December 31, 1996 and
1995, respectively. As a result of this evaluation, the Bank's provision for
loan losses for the six months ended December 31, 1996 and 1995 amounted to
$11,000. The Bank's provision for loan losses for the three months ended
December 31, 1996 and 1995 amounted to $6,000.
Noninterest Income
Noninterest income decreased from $10,000 for the six months ended December 31,
1995 to $8,000 for the six months ended December 31, 1996 and noninterest
income increased from $2,000 for the three months ended December 31, 1995 to
$5,000 for the three months ended December 31, 1996 due to a decrease in other
noninterest income offset by a gain on the sale of investments.
Noninterest Expense
Noninterest expense increased from $350,000 for the six months ended December
31, 1995 to $575,000 for the six months ended December 31, 1996. The majority
of the increase resulted from the special one-time FDIC assessment of $144,000
as of December 31,1996. Deposit insurance premiums are expected to decrease
substantially in future periods. Professional services increased from $15,000
in 1995 to $57,000 in 1996. The 1996 professional fees include initial
services for stock benefit plans and assistance with periodic security filings.
Management expects ongoing professional fees to be reduced from the 1996
level. Compensation and benefits increased from $174,000 for the six months
ended December 31, 1995 to $207,000 for the six months ended December 31, 1996
due to implementation of the ESOP in connection with the stock conversion.
Noninterest expense increased from $185,000 for the three months ended December
31, 1995 to $229,000 for the three months ended December 31, 1996. The primary
reason for the increase was due to and increase in compensation and benefits
due to the implementation of the ESOP, an increase in professional services and
an increase in other operating expenses. Other operating expenses increased
from $16,000 for the three months ended December 31, 1995 to $36,000 for the
three months December 31, 1996 as the result of stationery and printing charges
for the annual shareholders' report and the filing fees associated with
transmitting the annual report to the regulators.
Income Taxes
Income taxes fluctuated due to the level of pre-tax earnings.
9
<PAGE> 12
RELIANCE BANCSHARES INC. AND SUBSIDIARY
PART II - Other information
Item 1 - Legal Proceeding
There are no material legal proceedings to which the Holding Company or the
Bank is a party or of which any of their property is subject. From time to
time, the Bank is a party to various legal proceedings incident to its
business.
Item 2 - Changes in Securities
None.
Item 3 - Defaults upon Senior Securities
Not applicable.
Item 4 - Submission of Matters to a Vote of Security Holders
At the Annual Meeting of Shareholders held October 28, 1996, Mr. John T.
Lynch was elected to a one year term as director; Messrs. Allan T. Bach, and
O. William Held were elected to two year terms as directors; and, Mses.
Carol A. Barnharst, and Majorie A. Spicuzza were elected to three year terms
as directors. Shareholders also voted to ratify the selection of Meier,
Clancy, George & Co. LLP as independent auditors of the Company for the
current fiscal year.
At the Annual Meeting of Shareholders, there were:
a) 2,528,499 votes eligible to be cast,
b) 2,008,900 votes cast for and 80,721 votes withheld from the election of
Mr. Lynch,
c) 2,008,900 votes cast for and 80,721 votes withheld from the election of
Mr. Bach,
d) 2,008,900 votes cast for and 80,721 votes withheld from the election of
Mr. Held,
e) 2,008,900 votes cast for and 80,721 votes withheld from the election of
Ms. Barnharst,
f) 2,008,149 votes cast for and 81,472 votes withheld from the election of
Ms. Spicuzza,
g) 2,012,694 votes cast for, 20,700 votes cast against, and 36,622
abstentions related to the ratification of the selection of Meier,
Clancy, George & Co. LLP as the Company's independent auditors.
Item 5 - Other information
None
Item 6 - Exhibits and Reports on Form 8-K.
a) Exhibits: none
b) Reports on Form 8-K: No reports on Form 8-K have been filed during the
quarter for which this report is filed.
A report on Form 8-K was filed on October 25, 1996 indicating that the
Board of Directors of the Company had declared a special distribution of
$3.00 per share, payable on November 15, 1996 to shareholders of record on
November 6, 1996.
10
<PAGE> 13
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.
RELIANCE BANCSHARES, INC.
(Registrant)
Date: February 5, 1997 BY:
--------------------------------------
Allan T. Bach, Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)
Date: February 5, 1997 BY:
--------------------------------------
Carol A. Barnharst, Vice-President and
Chief Financial Officer (Principal Financial
and Accounting Officer)
11
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 399
<INT-BEARING-DEPOSITS> 2,600
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 8,690
<INVESTMENTS-CARRYING> 6,918
<INVESTMENTS-MARKET> 6,991
<LOANS> 25,085
<ALLOWANCE> 137
<TOTAL-ASSETS> 44,605
<DEPOSITS> 17,927
<SHORT-TERM> 4,000
<LIABILITIES-OTHER> 342
<LONG-TERM> 0
2,562
0
<COMMON> 0
<OTHER-SE> 19,774
<TOTAL-LIABILITIES-AND-EQUITY> 44,605
<INTEREST-LOAN> 1,051
<INTEREST-INVEST> 676
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 1,727
<INTEREST-DEPOSIT> 462
<INTEREST-EXPENSE> 483
<INTEREST-INCOME-NET> 1,244
<LOAN-LOSSES> 11
<SECURITIES-GAINS> 2
<EXPENSE-OTHER> 575
<INCOME-PRETAX> 666
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 412
<EPS-PRIMARY> .17
<EPS-DILUTED> .17
<YIELD-ACTUAL> 2.36
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 131
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 137
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 137
</TABLE>
