UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 25049
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended March 31, 1998
-----------------------------------
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 0-27620
-------
Green Street Financial Corp
---------------------------
(Exact name of registrant as specified in its charter)
North Carolina 56-1951478
-------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
241 Green Street
Fayetteville, North Carolina 28301-5051
---------------------------------------
(Address of principal executive office) (Zip code)
(910)-483-3681
--------------
(Registrant's telephone number)
N/A
---
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check 3 whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and 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
----- -----
As of May 7, 1998 there were issued and outstanding 4,298,125 shares of the
Registrant's common stock, no par value.
<PAGE>
Green Street Financial Corp and Subsidiary
CONTENTS
PART I - FINANCIAL INFORMATION Pages
Item 1. Condensed Consolidated Financial Statements
Statements of financial condition at September 30,
1997 and March 31, 1998 (unaudited) 1-2
Statements of income for the three months ended
March 31, 1997 (unaudited) and
March 31, 1998 (unaudited) 3
Statements of income for the six months ended
March 31, 1997 (unaudited) and
March 31, 1998 (unaudited) 4
Statements of cash flows for the six months ended
March 31, 1997 (unaudited) and
March 31, 1998 (unaudited) 5-6
Notes to condensed consolidated financial statements 7-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9-11
Item 3. Quantitative and Qualitative Disclosures About Market
Risk 12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 13-14
Item 2. Changes in Securities 13-14
Item 3. Defaults upon Senior Securities 13-14
Item 4. Submission of Matters to a Vote of Security Holders 13-14
Item 5. Other Information 13-14
Item 6. Exhibits and Reports on Form 8-K 13-14
Signatures 15
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION
March 31, 1998 and September 30, 1997
March 31, September 30,
ASSETS 1998 1997
- --------------------------------------------------------------------------------
(Unaudited)
Cash and short-term cash investments:
Interest-earning $ 31,153,936 $ 29,414,597
Noninterest-earning 361,562 555,043
Federal funds sold 1,733,000 3,118,000
Investment securities:
Held to maturity, at amortized cost 10,500,000 13,500,000
Nonmarketable equity securities 1,189,189 1,170,889
Loans receivable, net 131,791,523 128,945,951
Accrued interest receivable, investments 126,646 222,716
Real estate acquired in settlement of loans 51,749 -
Property and equipment, net 305,762 306,794
Prepaid expenses and other assets 687,419 727,688
---------------------------
Total Assets $177,900,786 $177,961,678
===========================
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
March 31, September 30,
LIABILITIES AND STOCKHOLDERS' EQUITY 1998 1997
- -------------------------------------------------------------------------------------------------------------
(Unaudited)
Liabilities:
<S> <C> <C>
Deposits $ 112,110,602 $ 112,641,893
Advance payments by borrowers for taxes and insurance 839,414 250,662
Income taxes payable 34,400 243,000
Accrued expenses and other liabilities 397,130 375,080
Dividends payable 472,794 1,117,513
Deferred compensation 381,436 387,847
----------------------------------
Total liabilities 114,235,776 115,015,995
----------------------------------
Stockholders' equity:
Preferred stock, no par value, authorized 1,000,000 shares;
none issued - -
Common stock, no par value, authorized 10,000,000 shares;
issued 4,298,125 shares - -
Additional paid-in capital 41,923,229 41,816,239
Note receivable, ESOP (2,080,000) (2,210,000)
Retained earnings, substantially restricted 23,821,781 23,339,444
----------------------------------
Total stockholders' equity 63,665,010 62,945,683
----------------------------------
Total liabilities and stockholders' equity $ 177,900,786 $ 177,961,678
==================================
</TABLE>
2
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Interest and dividend income:
Loans $ 2,604,349 $ 2,519,575
Investments 689,760 685,401
----------------------------------
Total interest income 3,294,109 3,204,976
Interest expense 1,393,714 1,311,896
----------------------------------
Net interest income 1,900,395 1,893,080
Provision for loan losses - -
----------------------------------
Net interest income after provision for loan losses 1,900,395 1,893,080
----------------------------------
Noninterest income 52,658 32,845
----------------------------------
Noninterest expense:
Compensation and employee benefits 579,952 569,373
Other 258,392 257,565
----------------------------------
838,344 826,938
----------------------------------
Income before income taxes 1,114,709 1,098,987
Income taxes 422,300 413,100
----------------------------------
Net income $ 692,409 $ 685,887
----------------------------------
Basic earnings per share $ 0.17 $ 0.17
==================================
Diluted earnings per share $ 0.17 $ 0.17
==================================
Dividends paid per share $ 0.11 $ 0.10
==================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
3
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Six Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Interest and dividend income:
Loans $ 5,227,983 $ 5,048,291
Investments 1,407,668 1,412,363
--------------------------------
Total interest income 6,635,651 6,460,654
Interest expense 2,853,591 2,680,669
--------------------------------
Net interest income 3,782,060 3,779,985
Provision for loan losses - -
--------------------------------
Net interest income after provision for loan losses 3,782,060 3,779,985
--------------------------------
Noninterest income 73,437 60,001
--------------------------------
Noninterest expense:
Compensation and employee benefits 1,169,530 1,142,118
Other 475,767 555,025
--------------------------------
1,645,297 1,697,143
--------------------------------
Income before income taxes 2,210,200 2,142,843
Income taxes 828,750 816,965
--------------------------------
Net income $ 1,381,450 $ 1,325,878
--------------------------------
Basic earnings per share $ 0.34 $ 0.33
================================
Diluted earnings per share $ 0.33 $ 0.32
================================
Dividends paid per share $ 0.22 $ 0.20
================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
4
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Operating Activities
Net income $ 1,381,450 $ 1,325,878
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 18,000 20,179
Net gain on disposal of real estate acquired
in settlement of loans - (12,354)
Increase in deferred income taxes 9,000 329,000
Decrease in deferred compensation (6,411) (8,197)
ESOP compensation charged to paid-in capital 106,990 80,730
Changes in assets and liabilities:
(Increase) decrease in:
Prepaid expenses and other assets 40,269 (82,189)
Accrued interest receivable 96,070 85,740
Increase (decrease) in:
Accrued expenses and other liabilities 13,050 280,860
Accrued SAIF assessment - (792,868)
Income taxes payable (208,600) 34,600
-------------------------------
Net cash provided by operating activities 1,449,818 1,261,379
-------------------------------
Cash Flows From Investing Activities
Net increase in loans receivable (2,897,321) (1,141,633)
Proceeds from sale of real estate acquired in settlement of loans - 46,779
Proceeds from maturities of held to maturity investment securities 18,000,000 12,000,000
Purchase of held to maturity investment securities (15,000,000) (9,000,000)
Purchase of nonmarketable equity securities (18,300) -
Purchase of property and equipment (16,968) (8,984)
-------------------------------
Net cash provided by investing activities $ 67,411 $ 1,896,162
-------------------------------
</TABLE>
5
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Financing Activities
Net decrease in deposits $ (531,291)$ (2,262,439)
Principal payment for ESOP debt 130,000 130,000
Cash dividends paid (1,543,832) (1,418,544)
Increase in advance payments by borrowers
for taxes and insurance 588,752 609,591
--------------------------------
Net cash used in financing activities (1,356,371) (2,941,392)
--------------------------------
Net increase in cash and cash equivalents 160,858 216,149
Cash and cash equivalents:
Beginning 33,087,640 35,481,906
--------------------------------
Ending $ 33,248,498 $ 35,698,055
================================
Cash and cash equivalents:
Cash and short-term investments:
Interest-bearing $ 31,153,936 $ 33,998,331
Noninterest-bearing 361,562 311,138
Federal funds sold 1,733,000 1,388,586
--------------------------------
$ 33,248,498 $ 35,698,055
================================
Supplemental Disclosures of Cash Flow Information
Cash payments for:
Interest $ 2,851,596 $ 2,675,434
================================
Income taxes $ 1,050,350 $ 428,543
================================
Supplemental Disclosure of Noncash Investing and Financing
Activities:
Dividends declared and accrued $ 472,794 $ 406,412
================================
Transfer from loans to real estate acquired
in settlement of loans $ 51,749 $ --
================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
6
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
Note 1. Nature of Business
Green Street Financial Corp (the "Corporation") was incorporated
under the laws of the State of North Carolina for the purpose of
becoming the savings and loan holding company of Home Federal
Savings and Loan Association (the "Association" or "Home Federal")
in connection with the Association's conversion from a federally
chartered mutual savings and loan association to a federally
chartered stock savings and loan association, pursuant to its Plan
of Conversion. The Corporation was organized in December 1995 to
acquire all of the common stock of Home Federal upon its conversion
to stock form. A subscription offering of the Corporation's shares
closed on April 3, 1996, at which time the Corporation acquired all
of the shares of the Association and commenced operations. The
financial statements of the Corporation are presented on a
consolidated basis with those of Home Federal.
The Corporation has no operations and conducts no business of its
own other than owning Home Federal, investing its portion of the net
proceeds received in the Conversion, and lending funds to the
Employee Stock Ownership Plan (the "ESOP") which was formed in
connection with the Conversion. The principal business of the
Association is accepting deposits from the general public and using
those deposits and other sources of funds to make loans secured by
real estate and other forms of collateral located in the
Association's primary market area of Cumberland and Robeson counties
in North Carolina.
Home Federal's results of operations depend primarily on its net
interest income, which is the difference between interest income
from interest-earning assets and interest expense on
interest-bearing liabilities. The Association's operations are also
affected by noninterest income, such as miscellaneous income from
loans, customer deposit account service charges, and other sources
of revenue. The Association's principal operating expenses, aside
from interest expense, consist of compensation and associated
benefits, federal deposit insurance premiums, occupancy costs,
advertising, and other general and administrative expenses.
Basis of Presentation The accompanying unaudited consolidated
financial statements (except for the statement of financial
condition at September 30, 1997, which is audited) have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-Q and Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (none of which were other than normal
recurring accruals) necessary for a fair presentation of the
financial position and results of operations for the periods
presented have been included. The results of operations for the
three and six month periods ended March 31, 1998 are not necessarily
indicative of the results of operations that may be expected for the
year ended September 30, 1998 or any other interim period.
The accounting policies followed are as set forth in Note 1 of the
Notes to Consolidated Financial Statements in the 1997 annual report
of the Corporation.
7
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
Note 3. Dividends Declared
Dividends Declared On March 25, 1998, the Board of Directors of the
Corporation declared a dividend of $ .11 a share for stockholders of
record as of April 13, 1998 and payable on April 23, 1998. The
dividends declared were accrued and reported as other liabilities in
the March 31, 1998 consolidated statement of financial condition.
Note 4. Earnings Per Share
Earnings Per Share As required, the Corporation adopted statement of
Financial Accounting Standards No. 128 during the quarter ended
December 31, 1997. This statement requires dual presentation of
basic and diluted earnings per share (EPS) with a reconciliation of
the numerator and denominator of the EPS computations. Basic per
share amounts are based on the weighted average shares of common
stock outstanding. Diluted earnings per share assume the conversion,
exercise or issuance of all potential common stock instruments such
as options, warrants and convertible securities, unless the effect
is to reduce a loss or increase earnings per share. No adjustments
were made to net income (numerator) for all periods presented.
Accordingly, this presentation has been adopted for all periods
presented. The basic and diluted weighted average shares outstanding
for the three and six month periods are as follows:
<TABLE>
<CAPTION>
Three-months ended:
1998 1997
--------------------------------
<S> <C> <C>
Weighted average shares outstanding 4,298,125 4,298,125
Less unallocated ESOP shares 211,250 237,250
--------------------------------
Weighted average outstanding shares used for basic EPS 4,086,875 4,060,875
Plus incremental shares from assumed issuance
of stock options 71,735 53,475
--------------------------------
Weighted average outstanding shares used for diluted EPS 4,158,610 4,114,350
================================
</TABLE>
<TABLE>
<CAPTION>
Six-months ended:
<S> <C> <C>
Weighted average shares outstanding 4,298,125 4,298,125
Less unallocated ESOP shares 214,500 240,500
--------------------------------
Weighted average outstanding shares used for basic EPS 4,083,625 4,057,625
Plus incremental shares from assumed issuance
of stock options 71,735 53,475
--------------------------------
Weighted average outstanding shares used for diluted EPS 4,155,360 4,111,100
================================
</TABLE>
8
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
- --------------------------------------------------------------------------------
Comparison of Financial Condition at March 31, 1998 and September 30, 1997:
Total assets remained stable at $177.9 million at March 31, 1998 compared to
$178.0 million at September 30, 1997. The only significant change in the
component of the Corporation's assets during the period was $3.0 million in held
to maturity investment securities, which were called and used to fund mortgage
loans at March 31, 1998. Investments and other short-term interest earning
assets amounted to $44.6 million at March 31, 1998. Net loans receivable
increased by $2.8 million during the period and amounted to $131.8 million at
March 31, 1998. Approximately 99% of the Corporation's assets were interest
earning at March 31, 1998, and approximately 75% of such interest earning assets
were held in the form of loans receivable.
Savings deposits decreased by $.5 million during the period and amounted to
$112.1 million at March 31, 1998. The Association had no borrowings outstanding
during or at the end of the six month period ended March 31, 1998, but has
guaranteed the repayment of the ESOP's note payable to the Corporation which was
originated on April 3, 1996 in order for the ESOP to purchase 260,000 shares of
common stock in the Corporation. The Corporation's note receivable from the
ESOP, which amounted to $2.1 million at March 31, 1998 net of a $130,000
principal repayment during the period, is reported as a reduction of
stockholders' equity. Retained earnings increased by $.5 million to $23.8
million at March 31, 1998, which is attributable to the Corporation's
consolidated earnings during the six months ended March 31, 1998, less dividends
accrued for the period.
At March 31, 1998, the Corporation's stockholders' equity amounted to $63.7
million, which as a percentage of total assets was 35.8%. As a Federally
chartered savings and loan association, the Association is required to meet
three separate capital standards established by the Office of Thrift Supervision
(OTS). The Association's stand-alone equity was $45.0 million at March 31, 1998
and was substantially in excess of all such capital requirements.
The Association's level of nonperforming loans, defined as loans past due 90
days or more, as a percentage of loans outstanding, was .21% and .13% at March
31, 1998 and September 30, 1997, respectively. The Association's level of
nonperforming loans was .19% at March 31, 1997. During the quarter ended March
31, 1998, the Association's level of nonperforming loans remained consistently
low in relation to total loans outstanding, and the Association did not incur
any loan losses. Based on management's analysis of the adequacy of its
allowances at March 31, 1998, no additional provision for loan losses was made
during the quarter.
9
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
- --------------------------------------------------------------------------------
Comparison of Operating Results for the Six Months Ended March 31, 1998 and
1997:
General. Net income for the three month and six month period ended March 31,
1998 was $692,000, and $1,381,000, respectively, or $6,000 and $55,000 more than
the $686,000 and $1,326,000 earned during the same periods in 1997. The increase
in net income was primarily attributable to an increase in noninterest income
for the three month period and to a decrease in noninterest expense for the six
month period ended March 31, 1998 as compared to the same periods in 1997.
Interest income. Interest income increased by $89,000 from $3.2 million for the
three months ended March 31, 1997 to $3.3 million for the three months ended
March 31, 1998. Interest income increased by $175,000 from $6.5 million for the
six months ended March 31, 1997 to $6.6 million for the six months ended March
31, 1998. These increases were principally attributable to the overall increase
in net loans receivable.
Interest expense. Interest expense increased by $82,000 from $1.3 million for
the three months ended March 31, 1997 to $1.4 million for the three months ended
March 31, 1998. Interest expense increased by $173,000 from $2.7 million for the
six months ended March 31, 1997 to $2.9 million for the six months ended March
31, 1998. Even though the Association's savings deposits decreased by $.5
million during the six month period, the cost of funds for the same period
increased from approximately 4.85% to approximately 5.05%. The Association's
cost of funds which approximated 4.75% for the quarter ended March 31, 1997
increased to approximately 4.95% for the quarter ended March 31, 1998.
Net interest income. Net interest income remained stable at $1.9 million and
$3.8 million for the three and six months ended March 31, 1997 and 1998,
respectively.
Provision for loan losses. Based on management's analysis of the adequacy of its
allowances at March 31, 1998 and 1997, no provisions for loan losses were made
during the three and six months periods ended March 31, 1998 and 1997.
Provisions, which are charged to operations, and the resulting loan loss
allowances are amounts the Association's management believes will be adequate to
absorb potential losses on existing loans that may become uncollectible. Loans
are charged off against the allowance when management believes that
collectibility is unlikely. The evaluation to increase or decrease the provision
and resulting allowances is based both on prior loan loss experience and other
factors, such as changes in the nature and volume of the loan portfolio, overall
portfolio quality, and current economic conditions. The Association's level of
nonperforming loans has remained consistently low in relation to total loans
outstanding, and the Association has not charged off any loans during either of
the three or six month periods ended March 31, 1998 and 1997. At March 31, 1998,
the Association's level of general valuation allowances for loan losses amounted
to $255,000, which management believes is adequate to absorb potential losses in
its loan portfolio.
Noninterest income. Noninterest income has historically been immaterial in
relation to the Association's overall operations. Noninterest income amounted to
$53,000 and $73,000 for the three and six months ended March 31, 1998, and
$33,000 and $60,000 for the three and six months ended March 31, 1997,
respectively.
10
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
- --------------------------------------------------------------------------------
Noninterest expense. Noninterest expense increased by $11,000 to $838,000 for
the three month period ended March 31, 1998 from $827,000 for the comparable
quarter in 1997. For the six month period ended March 31, 1998, noninterest
expense amounted to $1.6 million, a decrease of $52,000 from the $1.7 million
reported for the six months ended March 31, 1997. The increase in noninterest
expense for the three month period is principally due to an increase in employee
benefits, whereas the decrease in noninterest expense for the six month period
is principally due to a decrease in deposit insurance premiums.
Capital Resources and Liquidity. The term "liquidity" generally refers to an
organization's ability to generate adequate amounts of funds to meet its needs
for cash. More specifically for financial institutions, liquidity insures that
adequate funds are available to meet deposit withdrawals, fund loan and capital
expenditure commitments, maintain reserve requirements, pay operating expenses,
and provide funds for debt service, dividends to stockholders, and other
institutional commitments. Funds are primarily provided through financial
resources from operating activities, expansion of the deposit base, borrowings,
through the sale or maturity of investments, the ability to raise equity
capital, or maintenance of shorter term interest-earning deposits.
During the six month period ended March 31, 1998, cash and cash equivalents, a
significant source of liquidity, remained fairly constant, increasing by
approximately $161,000.
As a federally chartered savings association, Home Federal must maintain a daily
average balance of liquid assets equal to at least 4% of withdrawable deposits
and short-term borrowings. The Association's liquidity ratio at March 31, 1998,
as computed under OTS regulations, was considerably in excess of such
requirements. Given its excess liquidity and its ability to borrow from the
Federal Home Loan Bank, the Association believes that it will have sufficient
funds available to meet the anticipated future loan commitments, unexpected
deposit withdrawals, and other cash requirements.
Year 2000 Issue. The Year 2000 Issue relates to whether computer systems will
properly recognize and process date sensitive information on and after January
1, 2000. Systems that do not properly recognize such information could generate
erroneous data or fail. The Association is heavily dependent on computer systems
in the conduct of substantially all of its business activities. The Association
has conducted a comprehensive review of its computer systems, including its core
processing systems maintained by an independent data processing service center,
to identify the systems that could be affected by the Year 2000 Issue.
Management has identified the corrective action required to ensure that the
Association's internal and vendor-maintained systems that are date sensitive are
Year 2000 compliant.
Because the Association has not completed discussions with its vendors,
management is unable to estimate the cost of making all its systems Year 2000
compliant.
11
<PAGE>
GREEN STREET FINANCIAL CORP AND SUBSIDIARY
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
- --------------------------------------------------------------------------------
There were no significant changes for the six months ended March 31, 1998 from
the information presented in the annual report on Form 10K for the year ended
September 30, 1997.
12
<PAGE>
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not engaged in any legal proceedings at the
present time. From time to time, the Association is a party to
legal proceedings within the normal course of business wherein
it enforces its security interest in loans made by it, and
other matters of a similar nature.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
On January 28, 1998, the annual meeting of stockholders was
held to consider and vote upon the election of three directors
of the Company, to ratify the appointment of McGladrey &
Pullen, LLP as independent auditors for the Company for the
fiscal year ending September 30, 1998, to ratify the amendment
to Green Street Financial Corp's 1996 Stock Option Plan, and
to ratify the amendment to Home Federal Savings and Loan
Association's Restricted Stock Plan and Trust Agreement. All
items were approved by the stockholders as shown below:
Vote concerning the election of directors of the Company:
<TABLE>
<CAPTION>
For Against Abstain Total
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Hutaff, Sr. 3,935,504 95,757 0 4,031,261
McCoy, Jr. 3,942,422 88,839 0 4,031,261
Pate 3,942,072 89,189 0 4,031,261
</TABLE>
Vote concerning ratification of McGladrey & Pullen, LLP as
independent auditors for the year ended September 30, 1998:
<TABLE>
<CAPTION>
For Against Abstain Total
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
3,981,486 23,770 26,002 4,031,258
</TABLE>
13
<PAGE>
Vote concerning ratification of the amendment to Green
Street Financial Corp's 1996 Stock Option Plan:
<TABLE>
<CAPTION>
For Against Abstain Total
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
3,378,281 290,523 68,362 3,737,166
</TABLE>
Vote concerning ratification of the amendment to Home
Federal Savings and Loan Association's Restricted Stock Plan
and Trust Agreement:
<TABLE>
<CAPTION>
For Against Abstain Total
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
3,659,754 309,189 62,314 4,031,257
</TABLE>
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) 27. Financial Data Schedule
(b) No reports on 8-K were filed for the period covered
by this report.
14
<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.
Green Street Financial Corp
Dated May 7, 1998 By: s/s H. D. Reaves, Jr.
--------------------- -----------------------------
H. D. Reaves, Jr.
President and CEO
Dated May 7, 1998 By: s/s John C. Pate
--------------------- -----------------------------
John C. Pate
Senior Vice President and CFO
15
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION DERIVED FROM THE
QUARTERLY REPORT ON FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL INFORMATION.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-END> MAR-31-1998
<CASH> 362
<INT-BEARING-DEPOSITS> 31,154
<FED-FUNDS-SOLD> 1,733
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 11,689
<INVESTMENTS-MARKET> 11,707
<LOANS> 132,046
<ALLOWANCE> 255
<TOTAL-ASSETS> 177,901
<DEPOSITS> 112,111
<SHORT-TERM> 0
<LIABILITIES-OTHER> 2,125
<LONG-TERM> 0
0
0
<COMMON> 0
<OTHER-SE> 41,923
<TOTAL-LIABILITIES-AND-EQUITY> 177,901
<INTEREST-LOAN> 5,228
<INTEREST-INVEST> 1,408
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 6,630
<INTEREST-DEPOSIT> 2,854
<INTEREST-EXPENSE> 2,859
<INTEREST-INCOME-NET> 3,782
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,645
<INCOME-PRETAX> 2,210
<INCOME-PRE-EXTRAORDINARY> 1,381
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,381
<EPS-PRIMARY> .34
<EPS-DILUTED> .33
<YIELD-ACTUAL> 4.31
<LOANS-NON> 323
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 255
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 255
<ALLOWANCE-DOMESTIC> 255
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
