SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: JUNE 30, 1998
Commission File Number: 0-27784
HUMBOLDT BANCORP
(Exact name of small business issuer as specified in its charter)
CALIFORNIA 93-1175446
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
701 FIFTH STREET
EUREKA, CALIFORNIA
(Address of principal executive offices)
95501
(Zip Code)
(707) 445-3233
(Issuer's telephone number, including area code)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding twelve 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.
X Yes No
--- ---
Number of shares common stock outstanding at June 30, 1998 was: 1,775,403
<PAGE>2
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
The information required by Item 310(b) of Regulation S-B is attached hereto
as Exhibit A.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
On November 10, 1995, the shareholders of Humboldt Bank (the "Bank") approved
a Plan of Reorganization by and between the Bank, Humboldt Merger Company and
Humboldt Bancorp (the "Company") whereby the Bank became a wholly owned
subsidary of the Company. The reorganization became effective January 2,
1996. On April 1, 1998 Bancorp Financial Services, a small ticket leasing
company, jointly owned by Humboldt Bank and Tehema Bank was transferred from
the Bank to the Company. The business operation of the Company is conducted
through its wholly owned subsidary, Humboldt Bank and through a 50% ownership
with Tehema Bank of Bancorp Financial Services. The following discussion
therefore, presented on a consolidated basis, analyzes primarily the financial
condition and results of operations of the Bank and Bancorp Financial Services
for the six month period ended June 30, 1998. Prior to 1996, the Bank filed
its periodic reports under the Securities Exchange Act of 1934 with the
Federal Reserve Board.
CHANGES IN FINANCIAL CONDITION
- -------------------------------
During the six month period ended June 30, 1998, deposits increased $13.9
million or 5.5% to $269.1 million. During the same period, total loans
increased $13.2 million or 8.3% to $173.1 million, as a result of increases in
real estate loans, commercial loans, lease financing loans and other loans,
which were partially offset by small decreases in consumer loans. Loans held
for sale increased $2.2 million. The increase in deposits and loans is
attributable to internal factors and not as a result of acquisitions.
Investment securities decreased $7.2 million or 9.0% to $73.0 million. Excess
liquidity during the period was invested in federal funds.
During the six month period ending June 30, 1998, past due and non-accrual
loans decreased to $1.8 million (0.6% of total assets), compared with $3.1
million (1.1% of total assets) at December 31, 1997. The Company's allowance
for loan losses at June 30, 1998 was 1.5% of loans and leases which compared
with 1.5% at December 31, 1997.
EARNINGS SUMMARY
- ----------------
Net income for the six months ended June 30, 1998 was $1,703,000 or $0.96 per
share (diluted $0.84), compared with net income of $1,336,000 or $0.77 per
share (diluted $0.68) in the same period a year ago. This can be attributed
to increases in interest income ($2,584,000 or 28.2%), increases in non
interest income ($1,798,000 or 52.3%) offset by increases in interest expense
($761,000 or 24.2%), loan loss provision ($674,000 or 192.6%), non interest
expenses ($2,208,000 or 31.2%) and taxes ($326,000 or 44.7%).
<PAGE>3
NET INTEREST INCOME
- -------------------
Total interest income increased $1,823,000 or 30.4% for the six months ended
June 30, 1998, as compared to the prior year. During the same period,
interest expense increased $1,798,000 or 52.3%. Net interest income for the
six months ended June 30, 1998 was $7.8 million and $6.0 million for the
period ended June 30, 1997. Average loans and leases as a percentage of
average earning assets was 65.0% during the six months ended June 30, 1998,
compared to 72.8% a year earlier. The average balance of other earning assets
as a percentage of average earning assets was 35.0% during the six months
ended June 30, 1998, compared to 27.2% a year earlier.
PROVISION FOR LOAN LOSSES
- -------------------------
The Company maintains its allowance for loan losses at a level considered
appropriate by management to provide for known and inherent risks in the loan
portfolio. This consideration includes an evaluation of various factors
affecting the collectability of loans, including current and projected
economic conditions, past credit experience and a periodic review of the
Company's loan portfolio. The Company's allowance for loan losses for the six
month period ended June 30, 1998 increased $265,000 compared to an increase of
$273,000 for the same period in 1997. Loans charged off during the six month
period totaled $866,000 in 1998 and $105,000 in 1997. Recoveries in the same
period were $107,000 in 1998 and $28,000 in 1997.
NON-INTEREST INCOME
- -------------------
Non-interest income consists of gain/loss on sale of loans and fixed assets,
service charges on deposit accounts and other service charges, commissions and
fees including Lease Department, Merchant BankCard Department and Issuing
BankCard Department income. In the six months ended June 30, 1998, income
from these sources was $5.2 million, an increase of $1,798,000 from the same
period in 1997. The increase was attributable primarily to increases in
Merchant BankCard Department income, Issuing BankCard Department income, Lease
Department income, service charges on deposits and a decrease in loss on sale
of loans.
NON-INTEREST EXPENSE
- --------------------
Non-interest expenses increased $2.2 million or 31.2% to $9.3 million for the
six months ended June 30, 1998, compared to the same period in 1997. The
increase was due in part to increased personnel expenses, fixed asset expense,
Office Supply expense, Data Processing expense, Card service expense, Other
Outside Services expense and Merchant BankCard Department expense. At the
period ending June 30, 1998, the Company had a total of 248 full-time
equivalent employees, compared to 187 full-time equivalent employees at the
same period a year earlier.
<PAGE>4
YEAR 2000 ISSUE
- ---------------
The Company formed a committee of senior company personnel in late 1997, who
meet on a regular basis to evaluate and make recommendations on the Year 2000
Issue. The Assessment Phase and the Vendor, Customer and Employee
Notification Phase have been completed. The Vendor and Customer Response
Review is ongoing and we anticipate completion by September 30, 1998. The
Testing Phase commenced August 1, 1998 and it is anticipated that this phase
will be completed by March 31, 1999. The Contingency Plan Phase is ongoing
and it is anticipated that this phase will be completed by late 1998. The
Renovation Phase is ongoing and it is anticipated that this Phase will be
completed by mid 1999.
CAPITAL RESOURCES
- -----------------
Management seeks to maintain adequate capital to support anticipated asset
growth and credit risks and to ensure that the Company meets all regulatory
capital requirements.
The Company is required to maintain certain regulatory minimum capital ratios.
The following table outlines these ratios at June 30, 1998:
REQUIRED COMPANY'S
MINIMUM ACTUAL
-------- ---------
TIER 1 6.00 10.70
TOTAL CAPITAL 10.00 11.90
LEVERAGE 5.00 7.89
Future growth and earnings retention, as currently projected by management,
are expected to provide for the maintenance of capital ratios in conformity
with the requirements.
INCOME TAXES
- ------------
The provision for income taxes was $1,055,000 for the six months ended June
30, 1998, compared to $729,000 in the same period a year earlier. The
provision is classified as current tax liability for interim reporting
purposes. The tax rate was 38.3% for the six months ended June 30, 1998,
compared to 35.3% for the same period in 1997.
LIQUIDITY
- ---------
The Company manages its liquidity to ensure that sufficient funds are
available to meet loan commitments and deposit fluctuations. Primary sources
of liquidity include cash and due from bank deposits, unpledged short-term
U.S. Government securities and federal funds sold. The Bank's primary
liquidity ratio, which is the ratio of liquid assets to total deposits, was
28.7% at June 30, 1998, and 38.1% at December 31, 1997.
<PAGE>5
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Company is not involved in any legal proceedings that would have a
material adverse effect on its financial statements.
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 or about April 17, 1998, a Proxy Statement of Humboldt Bancorp was mailed
to shareholders of record as of March 31, 1998 by the Board of Directors
soliciting proxies for use at the Annual Meeting of Shareholders to be held on
May 21, 1998. At the meeting the shareholders were asked to elect
management's nominees for Directors (12), to ratify the appointment of
Richardson and Company as independent certified accountants and to adopt
amendments to the Amended Humboldt Bancorp Stock Option Plan. The results of
the voting are as follows:
PROPOSAL #1 - Election of Directors
<TABLE>
<CAPTION>
FOR ALL WITHHOLD
NOMINEES FROM AGAINST
ALL NOMINEES
<S> <C> <C> <C>
Ronald F. Angell 1,160,599 Shares 731 Shares 0 Shares
Marguerite Dalianes 1,160,599 Shares 731 Shares 356 Shares
Gary L. Evans 1,160,599 Shares 731 Shares 4,519 Shares
Lawrence Francesconi 1,160,599 Shares 731 Shares 1,516 Shares
Clayton R. Janssen 1,160,599 Shares 731 Shares 0 Shares
James O. Johnson 1,160,599 Shares 731 Shares 0 Shares
Theodore S. Mason 1,160,599 Shares 731 Shares 798 Shares
John McBeth 1,160,599 Shares 731 Shares 0 Shares
Michael Renner 1,160,599 Shares 731 Shares 798 Shares
Jerry L. Thomas 1,160,599 Shares 731 Shares 81 Shares
Edythe E. Vaissade 1,160,599 Shares 731 Shares 943 Shares
John R. Winzler 1,160,599 Shares 731 Shares 5,317 Shares
</TABLE>
<PAGE>6
PROPOSAL #2 - Ratify the appointment of Richardson and Company as Independent
Certified Accountants
FOR: 1,116,9911
AGAINST: 2,508
ABSTAIN: 41,911
PROPOSAL #3 - To adopt amendments to the Amended Humboldt Bancorp Stock Option
Plan (the Amended Option Plan)
FOR: 978,678
AGAINST: 95,950
ABSTAIN: 86,702
ITEM 5 - OTHER INFORMATION - NONE
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27.1 Financial Data Schedule
<PAGE>7
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Date: August 11, 1998 HUMBOLDT BANCORP
Alan J. Smyth
ALAN J. SMYTH
Senior Vice President and Chief Financial Officer
Theodore S. Mason
THEODORE S. MASON
President and Chief Executive Officer
<PAGE>8
Humboldt Bancorp and Subsidiary
Notes to Consolidated Financial Statements
June 30, 1998
(Unaudited)
Note 1 - Basis of Presentation
In the opinion of Management, the unaudited interim consolidated financial
statements contain all adjustments of a normal recurring nature, which are
necessary to present fairly the financial condition of Humboldt Bancorp and
Subsidiary at June 30, 1998 and results of operations for the six months then
ended.
Certain information and footnote disclosures presented in the Company's annual
financial statements are not included in these interim financial statements.
Accordingly, the accompanying unaudited interim consolidated financial
statements should be read in conjunction with the financial statements and
notes thereto included in the Company's 1997 Annual Report on Form 10-KSB.
The results of operations for the six months ended June 30, 1998 are not
necessarily indicative of the operating results through December 31, 1998.
Note 2 - New Accounting Policies
On January 1, 1995, the Company adopted SFAS No. 114, "Accounting by Creditors
for Impairment of a Loan." This statement addresses the accounting and
reporting by creditors for impairment of certain loans. A loan is impaired
when, based upon current information and events, it is probable that a
creditor will be unable to collect all amounts due according to the
contractual terms of the loan agreement. This statement is applicable to all
loans, uncollateralized as well as collateralized, except large groups of
smaller-balance homogeneous loans that are collectively evaluated for
impairment such as consumer installment loans and loans held for sale which
are measured at fair value or at the lower of cost or fair value. Impairment
is measured based on the present value of expected future cash flows
discounted at the loan's effective interest rate, except that as a practical
expedient, the Company measures impairment based on a loan's observable market
price or the fair value of the collateral if the loan is collateral dependent.
Loans are measured for impairment as part of the Company's normal internal
asset review process.
Interest income is recognized on impaired loans in a manner similar to that of
all loans. It is the Company's policy to place loans that are delinquent 90
days or more as to principal or interest on a nonaccrual of interest basis
unless secured and in the process of collection, and to reverse from current
income accrued but uncollected interest. Cash payments subsequently received
on nonaccrual loans are recognized as income only where the future collection
of principal is considered by management to be probable.
At June 30, 1998, the Company's total recorded investment in impaired loans
was $10,113 for which there is a related allowance for credit losses of $1,628
determined in accordance with these Statements. The average recorded
investment in the impaired loans during the six months ended June 30, 1998 was
$10,200. The related amount of interest income recognized during the period
that such loans were impaired was $490 and the amount of interest income
recognized using a cash-basis method of accounting during the time within the
period that such loans were impaired was $482.
<PAGE>9
On March 31, 1998, the Company adopted SFAS No. 130 "Reporting Comprehensive
Income." This statement establishes standards for reporting and display of
comprehensive income and its components (revenues, expenses, gains and losses)
in a full set of general-purpose financial statements. This Statement
requires that all items that are required to be recognized under accounting
standards as components of comprehensive income be reported in a financial
statement that is displayed with the same prominence as other financial
statements. This Statement does not require a specific format for that
financial statement but requires that an enterprise display an amount
representing total comprehensive income for the period in that financial
statement.
This Statement requires that an enterprise (a) classify items of other
comprehensive income by their nature in a financial statement and (b) display
the accumulated balance of other comprehensive income separately from retained
earnings and additional paid-in capital in the equity section of a statement
of financial position.
This Statement is effective for fiscal years beginning after December 15,
1997. Reclassification of financial statements for earlier periods provided
for comparative purposes is required.
Comprehensive income is defined as "the change in equity [net assets] of a
business enterprise during a period from transactions and other events and
circumstances from nonowner sources. It includes all changes in equity during
a period except those resulting from investments by owners and distributions
to owners."
The Board also stated that "a full set of financial statements for a period
should show: Financial position at the end of the period, earnings (net
income) for the period, comprehensive income (total non-owner changes in
equity) for the period, cash flows during the period, and investments by and
distributions to owners during the period." Prior to issuance of this
Statement, the Board had neither required that an enterprise report
comprehensive income, nor had it recommended a format for displaying
comprehensive income.
Note 3 - Consolidation
The consolidated financial statements include the accounts of Humboldt
Bancorp, its wholly-owned subsidiary, Humboldt Bank and its 50% ownership with
Tehema Bank, of Bancorp Financial Services. All material intercompany
accounts and transactions have been eliminated in consolidation.
Note 4 - Commitments
The bank has outstanding performance letters of credit of $8.6 million at June
30, 1998.
Note 5 - Net Income Per Common Share
Net income per share is calculated by using the weighted average common shares
outstanding. The weighted average number of common shares used in computing
the net income per common share for the period ending June 30, 1998 was
1,775,403 and for the period ending June 30, 1997 was 1,734,041.
Net income per share (diluted) is calculated by using the weighted average
common shares (diluted) outstanding. The weighted average number of common
shares (diluted) used in computing the net income per common share (diluted)
for the period ending June 30, 1998 was 2,034,078 and for the period ending
June 30, 1997 was 1,954,236.
<PAGE>10
HUMBOLDT BANCORP AND SUBSIDIARY CONSOLIDATED BANK ONLY
CONSOLIDATED BALANCE SHEETS UNAUDITED AUDITED
(IN THOUSANDS OF DOLLARS) JUNE 30, 1998 DECEMBER 31, 1997
ASSETS:
Cash and Due From Banks 19,674 21,442
Interest Bearing Deposits in Banks 3,020 3,020
Federal Funds Sold 10,750 3,520
Investment Securities (Market value
of $72,970 and $62,183 72,970 80,180
respectively)
Loans Held For Sale 2,276 48
LOANS
Real Estate-Construction and
Land Development 15,123 20,165
Real Estate-Commercial and Agriculture 79,592 65,772
Real Estate-Family and
Multifamily Residential 27,383 27,205
Commercial, Industrial and Agriculture 32,040 28,766
Lease Financing 9,937 8,732
Consumer Loans 8,037 9,502
State and Political Subdivisions 0 0
Other 1,860 502
173,972 160,644
Less: Deferred Loan Fees <915> <809>
TOTAL LOANS 173,057 159,835
Less: Allowance for Credit Losses <2,636> <2,371>
NET LOANS 170,421 157,464
Premises and Equipment (net) 8,685 5,635
OREO 349 148
Investment in Associated Companies 2,112 2,022
Intangible Assets 1,359 1,545
Other Assets 10,017 9,063
TOTAL ASSETS 301,633 284,087
LIABILITIES
Deposits:
Demand 81,040 70,767
Demand-Interest Bearing 50,368 52,004
Time - $100,000 and over 47,923 40,643
Other Time 69,502 69,821
Savings 20,282 21,951
269,115 255,186
Borrowed Funds 3,444 1,761
Other Liabilities 3,979 3,586
276,538 260,533
SHAREHOLDERS' EQUITY
Preferred stock, no par value;
1,000,000 shares authorized, none
issued
Common stock, no par value; 20,000,000
shares authorized,
1,775,403 shares in 1998 and
1,576,542 in 1997, issued and
outstanding 25,493 20,495
Retained Earnings (828) 2,200
Additional Paid in Capital 114 114
Unrealized Gain/Loss 316 745
TOTAL SHAREHOLDERS' EQUITY 25,095 23,554
TOTAL LIABILITIES AND SHAREHOLDERS
EQUITY 301,633 284,087
NOTE: Humboldt Bancorp became effective January 2, 1996.
See notes to consolidated financial statements.
<PAGE>11
HUMBOLDT BANCORP
STATEMENT OF OPERATIONS
For The Three Months Ended UNAUDITED UNAUDITED
June 30, 1998 and 1997 June 30, 1998 June 30, 1997
(In Thousands of Dollars)
INTEREST INCOME
Interest and Fees on Loans 4,592 3,889
Interest on Deposits in Banks 46 23
Interest and Dividends on Securities 1,139 697
Interest on Federal Funds Sold 139 154
Total Interest Income 5,916 4,763
INTEREST EXPENSE
Interest on Demand Deposits 49 39
Interest on Other Savings Deposits 301 277
Interest on Time Deposits $100,000+ 598 411
Interest on all Other Time Deposits 943 891
Interest on Other Borrowings 45 49
Total Interest Expense 1,936 1,667
Net Interest Income 3,980 3,096
Provision for Loan Losses 515 144
NON INTEREST INCOME
Service Charges on Deposit Accounts 494 277
Other Fee Income 1,967 1,162
All Other Non-Interest Income 375 511
Total Non-Interest Income 2,836 1,950
Realized Gain/Loss on Securities 0 20
NON INTEREST EXPENSE
Salaries and Employee Benefits 2,252 1,655
Premises and Fixed Asset Expense 692 593
Other Non-Interest Expense 2,023 1,569
Total Non-Interest Expense 4,967 3,817
INCOME BEFORE TAXES 1,334 1,105
Applicable Income Taxes 506 403
NET INCOME 828 702
COMPREHENSIVE INCOME.
NET OF TAX UNREALIZED HOLDING
GAINS FOR PERIOD 316 <264>
COMPREHENSIVE INCOME 1,144 702
INCOME PER SHARE $0.41 $0.36
INCOME PER SHARE DILUTED $0.36 $0.33
NOTE: Humboldt Bancorp became effective January 2, 1996.
See notes to consolidated financial statements.
<PAGE>12
HUMBOLDT BANCORP AND SUBSIDIARY
STATEMENT OF OPERATIONS
For The Six Months Ended UNAUDITED UNAUDITED
June 30, 1998 And 1997 June 30, 1998 June 30, 1997
(In Thousands of Dollars)
INTEREST INCOME
Interest and Fees on Loans 9,064 7,605
Interest on Deposits in Banks 88 25
Interest and Dividends on Securities 2,352 1,257
Interest on Federal Funds Sold 229 262
Total Interest Income 11,733 9,149
INTEREST EXPENSE
Interest on Demand Deposits 101 78
Interest on Other Savings Deposits 689 547
Interest on Time Deposits $100,000+ 1,155 765
Interest on all Other Time Deposits 1,889 1,692
Interest on Other Borrowings 73 64
Total Interest Expense 3,907 3,146
Net Interest Income 7,826 6,003
Provision for Loan Losses 1,024 350
NON INTEREST INCOME
Service Charges on Deposit Accounts 1,040 490
Other Fee Income 3,576 2,519
All Other Non-Interest Income 621 430
Total Non-Interest Income 5,237 3,439
Realized Gain/Loss on Securities 0 46
NON INTEREST EXPENSE
Salaries and Employee Benefits 4,387 3,247
Premises and Fixed Asset Expense 1,303 1,127
Other Non-Interest Expense 3,591 2,699
Total Non-Interest Expense 9,281 7,073
INCOME BEFORE TAXES 2,758 2,065
Applicable Income Taxes 1,055 729
NET INCOME 1,703 1,336
INCOME PER SHARE $ 0.96 $ 0.77
INCOME PER SHARE DILUTED $ 0.84 $ 0.68
NOTE: Humboldt Bancorp became effective January 2, 1996.
See notes to consolidated financial statements.
<PAGE>13
HUMBOLDT BANCORP STATEMENT
OF CASH FLOWS CONSOLIDATED BANK ONLY
For the Six Months Ended UNAUDITED UNAUDITED
June 30, 1998 and 1997
(In Thousands of Dollars) June 30, 1998 June 30, 1997
OPERATING ACTIVITIES
Net Income - Adjustments
to reconcile net income
to net cash
provided by operating activities: 1,703 1,336
Provision for Loan Loss 1,024 350
Depreciation 724 728
Amortization and Other 799 575
<Gain>/Loss on Sale of Securities 0 <45>
Equity in Loss/Income of Associated
Company <90> 44
Net Change in Other Assets <648> <1,126>
Net Change in Other Liabilities 393 2,179
Net Change in Loans Held for Sale <2,228> <166>
NET CASH PROVIDED BY OPERATING
ACTIVITIES 1,67 3,875
INVESTING ACTIVITIES
Net Change in Interest-bearing
Deposits in Banks 0 <3,000>
Federal Funds Sold (Net) <7,230> <4,730>
Securities Held to Maturity
Investment Purchases 0 0
Proceeds from Maturities of
Investments 0 0
Proceeds from Sale of Investments 0 0
Securities Available For Sale
Investment Purchases <7,713> <32,276>
Proceeds From Maturities of
Investments 13,129 3,543
Proceeds From Sale of Investments 446 6,172
Net Change in Loans <14,182> <4,607>
Purchase of Premises and Equipment <3,774> <545>
Premium Paid on Deposits Purchase 0 <1,039>
Investment in Associated Company 0 <2,000>
NET CASH USED FOR INVESTING
ACTIVITIES <19,324> <38,482>
FINANCING ACTIVITIES
Net Change in Deposits 13,929 35,228
Net Change in Borrowings 1,683 <7>
Stock Options Exercised 275 203
Fractional Shares Purchased <8> <5>
NET CASH PROVIDED BY FINANCING
ACTIVITIES 15,879 35,419
NET CHANGE IN CASH AND CASH
EQUIVALENTS <1,768> 812
Cash and Due From Banks at
Beginning of Period 21,442 10,247
CASH AND DUE FROM BANKS AT END
OF PERIOD 19,674 11,059
SUPPLEMENTAL DISCLOSURES
Cash Paid During the
Period For: Interest 3,903 2,997
Income Taxes 1,705 422
NON-CASH TRANSACTIONS
Unrealized holding Losses
on Securities 735 <38>
Deferred Income Taxes on
Unrealized Holding Gains and Losses
on Securities 298 16
Deposit Liabilities Assumed in
Exchange for Assets Acquired in
Connection with Purchase of Branches 0 75
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THE SCHEDULE SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED CONSOLIDATED
BALANCE SHEETS, CONSOLIDTAED STATEMENTS OF OPERATIONS AND OTHER INTERNALLY
GENERATED REPORTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1997
<PERIOD-END> JUN-30-1998 JUN-30-1997
<CASH> 19,674 11,059
<INT-BEARING-DEPOSITS> 3,020 3,020
<FED-FUNDS-SOLD> 10,750 11,300
<TRADING-ASSETS> 0 0
<INVESTMENTS-HELD-FOR-SALE> 72,970 62,183
<INVESTMENTS-CARRYING> 0 0
<INVESTMENTS-MARKET> 0 0
<LOANS> 175,333 149,704
<ALLOWANCE> (2,636) (2,419)
<TOTAL-ASSETS> 301,663 253,769
<DEPOSITS> 269,115 227,879
<SHORT-TERM> 0 0
<LIABILITIES-OTHER> 3,979 3,966
<LONG-TERM> 3,444 768
0 0
0 0
<COMMON> 25,493 20,495
<OTHER-SE> (398) 661
<TOTAL-LIABILITIES-AND-EQUITY> 301,633 253,769
<INTEREST-LOAN> 9,064 7,605
<INTEREST-INVEST> 2,352 1,257
<INTEREST-OTHER> 317 287
<INTEREST-TOTAL> 11,733 9,149
<INTEREST-DEPOSIT> 88 25
<INTEREST-EXPENSE> 3,907 3,146
<INTEREST-INCOME-NET> 7,826 6,003
<LOAN-LOSSES> 1,024 350
<SECURITIES-GAINS> 0 46
<EXPENSE-OTHER> 9,281 7,073
<INCOME-PRETAX> 2,758 2,065
<INCOME-PRE-EXTRAORDINARY> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,703 1,336
<EPS-PRIMARY> 0.96 0.77
<EPS-DILUTED> 0.84 0.68
<YIELD-ACTUAL> 6.21 5.70
<LOANS-NON> 356 72
<LOANS-PAST> 494 74
<LOANS-TROUBLED> 39 128
<LOANS-PROBLEM> 0 0
<ALLOWANCE-OPEN> 2,371 2,146
<CHARGE-OFFS> (866) (105)
<RECOVERIES> 107 28
<ALLOWANCE-CLOSE> 2,636 2,419
<ALLOWANCE-DOMESTIC> 174 417
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 2,462 2,002
</TABLE>
