<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
April 2, 1996 (April 2, 1996)
-----------------------------------------
Date of Report (Date of earliest event reported)
UNION PLANTERS CORPORATION
--------------------------------------------------
(Exact name of registrant as specified in charter)
TENNESSEE 1-10160 62-0859007
- ------------------------ ------------ -------------------
(State of incorporation) (Commission (I.R.S. Employer
File Number) Identification No.)
UNION PLANTERS ADMINISTRATIVE CENTER
7130 GOODLETT FARMS PARKWAY
MEMPHIS, TENNESSEE 38018
----------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (901) 383-6000
-----------------
Not Applicable
------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 5. OTHER EVENTS
Item 7 (b) below presents unaudited pro forma consolidated financial
statements of Union Planters Corporation (the Corporation) reflecting certain
pending and probable acquisitions as of and for the three years ended December
31, 1995.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS, AND EXHIBITS
(b) Pro Forma Financial Information
<TABLE>
<CAPTION>
Index to Unaudited Pro Forma Financial Information
Page
------
<S> <C> <C>
(1) Introduction 1
(2) Unaudited Pro Forma Consolidated Balance Sheet
as of December 31, 1995 2
(3) Unaudited Pro Forma Consolidated Statements of Earnings
for the Years Ended December 31, 1995, 1994, and 1993 3 - 5
(4) Notes to Unaudited Pro Forma Consolidated Financial Statements 6
</TABLE>
1
<PAGE> 3
SIGNATURE
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 hereunto duly authorized.
Union Planters Corporation
---------------------------------
Registrant
Date: April 2, 1996 /s/ M. Kirk Walters
---------------------- ---------------------------------
M. Kirk Walters
Senior Vice President, Treasurer,
and Chief Accounting Officer
2
<PAGE> 4
UNION PLANTERS CORPORATION
Unaudited Pro Forma Consolidated Financial Statements
<PAGE> 5
UNION PLANTERS CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
INTRODUCTION
The following unaudited pro forma consolidated financial statements
present a balance sheet as of December 31, 1995, and statements of earnings for
each of the three years ended December 31, 1995. The pro forma balance sheet
includes on a pro forma basis the impact of certain recently completed
acquisitions and certain pending acquisitions, the consummations of which are
considered by management to be probable, both as described in Note 1. The
statement of earnings for the year ended December 31, 1995 presents the pro
forma impact of the acquisitions completed in 1995, the recently completed
acquisitions, and the pending acquisitions considered probable of consummation
assuming that all of the acquisitions had been completed at January 1, 1995, in
each case as described in Note 1. Pro forma statements of earnings are also
presented for each of the two years ended December 31, 1994 to reflect only the
pending acquisition of Leader Financial Corporation (Leader) which would
constitute a significant subsidiary and is expected to be accounted for as a
pooling of interests. With the exception of the Leader acquisition, the pro
forma impacts of the other recently completed and probable acquisitions are not
presented individually because these entities are not considered to be
significant to Union Planters Corporation's (the Corporation) consolidated
financial condition or results of operations. The pro forma financial
statements should be read in conjunction with the audited consolidated
financial statements and the notes thereto included in Exhibit 13 to the
Corporation's 1995 Annual Report on Form 10-K. Additionally, the Corporation's
Current Reports on Form 8-K dated March 8, 1996 and April 1, 1996 include
respectively: (i) the definitive Agreement and Plan of Merger dated as of March
8, 1996, pursuant to which the Leader acquisition would be effected and (ii)
Leader's audited consolidated financial statements as of December 31, 1995 and
1994 and for each of the three years ended December 31, 1995.
1
<PAGE> 6
UNION PLANTERS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1995
(Dollars in thousands)
<TABLE>
<CAPTION>
OTHER
CONSUMMATED
UNION AND
PLANTERS PROBABLE
UNION PRO FORMA AND PENDING PRO FORMA
PLANTERS LEADER ADJUSTMENTS LEADER ACQUISITIONS TOTAL
------------ ------------ ------------ ------------ ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and due from banks $ 432,949 $ 27,014 $ 0 $ 459,963 $ 27,117 $ 487,080
Interest-bearing deposits at financial
institutions 13,571 544 0 14,115 1,341 15,456
Federal funds sold and securities
purchased under agreements to resell 356,655 90,000 0 446,655 2,212 448,867
Trading account assets 121,927 0 0 121,927 0 121,927
Loans held for resale 68,819 19,060 0 87,879 0 87,879
Investment securities
Available for sale, at fair value 2,774,890 611,895 188,970 3,575,755 145,625 3,721,380
Held to maturity, at amortized cost - 186,806 (186,806) 0 0 0
Loans 7,100,051 1,973,320 0 9,073,371 417,003 9,490,374
Less: Unearned income (30,198) (9,298) 0 (39,496) (1,142) (40,638)
Allowance for losses on loans (133,487) (22,901) 0 (156,388) (4,030) (160,418)
----------- ---------- --------- ----------- -------- -----------
Net loans 6,936,366 1,941,121 0 8,877,487 411,831 9,289,318
Premises and equipment 228,272 18,613 0 246,885 18,814 265,699
Accrued interest receivable 100,686 72,059 0 172,745 5,149 177,894
Goodwill and other intangibles 58,535 0 0 58,535 15,387 73,922
Other assets 184,446 131,465 (822) 315,089 10,015 325,104
----------- ---------- --------- ----------- -------- -----------
Total assets $11,277,116 $3,098,577 $ 1,342 $14,377,035 $637,491 $15,014,526
=========== ========== ========= =========== ======== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Noninterest-bearing $ 1,420,358 $ 179,363 $ 0 $ 1,599,721 $ 54,068 $ 1,653,789
Certificates of deposit of $100,000
and over 754,434 160,572 0 915,006 65,881 980,887
Other interest-bearing 7,272,944 1,237,295 0 8,510,239 441,030 8,951,269
----------- ---------- --------- ----------- -------- -----------
Total deposits 9,447,736 1,577,230 0 11,024,966 560,979 11,585,945
Short-term borrowings 241,023 597,260 0 838,283 6,727 845,010
FHLB advances 268,892 529,147 0 798,039 11,399 809,438
Long-term debt 216,366 12,171 0 228,537 13,000 241,537
Accrued interest, expenses, and taxes 90,754 34,659 0 125,413 2,213 127,626
Other liabilities 46,014 101,280 0 147,294 9,539 156,833
----------- ---------- --------- ----------- -------- -----------
Total liabilities 10,310,785 2,851,747 0 13,162,532 603,857 13,766,389
----------- ---------- --------- ----------- -------- -----------
Shareholders' equity
Preferred stock
Convertible 91,810 0 0 91,810 6,711 98,521
Nonconvertible 0 0 0 0 0 0
Common stock 227,235 10,753 64,689 302,677 5,728 308,405
Additional paid-in capital 111,348 94,415 (82,675) 123,088 11,512 134,600
Net unrealized gain (loss) on
available for sale securities 21,366 9,702 1,342 32,410 (12) 32,398
Retained earnings 514,572 149,946 0 664,518 9,695 674,213
Treasury stock 0 (17,986) 17,986 0 0 0
----------- ---------- --------- ----------- -------- -----------
Total shareholders' equity 966,331 246,830 1,342 1,214,503 33,634 1,248,137
----------- ---------- --------- ----------- -------- -----------
Total liabilities and
shareholders' equity $11,277,116 $3,098,577 $ 1,342 $14,377,035 $637,491 $15,014,526
=========== ========== ========= =========== ======== ===========
</TABLE>
See the accompanying notes to the unaudited pro forma consolidated financial
statements.
-2-
<PAGE> 7
UNION PLANTERS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1995
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
OTHER
CONSUMMATED
UNION AND
PLANTERS PROBABLE
UNION AND PENDING PRO FORMA
PLANTERS LEADER LEADER ACQUISITIONS TOTAL
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Interest income
Interest and fees on loans $636,769 $167,651 $ 804,420 $42,681 $ 847,101
Interest on investment securities
Taxable 137,453 39,819 177,272 10,548 187,820
Tax-exempt 31,816 497 32,313 262 32,575
Interest on deposits at financial institutions 1,910 26 1,936 131 2,067
Interest on federal funds sold and securities
purchased under agreements to resell 12,095 4,946 17,041 263 17,304
Interest on trading account assets 12,774 0 12,774 0 12,774
Interest on loans held for resale 3,865 1,453 5,318 0 5,318
-------- -------- ---------- ------- ----------
Total interest income 836,682 214,392 1,051,074 53,885 1,104,959
-------- -------- ---------- ------- ----------
Interest expense
Interest on deposits 347,859 74,501 422,360 23,254 445,614
Interest on short-term borrowings 12,825 21,031 33,856 216 34,072
Interest on FHLB advances and long-term debt 28,567 30,350 58,917 2,945 61,862
-------- -------- ---------- ------- ----------
Total interest expense 389,251 125,882 515,133 26,415 541,548
-------- -------- ---------- ------- ----------
Net interest income 447,431 88,510 535,941 27,470 563,411
Provision for losses on loans 22,231 5,150 27,381 3,115 30,496
-------- -------- ---------- ------- ----------
Net interest income after provision
for losses on loans 425,200 83,360 508,560 24,355 532,915
Noninterest income
Service charges on deposit accounts 71,611 4,083 75,694 3,070 78,764
Bank card income 20,103 637 20,740 0 20,740
Mortgage servicing income 9,835 13,904 23,739 0 23,739
Trust service income 8,010 0 8,010 0 8,010
Profits and commissions from trading activities 10,441 0 10,441 0 10,441
Investment securities gains (losses) 476 (67) 409 (41) 368
Other income 37,176 4,934 42,110 3,187 45,297
-------- -------- ---------- ------- ----------
Total noninterest income 157,652 23,491 181,143 6,216 187,359
-------- -------- ---------- ------- ----------
Noninterest expense
Salaries and employee benefits 171,325 26,530 197,855 12,547 210,402
Net occupancy expense 27,192 3,255 30,447 3,202 33,649
Equipment expense 30,156 4,249 34,405 0 34,405
Other expense 153,491 14,101 167,592 11,409 179,001
-------- -------- ---------- ------- ----------
Total noninterest expense 382,164 48,135 430,299 27,158 457,457
-------- -------- ---------- ------- ----------
Earnings before income taxes 200,688 58,716 259,404 3,413 262,817
Applicable income taxes 65,286 21,363 86,649 2,647 89,296
-------- -------- ---------- ------- ----------
Net earnings $135,402 $ 37,353 $ 172,755 $ 766 $ 173,521
======== ======== ========== ======= ==========
Earnings per common share
Primary $ 2.82 $ 2.72 $ 2.67
Fully diluted 2.70 2.64 2.58
Weighted average shares outstanding
(in thousands)
Primary 45,008 60,384 61,525
Fully diluted 49,618 64,994 66,712
</TABLE>
See the accompanying notes to the unaudited pro forma consolidated financial
statements.
-3-
<PAGE> 8
UNION PLANTERS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1994
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
UNION PRO FORMA
PLANTERS LEADER CONSOLIDATED
------------ ------------ ------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans $517,032 $127,658 $644,690
Interest on investment securities
Taxable 162,012 31,264 193,276
Tax-exempt 32,999 416 33,415
Interest on deposits at financial institutions 734 14 748
Interest on federal funds sold and securities
purchased under agreements to resell 4,472 2,390 6,862
Interest on trading account assets 9,143 0 9,143
Interest on loans held for resale 1,573 823 2,396
-------- -------- --------
Total interest income 727,965 162,565 890,530
-------- -------- --------
Interest expense
Interest on deposits 262,572 55,149 317,721
Interest on short-term borrowings 21,300 6,977 28,277
Interest on FHLB advances and long-term debt 20,979 17,948 38,927
-------- -------- --------
Total interest expense 304,851 80,074 384,925
-------- -------- --------
Net interest income 423,114 82,491 505,605
Provision for losses on loans 4,894 4,767 9,661
-------- -------- --------
Net interest income after provision
for losses on loans 418,220 77,724 495,944
Noninterest income
Service charges on deposit accounts 55,551 4,013 59,564
Bank card income 10,953 433 11,386
Mortgage servicing income 9,621 9,176 18,797
Trust service income 7,990 0 7,990
Profits and commissions from trading activities 6,639 0 6,639
Investment securities gains (losses) (20,298) (2,217) (22,515)
Other income 30,349 12,016 42,365
-------- -------- --------
Total noninterest income 100,805 23,421 124,226
-------- -------- --------
Noninterest expense
Salaries and employee benefits 175,218 26,314 201,532
Net occupancy expense 28,041 3,597 31,638
Equipment expense 28,698 3,920 32,618
Other expense 195,740 13,045 208,785
-------- -------- --------
Total noninterest expense 427,697 46,876 474,573
-------- -------- --------
Earnings before income taxes 91,328 54,269 145,597
Applicable income taxes 25,467 19,707 45,174
-------- -------- --------
Net earnings $ 65,861 $ 34,562 $100,423
======== ======== ========
Earnings per common share
Primary $ 1.28 $ 1.52
Fully diluted 1.28 1.52
Weighted average shares outstanding
(in thousands)
Primary 43,741 59,587
Fully diluted 44,083 59,929
</TABLE>
See the accompanying notes to the unaudited pro forma consolidated financial
statements.
-4-
<PAGE> 9
UNION PLANTERS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1993
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
UNION PRO FORMA
PLANTERS LEADER CONSOLIDATED
------------ ------------ ------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans $425,967 $105,450 $531,417
Interest on investment securities
Taxable 157,403 29,563 186,966
Tax-exempt 30,507 89 30,596
Interest on deposits at financial institutions 1,862 22 1,884
Interest on federal funds sold and securities
purchased under agreements to resell 6,175 2,394 8,569
Interest on trading account assets 6,194 0 6,194
Interest on loans held for resale 7,438 725 8,163
-------- -------- --------
Total interest income 635,546 138,243 773,789
-------- -------- --------
Interest expense
Interest on deposits 238,019 60,293 298,312
Interest on short-term borrowings 8,203 0 8,203
Interest on FHLB advances and long-term debt 14,291 13,693 27,984
-------- -------- --------
Total interest expense 260,513 73,986 334,499
-------- -------- --------
Net interest income 375,033 64,257 439,290
Provision for losses on loans 17,950 4,710 22,660
-------- -------- --------
Net interest income after provision
for losses on loans 357,083 59,547 416,630
Noninterest income
Service charges on deposit accounts 49,490 4,233 53,723
Bank card income 10,393 491 10,884
Mortgage servicing income 9,595 (528) 9,067
Trust service income 7,643 0 7,643
Profits and commissions from trading activities 13,787 0 13,787
Investment securities gains (losses) 4,506 (998) 3,508
Other income 32,148 7,803 39,951
-------- -------- --------
Total noninterest income 127,562 11,001 138,563
-------- -------- --------
Noninterest expense
Salaries and employee benefits 163,711 22,992 186,703
Net occupancy expense 25,393 3,083 28,476
Equipment expense 25,989 4,356 30,345
Other expense 131,357 12,808 144,165
-------- -------- --------
Total noninterest expense 346,450 43,239 389,689
-------- -------- --------
Earnings before income taxes, extraordinary
items, and accounting changes 138,195 27,309 165,504
Applicable income taxes 41,168 10,696 51,864
-------- -------- --------
Earnings before extraordinary items
and accounting changes $ 97,027 $ 16,613 $113,640
======== ======== ========
Earnings per common share before extraordinary items
and accounting changes
Primary $ 2.24 $ 2.17
Fully diluted 2.18 2.11
Weighted average shares outstanding
(in thosands)
Primary 38,914 43,192
Fully diluted 43,144 47,422
</TABLE>
See the accompanying notes to the unaudited pro forma consolidated financial
statements.
-5-
<PAGE> 10
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. CONSUMMATED AND PENDING ACQUISITIONS
The unaudited pro forma consolidated balance sheet and statements of
earnings reflect the recently completed acquisitions and those pending
acquisitions, consummation of which management deems probable, which are listed
below. The unaudited pro forma consolidated balance sheet gives effect to the
recently completed and pending transactions at December 31, 1995 as if they had
been consummated on that date and the unaudited pro forma consolidated
statements of earnings reflect the impact of the consummated and pending
transactions as if they had been consummated January 1, 1995, with the
exception of the acquisition of Leader which is presented assuming the
transaction had been consummated January 1, 1993.
The unaudited pro forma consolidated results shown are not necessarily
indicative of future operating results, nor can there be any assurance that the
pending transactions will be consummated.
UNION PLANTERS CORPORATION ACQUISITIONS COMPLETED IN 1996 AND ACCOUNTED FOR AS
PURCHASES
<TABLE>
<CAPTION>
PURCHASE RESULTING APPROXIMATE
INSTITUTION ACQUIRED CONSIDERATION PRICE INTANGIBLES TOTAL ASSETS
--------------------- ---------- --------------- ---------- ------------- --------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C>
First Bancshares of Eastern 1/2/96 Cash $10.9 $3.2 $ 60
Arkansas, Inc., West Memphis,
Arkansas, and its subsidiary,
First National Bank of West Memphis
First Bancshares of North Eastern 1/2/96 Cash $ 9.2 $2.4 $ 62
Arkansas, Inc., Osceola, Arkansas,
and its subsidiary, First National
Bank of Osceola
</TABLE>
UNION PLANTERS CORPORATION PROBABLE PENDING ACQUISITIONS AT MARCH 31, 1996
<TABLE>
<CAPTION>
ANTICIPATED
METHOD OF APPROXIMATE
INSTITUTION CONSIDERATION ACCOUNTING TOTAL ASSETS
----------------- --------------- ------------- ---------------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C>
Eastern National Bank in Miami, Florida Approximately $4.5 Purchase $ 266
million in cash, up
to 317,458 Shares
of Series E Preferred Stock
and the Corporation's promissory
notes in face amount of
$14.5 million
Valley Federal Savings Bank in Approxiately 480,000 Pooling of 126
Sheffield, Alabama shares of Common Stock Interests
Franklin Financial Group, Inc., Approximately 670,000 Pooling of 137
Parent Company of Franklin shares of Common Stock Interests
Federal Savings Bank in
Morristown, Tennessee
Leader Financial Corporation, Approximately 16,600,000 Pooling of 3,099
Parent Company of shares of Common Stock Interests
Leader Federal Bank for Savings (including estimated shares
in Memphis, Tennessee to be issued for outstanding options)
------
Total $3,628
======
</TABLE>
6
<PAGE> 11
NOTE 2. UNAUDITED PRO FORMA ADJUSTMENTS
The following summarizes the unaudited pro forma adjustments which are
necessary to reflect the transactions described previously. The adjustments for
probable acquisitions are based on currently available information and could
change significantly upon consummation. Not all purchase accounting adjustments
have been reflected because certain information is not available, however, the
amounts not reflected are not expected to be material.
7
<PAGE> 12
UNION PLANTERS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET ADJUSTMENTS
LEADER
<TABLE>
<CAPTION>
DECEMBER 31, 1995
DEBIT (CREDIT)
-------------------------
(Dollars in thousands)
<S> <C> <C> <C>
(1) INVESTMENT SECURITIES AVAILABLE FOR SALE
TO TRANSFER HELD TO MATURITY SECURITIES TO AVAILABLE FOR SALE $186,806
TO RECORD UNREALIZED GAIN ON SECURITIES TRANSFERRED 2,164
--------
TOTAL $188,970
(2) INVESTMENT SECURITIES HELD TO MATURITY
TO TRANSFER HELD TO MATURITY SECURITIES TO AVAILABLE FOR SALE (186,806)
(3) OTHER ASSETS
TO RECORD TAX EFFECT OF UNREALIZED GAIN ON SECURITIES TRANSFERRED (822)
(4) COMMON STOCK
TO RETIRE TREASURY STOCK 859
TO ELIMINATE COMMON STOCK OF LEADER 9,894
ISSUANCE OF COMMON STOCK OF UNION PLANTERS CORPORATION (75,442)
--------
TOTAL (64,689)
(5) ADDITIONAL PAID-IN CAPITAL
TO RETIRE TREASURY STOCK 17,127
TO ELIMINATE SURPLUS OF LEADER 77,288
EXCESS OF TOTAL EQUITY OVER PAR/STATED VALUE OF ISSUED STOCK
OF UNION PLANTERS CORPORATION (11,740)
--------
TOTAL 82,675
(6) NET UNREALIZED GAIN (LOSS) ON AVAILABLE FOR SALE SECURITIES
TO RECORD NET UNREALIZED GAIN ON SECURITIES TRANSFERRED
FROM HELD TO MATURITY TO AVAILABLE FOR SALE (1,342)
(7) TREASURY STOCK
TO RETIRE TREASURY STOCK (17,986)
--------
TOTAL $ 0
========
</TABLE>
-8-
<PAGE> 13
NOTE 3. EARNINGS CONSIDERATIONS RELATED TO PENDING ACQUISITIONS
Note 1 to the unaudited pro forma consolidated financial statements
presents the Corporation's pending acquisitions which management deems probable
of consummation. It is expected that the Corporation or the institutions to be
acquired will incur charges related to such acquisitions and to the
assimilation of those institutions into the UPC organization. Anticipated
charges would arise from matters such as, but not limited to, legal and
accounting fees, financial advisory fees, consulting fees, payment of
contractual benefits triggered by a change of control, early retirement and
involuntary separation and related benefits, costs associated with elimination
of duplicate facilities and branch closures, data processing charges,
cancellation of vendor contracts, the potential for additional provisions for
loan losses and similar costs which normally arise from the consolidation of
operational activities.
Aggregate charges expected to arise from the pending acquisitions have
been preliminarily estimated to be between $17 million to $22 million after
taxes, which does not include a potential after-tax charge of approximately
$6.0 million for the recapture of Leader's thrift bad debt reserve which, under
existing law, would be triggered by the assimilation of Leader's branches into
Union Planters National Bank, the Corporation's principal subsidiary, and
certain other banking subsidiaries. If enacted by the Congress, pending
legislation would eliminate this recapture. Moreover, the range of charges does
not take into account any potential assessment for recapitalization of the
Savings Association Insurance Fund (Note 4).
To the extent that any of these charges should be contingent upon
consummation of a particular transaction, those charges would be recognized in
the period in which such transaction closes. This range of potential charges is
based on currently available information as well as preliminary estimates and
is subject to change. The range is provided as a preliminary estimate of the
significant charges which may in the aggregate be required and should be viewed
accordingly. These charges are not reflected in the pro forma consolidated
financial statements.
NOTE 4. SPECIAL REGULATORY ASSESSMENT
There are several bills currently under consideration by Congress, the
purpose of which is to provide additional financing for the Savings Association
Insurance Fund (SAIF) and to provide interest payments on Financing Corporation
(FICO) bonds issued in connection with earlier efforts to support the then
failing thrift industry. A common feature of the proposed bills is a one-time
special assessment ranging from 85 to 90 basis points on all deposits insured
by the SAIF ($.85 to $.90 per $100 of covered deposits). The special assessment
may be less for SAIF-insured
9
<PAGE> 14
deposits held by banks (sometimes referred to as "Oakar Deposits"). In addition
to the special assessment on SAIF deposits, the bills also contemplate a
special assessment on deposits which are insured by the Bank Insurance Fund
(BIF). This assessment on BIF-insured deposits presumably would be to provide
financial support to pay interest on FICO bonds. At December 31, 1995, the
Corporation's subsidiaries held approximately $1.4 billion in SAIF-insured
deposits, approximately $1.0 billion of which were Oakar Deposits; Leader had
approximately $1.6 billion of SAIF-insured deposits; and the pending
acquisitions had $221 million of SAIF-insured deposits. Should the proposed
legislation be adopted at the levels indicated and the pending acquisitions are
consummated, the Corporation would be required to recognize as an expense
aggregate SAIF assessments at the time the legislation is passed.
NOTE 5. EARNINGS PER SHARE CALCULATION FOR 1993
Leader was organized on March 18, 1993 in connection with the
conversion of its principal subsidiary, Leader Federal Bank for Savings and
subsidiaries, from a federal mutual savings bank to a federally-chartered
capital stock savings bank. Accordingly, the calculation of earnings per share
on a pooled basis is based on Leader's fourth quarter net income since the
stock conversion occured on September 30, 1993.
NOTE 6. UNAUDITED PRO FORMA CAPITAL RATIOS
The following table summarizes the Corporation's capital ratios as of
December 31, 1995 and the pro forma capital ratios assuming consummation of all
recently completed and probable acquisitions as of December 31, 1995.
<TABLE>
<CAPTION>
AS ADJUSTED FOR THE
ACTUAL ACQUISITIONS
--------- -------------------
<S> <C> <C>
Shareholders' Equity to Assets 8.57% 8.31%
Leverage Ratio 8.09 7.78
Tier 1 Capital to Risk-Weighted Assets* 12.64 13.01
Total Capital to Risk-Weighted Assets* 16.35 16.24
</TABLE>
- --------------------
*Based on estimated risk-weighted assets of all pending acquisitions.
10
