<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OR THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
---------------------------------------
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: 0-28700
FIRST HOME BANCORP INC.
(Exact name of registrant as specified in its charter)
New Jersey 22-3423990
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
125 South Broadway, Pennsville, New Jersey 08070
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(609) 678-4400
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changes since last report)
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 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
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date:
Common Stock, No par value, 2,708,426 shares as of May 13, 1997.
<PAGE>
FIRST HOME BANCORP INC.
AND SUBSIDIARY
INDEX
Page
Number
------
Part I Financial Information:
Item 1: Financial Statements:
Consolidated Statements of Financial Condition -
March 31, 1997 and December 31, 1996 (unaudited) 1
Consolidated Statements of Income -
Three Months Ended March 31, 1997
and 1996 (unaudited) 2
Consolidated Statements of Cash Flows -
Three Months Ended March 31, 1997
and 1996 (unaudited) 3
Notes to Consolidated Financial Statements
(unaudited) 4
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Part II. Other Information:
Other Information 15
<PAGE>
Part I
Item 1.
FIRST HOME BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
(Unaudited)
(in thousands)
<S> <C> <C>
ASSETS
Cash and amounts due from depository institutions $ 4,477 $ 5,133
Interest-earning deposits and short-term funds 870 1,302
Investment securities held-to-maturity (market value - $2,321
at March 31, 1997 and December 31, 1996) 2,321 2,321
Investment securities held for trading at market value 334 60
Investment securities available-for-sale at market value 23,592 24,975
Mortgage-backed securities (market value - 1997, $107,404;
1996, $98,418) 106,966 97,391
Mortgage-backed securities available-for-sale at market value 89,459 91,216
Loans receivable - net 263,014 258,234
Loans held for sale at market value 334 676
Accrued interest receivable 3,075 3,013
Real estate owned and other repossessed assets 717 948
Federal Home Loan Bank stock-at cost 7,376 7,376
Office properties and equipment 2,960 2,999
Deposit premium 602 631
Net deferred income taxes 1,339 1,347
Prepaid expenses and other assets 807 777
-------- --------
TOTAL ASSETS $508,243 $498,399
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits $295,237 $290,298
Borrowings from the Federal Home Loan Bank 131,484 136,622
Other borrowed funds 45,208 36,526
Advances by borrowers for taxes and insurance 516 445
Accrued interest payable on advances 656 588
Excess of fair value over cost 4 66
Accounts payable and accrued expenses 1,656 1,209
-------- --------
Total liabilities 474,761 465,754
-------- --------
Commitments and Contingencies (Note 13)
Shareholders' equity:
Preferred stock - No par value; 1,000,000 shares authorized;
none issued --- ---
Common stock - No par value; 10,000,000 shares authorized;
2,708,426 shares issued and outstanding at March 31, 1997 and
December 31, 1996 --- ---
Paid-in capital in excess of par 8,923 8,923
Retained earnings - partially restricted 25,619 24,592
Unrealized loss on securities available-for-sale (1,060) (870)
-------- --------
Total shareholders' equity 33,482 32,645
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $508,243 $498,399
======== ========
</TABLE>
See notes to consolidated financial statements.
1
<PAGE>
FIRST HOME BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended
March 31, March 31,
1997 1996
---- ----
(Unaudited)
(in thousands)
INTEREST INCOME:
Interest and fees on loans $5,474 $5,379
Interest on mortgage-backed securities 3,393 2,864
Other interest income and dividends 574 590
------ ------
Total interest income 9,441 8,833
------ ------
INTEREST EXPENSE:
Interest on deposits 3,240 2,960
Interest on borrowed money 2,373 2,141
------ ------
Total interest expense 5,613 5,101
------ ------
NET INTEREST INCOME 3,828 3,732
PROVISION FOR CREDIT LOSSES 100 100
------ ------
NET INTEREST INCOME AFTER PROVISION FOR
CREDIT LOSSES 3,728 3,632
------ ------
OTHER INCOME:
Loan servicing fees 49 56
Service charges and other fees 157 139
Profit (loss) relating to:
Loans held for sale 3 (23)
Investment securities held for trading 54 36
Accretion of excess of fair value over cost 62 62
Other income 32 32
------ ------
Total other income 357 302
------ ------
OPERATING EXPENSES:
General and administrative expense:
Salaries and employee benefits 1,042 1,037
Occupancy and equipment 314 311
Federal insurance premium 42 134
Other expenses 677 549
------ ------
Total general and administrative expenses 2,075 2,031
Amortization of deposit premium 28 64
Real estate operations, net 22 15
------ ------
Total operating expenses 2,125 2,110
------ ------
INCOME BEFORE INCOME TAXES 1,960 1,824
INCOME TAX EXPENSE 662 659
------ ------
NET INCOME $1,298 $1,165
====== ======
Earnings per share $ .48 $ .43
====== ======
Dividends per share $ .10 $ .09
====== ======
Weighted average number of shares outstanding 2,708,426 2,706,679
========= =========
See notes to consolidated financial statements.
2
<PAGE>
FIRST HOME BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
March 31, March 31,
1997 1996
---- ----
(Unaudited)
(in thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
Net Income $ 1,298 $ 1,165
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for losses 100 100
Depreciation 92 79
Accretion of excess fair value over cost (62) (62)
Amortization of fair market premiums --- 26
Amortization of deposit premium 28 64
Investment security gains (54) (36)
Purchase of investment securities held for trading (2,982) (2,340)
Proceeds from sale of investment securities held for trading 2,763 1,864
Loans originated for sale (1,488) (2,040)
Proceeds from loans sold 1,833 953
Net (gain) loss on sale of loans (3) 23
Increase in accrued interest receivable (62) (7)
Increase (decrease) in accrued interest payable 68 (30)
Decrease in net deferred tax asset 115 178
Net other 417 (396)
------- -------
Net cash (used in) provided by operating activities 2,063 (459)
------- -------
INVESTMENT ACTIVITIES:
Proceeds from maturities of investment securities 1,719 4,500
Purchase of investment securities (499) (2,554)
Purchase of mortgage-backed securities (11,326) (18,309)
Repayments on mortgage-backed securities 3,375 1,917
Purchase sale of FHLB stock --- (248)
Purchase of property and equipment (53) (174)
Decrease (increase) in real estate owned 231 (152)
Principal collected on longer term loans 11,326 13,145
Loans originated or acquired (16,206) (11,876)
------- -------
Net cash used by investing activities (11,433) (13,751)
------- -------
FINANCING ACTIVITIES:
Net increase (decrease) in:
Demand deposits, NOW accounts, and savings accounts 5,471 (996)
Certificates of deposit (532) 7,489
Proceeds from short-term borrowings 8,682 1,541
Proceeds from FHLB borrowings 2,000 7,700
Cash dividends and cash in lieu of fractional shares (272) (244)
Repayment of FHLB borrowings (7,138) (3,000)
Decrease in advance from borrowers for taxes and insurance 71 89
------- -------
Net cash provided by financing activities 8,282 12,579
------- -------
DECREASE IN CASH AND CASH EQUIVALENTS (1,088) (1,631)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 6,435 8,657
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 5,347 $ 7,026
======= =======
</TABLE>
See notes to consolidated financial statements
3
<PAGE>
FIRST HOME BANCORP INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
1. BASIS OF PRESENTATION
First Home Bancorp Inc. (the Company) is a New Jersey corporation which is
the holding company for First Home Savings Bank, F.S.B. (the Bank). The
Company was organized for the purpose of acquiring all of the capital stock
of the Bank in connection with the reorganization of the Bank into the
holding company form of ownership. Each outstanding share of common stock
of the Bank was converted into one share of common stock of the Company.
The reorganization was consummated on May 31, 1996.
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments necessary to present fairly
the Company's financial position as of March 31, 1997 and December 31,
1996, the results of operations for the three months ended March 31, 1997
and 1996 and changes in cash flows for the three months then ended. The
accompanying financial statements do not include information or footnotes
necessary for a complete presentation of financial condition, statements of
income and cash flows in conformity with generally accepted accounting
principles. Certain reclassifications have been made to the consolidated
financial statements for 1996 to conform to the 1997 presentation. The
statements of income for the three months ended March 31, 1997 and 1996 are
not necessarily indicative of the results which may be expected for the
entire year.
On July 1, 1992, the Bank acquired Fidelity Mutual Savings and Loan
Association in a supervisory conversion merger transaction. No
consideration was paid in connection with the transaction. The Bank
acquired assets with a fair value of approximately $79,900,000 and assumed
liabilities of approximately $79,400,000. The acquisition was accounted for
as a purchase with excess fair value over cost being accreted into income
over a period of five years.
2. INVESTMENT SECURITIES HELD-TO-MATURITY
Investment securities held-to-maturity at March 31, 1997 and December 31,
1996 consisted of tax exempt obligations due in less than one year.
3. INVESTMENT SECURITIES HELD FOR TRADING
Investment securities held for trading at March 31, 1997 consisted of an
investment in common stock and a mutual fund. Investment securities held
for trading at December 31, 1996 consisted of an investment in a mutual
fund.
The Company buys and sells debt and equity securities that are classified
as trading securities. At each reporting period, the Company adjusts the
value of these securities to market value.
4. INVESTMENT SECURITIES AVAILABLE-FOR-SALE
Investment securities available-for-sale at March 31, 1997 and December 31,
1996 consisted of the following:
<TABLE>
<CAPTION>
March 31, 1997
--------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
---- ----- ------ -----
(in thousands)
<S> <C> <C> <C> <C>
U.S. Government Agencies
Due after one year through five years $17,476 $ 4 $(112) $17,368
Corporate Notes
Due in one year or less 1,984 14 --- 1,998
Due after one year through five years 994 9 --- 1,003
Due after five years through ten years 637 --- --- 637
Preferred stock 2,548 38 --- 2,586
------- ---- ----- -------
Total $23,639 $ 65 $(112) $23,592
======= ==== ===== =======
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
December 31, 1996
-----------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
---- ----- ------ -----
(in thousands)
<S> <C> <C> <C> <C>
U.S. Government Agencies
Due in one year through five years $17,976 $ 73 $(17) $18,032
Corporate Notes
Due in one year or less 725 2 --- 727
Due after one year through five years 2,972 37 --- 3,009
Due after five years through ten years 639 11 --- 650
Preferred stock 2,548 9 --- 2,557
------- ---- ---- -------
Total $24,860 $132 $(17) $24,975
======= ==== ==== =======
</TABLE>
5. MORTGAGE-BACKED SECURITIES
A summary of mortgage-backed securities at March 31, 1997 and December 31,
1996 consisted of the following:
<TABLE>
<CAPTION>
March 31, 1997
--------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
---- ----- ------ -----
(in thousands)
<S> <C> <C> <C> <C>
Mortgage-backed Securities
Available-for-sale
FNMA pass-through certificates $ 1,830 $ 26 $ (10) $ 1,846
FHLMC pass-through certificates 3,791 206 --- 3,997
GNMA pass-through certificates 5,862 352 --- 6,214
Real estate mortgage investment
conduit obligations 79,584 156 (2,338) 77,402
-------- ---- ------- -------
Total mortgage-backed securities
available-for-sale $ 91,067 $740 $(2,348) $ 89,459
======== ==== ======= =======
Mortgage-Backed Securities
Held to Maturity
Non-agency pass through certificates $ 5,985 $ 43 $ (14) $ 6,014
FNMA pass-through certificates 7,136 --- --- 7,136
FHLMC pass-through certificates 4,190 --- (2) 4,188
Real estate mortgage investment
conduit obligations 89,655 857 (446) 90,066
-------- ---- ------- --------
Total mortgage-backed securities
held to maturity $106,966 $900 $ (462) $107,404
======== ==== ======= ========
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
December 31,1996
----------------
Gross Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
---- ----- ------ -----
(in thousands)
<S> <C> <C> <C> <C>
Mortgage-backed Securities
Available-for-sale
FNMA pass-through certificates $ 1,863 $ 34 $ (2) $ 1,895
FHLMC pass-through certificates 4,342 237 --- 4,579
GNMA pass-through certificates 6,070 390 --- 6,460
Real estate mortgage investment
conduit obligations 80,416 277 (2,411) 78,282
------- ------ ------- -------
Total mortgage-backed securities
available-for-sale $92,691 $938 $(2,413) $91,216
======= ====== ======= =======
Mortgage-Backed Securities
Held to Maturity
Non-agency pass through certificates $ 6,143 $ 48 $ (7) $ 6,184
Real estate mortgage investment
conduit obligations 91,248 1,203 (217) 92,234
------- ------ ------- -------
Total mortgage-backed securities
held to maturity $97,391 $1,251 $ (224) $98,418
======= ====== ======= =======
</TABLE>
Mortgage-backed securities with amortized costs of $75,276,000 and
$66,690,000 and market values of approximately $74,734,000 and $66,990,000
were pledged as collateral for securities sold under agreements to
repurchase at March 31, 1997 and December 31, 1996, respectively.
6. LOANS RECEIVABLE
Loans receivable at March 31, 1997 and December 31, 1996 consisted of the
following:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
(in thousands)
<S> <C> <C>
Residential mortgages on existing property $207,277 $203,574
Residential construction mortgages 2,949 3,824
Commercial real estate loans 18,523 17,214
Commercial business loans 2,065 1,948
Consumer loans:
Home equity loans 20,458 19,479
Mobile home loans 6,338 6,606
Equity lines of credit 4,026 3,993
Automobile loans 4,715 4,631
Other loans 3,488 3,747
-------- --------
Total 269,839 265,016
Undisbursed portion of loans in process (1,163) (1,222)
Net deferred loan fees, discounts and premiums (1,905) (1,800)
Allowance for possible credit losses (3,757) (3,760)
-------- --------
Total $263,014 $258,234
======== ========
</TABLE>
The total amount of loans serviced for the benefit of others was
approximately $65,600,000 and $64,900,000 at March 31, 1997 and
December 31, 1996, respectively.
6
<PAGE>
Following is a summary of changes in allowance for possible credit losses:
March 31, December 31,
1997 1996
---- ----
(in thousands)
Balance, beginning of period $3,761 $3,562
Provision for credit losses 100 400
Charge-offs (133) (358)
Recoveries 29 156
------ ------
Total $3,757 $3,760
====== ======
7. LOANS HELD FOR SALE
Loans held for sale at March 31,1997 and December 31, 1996 amounted to
$334,000 and $676,000, respectively. Loans held for sale consist of 30 year
fixed-rate residential mortgage loans which qualify for sale in the
secondary market. These loans are recorded at the lower of cost or market
value determined on an aggregate basis.
8. REAL ESTATE OWNED AND OTHER REPOSSESSED ASSETS
Real estate owned and other repossessed assets at March 31, 1997 and
December 31, 1996 consisted of the following:
March 31, December 31,
1997 1996
---- ----
(in thousands)
Real estate owned $710 $941
Other repossessed assets 7 7
---- ----
Total $717 $948
==== ====
9. OFFICE PROPERTIES AND EQUIPMENT
Office properties and equipment at March 31, 1997 and December 31, 1996 are
summarized by major classifications as follows:
March 31, December 31,
1997 1996
---- ----
(in thousands)
Land, buildings and improvements $3,695 $3,689
Furniture and equipment 1,487 1,437
------ ------
Total 5,182 5,126
Less accumulated depreciation (2,222) (2,127)
------ ------
Total $2,960 $2,999
====== ======
10. DEPOSITS
Deposits at March 31, 1997 and December 31, 1996 consisted of the
following:
March 31, December 31,
1997 1996
---- ----
(in thousands)
NOW accounts $ 26,497 $ 26,477
Non-interest bearing accounts 6,606 7,594
Money market and other accounts 57,873 51,408
Savings and club accounts 34,515 34,541
Time deposits 169,330 169,899
-------- --------
Total 294,821 289,919
Accrued interest payable 416 379
-------- --------
Total $295,237 $290,298
======== ========
7
<PAGE>
The Bank has pledged mortgage loans and mortgage-backed securities
aggregating approximately $1,282,000 for public fund deposits as required
by the New Jersey Department of Banking's Govern mental Unit Deposit
Protection Act.
11. BORROWINGS FROM FEDERAL HOME LOAN BANK
Federal Home Loan Bank borrowings due at various dates through 2002 with
interest rates from 5.08% to 7.52% at March 31, 1997 totaled $131,484,000
and from 5.08% to 7.52% at December 31, 1996 totaled $136,622,000. The
borrowings from the Federal Home Loan Bank are collateralized by Federal
Home Loan Bank stock and substantially all first mortgage loans.
Borrowings from the Federal Home Loan Bank at March 31, 1997 and December
31, 1996 also include securities sold under agreements to repurchase of
$27,109,000 and $27,297,000, respectively. These agreements are due within
30 days and have interest rates of 5.62% and 5.61%, respectively.
Securities sold under agreement to repurchase were collateralized by
mortgage-backed securities with amortized costs of $28,852,000 and
$28,935,000 and market values of approximately $28,654,000 and $28,816,000
at March 31, 1997 and December 31, 1996, respectively.
12. OTHER BORROWED FUNDS
Other borrowed funds at March 31, 1997 and December 31, 1996 consisted of
securities sold under agreements to repurchase. At March 31, 1997,
$25,208,000 of these agreements are due within 30 days and $20,000,000 is
due November 1998 and have a weighted interest rate of 5.78% and 5.73%,
respectively. Such agreements are treated as financings and the obligations
to repurchase securities sold are reflected as a liability in the
statements of financial condition. Securities sold under agreement to
repurchase were collaterized by mortgage-backed securities and U.S.
Government Agencies with amortized costs of $46,425,000 and $37,755,000 and
market values of approximately $46,080,000 and $38,174,000 at March 31,
1997 and December 31, 1996, respectively. The securities underlying the
agreements were delivered to, and are held by, the dealers who arranged the
transactions.
13. COMMITMENTS AND CONTINGENCIES
Commitments at March 31, 1997 and December 31, 1996 consisted of the
following:
March 31, December 31,
1997 1996
---- ----
(in thousands)
Fixed rate mortgage loans
(current market rates) $ 2,980 $ 2,310
Adjustable rate mortgage loans 987 1,107
Purchase of fixed rate mortgage loans --- 7,189
Unused lines of credit 5,936 5,421
Letters of credit 567 574
Consumer loans 699 564
Loans in process 1,163 1,222
------- -------
Total $12,332 $18,387
======= =======
At March 31, 1997 all commitments are expected to be funded within one
year.
8
<PAGE>
FIRST HOME BANCORP INC.
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
First Home Bancorp Inc. (the Company) is the sole stockholder of First
Home Savings Bank, F.S.B. (the Bank). Substantially all of the Company's
consolidated revenues are derived from the operations of the Bank, and the Bank
represented substantially all of the Company's consolidated assets and
liabilities at March 31, 1997. The Bank's business is that of a financial
intermediary and consists primarily of attracting deposits from the general
public and using such deposits, together with borrowings and other funds, to
make mortgage loans secured by residential real estate primarily located in New
Jersey and Delaware. The Bank provides consumer banking services through eight
retail banking offices in New Jersey and two retail banking offices in Delaware.
The Bank is subject to significant competition from other financial
institutions, and is also subject to regulation by the Office of Thrift
Supervision (OTS) and the Federal Deposit Insurance Corporation and undergoes
periodic examinations by these regulatory agencies.
Net Income
The Company earned $1,298,000 or $.48 per share for the three month
period ended March 31, 1997 compared to $1,165,000 or $.43 per share for the
three month period ended March 31, 1996. Net income increased $133,000 or 11.4%
for the three months ended March 31, 1997 as compared to the same period in
1996.
Net Interest Income
Net interest income for the three month period ended March 31, 1997
totaled $3,828,000 compared to $3,732,000 for the three month period ended March
31, 1996, a $96,000 or 2.6% increase. The increase in net interest income for
the three months ended March 31, 1997 was attributable to growth in net
interest-earning assets of $1,054,000 and was offset by a decline in net
interest margin. Average interest-earning assets increased by $45,142,000 for
the three month period ended March 31, 1997 as compared to the prior year.
Average interest-bearing liabilities increased by $44,088,000 for the three
month period ended March 31, 1997 as compared to the prior year. The increase in
interest-earning assets was primarily attributable to the purchase of
mortgaged-backed securities which increased by $35,085,000 from the prior year.
The increase in interest-bearing liabilities was attributable to increases in
deposits of $24,232,000 and borrowings of $19,856,000 from the prior year. The
increase in net interest income resulting from the increase in net
interest-earning assets was offset by a decline in interest rate spread of .21%
to 2.93% in March 1997 from 3.14% in March 1996.
The following table sets forth information for the three month periods
ended March 31, 1997 and March 31, 1996 regarding the Company's (1) average
balance of interest-earning assets and the resultant interest income and average
yields; (2) average balance of interest-bearing liabilities and the resultant
interest expense and average costs; (3) net interest income; (4) interest rate
spread; (5) and net yield earned on weighted average interest-earning assets.
Averages are calculated on a month-end basis for each of the periods indicated.
The table is not presented on a tax equivalent basis because the Company's
investment in tax-free obligations is insignificant.
9
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended
March 31, 1997 March 31, 1996
--------------------------- ----------------------------
(dollars in thousands)
Average Average
Average Yield/ Average Yield/
Balance Interest Rate Balance Interest Rate
------- -------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Loans $263,843 $5,474 8.30% $254,332 $5,379 8.46%
Mortgage-backed securities 190,702 3,393 7.12 155,617 2,864 7.36
Other (1) 34,216 574 6.71 33,670 590 7.00
-------- ------ ----- -------- ------ ----
Total interest-earning assets 488,761 9,441 7.73 443,619 8,833 7.96
-------- ------ ----- -------- ------ ----
Non-interest earning assets 14,679 13,118
-------- --------
Total assets $503,440 $456,737
======== ========
Interest bearing liabilities:
Deposits $295,958 3,240 4.38 $271,726 2,960 4.36
Borrowings 171,656 2,373 5.53 151,800 2,141 5.64
-------- ------ ----- -------- ------ ----
Total interest-bearing liabilities 467,614 5,613 4.80 423,526 5,101 4.82
-------- ----- ----- ------- ------ ----
Non-interest-bearing liabilities 2,476 2,673
-------- -------
Total liabilities 470,090 426,199
-------- -------
Shareholders' equity 33,350 30,538
-------- -------
Total liabilities and
shareholders' equity $503,440 $456,737
======== ========
Net interest income $3,828 $3,732
====== ======
Interest rate spread 2.93% 3.14%
===== ====
Net yield on weighted average
interest-earning assets 3.13% 3.37%
===== ====
</TABLE>
(1) Consists of interest-earning deposits, short-term funds, investment
securities, and Federal Home Loan Bank stock.
Provision for Credit Losses
The provision for credit losses were $100,000 for the three month
periods ended March 31, 1997 and 1996. As of March 31, 1997, the allowance for
credit losses totaled $3,757,000 or 1.41% of total loans including loans held
for sale compared to $3,608,000 or 1.40% of total loans at March 31, 1996.
Other Income
Other income increased by $55,000 for the three months ended March 31,
1997 from the comparable period of 1996. The increase for the three months ended
March 31, 1997 was attributable to the increase in net profits relating to the
sale of investment securities held for trading and loans held for sale to
$57,000 for the three months ended March 31, 1997 from $13,000 during the
comparable period in the prior year. In addition, service charges and other fees
increased $18,000 during the three months ended March 31, 1997 compared to the
comparable period in the prior year.
Operating Expenses
General and Administrative Expense - General and administrative expenses
increased $44,000 or 2.2% for the three months ended March 31, 1997 from the
comparable period of 1996. The increase in general and administrative expenses
for the three months ended March 31, 1997 was attributable to increases of
$135,000 attributable to costs associated with the operation, expansion, and
administration of customer services and additional costs of operating the
holding company. These increases were offset by a decrease of $92,000 in the
federal insurance premium for the three month period ended March 31, 1997 to
$42,000 from $134,000 for the three month period ended March 31, 1996.
10
<PAGE>
Amortization of Deposit Premium - In January 1995, the Bank acquired two branch
offices with deposits of approximately $15,900,000. The premium paid for these
deposits is amortized over a period not exceeding the estimated average
remaining life of the customer base acquired. During the three month periods
ended March 31, 1997 and March 31, 1996 amortization was $28,000 and $64,000,
respectively.
Income Tax Expense
Income tax expense increased $3,000 for the three months ended March 31,
1997 as compared to the same period in 1996. Although pre-tax income increased
$136,000 or 7.5% from the comparable period of 1996, tax expense did not
increase by a comparable amount because a valuation allowance on deferred tax
assets was provided during the period ended March 31, 1996 while there was no
valuation allowance provided during the period ended March 31, 1997.
Financial Condition
Total assets increased to $508,243,000 on March 31, 1997 from
$498,399,000 as of December 31, 1996, an increase of 7.9% on an annualized
basis. This increase was mainly attributable to an increase in mortgage-backed
securities. From December 31, 1996 to March 31, 1997 mortgage-backed securities
increased by $7,818,000.
Total liabilities increased to $474,761,000 on March 31, 1997 from
$465,754,000 as of December 31, 1996, an increase of 7.7% on an annualized
basis. Deposits increased to $295,237,000 on March 31, 1997 from $290,298,000 on
December 31, 1996. This increase was primarily due to an increase in money
market and other accounts. From December 31, 1996 to March 31, 1997, money
market and other accounts increased by $6,465,000. This increase was primarily
used to fund the increase in mortgage-backed securities.
Shareholders' equity increased to $33,482,000 on March 31, 1997 from
$32,645,000 as of December 31, 1996. This increase was primarily the result of
net income of $1,298,000 for the three months ended March 31, 1997, less cash
dividends and cash in lieu of fractional shares of $272,000 declared during the
period. In addition, investments classified as available-for-sale in accordance
with the Financial Accounting Standards Board Statement No. 115 "Accounting for
Certain Investments in Debt and Equity Securities" are required to be marked to
market on an after-tax basis and unrealized gains or losses are reflected as an
adjustment to shareholders' equity. The Company had unrealized losses of
$1,060,000 on March 31, 1997 and unrealized losses of $870,000 on December 31,
1996 or a net increase in unrealized losses of $190,000.
Asset Quality
The Company's non-performing assets consist of non-accrual loans, real
estate owned and repossessed assets. The following table sets forth information
regarding non-performing assets.
March 31, December 31,
1997 1996
---- ----
(in thousands)
Non-accrual loans
Residential loans $2,330 $2,316
Commercial loans 515 592
Consumer loans 461 305
------ ------
Total non-accrual loans 3,306 3,213
Real estate owned 710 941
Other repossessed assets 7 7
------ ------
Total non-performing assets $4,023 $4,161
====== ======
Total non-performing assets as a percent of total assets .79% .83%
=== ===
11
<PAGE>
The Company's level of non-performing assets is affected by adverse
situations that may affect a borrower's ability to repay and other conditions
beyond the Company's control. The Company's management monitors the quality of
assets on a regular basis.
Liquidity and Committed Resources
Liquidity is maintained at a sufficient level to generate cash to fund
current loan demand and pay operating expenses. Sources of funds are obtained
from increases in deposits, loan principal repayments, sales of loans and
investments, increases in borrowed money and from operations. While loan
principal repayments are a relatively stable source of funds, deposit flows are
greatly influenced by general interest rates, economic conditions and
competition. As a member of the Federal Home Loan Bank (FHLB) system, the
Company may borrow from the FHLB of New York. The Company may also utilize
reverse repurchase agreements collateralized by mortgage-backed securities or
other securities. Management believes that the Company has sufficient borrowing
capacity to compensate for reductions in other sources of funds such as
deposits.
The Company had 6.86% of its assets qualifying for liquidity under
applicable federal regulations as of March 31, 1997. The overall liquidity
percentage requirement is currently 5% on an average monthly basis.
At March 31, 1997, the Company had approximately $12,332,000 in
outstanding commitments. It is anticipated that these commitments will fund
within the next year and funds will be available from normal cash flows.
Interest Rate Risk Management
The Company has a program to control its interest rate risk. The
strategy includes an emphasis on originating adjustable rate mortgage (ARM)
loans, the purchase of adjustable rate and short-term mortgage-backed securities
(MBS) and the origination of short-term consumer loans. The Board of Directors
has instructed management to maintain interest rate risk within prescribed
limits. An internal asset/liability modeling system monitors the effect on
income of changing market interest rates.
The difference between the amount of interest-earning assets maturing or
repricing within a specific time period and the amount of interest-bearing
liabilities maturing or repricing within that time period (gap) is also
monitored. A gap is considered positive when the amount of interest rate
sensitive assets exceeds the amount of interest rate sensitive liabilities. When
interest rate sensitive liabilities exceed interest rate sensitive assets, the
gap is considered negative. However, because all interest rates and yields do
not adjust at the same velocity, the gap is only a general indicator of interest
rate sensitivity.
During a period of rising interest rates, a negative gap tends to
adversely affect net interest income while a positive gap tends to increase net
interest income. During a period of declining interest rates, a negative gap
tends to increase net interest income while a positive gap tends to adversely
affect net interest income.
The Company's net interest income tends to increase in periods of
declining interest rates because its interest-bearing liabilities generally
reprice faster than its interest-earning assets. The Company's net interest
income tends to decrease in periods of rising interest rates. Therefore, rising
interest rates, particularly when combined with a flattening yield curve, could
have a negative impact on net interest income in future periods.
The following table summarizes the amounts of interest-earning assets
and interest-bearing liabilities outstanding as of March 31, 1997 which are
anticipated to mature, prepay or reprice in each of the future time periods
shown. Adjustable and floating rate assets are included in the period in which
interest rates are next scheduled to adjust rather than in the period in which
they are due. Loans and mortgage-backed securities are included in the periods
in which they are anticipated to be repaid, based on internal assumptions.
Non-performing loans have been excluded from interest-earning assets. Money
market deposit accounts (MMDA) and other accounts, NOW and savings accounts
which are subject to immediate withdrawal and repricing are classified at decay
rates based upon assumptions provided by the OTS.
12
<PAGE>
<TABLE>
<CAPTION>
Twelve
Months 1-3 3-5 5-10 10-20 Over 20
or less Years Years Years Years Years Total
------- ----- ----- ----- ----- ----- -----
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Residential mortgage loans
Adjustable rate $ 52,219 $ 18,326 $ 457 $ --- $ --- $ --- $ 71,002
Fixed rate 26,302 38,706 26,387 32,482 11,627 228 135,732
Mortgage-backed securities
Adjustable rate 96,390 9,544 --- --- --- --- 105,934
Fixed rate 16,088 24,099 16,692 23,506 12,689 1,129 94,203
Consumer and commercial loans
Adjustable rate 11,174 2,657 340 --- --- --- 14,171
Fixed rate 19,263 16,128 5,672 3,042 361 --- 44,466
Loans held for sale 334 --- --- --- --- --- 334
Investment securities 4,691 2,500 16,500 605 --- 9,923 34,219
Investment securities held-for-trading 334 --- --- --- --- --- 334
-------- -------- -------- ------- ------- ------- --------
Total 226,795 111,960 66,048 59,635 24,677 11,280 500,395
-------- -------- -------- ------- ------- ------- --------
Interest-bearing liabilities:
Deposits
Savings accounts 4,832 7,729 5,717 8,599 5,948 1,690 34,515
NOW and non-interest
bearing demand accounts 5,628 8,548 5,888 7,903 4,339 797 33,103
Money market accounts 17,941 20,920 9,960 7,636 1,381 35 57,873
Certificates of deposit 116,566 44,088 8,676 --- --- --- 169,330
Borrowings 116,132 52,703 7,857 --- --- --- 176,692
-------- -------- -------- ------- ------- ------- --------
Total 261,099 133,988 38,098 24,138 11,668 2,522 471,513
-------- -------- -------- ------- ------- ------- --------
Excess int.-earning assets (liabilities) $(34,304) $(22,028) $ 27,950 $35,497 $13,009 $ 8,758 $ 28,882
======== ======== ======== ======= ======= ======= ========
Cumulative excess interest-earning
assets (liabilities) $(34,304) $(56,332) $(28,382) $ 7,115 $20,124 $28,882
======== ======== ======== ======= ======= =======
Ratio of GAP during the period
to total assets (6.75)% (4.33)% 5.50% 6.98% 2.56% 1.72%
===== ====== ===== ==== ==== ====
Ratio of cumulative GAP
to total assets (6.75)% (11.08)% (5.58)% 1.40% 3.96% 5.68%
===== ====== ===== ==== ==== ====
</TABLE>
Capital
The Bank is in full compliance with its capital requirements. Management
believes that, under current regulations, the Bank will continue to meet its
minimum capital requirements in the foreseeable future. The table below presents
the Bank's actual and regulatory required capital amounts for core, tangible,
tier 1 risk-based and total risk-based capital at March 31, 1997.
<TABLE>
<CAPTION>
Required to be
Required for Well Capitalized
Capital Adequacy Under Prompt
Actual Purposes Corrective Action
--------------------- -------------------- ---------------------
Amount Percentage Amount Percentage Amount Percentage
-------------------- -------------------- ---------------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Core (Leverage) $33,018 6.50% $15,241 3.0% $25,402 5.0%
Tangible 33,018 6.50 7,621 1.5 N/A N/A
Tier I risk-based 33,018 15.27 8,648 4.0 12,972 6.0
Total risk-based 35,659 16.49 17,296 8.0 21,620 10.0
</TABLE>
13
<PAGE>
Recent Accounting Pronouncements
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, "Earnings Per Share" effective for fiscal years ending on or
after December 15, 1997. This statement establishes new standards for computing
and presenting earnings per share and now makes the earnings per share
comparable to international standards. Early application is not permitted and
the Statement requires restatement of all prior-period Earnings Per Share (EPS)
data presented after its effective date.
The EPS as curently reported is the same as the Basic EPS required by
the Statement. The newly required Diluted EPS is not expected to be materially
different than the Basic EPS.
Also, in March 1997, the FASB issued Statement No. 129, "Disclosure of
Information about Capital Structure." This statement did not change the
currently reported disclosures.
<TABLE>
<CAPTION>
Selected Financial and Other Data
- ----------------------------------------------------------------------------------------------------
Three Months Ended
March 31,
1997 1996
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Interest rate spread 2.93% 3.14%
Net yield on interest-earning assets 3.13% 3.37%
Return on average assets 1.03% 1.02%
Return on average equity 15.57% 15.26%
General and administrative expenses to average assets 1.65% 1.78%
Ratio of interest-earning assets to interest-bearing liabilities 1.05x 1.05x
Ratio of non-performing assets to total assets at end of period .79% .95%
Dividends per common share $.10 $.09
Book value per share at end of period $12.36 $11.23
</TABLE>
14
<PAGE>
FIRST HOME BANCORP INC.
AND SUBSIDIARY
Part II: Other Information
Item 6: Exhibits and Other Reports on Form 8-K
Exhibit 11 - Statement regarding computation of earnings per share
Exhibit 27 - Financial Data Schedule
No reports on Form 8-K were filed during the quarter for which this
report is filed.
15
<PAGE>
FIRST HOME BANCORP INC.
AND SUBSIDIARY
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.
FIRST HOME BANCORP INC.
(Registrant)
Date: May 13, 1997 /s/Stephen D. Miller
------------------------------------
Stephen D. Miller
President/Chief Executive Officer
Date: May 13, 1997 /s/Robert A. DiValerio
------------------------------------
Robert A. DiValerio
Senior Executive Vice-President/
Chief Financial Officer
16
<PAGE>
EXHIBIT (11)
FIRST HOME BANCORP INC. AND SUBSIDIARY
COMPUTATION OF EARNINGS PER SHARE OF COMMON STOCK
<TABLE>
<CAPTION>
Three Months Ended
March March
1997 1996
---- ----
<S> <C> <C>
PRIMARY
EARNINGS:
Net income $1,298,042 $1,164,960
========== ==========
SHARES:
Weighted average number of
common shares outstanding 2,708,426 2,706,679
Assuming exercise of options reduced by the number of shares which could have
been purchased with the proceeds from exercise
of such options (1) 36,429 20,384
---------- ----------
Weighted average number of common
shares outstanding as adjusted 2,744,855 2,727,063
========== ==========
Primary earnings per share of
common stock $0.47 $0.43
===== =====
ASSUMING FULL DILUTION
EARNINGS:
Net income $1,298,042 $1,164,960
========== ==========
SHARES:
Weighted average number of
common shares outstanding 2,708,426 2,706,679
Assuming exercise of options reduced by the number of shares which could have
been purchased with the proceeds from exercise
of such options (2) 39,849 20,384
---------- ----------
Weighted average number of common
shares outstanding as adjusted 2,748,275 2,727,063
========== ==========
Fully diluted earnings per share of
common stock $0.47 $0.43
===== =====
</TABLE>
- -----------------
(1) Assumes the proceeds obtained from the exercise of options were used to
purchase common shares at the average market price during the quarter.
(2) Assumes the proceeds obtained from the exercise of stock options were used
to purchase common shares at the market price at the close of the quarter
if such price was higher than the average price during the quarter.
17
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
The schedule contains summary financial information extracted from the
statements of consolidated financial condition as of March 31, 1997 and the
consolidated statements of income for the three months ended March 31, 1997 and
is qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0001009195
<NAME> FIRST HOME BANCORP, INC.
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-1-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 4,477
<INT-BEARING-DEPOSITS> 870
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 334
<INVESTMENTS-HELD-FOR-SALE> 113,051
<INVESTMENTS-CARRYING> 109,287
<INVESTMENTS-MARKET> 109,725
<LOANS> 263,348
<ALLOWANCE> 3,757
<TOTAL-ASSETS> 508,243
<DEPOSITS> 295,237
<SHORT-TERM> 116,132
<LIABILITIES-OTHER> 2,832
<LONG-TERM> 60,560
0
0
<COMMON> 0
<OTHER-SE> 33,482
<TOTAL-LIABILITIES-AND-EQUITY> 508,243
<INTEREST-LOAN> 5,474
<INTEREST-INVEST> 3,967
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 9,441
<INTEREST-DEPOSIT> 3,240
<INTEREST-EXPENSE> 5,613
<INTEREST-INCOME-NET> 3,828
<LOAN-LOSSES> 100
<SECURITIES-GAINS> 57
<EXPENSE-OTHER> 2,126
<INCOME-PRETAX> 1,960
<INCOME-PRE-EXTRAORDINARY> 1,960
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,298
<EPS-PRIMARY> .47
<EPS-DILUTED> .47
<YIELD-ACTUAL> 7.73
<LOANS-NON> 3,306
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 3,760
<CHARGE-OFFS> 132
<RECOVERIES> 29
<ALLOWANCE-CLOSE> 3,757
<ALLOWANCE-DOMESTIC> 3,757
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
