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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to ____________
Commission file number 0-21939
Pennwood Bancorp, Inc.
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(Exact Name of Small Business Issuer as Specified in Its Charter)
Pennsylvania 25-1783648
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(State or Other Jurisdiction of Incorporation or (I.R.S. Employer
Organization) Identification No.)
683 Lincoln Avenue
Pittsburgh, Pennsylvania 15202
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(Address of Principal Executive Offices) (Zip Code)
(412) 761-1234
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(Registrant's Telephone Number, Including Area Code)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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:
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 563,922
Transitional Small Business Disclosure Format (check one):
Yes No X
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PENNWOOD BANCORP, INC.
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TABLE OF CONTENTS
PAGE
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PART I. FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS. 3
Consolidated Balance Sheets (As of September 30, 1997 (unaudited)
and June 30, 1997) 3
Consolidated Statements of Income (For the three months
ended September 30, 1997 and 1996 (unaudited)) 4
Consolidated Statements of Cash Flows (For the three months
ended September 30, 1997 and 1996 (unaudited)) 5
Notes to Consolidated Financial Statements 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS. 10
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. 14
ITEM 2. CHANGES IN SECURITIES. 14
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. 14
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS. 14
ITEM 5. OTHER INFORMATION. 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. 14
</TABLE>
SIGNATURES
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PENNWOOD BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
SEPT. 30 JUNE 30,
ASSETS 1997 1997
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Cash and amounts due from depository institutions 657 936
Money market investments at cost which approximates
market value 2,713 868
Federal funds sold 500 0
Investment and mortgage-backed securities:
Available-for-sale (Amortized cost of $12,523 and $18,227) 12,617 18,224
Held-to-maturity (Market value of $520 and $720) 512 712
Loans receivable, net 28,661 26,980
Real estate owned, net 37 37
Federal Home Loan Bank stock 190 345
Premises and equipment, net 1,084 1,089
Accrued interest receivable 400 534
Prepaid expenses and other assets 274 256
--- ---
Total assets 47,645 49,981
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Savings deposits 36,539 35,819
Advances from borrowers for taxes and insurance 185 320
Accrued interest payable on savings deposits 477 410
Borrowed funds 1,456 4,464
Accrued expenses and other liabilities 252 242
--- ---
Total liabilities 38,909 41,255
Shareholders' Equity:
Common Stock, $.01 par value; 4,000,000 shares authorized;
610,128 issued at September 30, 1997. 6 6
Additional paid-in capital 5,610 5,603
Retained earnings, substantially restricted 4,426 4,355
Treasury stock, at cost: 40,506 and 30,506 shares at September 30, 1997
and June 30, 1997, respectively. (621) (458)
Unearned Employee Stock Ownership Plan shares (427) (439)
Unearned common stock - Recognition and Retention Plan (321) (339)
Unrealized (loss) on securities available-for-sale 63 (2)
-- --
Total shareholders' equity 8,736 8,726
Total liabilities and shareholders' equity 47,645 49,981
====== ======
</TABLE>
See accompanying notes to unaudited consolidated financial statements
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PENNWOOD BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in Thousands except Per Share Amount)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30,
1997 1996
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<S> <C> <C>
Interest income:
Loans 644 521
Investment securities 259 232
Mortgage backed securities 34 48
Federal funds sold & other investments 9 7
Money market investments 21 96
-- --
Total interest income 967 904
Interest expense:
Interest on savings deposits 422 404
Interest on borrowed funds 43 4
-- -
Total interest expense 465 408
Net interest income 502 496
Provision for loan losses 15 8
Net interest income after provision --- ---
for loan losses 487 488
Other income:
Service charges 16 9
Other 21 18
-- --
Total other income 37 27
Other expenses:
Compensation and employee benefits 176 141
Premises and occupancy costs 59 53
Federal insurance premiums 6 24
SAIF assessment 0 247
Data processing expense 20 19
Net loss on real estate owned 0 12
Other operating expenses 86 75
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Total other expenses 347 571
Income (loss) before income taxes 177 (56)
Provision (benefit) for income taxes 49 (39)
Net income (loss) 128 (17)
=== ===
Earnings (loss) per share $.24 $(.03)
Dividend declared per share $.08 $ .00
</TABLE>
See accompanying notes to unaudited consolidated financial statements
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PENNWOOD BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30,
OPERATING ACTIVITIES: 1997 1996
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<S> <C> <C>
Net Income (Loss) 128 (17)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation expense 18 18
Provision for loan and real estate owned losses 15 20
Decrease (Increase) in accrued interest receivable 134 (79)
(Increase) decrease in prepaid expenses and other assets (18) 257
Increase in accrued interest payable on deposits 67 46
Decrease in deposits on stock subscription rights 0 (4,569)
Other, net 47 61
-- --
Total adjustments 263 (4,246)
Net cash (used) provided by operating activities 391 (4,263)
INVESTING ACTIVITIES:
Purchases of premises and equipment (11) 0
Purchases of investment and mortgage-backed securities
available-for-sale 0 (4,749)
Proceeds from maturities of investment and mortgage-backed
securities held-to-maturity 200 649
Proceeds from maturities and principal repayments of
investment and mortgage-backed securities available-
for-sale 5,700 250
Net (increase) decrease in loans receivable (1,696) (263)
Increase in federal funds (500) 0
Decrease in FHLB stock 155 0
Other, net (28) (1)
--- --
Net cash used by investing activities 3,820 (4,114)
FINANCING ACTIVITIES:
Net decrease in passbook, club, money market and
NOW accounts (289) (1,349)
Net (decrease) increase in certificates of deposit accounts 1,009 (382)
Net decrease in advances from borrowers for
taxes and insurance (135) (135)
Proceeds from ESOP loan 0 488
Repayment of ESOP loan (15) 0
Release of ESOP shares 12 0
Proceeds from issuance of common stock 0 5,660
Stock acquired for ESOP 0 (488)
Purchase of Treasury stock (163) 0
Dividends paid (47) 0
Repayment of FHLB advances (3,000) 0
Other (17) 0
--- -
Net cash (used) provided by financing activities (2,645) 3,794
Net decrease in cash and cash equivalents 1,566 (4,583)
Cash and cash equivalents, beginning of period 1,804 10,106
Cash and cash equivalents, end of period 3,370 5,523
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</TABLE>
See accompanying notes to unaudited consolidated financial statements
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PENNWOOD BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED
(Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30,
1997 1996
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Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest 363 357
=== ===
Income taxes 25 0
== =
Supplemental schedule of noncash investing activities:
Loan transferred to real estate owned 0 0
= =
Dividend declared but not paid 46 0
== =
</TABLE>
See accompanying notes to unaudited consolidated financial statements
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PENNWOOD BANCORP, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with instructions to Form 10-Q. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complex financial statements. However, such information presented reflects
all adjustments (consisting solely of normal recurring adjustments) which are,
in the opinion of management, necessary for a fair statement of results for the
interim periods.
The results of operations for the three months ended September 30, 1997 are not
necessarily indicative of the results to be expected for the year ending June
30, 1998. The unaudited consolidated financial statements and notes thereto
should be read in conjunction with the audited financial statements and notes
thereto for the year ended June 30, 1997.
Note 2 - Principles of Consolidation
The accompanying unaudited financial statements of Pennwood Bancorp, Inc. ("the
Company") include the accounts of the Company and its wholly-owned subsidiary,
Pennwood Savings Bank. All significant intercompany transactions have been
eliminated in consolidation.
Note 3 - Conversion to Stock Form of Ownership
On February 20, 1996, as amended on April 6, 1996, the Board of Trustees adopted
a plan of conversion whereby the Company would be converted from a Pennsylvania
mutual savings bank to a Pennsylvania stock savings bank. The conversion was
completed on July 12, 1996, and the Company issued 610,128 shares of common
stock resulting in $6,101,280 in gross proceeds to the Company. Costs of the
common stock offering of approximately $477,000 were deducted from the offering
proceeds.
At the completion of the conversion to stock form, the Company established a
liquidation account in the amount of retained earnings set forth in the offering
circular utilized in the conversion. The liquidation account will be maintained
for the benefit of eligible savings account holders who maintain deposit
accounts in the Company after conversion. In the event of a complete liquidation
(and only in such event), each eligible savings account holder will be entitled
to receive a liquidation distribution from the liquidation account in the amount
of the then current adjusted balance of deposit accounts held, before any
liquidation distribution may be made with respect to the common shares. Except
for the
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repurchase of stock and payment of dividends by the Company, the existence of
the liquidation account will not restrict the use or further application of such
retained earnings.
The Company may not declare or pay a cash dividend on, or repurchase any of its
common shares if the effect thereof would cause the Company's stockholders'
equity to be reduced below either the amount required for the liquidation
account or the regulatory capital requirements for insured institutions.
On January 27, 1997, the reorganization of the Savings Bank was completed. The
resulting company is Pennwood Bancorp, Inc.
Note 4 - Earnings Per Share
Earnings per share ("EPS") is computed by dividing net income or loss by the
weighted average number of common shares and common stock equivalents
outstanding during the period. Such shares amounted to 556,184 at September 30,
1997. Shares outstanding for the three months ended September 30, 1997, do not
include 43,929 of ESOP shares that were unallocated at September 30, 1997, in
accordance with SOP 93-6 "Employers Accounting for Employee Stock Ownership
Plans." There were common stock equivalents outstanding at September 30, 1997,
in the form of stock options. However, the September 30, 1997 dilutive effect of
these stock options was immaterial. There were no common stock equivalents
outstanding during the three months ended September 30, 1996.
On September 17, 1997, the Company declared a quarterly dividend of $.08 per
share, payable on October 15, 1997, to shareholders of record of September 30,
1997.
Note 5 - Special Deposit Insurance Assessment
On September 30, 1996, congressional legislation was enacted which is designed
to recapitalize the Savings Association Insurance Fund ("SAIF") and to eliminate
the substantial deposit premium disparity between Bank Insurance Fund and
SAIF-insured institutions. This legislation imposes a one-time assessment on all
SAIF-insured deposits as of March 31, 1995. This assessment totals $247,000 and
is reflected in the other expenses section of the consolidated statement of
income for the three months ended September 30, 1996.
Note 6 - Employee Stock Ownership Plan ("ESOP")
In connection with the conversion to stock form of ownership, the Company formed
an ESOP. The ESOP covers employees who have completed at least 1000 hours of
service during a twelve month period and have attained the age of 21. The ESOP
borrowed $488,000 from an independent third party lender to fund the purchase of
48,810 shares or 8% of the shares issued in the conversion. The loan to the ESOP
will be repaid from scheduled discretionary cash contributions from the Company
sufficient to service the debt
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over a ten year period. Shares are released and allocated to the participants on
the basis of a compensation formula. Compensation expense for the three months
ended September 30, 1997, was approximately $17,000.
Note 7 - Recent Accounting Pronouncements
In February, 1997, the FASB issued SFAS No. 128, "Earnings Per Share." SFAS No.
128 establishes standards for computing and presenting earnings per share (EPS)
and applies to entities with publicly held common stock or potential common
stock. SFAS No. 128 simplifies previous standards for computing EPS. SFAS No.
128 is effective for financial statements issued for periods ending after
December 15, 1997, including interim periods; earlier application is not
permitted. SFAS No. 128 requires restatement of all prior period EPS data
presented. Management does not expect SFAS No. 128 to have a significant impact
on the Company's net income per share amounts disclosed.
In February 1997, the FASB issued SFAS No. 129, "Disclosure of Information
about Capital Structure." SFAS No. 129 summarizes previously issued
disclosure guidance contained within APB Opinions No. 10 and 15 as well as
SFAS No. 47. There will be no changes to the Company's disclosures pursuant
to the adoption of SFAS No. 129. This statement is effective for financial
statements issued for periods ending after December 15, 1997.
In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive Income,"
which establishes standards for reporting and display of comprehensive income
and its components in a full set of general-purpose financial statements.
Comprehensive income is defined as 'the change in equity 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 investment by owners and distributions to owners.' The
comprehensive income and related cumulative equity impact of comprehensive
income items will be required to be disclosed prominently as part of the notes
to the financial statements. Only the impact of unrealized gains or losses on
securities available for sale is expected to be disclosed as an additional
component of the Company's income under the requirements of SFAS No. 130. This
statement is effective for fiscal years beginning after December 15, 1997.
In June 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of an
Enterprise and related Information." SFAS No. 131 establishes standards for the
way public business enterprises are to report information about operating
segments in annual financial statements and requires those enterprises to report
selected information about operating segments in interim financial reports
issued to shareholders. It also establishes standards for the related
disclosures about products and services, geographic areas, and major customers.
SFAS No. 131 supersedes FASB Statement No. 14, "Financial Reporting for Segments
of a Business Enterprise," but retains the requirement to report information
about major customers. It amends FASB Statement No. 94, "Consolidation of All
Majority-
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Owned Subsidiaries," to remove the special disclosure requirements for
previously unconsolidated subsidiaries. Management does not expect SFAS No. 131
to have significant impact on the consolidated financial statements of the
Company. This Statement is effective for financial statements for periods
beginning after December 15, 1997.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
GENERAL
Pennwood Bancorp, Inc. (the "Company") is the holding company for the
Pennwood Savings Bank (the "Savings Bank"). The operating results of the Company
depend upon the operating results of the Savings Bank. The operating results of
the Savings Bank depend primarily upon its net interest income, which is
determined by the difference between interest income on interest-earning assets,
which consist principally of loans, investment securities and other investments,
and interest expense on interest-bearing liabilities, which consist principally
of deposits and borrowed money. The Savings Bank's net income also is affected
by its provision for loan losses, as well as the level of its other income,
including loan fees and service charges and miscellaneous items, and its other
expenses, including compensation and other employee benefits, premises and
occupancy costs, federal deposit insurance premiums, data processing expense,
net loss on real estate owned and other miscellaneous expenses, and income
taxes.
On July 12, 1996, the Savings Bank completed its conversion from the
mutual to the stock form (the "Conversion"). In the Conversion, the Savings Bank
issued 610,128 shares of common stock, which resulted in net proceeds to the
Savings Bank of approximately $5.7 million. On January 27, 1997, the Savings
Bank completed its Reorganization into the holding company form of ownership
(the "Reorganization"), whereby each outstanding share of common stock of the
Savings Bank was converted into common stock of the Company and the Company
acquired all the capital stock of the Savings Bank.
CHANGES IN FINANCIAL CONDITION
The Savings Bank's total assets decreased by $2.3 million or 4.7% from
$49.9 million at June 30, 1997 to $47.6 million at September 30, 1997. During
the three months ended September 30, 1997, the Savings Bank's investment and
mortgage-backed securities (classified as available for sale) decreased by $5.6
million or 30.8% from $18.2 million at June 30, 1997 to $12.6 million at
September 30, 1997, investment and mortgage-backed securities (classified as
held-to-maturity) decreased by $200,000 and cash and amounts due from depository
institutions decreased by $279,000, while money market investments (consisting
of interest-bearing deposits, including certificates of deposit, with other
financial institutions) increased by $1.8 million and federal funds increased
from $0.0 at June 30, 1997, to $500,000 at the quarter ending September 30,
1997. The Savings Bank's net loans
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receivable increased $1.7 million or 6.3% during the quarter. During the
quarter, the Savings Bank's total liabilities decreased by $2.3 million or 5.7%
at September 30, 1997. Borrowed money decreased by $3.0 million or 67.4%, which
was offset by an increase in deposit liabilities of $720,000. Shareholders
equity increased by $10,000 during the three months ended September 30, 1997 as
a result of the market value adjustment on investments classified as available
for sale of $65,000 and the year to date net income of $128,000, which were
partially offset by the purchase of Treasury Stock of $162,500.
RESULTS OF OPERATIONS
NET INCOME. The Savings Bank reported net income of $128,000 for the three
months ended September 30, 1997 compared to a net loss of $17,000 during the
three months ended September 30, 1996. The $145,000 increase in net income
during such period as compared to the 1996 period was the result of a $224,000
reduction in non-interest expenses, a $10,000 increase in non-interest income
and a $6,000 increase in net interest income, which was partially offset by a
$7,000 increase in loan loss provisions and an $88,000 increase in income taxes.
For the three months ended September 30, 1997, the Savings Bank's net
interest margin decreased by 12 basis points to 4.42% from 4.54% for the three
months ended September 30, 1996. The average yield earned on the Savings Bank's
interest-earning assets increased by 23 basis points, which was offset by a 31
basis point decrease in the average rate paid on the Savings Bank's
interest-bearing liabilities.
NET INTEREST INCOME. Net interest income increased by $6,000 or 1.2%
during the three months ended September 30, 1997, as compared to the 1996
quarter, due to a $1.7 million or 4.0% increase in the average balance of
interest-bearing assets, which had a 23 basis point increase in the average
yield earned thereon, which was offset by a $2.3 million or 6.5% increase in the
average balance of interest-bearing liabilities and a 31 basis point increase in
the average rate paid thereon.
During the three months ended September 30, 1997, total interest income
increased by $63,000 or 7.0%, as compared to the same period in 1996, primarily
due to a $123,000 or 23.6% increase in interest earned on loans, a $27,000 or
11.6% increase in interest earned on investment securities, and a $2,000 or
28.6% increase in interest earned on federal funds sold and other investments.
These increases were partially offset by a $14,000 or 29.2% decrease in interest
earned on mortgage backed securities and a $75,000 or 78.1% decrease in interest
earned on money market investments. The increase in interest earned on loans was
due primarily to a $6.9 million or 32.8% increase in the average balance of
loans outstanding, which was partially offset by a 68 basis point decrease in
the average yield earned thereon. The increase in interest earned on investment
securities was due primarily to a 53 basis point increase in average yield
earned thereon, which was partially offset by a $354,000 or 2.3% decrease in the
average balance of investment securities. The increase in interest earned on
federal funds sold was due primarily to a 281 basis point increase in
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the average yield earned thereon. The decrease in interest earned on money
market investments was primarily due to a $4.8 million or 28.9% decrease in the
average balance of money market investments and a 137 basis point decrease in
the average yield earned thereon. The increase in the average yield earned on
the Savings Bank's investment securities reflected the Savings Bank's
reinvestment of a portion of its money market investments and federal funds sold
into higher yielding U.S. Government and agency obligations, and also by
reinvesting in loans.
During the three months ended September 30, 1997, total interest expense
increased by $57,000 or 13.9%, as compared to the same period in 1996, due to an
increase of $1.1 million or 4.9% in the average balance of certificates of
deposit and a 19 basis point decrease on the average rate paid thereon, and a
$1.8 million or 367.7% increase in the average balance of borrowed money.
PROVISION FOR LOAN LOSSES. The Savings Bank establishes provisions for
losses on loans, which are charged to operations, in order to maintain the
allowance for loan losses at a level which is deemed to be appropriate based
upon an assessment of prior loss experience, the volume and type of lending
presently being conducted by the Savings Bank, industry standards, past due
loans, economic conditions in the Savings Bank's market area generally and other
factors related to the collectibility of the Savings Bank's loan portfolio.
During the three months ended September 30, 1997, the Savings Bank established
provisions for loan losses of $15,000.
OTHER INCOME. Total other income increased by $10,000 or 37.0% during the
three months ended September 30, 1997 as compared to the same quarter in 1996.
The increase was primarily due to an increase of $7,000 or 77.7% in income from
service charges and an increase of $3,000 or 16.7% in other miscellaneous income
(which consists primarily of rental income earned on real estate owned, late
charges, service charges and other miscellaneous fees).
OTHER EXPENSES. Total other expenses decreased by $224,000 during the
three months ended September 30, 1997 as compared to the same quarter in 1996
primarily because of the special one-time SAIF assessment of $247,000, which was
assessed in the first fiscal quarter of 1996. Also contributing to the decrease
in other expenses during the three months ended September 30, 1997 compared to
the 1996 quarter were a decrease of $18,000 or 75.0% in federal insurance
premiums and a decrease of $12,000 or 100.0% in net loss on real estate owned,
which were partially offset by a $35,000 or 24.8% increase in compensation and
employee benefits, a $6,000 or 11.3% increase in office occupancy expenses and a
$11,000 or 14.7% increase in other miscellaneous expenses.
PROVISION FOR INCOME TAXES. The Savings Bank incurred an increase of
$88,000 or 225.6% in income tax expense for the three months ended September 30,
1997, as compared to the 1996 quarter, due to a tax credit of $112,000 on the
SAIF assessment, as compared to a provision for income taxes of $56,000 for the
1996 quarter.
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LIQUIDITY AND CAPITAL RESOURCES
The Savings Bank's primary source of funds are deposits, repayments,
prepayments and maturities of outstanding loans, maturities of investment
securities and other short-term investments, and funds provided from operations.
While scheduled loan repayments and maturing investment securities and
short-term investments are relatively predictable sources of funds, deposit
flows and loan prepayments are greatly influenced by the movement of interest
rates in general, economic conditions and competition. The Savings Bank manages
the pricing of its deposits to maintain a deposit balance deemed appropriate and
desirable. In addition, the Savings Bank invests in short-term investment
securities and other interest- earning assets which provide liquidity to meet
lending requirements. Although the Savings Bank has been able to generate enough
cash through the retail deposit market, its traditional funding source, the
Savings Bank may, to the extent deemed necessary, utilize other borrowing
sources, consisting primarily of advances from the Federal Home Loan Bank
("FHLB") of Pittsburgh. At September 30, 1997, the Savings Bank had $1.5 million
of outstanding advances from the FHLB of Pittsburgh.
Liquidity management is both a daily and long-term function. Excess
liquidity is generally invested in short-term investments such as cash and cash
equivalents, including money market investments and federal funds sold, and U.S.
Government and agency obligations. On a longer-term basis, the Savings Bank
invests in various lending products and investment securities. The Savings Bank
uses its sources of funds primarily to meet its ongoing commitments to pay
maturing savings certificates and savings withdrawals, fund loan commitments and
maintain an investment securities portfolio. At September 30, 1997, the total
commitments outstanding (excluding undisbursed portions of loans in process)
amounted to $1.3 million in mortgage loans and $644,000 in unused lines of
credit. At the same date, the unadvanced portion of loans in process
approximated $1.7 million. Certificates of deposit scheduled to mature in three
months or less at September 30, 1997, totaled $3.9 million. Management of the
Savings Bank believes that the Savings Bank has adequate resources, including
principal payments and repayments of loans and maturing investments, to fund all
of its commitments to the extent required. Based upon its historical run-off
experience, management believes that a significant portion of maturing deposits
will remain with the Savings Bank.
As of September 30, 1997, the Savings Bank has regulatory capital which
was in excess of required amounts.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Not applicable.
Item 2. Changes in Securities.
Not applicable.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Security-Holders.
Not applicable.
Item 5. Other Information.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits
27 Financial Data Schedule
b) Reports on Form 8-K
The Company filed a Form 8-K, dated July 30, 1997, to announce the
repurchase of up to five percent of the Company's outstanding common
stock.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PENNWOOD BANCORP, INC.
Date: November 10, 1997 By: /s/ Paul S. Pieffer
--------------------------------
Paul S. Pieffer, President and
Chief Executive Officer
Date: November 10, 1997 By: /s/ James W. Kihm
--------------------------------
James W. Kihm, Vice President and
Secretary (principal financial officer)
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> SEP-30-1997
<CASH> 657
<INT-BEARING-DEPOSITS> 2713
<FED-FUNDS-SOLD> 500
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 12617
<INVESTMENTS-CARRYING> 512
<INVESTMENTS-MARKET> 520
<LOANS> 28661
<ALLOWANCE> 301
<TOTAL-ASSETS> 47645
<DEPOSITS> 36539
<SHORT-TERM> 456
<LIABILITIES-OTHER> 437
<LONG-TERM> 1000
0
0
<COMMON> 6
<OTHER-SE> 8730
<TOTAL-LIABILITIES-AND-EQUITY> 47645
<INTEREST-LOAN> 644
<INTEREST-INVEST> 293
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</TABLE>
