<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------------------------
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- - ----- EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- - ----- EXCHANGE ACT OF 1934
For the transition period from to
---------- ----------
Commission file number 1-14364
Acadiana Bancshares, Inc.
- - --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Louisiana 72-1317124
- - ------------------------------- -------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
101 West Vermilion Street
Lafayette, Louisiana 70501
- - --------------------------------------- -------------------
(Address of Principal Executive Offices) (Zip Code)
(318)232-4631
---------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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:
As of August 10, 1998, 2,360,013 shares of the Registrant's common stock
were issued and outstanding. Of that total, 218,369 shares were held by
the Registrant's Employee Stock Ownership Plan, of which 174,716 were not
committed to be released.
1
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ACADIANA BANCSHARES, INC.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
PART 1. FINANCIAL INFORMATION
- - -------- ----------------------
Item 1. Financial Statements
Consolidated Statements of Financial Condition
(As of June 30, 1998 and December 31, 1997) 3
Consolidated Statements of Income (For the three and six
Months ended June 30, 1998 and 1997) 4
Consolidated Statements of Stockholders' Equity (For
The six months ended June 30, 1998 and 1997) 5
Consolidated Statements of Cash Flows (For the six
Months ended June 30, 1998 and 1997) 6
Consolidated Statements of Comprehensive Income (For
The three and six months ended June 30, 1998 and 1997) 7
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11
PART II. OTHER INFORMATION
- - -------- ----------------------
Item 1. Legal Proceedings 20
Item 2. Changes in Securities 20
Item 3. Defaults Upon Senior Securities 20
Item 4. Submission of Matters to a Vote of Security Holders 20
Item 5. Other Information 20
Item 6. Exhibits and Reports on Form 8-K 20
Signatures 21
</TABLE>
2
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ACADIANA BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In Thousands, except share data)
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
--------------- --------------
<S> <C> <C>
ASSETS
Cash and Cash Equivalents:
Cash and Amounts Due from Banks $ 868 $ 622
Interest Bearing Deposits 34,629 13,535
--------------- --------------
Total 35,497 14,157
Investment Securities:
Equity Securities Held for Trading 916 826
Available for Sale, at fair value 6,000 11,044
Mortgage-Backed Securities:
Held to Maturity (fair value of $12,851 and $12,736, respectively) 12,610 12,806
Available for Sale, at fair value 14,489 17,846
Loans Receivable, net of Allowance for
Loan Losses of $2,818 and $2,760, respectively 220,425 212,840
Federal Home Loan Bank Stock, at Cost 2,556 1,887
Real Estate Owned, Net 23 204
Premises and Equipment, Net 2,879 2,806
Accrued Interest Receivable 1,394 1,416
Other Assets 1,359 1,234
--------------- --------------
TOTAL ASSETS $ 298,148 $ 277,066
=============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits $ 201,894 $ 193,422
Advances from Federal Home Loan Bank 49,728 36,628
Accrued Interest Payable on Deposits 137 49
Advance Payments by Borrowers for Taxes and Insurance 544 431
Accrued and Other Liabilities 1,945 1,974
--------------- --------------
TOTAL LIABILITIES 254,248 232,504
--------------- --------------
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred Stock of $.01 Par Value; 5,000,000 shares authorized, -0- shares
issued or outstanding
Common Stock of $.01 Par Value; 20,000,000 shares authorized, 27 27
2,731,250 shares issued
Additional Paid-In Capital 32,124 32,005
Retained Earnings (Substantially Restricted) 20,229 19,355
Unearned Common Stock Held by ESOP (2,096) (2,228)
Unearned Common Stock Held by RRP Trust (1,478) (1,602)
Treasury Stock, at Cost; 225,937 shares and 150,000 shares, respectively (5,230) (3,445)
Accumulated Other Comprehensive Income 324 450
--------------- --------------
TOTAL STOCKHOLDERS' EQUITY 43,900 44,562
--------------- --------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 298,148 $ 277,066
=============== ==============
</TABLE>
See Notes to Consolidated Financial Statements
3
<PAGE> 4
ACADIANA BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, except per share data)
<TABLE>
<CAPTION>
For the Three Months For the Six Months
Ended June 30, Ended June 30,
---------------------------- ----------------------------
1998 1997 1998 1997
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
INTEREST INCOME:
Loans $ 4,433 $ 3,843 $ 8,767 $ 7,600
Mortgage-Backed Securities 493 593 1,024 1,204
Investment Securities 187 534 413 917
Interest Bearing Deposits 360 66 576 268
----------- ----------- ------------ ------------
Total interest income $ 5,473 $ 5,036 $ 10,780 $ 9,989
----------- ----------- ------------ ------------
INTEREST EXPENSE:
Deposits $ 2,343 $ 2,292 $ 4,614 $ 4,586
Advances from Federal Home Loan Bank 686 363 1,290 664
----------- ----------- ------------ ------------
Total Interest Expense 3,029 2,655 5,904 5,250
----------- ----------- ------------ ------------
Net Interest Income 2,444 2,381 4,876 4,739
Provision for Loan Losses 45 45 90 90
----------- ----------- ------------ ------------
Net Interest Income After Provision for
Loan Losses 2,399 2,336 4,786 4,649
----------- ----------- ------------ ------------
NON-INTEREST INCOME:
Loan Fees and Service Charges $ 34 $ 24 $ 69 $ 61
Servicing Fees on Loans Sold 12 15 23 31
Deposit Fees and Service Charges 198 190 375 368
Investment Securities Gain (Loss), Net (45) 16 50 24
Gain (Loss) on Sale of Fixed Rate Loans, Net 82 - 127 (1)
Other 19 17 40 40
----------- ----------- ------------ ------------
Total Non-Interest Income $ 300 $ 262 $ 684 $ 523
----------- ----------- ------------ ------------
NON-INTEREST EXPENSE:
Salaries and Employee Benefits $ 829 $ 770 $ 1,693 $ 1,530
Occupancy 76 87 138 166
Depreciation 100 74 178 150
Net Costs of Real Estate Owned (4) (11) (26) (35)
SAIF Deposit Insurance Premium 30 31 59 62
Advertising 75 99 168 142
Consulting 16 31 40 51
Bank Shares and Franchise Tax Expense 108 87 216 173
Other 476 464 815 796
----------- ----------- ------------ ------------
Total Non-Interest Expenses $ 1,706 $ 1,632 $ 3,281 $ 3,035
----------- ----------- ------------ ------------
Income Before Income Taxes $ 993 $ 966 $ 2,189 $ 2,137
Income Tax Expense 365 341 797 741
----------- ----------- ------------ ------------
Net Income $ 628 $ 625 $ 1,392 $ 1,396
=========== =========== ============ ============
Net Income Per Common Share - basic $ 0.28 $ 0.26 $ 0.61 $ 0.57
Net Income Per Common Share - diluted $ 0.27 $ 0.25 $ 0.59 $ 0.56
</TABLE>
See Notes to Consolidated Financial Statements
4
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ACADIANA BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In Thousands)
<TABLE>
<CAPTION>
Retained Unearned
Earnings Common
Common Paid In (Substantially Stock Held
Stock Capital Restricted) By ESOP
------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1997 $ 27 $ 31,827 $ 17,344 $ (2,490)
Net Income 1,396
Cash Dividends Declared (452)
Common Stock Released by ESOP Trust 62 131
Common Stock Acquired by Recognition
and Retention Plan Trust
Common Stock Earned by Participants of
Recognition and Retention Plan Trust
Change in Unrealized Gain on Securities
Available for Sale, Net of Deferred Taxes
------------- ------------ ------------- -------------
BALANCE, JUNE 30, 1997 $ 27 $ 31,889 $ 18,288 $ (2,359)
============= ============ ============= =============
BALANCE, JANUARY 1, 1998 $ 27 $ 32,005 $ 19,355 $ (2,228)
Net Income 1,392
Cash Dividends Declared (518)
Common Stock Released by ESOP Trust 119 132
Repurchase of Common Stock
Common Stock Earned by Participants of
Recognition and Retention Plan Trust
Change in Unrealized Gain on Securities
Available for Sale, Net of Deferred Taxes
------------- ------------ ------------- -------------
BALANCE, JUNE 30, 1998 $ 27 $ 32,124 $ 20,229 $ (2,096)
------------- ------------ ------------- -------------
</TABLE>
<TABLE>
<CAPTION>
Unearned
Common Accumulated
Stock Other Total
Held By Treasury Comprehensive Stockholders'
RRP Trust Stock Income Equity
------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1997 $ - $ - $ 383 $ 47,091
Net Income 1,396
Cash Dividends Declared (452)
Common Stock Released by ESOP Trust 193
Common Stock Acquired by Recognition
and Retention Plan Trust (1,830) (1,830)
Common Stock Earned by Participants of
Recognition and Retention Plan Trust 114 114
Change in Unrealized Gain on Securities
Available for Sale, Net of Deferred Taxes (124) (124)
------------- ------------ ------------- --------------
BALANCE, JUNE 30, 1997 $ (1,716) $ - $ 259 $ 46,388
============== ============ ============= ==============
BALANCE, JANUARY 1, 1998 (1,602) $ (3,445) $ 450 $ 44,562
Net Income 1,392
Cash Dividends Declared (518)
Common Stock Released by ESOP Trust 251
Repurchase of Common Stock (1,785) (1,785)
Common Stock Earned by Participants of
Recognition and Retention Plan Trust 124 124
Change in Unrealized Gain on Securities
Available for Sale, Net of Deferred Taxes (126) (126)
------------- ------------ ------------ --------------
BALANCE, JUNE 30, 1998 $ (1,478) $ (5,230) $ 324 $ 43,900
------------- ------------ ------------ --------------
</TABLE>
See Notes to Consolidated Financial Statements
5
<PAGE> 6
ACADIANA BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
<TABLE>
<CAPTION>
For the Six Months Ended
----------------------------------
June 30, June 30,
1998 1997
--------------- ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,392 $ 1,396
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization 184 150
Provision for deferred income taxes 16 -
Provision for losses on loans 90 90
Compensation expense recognized on RRP 124 114
ESOP contribution 251 193
Other gains and losses, net (8) (14)
Net change in securities classified as trading (89) (389)
Gain on sale of loans held for sale (127) (1)
Proceeds from sales of loans held for sale 10,184 921
Originations of loans held for sale (10,057) (920)
Accretion of discounts, net of premium amortization on securities (24) (35)
Amortization of deferred revenues and unearned income on loans (33) (13)
FHLB stock dividend received (70) (53)
Changes in assets and liabilities:
Decrease (increase) in accrued interest receivable 22 (141)
(Increase) decrease in other assets (83) 170
Increase in accounts payable and accrued expenses 65 224
-------------- -------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,837 1,692
-------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from calls and maturities of securities available for sale 5,000 6,500
Purchases of securities available for sale - (9,998)
Net advances on loans (7,723) (12,427)
Purchases of premises and equipment (251) (353)
Purchases of FHLB stock (599) -
Proceeds from sale of real estate owned and other property acquired 274 184
Capital costs incurred on real estate owned and other property acquired (4) (8)
Principal collections on mortgage-backed securities available for sale 3,236 1,824
Principal collections on mortgage-backed securities held to maturity 194 147
-------------- -------------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 127 (14,131)
-------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in demand, NOW and savings deposits 6,513 (1,559)
Net change in time deposits 1,959 (2,409)
Net change in mortgage escrow funds 113 73
Proceeds from FHLB advances 13,100 7,000
Dividends paid to shareholders (524) (452)
Acquisition of common stock by RRP - (1,830)
Payments to repurchase common stock (1,785) -
-------------- -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 19,376 823
-------------- -------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 21,340 (11,616)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 14,157 19,784
-------------- -------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 35,497 $ 8,168
============== =============
SUPPLEMENTAL SCHEDULE OF NONCASH ACTIVITIES:
Acquisition of real estate in settlement of loans $ 82 $ 67
Unrealized (loss) on securities $ (190) $ (189)
SUPPLEMENTAL DISCLOSURES:
Cash paid for:
Interest on deposits and borrowings $ 5,770 $ 5,212
Income taxes $ 510 $ 691
</TABLE>
See Notes to Consolidated Financial Statements
6
<PAGE> 7
ACADIANA BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
<TABLE>
<CAPTION>
For the Three Months For the Six Months
Ended June 30, Ended June 30,
----------------------------------------------------------------
1998 1997 1998 1997
-------------- ------------- -------------- --------------
<S> <C> <C> <C> <C>
NET INCOME $ 628 $ 625 $ 1,392 $ 1,396
OTHER COMPREHENSIVE INCOME
Unrealized Gains and Losses on Investment
in Debt and Equity Securities Classified as
Available for Sale (72) 326 (191) (188)
Income Tax Effect 24 (111) 65 64
-------------- ------------- -------------- --------------
Net Gain (Loss) (48) 215 (126) (124)
-------------- ------------- -------------- --------------
COMPREHENSIVE INCOME $ 580 $ 840 $ 1,266 $ 1,272
-------------- ------------- -------------- --------------
</TABLE>
See Notes to Consolidated Financial Statements
7
<PAGE> 8
ACADIANA BANCSHARES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying consolidated financial statements were prepared in accordance
with instructions to Form 10-Q, and therefore, do not include information or
footnotes necessary for a complete presentation of financial position, results
of operations and cash flows in conformity with generally accepted accounting
principles. However, all normal, recurring adjustments, which, in the opinion
of management, are necessary for a fair presentation of financial statements,
have been included. These interim financial statements should be read in
conjunction with the audited financial statements and the notes thereto for
Acadiana Bancshares, Inc. (the "Company") previously filed with the Securities
and Exchange Commission in the Company's 1997 Annual Report and on Form 10-K
for the year ended December 31, 1997.
BUSINESS
The Company's principal business is conducted through its wholly owned
subsidiary, LBA Savings Bank, (the "Bank") which conducts business from its
main office and three branch offices located in Lafayette, Louisiana, one
branch office in New Iberia, Louisiana, and one loan production office in
Eunice, Louisiana. The Bank holds deposits from the public and provides
residential real estate loans and other loans to the Lafayette, Louisiana area.
The Savings Association Insurance Fund ("SAIF") insures the Bank's deposits to
the maximum extent permitted by law. The Bank is subject to competition from
other financial institutions and other companies which provide financial
services. The Bank is subject to examination and comprehensive regulation by
the Office of Financial Institutions of the State of Louisiana ("OFI"), which
is the Bank's chartering authority and primary regulator. The Bank is also
subject to regulation by the Federal Deposit Insurance Corporation ("FDIC"), as
the administrator of the SAIF. The Bank is a member of the Federal Home Loan
Bank of Dallas ("FHLB"). The Company is subject to examination and
comprehensive regulation by the Federal Reserve.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company and
the Bank. All significant inter-company balances and transactions have been
eliminated in consolidation.
8
<PAGE> 9
(2) LOANS RECEIVABLE
Loans receivable (in thousands) at June 30, 1998 and December 31, 1997
consisted of the following
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
--------------- ----------------
<S> <C> <C>
Mortgage Loans:
Single Family Residential $ 170,736 $ 169,637
Single Family Construction 12,462 9,301
Multi-family Residential 523 546
Commercial Real Estate 8,708 9,363
--------------- ----------------
Total Mortgage loans 192,429 188,847
Commercial Business Loans 19,700 15,400
Consumer Loans:
Savings 1,999 2,046
Indirect Automobile Dealer 3,227 4,526
Other 13,176 9,783
--------------- ----------------
Total Loans 230,531 220,602
Less:
Allowance for Loan Losses (2,818) (2,760)
Unearned Discounts and Prepaid Dealer
Reserve 96 162
Net Deferred Loan Origination Fees (463) (535)
Loans in Process and Undisbursed Funds (6,921) (4,629)
--------------- ----------------
Net Loans $ 220,425 $ 212,840
=============== ================
</TABLE>
(3) EARNINGS PER SHARE
The Company adopted FAS 128, Earnings Per Share, as of December 31, 1997.
Weighted average shares of common stock outstanding for basic EPS excludes the
weighted average shares unreleased by the Employee Stock Ownership Plan
("ESOP") (180,189 and 202,051 shares at June 30, 1998 and June 30, 1997,
respectively) and the weighted average unvested shares in the Recognition and
Retention Plan ("RRP") (96,400 and 84,287 at June 30, 1998 and June 30, 1997,
respectively). The effect on diluted EPS of stock option shares outstanding and
unvested RRP shares is calculated using the treasury stock method. The
following is a reconcilement of the numerator and denominator for basic and
diluted Earnings Per Share.
9
<PAGE> 10
<TABLE>
<CAPTION>
Three months ended Six months ended
-------------------------------- --------------------------------
June 30, 1998 June 30, 1997 June 30, 1998 June 30, 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
BASIC EPS
Income available to Common
Stockholders $ 628,000 $ 625,000 $ 1,392,000 $ 1,396,000
============= ============= ============= =============
Weighted average shares of common
stock outstanding 2,271,520 2,422,686 2,283,076 2,444,912
============= ============= ============= =============
Per-Share Amount $ 0.28 $ 0.26 $ 0.61 $ 0.57
============= ============= ============= =============
DILUTED EPS
Effect of Dilutive Securities:
Stock Options Outstanding 61,880 29,765 58,392 20,350
Restricted Stock Grants 17,269 13,047 15,356 8,832
------------- ------------- ------------- -------------
Weighted average shares of common
stock outstanding 2,350,669 2,465,498 2,356,824 2,474,094
============= ============= ============= =============
Per-Share Amount $ 0.27 $ 0.25 $ 0.59 $ 0.56
------------- ------------- ------------- -------------
</TABLE>
(4) EFFECTS OF NEW ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board issued SFAS 133,
Accounting for Derivative Instruments and Hedging Activities. The statement
establishes accounting and reporting standards for derivative instruments,
including certain derivative instruments imbedded in other contracts. It
requires that an entity recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those
instruments at fair value. The accounting for changes in the fair value of a
derivative (that is, gains and losses) depends on the intended use of the
derivative and the resulting designation. The statement is effective for fiscal
years beginning after June 15, 1999. The Company currently has no derivatives
and does not have any hedging activities. The adoption of this statement is not
expected to have a material effect on financial position and results of
operations.
10
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following discussion and analysis is intended to assist readers in
understanding the financial condition and results of operations of Acadiana
Bancshares, Inc, and its subsidiary, LBA Savings Bank, for the periods
indicated. This review should be read in conjunction with the audited
consolidated financial statements, accompanying footnotes and supplemental data
included in the Company's 1997 Annual Report and FORM 10-K for the years ended
December 31, 1995 through 1997.
FINANCIAL CONDITION
ASSETS
GENERAL - At June 30, 1998, the consolidated assets of the Company totaled
$298.1 million, an increase of $21.1 million, or 7.6%, from December 31, 1997.
The primary reasons for the increase in consolidated assets were increases in
interest bearing deposits by $21.1 million, or 155.8%, and loans receivable,
net, by $7.6 million, or 3.6%, all of which were partially offset by a decrease
in investment securities available for sale of $5.0 million, or 45.7%, and a
$3.6 million, or 11.6% decrease in mortgage-backed securities.
LOANS RECEIVABLE, NET - Net loans grew $7.6 million, or 3.6%, for the three
months ended June 30, 1998, to $220.4 million compared to $212.8 million in net
loans at December 31, 1997. The Company originated and sold $10.1 million of
primarily 30-year single-family fixed rate loans during the same six month
period, resulting in the net growth in loans to be substantially less than
would have been without the loan sales.
Commercial loans, net, increased $4.1 million, or 27.0%, to $19.4 million
at June 30, 1998 compared to $15.3 million at December 31, 1997. Consumer loans,
net, increased $2.4 million, or 15.1%, to $18.2 million at June 30, 1998
compared to $15.8 million at December 31, 1997. Mortgage loans, net, increased
slightly by $1.1 million, or 0.6%, to $182.8 million at June 30, 1998 compared
to $181.7 at December 31, 1997.
CASH AND CASH EQUIVALENTS - Cash and interest bearing deposits at other
institutions increased $21.3 million, or 150.7%, to $35.5 million at June 30,
1998, compared to $14.2 million at December 31, 1997. The primary source of net
new cash was $13.1 in proceeds from FHLB Advances. Net cash flows from
financing activities provided $19.4 million and net cash flows from operating
activities provided $1.8 million, for the six months ended June 30, 1998, while
net cash flows from investing activities provided $127,000.
INVESTMENT SECURITIES - The Company owned $916,000 of investment securities held
for trading, as of June 30, 1998. Investment securities available for sale
decreased $5.0 million, or 45.7%, to $6.0 million at June 30, 1998, compared to
$11.0 million at December 31, 1997, because of the redemption of $5.0 million of
investment securities during the six months ended June 30, 1998.
Mortgage-backed securities held to maturity decreased $196,000, or 1.5%,
to $12.6 million at June 30, 1998 compared to $12.8 million at December 31,
1997. Such decrease was primarily the result of principal repayments. The
mortgage-backed securities available for sale portfolio decreased $3.4 million,
or 18.8%, to $14.5 million at June 30, 1998 as compared to $17.8 million at
December 31, 1997. The decrease reflects monthly principal repayments and a
decrease of $122,000 in market values of the securities.
11
<PAGE> 12
LIABILITIES AND STOCKHOLDERS' EQUITY
GENERAL - The Company's primary funding sources include deposits, borrowings
from the FHLB and stockholders' equity. The discussion that follows focuses on
the major changes in this mix.
DEPOSITS - Deposits increased $8.5 million, or 4.4%, to $201.9 million at June
30, 1998, compared to $193.4 million at December 31, 1997. This increase was
due primarily to deposit inflows, including interest earned and credited to
deposit balances. Deposits funded 67.7% of assets at June 30, 1998 compared to
69.8% at December 31, 1997.
BORROWINGS - Advances from the FHLB of Dallas increased $13.1 million, or
35.8%, to $49.7 million at June 30, 1998 as compared to $36.6 million at
December 31, 1997. Of the Company's total outstanding FHLB advances, $22.0
million mature in the year ending December 31, 1998, $14.4 million mature in
the year ending December 31, 1999, and $13.3 million mature in five years or
more. The Company has the ability to borrow up to approximately $127.7 million
from the FHLB of Dallas, which together with the current advances, would be
secured by mortgage loans under an existing blanket collateral agreement, and
by Federal Home Loan Bank Stock. Borrowings funded 16.7% of assets at June 30,
1998 compared to 13.2% at December 31, 1997.
STOCKHOLDERS' EQUITY - Total stockholders' equity decreased $662,000, or 1.5%,
to $43.9 million at June 30, 1998, compared to $44.6 million at December 31,
1997. The decrease was primarily attributable to $1.8 million for the purchase
of 76,000 common shares of Treasury Stock, $518,000 in dividends declared on
common stock, and a $126,000 decrease in unrealized gain on securities
available for sale, net of deferred taxes, all of which was partially offset by
$1.4 million of net income and credits of $375,000 reflecting the value of
participants' earnings related to stock-based compensation plans. Stockholders'
equity funded 14.7% of assets at June 30, 1998 compared to 16.1% at December
31, 1997.
The dividends paid during the first quarter of 1998 were declared at
December 31, 1997, and paid on January 15, 1998 at the rate of $0.11 per share.
The dividends paid during the second quarter of 1998 were declared at March 31,
1998, and paid on April 15, 1998 at the rate of $0.11 per share. The Board of
Directors declared dividends of $0.11 per share to be paid on July 15, 1998.
12
<PAGE> 13
Average Balances, Net Interest Income, and Yields Earned and Rates
Paid. The following table sets forth, for the periods indicated, information
regarding (i) the dollar amount of interest income of the Company from
interest-earning assets and the resultant average yields; (ii) the total dollar
amount of interest expense on interest-bearing liabilities and the resultant
rate; (iii) net interest income; (iv) interest rate spread; and (v) net
interest margin. Non-accrual loans have been included in the appropriate
average balance loan category, but interest on non-accrual loans has been
included for purposes of determining interest income only to the extent that
cash payments are actually received.
<TABLE>
<CAPTION>
Three Months Ended June 30,
------------------------------------------------
1998
------------------------------------------------
Average
Average Yield/
Balance Interest Cost
-------------- ------------- ------------
(Dollars in Thousands)
<S> <C> <C> <C>
Interest-earning assets:
Loans receivable:
Real estate mortgage loans $ 183,220 $ 3,603 7.87%
Commercial business loans 17,868 427 9.56%
Consumer and other loans 17,200 403 9.37%
-------------- ------------
Total loans 218,288 4,433 8.12%
Mortgage-backed securities 28,312 493 6.97%
Investment securities (1) 11,988 187 6.24%
Other earning assets 28,070 360 5.13%
-------------- ------------
Total interest-earning assets 286,658 5,473 7.64%
------------
Noninterest-earning assets 6,558
--------------
Total Assets $ 293,216
==============
Interest-bearing liabilities:
Deposits:
Demand deposits $ 22,067 171 3.10%
Passbook savings deposits 22,172 130 2.35%
Certificates of deposit 143,723 2,042 5.68%
-------------- ------------
Total deposits 187,962 2,343 4.99%
Advance from FHLB 49,728 686 5.52%
-------------- ------------
Total interest-bearing liabilities 237,690 3,029 5.10%
------------
Noninterest-bearing demand deposits 8,070
Other noninterest-bearing liabilities 2,706
--------------
Total liabilities 248,466
Equity 44,750
==============
Total liabilities and equity $ 293,216
==============
Net interest-earning assets $ 48,968
==============
Net interest income/interest rate spread $ 2,444 2.54%
============ ===========
Net interest margin 3.41%
===========
Ratio of average interest-earning assets
to average interest-bearing liabilities 120.60%
============
</TABLE>
(1)Includes FHLB stock.
<TABLE>
<CAPTION>
Three Months Ended June 30,
----------------------------------------------------
1997
----------------------------------------------------
Average
Average Yield/
Balance Interest Cost
-------------- ------------- ------------
(Dollars in Thousands)
<S> <C> <C> <C>
Interest-earning assets:
Loans receivable:
Real estate mortgage loans $ 164,044 $ 3,252 7.93%
Commercial business loans 9,259 220 9.50%
Consumer and other loans 15,884 371 9.34%
-------------- --------------
Total loans 189,187 3,843 8.13%
Mortgage-backed securities 33,194 593 7.15%
Investment securities (1) 30,520 534 7.00%
Other earning assets 6,167 66 4.28%
-------------- --------------
Total interest-earning assets 259,068 5,036 7.78%
--------------
Noninterest-earning assets 5,725
--------------
Total Assets $ 264,793
==============
Interest-bearing liabilities:
Deposits:
Demand deposits $ 13,449 60 1.78%
Passbook savings deposits 23,766 129 2.17%
Certificates of deposit 145,666 2,103 5.77%
-------------- --------------
Total deposits 182,881 2,292 5.01%
Advance from FHLB 25,736 363 5.64%
-------------- --------------
Total interest-bearing liabilities 208,617 2,655 5.09%
--------------
Noninterest-bearing demand deposits 7,379
Other noninterest-bearing liabilities 2,722
--------------
Total liabilities 218,718
Equity 46,075
==============
Total liabilities and equity $ 264,793
==============
Net interest-earning assets $ 50,451
==============
Net interest income/interest rate spread $ 2,381 2.69%
============ ==========
Net interest margin 3.68%
==========
Ratio of average interest-earning assets
to average interest-bearing liabilities 124.18%
============
</TABLE>
(1)Includes FHLB stock.
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------------------------------------
1998
-------------------------------------------------------
Average
Average Yield/
Balance Interest Cost
-------------- ----------------- ----------------
(Dollars in Thousands)
<S> <C> <C> <C>
Interest-earning assets:
Loans receivable:
Real estate mortgage loans $ 183,466 $ 7,196 7.84%
Commercial business loans 16,684 792 9.49%
Consumer and other loans 16,568 779 9.40%
-------------- ------------
Total loans 216,718 8,767 8.09%
Mortgage-backed securities 29,252 1,024 7.00%
Investment securities (1) 12,976 413 6.37%
Other earning assets 22,925 576 5.03%
-------------- ------------
Total interest-earning assets 281,871 10,780 7.65%
------------
Noninterest-earning assets 6,460
==============
Total Assets $ 288,331
==============
Interest-bearing liabilities:
Deposits:
Demand deposits $ 20,786 313 3.01%
Passbook savings deposits 22,688 254 2.24%
Certificates of deposit 142,783 4,047 5.67%
-------------- ------------
Total deposits 186,257 4,614 4.95%
Advance from FHLB 46,564 1,290 5.54%
-------------- ------------
Total interest-bearing liabilities 232,821 5,904 5.07%
------------
Noninterest-bearing demand deposits 8,107
Other noninterest-bearing liabilities 2,570
--------------
Total liabilities 243,498
Equity 44,833
==============
Total liabilities and equity $ 288,331
==============
Net interest-earning assets $ 49,050
==============
Net interest income/interest rate spread $ 4,876 2.58%
============ ==========
Net interest margin 3.46%
==========
Ratio of average interest-earning assets
to average interest-bearing liabilities 121.07%
============
</TABLE>
(1)Includes FHLB stock.
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------------------------------------
1997
-------------------------------------------------------
Average
Average Yield/
Balance Interest Cost
-------------- ----------------- ----------------
(Dollars in Thousands)
<S> <C> <C> <C>
Interest-earning assets:
Loans receivable:
Real estate mortgage loans $ 161,474 $ 6,454 7.99%
Commercial business loans 8,561 402 9.39%
Consumer and other loans 16,206 744 9.18%
------------- -----------
Total loans 186,241 7,600 8.16%
Mortgage-backed securities 33,715 1,204 7.14%
Investment securities (1) 26,252 917 6.99%
Other earning assets 11,296 268 4.75%
------------- -----------
Total interest-earning assets 257,504 9,989 7.76%
-----------
Noninterest-earning assets 5,708
=============
Total Assets $ 263,212
=============
Interest-bearing liabilities:
Deposits:
Demand deposits $ 13,444 121 1.80%
Passbook savings deposits 23,926 260 2.17%
Certificates of deposit 146,115 4,205 5.76%
------------- -----------
Total deposits 183,485 4,586 5.00%
Advance from FHLB 23,993 664 5.53%
------------- -----------
Total interest-bearing liabilities 207,478 5,250 5.06%
-----------
Noninterest-bearing demand deposits 6,884
Other noninterest-bearing liabilities 2,503
-------------
Total liabilities 216,865
Equity 46,347
-------------
Total liabilities and equity $ 263,212
=============
Net interest-earning assets $ 50,026
=============
Net interest income/interest rate spread $ 4,739 2.70%
=========== ============
Net interest margin 3.68%
============
Ratio of average interest-earning assets
to average interest-bearing liabilities 124.11%
===========
(1)Includes FHLB stock.
</TABLE>
13
<PAGE> 14
RESULTS OF OPERATIONS
GENERAL - The Company reported net income of $628,000 for the three months ended
June 30, 1998, compared to net income of $625,000 for the three months ended
June 30, 1997. The slight increase in net income for the quarter ended June 30,
1998, as compared to the quarter ended June 30, 1997, was due primarily to an
increase in net interest income for the quarter ended June 30, 1998.
The Company reported net income of $1.4 million for both the six months
ended June 30, 1998 and 1997.
NET INTEREST INCOME - Net interest income increased slightly, by $63,000, or
2.6%, for the three months ended June 30, 1998, to $2.4 million, compared to
$2.4 million for the three months ended June 30, 1997. The increase was due to a
$437,000, or 8.7%, increase in interest income which was partially offset by an
increase in interest expense of $374,000, or 14.1%. The increase in interest
income was the result of a $27.6 million, or 10.6%, increase in the average
balances of interest-earning assets which was partially offset by a 14 basis
point (100 basis points being equal to 1%) decrease in the yield thereon. The
increase in interest expense was the result of a $29.1 million, or 13.9%,
increase in average interest-bearing liabilities together with a 1 basis point
increase in the yield thereon. The Company's interest rate spread (the
difference between the weighted average yield on interest-earning assets and the
weighted average cost of interest-bearing liabilities) and net interest margin
(net interest income as a percentage of average interest-earning assets)
amounted to 2.54% and 3.41%, respectively, during the three months ended June
30, 1998 compared to 2.69% and 3.68%, respectively, for the comparable period in
1997. The average balance in non-interest bearing demand deposit accounts grew
$691,000, or 9.4%, for the three months ended June 30, 1998 as compared to June
30, 1997.
For the six months ended June 30, 1998, net interest income increased
$137,000, or 2.9%, to $4.9 million, compared to $4.7 million for the six months
ended June 30, 1997. The increase was due to a $791,000, or 7.9%, increase in
interest income which was partially offset by an increase in interest expense of
$654,000, or 12.5%. The increase in interest income was the result of a $24.4
million, or 9.5%, increase in the average balance of interest-earning assets
which was partially offset by a 11 basis point decrease in the yield thereon.
The increase in interest expense was the result of a $25.3 million, or 12.2%,
increase in average interest-bearing liabilities together with a 1 basis point
increase in the yield thereon. The Company's interest rate spread and net
interest margin amounted to 2.58% and 3.46%, respectively, during the six months
ended June 30, 1998 compared to 2.70% and 3.68%, respectively, for the
comparable period in 1997.
INTEREST INCOME - The Company's total interest income was $5.5 million for the
three months ended June 30, 1998, compared to $5.0 million for the three months
ended June 30, 1997. The reasons for the $437,000, or 8.7%, increase in interest
income was a $590,000, or 15.4%, increase in interest income from loans and a
$294,000 or 445.5%, increase in interest income from other earning assets, which
was partially offset by a $100,000, or 16.9%, decrease in interest income from
mortgage-backed securities, and a $347,000, or 65.0%, decrease in interest
income from investment securities. The increase in interest income from loans
was the result of a $29.1 million, or 15.4%, increase in the average balance of
loans, which was partially offset by a 1 basis point decrease in the yield
thereon. The decrease in interest income from investment securities was the
result of a $18.5 million, or 60.7%, decrease in the average balance of
investments together with a 76 basis point decrease in the yield thereon. The
decrease in interest income on mortgage-backed securities was the result of a
$4.9
14
<PAGE> 15
million, or 14.7%, decrease in the average balance of mortgage-backed
securities, together with a decrease of 18 basis points in the yield thereon.
The increase in interest income from other earning assets, substantially all of
which are interest-bearing deposits at the FHLB, was the result of a $21.9
million increase in the average balance of other earning assets, together with
an 85 basis point increase in the yield thereon.
For the six months ended June 30, 1998, the Company's total interest
income was $10.8 million, compared to $10.0 million for the six months ended
June 30, 1997. The reasons for the $791,000, or 7.9%, increase in interest
income was a $1.2 million, or 15.4%, increase in interest income from loans and
a $308,000 or 114.9%, increase in interest income from other earning assets,
which was partially offset by a $180,000, or 15.0%, decrease in interest income
from mortgage-backed securities, and a $501,000, or 55.0%, decrease in interest
income from investment securities. The increase in interest income from loans
was the result of a $30.5 million, or 16.4%, increase in the average balance of
loans, which was partially offset by a 7 basis point decrease in the yield
thereon. The decrease in interest income from investment securities was the
result of a $13.3 million, or 50.6%, decrease in the average balance of
investments together with a 62 basis point decrease in the yield thereon. The
decrease in interest income on mortgage-backed securities was the result of a
$4.5 million, or 13.2%, decrease in the average balance of mortgage-backed
securities, together with a decrease of 14 basis points in the yield thereon.
The increase in interest income from other earning assets was the result of a
$11.6 million increase in the average balance of other earning assets, together
with an 28 basis point increase in the yield thereon.
INTEREST EXPENSE - The Company's total interest expense was $3.0 million during
the three months ended June 30, 1998, compared to $2.7 million for the three
months ended June 30, 1997. The $374,000 increase in interest expense was
comprised of an increase of $323,000 in interest expense on advances from the
FHLB, together with an increase of $51,000 in interest expense on deposits. The
increase in interest expense on deposits was the result of an increase of $5.1
million, or 2.8%, in average balances in interest bearing deposits which was
partially offset by an increase of 2 basis points in the cost thereon. The
increase in interest expense on advances from the FHLB was the result of an
increase in the average balances of $24.0 million, which was partially offset by
a decrease of 12 basis points in the cost thereon.
The Company's total interest expense was $5.9 million during the six
months ended June 30, 1998, compared to $5.3 million for the six months ended
June 30, 1997. The $654,000 increase in interest expense was comprised of an
increase of $626,000 in interest expense on advances from the FHLB, together
with an increase of $28,000 in interest expense on deposits. The increase in
interest expense on deposits was the result of an increase of $2.8 million, or
1.5%, in average balances in interest bearing deposits which was partially
offset by a decrease of 5 basis points in the cost thereon. The increase in
interest expense on advances from the FHLB was the result of an increase in the
average balances of $22.6 million, together with an increase of 1 basis point in
the cost thereon.
PROVISION FOR LOAN LOSSES - The provision for loan losses was $45,000 for the
three months ended June 30, 1998 and 1997. The Company's non-performing assets
amounted to .13% of total assets at June 30, 1998 compared to .22% at December
31, 1997. In addition, the ratio of the Bank's allowance for loan losses to
non-performing loans and troubled debt restructurings was 328.82% at June 30,
1998 compared to 297.09% at December 31, 1997. During the three months ended
June 30, 1998, the Company charged-off $39,000 of loans and recovered $24,000 of
loans previously charged-off.
15
<PAGE> 16
The provision for loan losses for the six months ended June 30, 1998 was
$90,000, remaining stable as compared to the same period in 1997. During the six
months ended June 30, 1997, the Company charged-off $84,000 of loans and
recovered $53,000 of loans previously charged-off.
NON-INTEREST INCOME - Non-interest income increased $38,000 or 14.5%, for the
three months ended June 30, 1998 to $300,000, compared to $262,000 for the three
months ended June 30, 1997. Such increase was due primarily to an increase of
$82,000 net gain on sale of fixed rate loans, which was partially offset by a
decrease in investment securities gains (net) of $61,000. The gain from the sale
of loans reflects the Company's decision to sell certain newly originated fixed
rate loans. The investment gains are related to the Company's trading portfolio.
Non-interest income increased $161,000 or 30.8%, for the six months ended
June 30, 1998 to $684,000, compared to $523,000 for the six months ended June
30, 1997. Such increase was due primarily to an increase of $128,000 net gain on
sale of fixed rate loans and an increase in investment securities gains (net) of
$26,000.
NON-INTEREST EXPENSE - Non-interest expense increased $74,000, or 4.5%, for the
three months ended June 30, 1998, to $1.7 million, compared to $1.6 million for
the three months ended June 30, 1997. The primary reasons for such increase were
a $59,000, or 7.7%, increase in salaries and employee benefits, a $26,000, or
35.1%, increase in depreciation, and a $21,000, or 24.1%, increase in bank share
and franchise tax expense. The increase in salaries and employee benefits
reflect an increase in retail staffing, including the New Iberia branch office,
which was opened in the third quarter of 1997, additional staff for commercial
loan origination functions, and the increased cost of the Company's employee
stock ownership plan, which generally requires the Company to record expenses
based on the current market value of the Company's stock. The average price of
the Company's stock was $23.482 for the quarter ended June 30, 1998, compared to
$18.553 for the quarter ended June 30, 1997.
Non-interest expense increased $246,000, or 8.1%, for the six months ended
June 30, 1998, to $3.3 million, compared to $3.0 million for the six months
ended June 30, 1997. The primary reasons for such increase were a $163,000, or
10.7%, increase in salaries and employee benefits, a $28,000, or 18.7%, increase
in depreciation, and a $43,000, or 24.9%, increase in bank share and franchise
tax expense. The average price of the Company's stock was $22.932 for the six
months ended June 30, 1998, compared to $17.633 for the six months ended June
30, 1997.
INCOME TAXES - Income tax expense was $365,000 for the three months ended June
30, 1998, compared to $341,000 for the three months ended June 30, 1997 due
primarily to a slightly higher effective income tax rate for the quarter ended
June 30, 1998.
Income tax expense was $797,000 for the six months ended June 30, 1998,
compared to $741,000 for the six months ended June 30, 1997 due primarily to a
slightly higher effective income tax rate for the six months ended June 30,
1998.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary liquidity, represented by cash and cash equivalents,
is a product of its operating, investing and financing activities. Excess
liquidity includes the Company's portfolios of investment securities held for
sale and mortgage-backed securities held for sale. The Company's primary sources
of funds are deposits, borrowings, proceeds
16
<PAGE> 17
from sale of stock and amortization, prepayments and maturities from its loan
portfolio, and its held to maturity investment securities and mortgage-backed
securities portfolios, and other funds provided from operations. While scheduled
payments from the amortization of loans and mortgage-backed securities and
maturing investment securities are relatively predictable sources of funds,
deposit flows, loan prepayments, and mortgage-backed securities prepayments are
greatly influenced by general interest rates, economic conditions and
competition. The Company, through its subsidiary Bank, has the ability to borrow
up to approximately $98.9 million from the FHLB of Dallas, which together with
the current advances, would be secured by mortgage loans under an existing
blanket collateral agreement, and by Federal Home Loan Bank Stock. At June 30,
1998, the Company had $49.7 million of outstanding advances from the FHLB of
Dallas, and no other borrowings.
Liquidity management is both a daily and long-term function of business
management. The Company uses its primary liquidity to meet its ongoing
commitments, to pay maturing certificates of deposit and deposit withdrawals and
to fund loan commitments. The Company's excess liquidity and borrowing capacity
provide added readiness to meet ongoing commitments and growth. At June 30,
1998, the total approved commitments to extend credit amounted to $31.4 million.
At that same date, certificates of deposit scheduled to mature in one year or
less totaled $64.3 million. Management believes that a significant portion of
maturing deposits will stay with the Company. The Company anticipates it will
continue to have sufficient funds together with available borrowings to meet its
current commitments.
IMPACT OF INFLATION AND CHANGING PRICES
The Consolidated Financial Statements and related financial data presented
herein have been prepared in accordance with generally accepted accounting
principles, which generally require the measurement of financial position and
operation results in terms of historical dollars, without considering changes in
relative purchasing power over time due to inflation. Unlike most industrial
companies, most of the Company's assets and liabilities are monetary in nature.
Consequently, interest rates generally have a more significant impact on the
Company's performance than does the effect of inflation. Interest rates do not
necessarily move in the same direction or in the same magnitude as the prices of
goods and services, since such prices are affected by inflation to a larger
extent than interest rates.
MARKET RISK
Market risk is the risk of loss in a financial instrument arising from
adverse changes in market rates or prices such as interest rates, foreign
currency exchange rates, commodity prices, and equity prices. The Company's
primary market risk exposure is interest rate risk. The ongoing monitoring and
management of this risk is an important component of the Company's
asset/liability management process which is governed by policies established by
its Board of Directors that are reviewed and approved annually.
INTEREST RATE RISK
Interest rate risk represents the sensitivity of earnings to changes in
market interest rates. As interest rates change the interest income and interest
expense streams associated with the Company's financial instruments also change
thereby impacting net interest income ("NII"), the primary component of the
Company's earnings.
17
<PAGE> 18
The ability to maximize net interest income is largely dependent upon the
achievement of a positive interest-rate spread that can be sustained during
fluctuations of interest rates. Interest rate sensitivity is a measure of the
difference between amounts of interest-earning assets and interest-bearing
liabilities that either reprice or mature within a given period. The difference,
or the interest rate repricing "gap", provides an indication of the extent to
which an institution's interest rate spread will be affected by changes in
interest rates. A gap is considered positive when the amount of interest-rate
sensitive assets exceeds the amount of interest-rate sensitive liabilities, and
is considered negative when the amount of interest-rate sensitive liabilities
exceeds the amount of interest-rate sensitive assets, in a given time period.
Generally, during a period of rising interest rates, a negative gap within
shorter maturities would adversely affect net interest income, while a positive
gap within shorter maturities would result in an increase in net interest
income, and during a period of falling interest rates, a negative gap within
shorter maturities would result in an increase in net interest income while a
positive gap within shorter maturities would have the opposite effect. The
Company utilizes the results of a detailed and dynamic simulation model to
quantify the estimated exposure of NII to sustained interest rate changes. While
the Company routinely monitors simulated NII sensitivity over a rolling two-year
horizon, it also utilizes additional tools to monitor potential longer-term
interest rate risk. More information may be found in the Company's 1997 Annual
Report.
CAPITAL ADEQUACY
Federally insured state-chartered banks are required to maintain minimum
levels of regulatory capital. Under current FDIC regulations, insured
state-chartered banks generally must maintain (i) a ratio of Tier 1 leverage
capital to total assets of at least 3.0% (4.0% to 5.0% for all but the most
highly rated banks) and (ii) a ratio of Tier 1 capital risk weighted assets of
at least 4.0% and a ratio of total capital risk weighted assets of at least
8.0%. At June 30, 1998, the Bank complied with all applicable regulatory capital
requirements.
The following reflects the Bank's actual levels of regulatory capital and
applicable regulatory capital requirements at June 30, 1998.
<TABLE>
<CAPTION>
Required Actual Excess
-------------------- -------------------- -------------------
Percent Amount Percent Amount Percent Amount
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Tier I leverage capital ratios 4.00% $11,292 8.05% $22,720 4.05% $11,428
Risk-based capital ratios:
Tier I 4.00% $ 6,029 15.07% $22,720 11.07% $16,691
Total 8.00% $12,058 16.33% $24,616 8.33% $12,558
</TABLE>
The Company, as a separately incorporated holding company, has no
significant operations other than serving as sole stockholder of the Bank. On an
unconsolidated basis, the Company has no paid employees. The Company's assets
consist of its investment in the Bank, the Company's loan to the Bank's ESOP and
50% of the net proceeds retained from the Conversion, and its sources of income
consists primarily of earnings from the investment of such funds as well as any
dividends from the Bank. The expenses expected to be incurred by the Company
will relate to its reporting obligations under the Securities Exchange Act of
1934,
18
<PAGE> 19
as amended ("Exchange Act"), and related expenses as a publicly traded
company. The Bank regularly reimburses the Company for all such expenses.
19
<PAGE> 20
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) Not applicable.
b) No Form 8-K reports were filed during the quarter.
20
<PAGE> 21
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ACADIANA BANCSHARES, INC.
Date: August 10, 1998 By: /S/
-------------------------------------
Gerald G. Reaux, Jr., President and
Chief Executive Officer
Date: August 10, 1998 By: /S/ EMILE E. SOULIER, III
-------------------------------------
Emile E. Soulier, III, Vice-President
and Chief Financial Officer
21
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 868
<INT-BEARING-DEPOSITS> 34,629
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 916
<INVESTMENTS-HELD-FOR-SALE> 20,489
<INVESTMENTS-CARRYING> 12,610
<INVESTMENTS-MARKET> 12,851
<LOANS> 223,243
<ALLOWANCE> 2,818
<TOTAL-ASSETS> 289,148
<DEPOSITS> 201,894
<SHORT-TERM> 29,000
<LIABILITIES-OTHER> 2,626
<LONG-TERM> 20,728
0
0
<COMMON> 27
<OTHER-SE> 43,873
<TOTAL-LIABILITIES-AND-EQUITY> 298,148
<INTEREST-LOAN> 8,767
<INTEREST-INVEST> 1,437
<INTEREST-OTHER> 576
<INTEREST-TOTAL> 10,780
<INTEREST-DEPOSIT> 4,614
<INTEREST-EXPENSE> 5,904
<INTEREST-INCOME-NET> 4,876
<LOAN-LOSSES> 90
<SECURITIES-GAINS> 50
<EXPENSE-OTHER> 3,281
<INCOME-PRETAX> 2,189
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,392
<EPS-PRIMARY> .61
<EPS-DILUTED> .59
<YIELD-ACTUAL> 7.65
<LOANS-NON> 354
<LOANS-PAST> 0
<LOANS-TROUBLED> 503
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,759
<CHARGE-OFFS> 84
<RECOVERIES> 53
<ALLOWANCE-CLOSE> 2,818
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,818
</TABLE>
