FORM 1O-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 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 0-20907
KENWOOOD BANCORP, INC.
(Exact name of registrant as specified in its charter)
Delaware 31-1457996
(State or other jurisdiction or (IRS Employer
incorporation or organization) Identification Number)
7711 Montgomery Road
Cincinnati, Ohio 45236
(Address of principal (Zip Code)
executive office)
Registrant's telephone number, including area code: (513) 791-2834
Check 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 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 [ ]
As of August 7, 1997, the latest practicable date, 295,133 shares of the
registrant's common stock, $.01 par value, were issued and outstanding.
Page 1 of 13 pages
<PAGE>
KENWOOD BANCORP, INC.
Index
Page
----
PART I FINANCIAL INFORMATION
Consolidated Statements of Financial Condition 3
Consolidated Statements of Income 4
Consolidated Statements of Cash Flows 5
Notes to Consolidated Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
PART II OTHER INFORMATION 12
SIGNATURES 13
- 2 -
<PAGE>
<TABLE>
<CAPTION>
KENWOOD BANCORP INC.
STATEMENTS OF FINANCIAL CONDITION
(in Thousands)
ASSETS
June 30 September 30,
1997 1996
-------- --------
(unaudited)
<S> <C> <C>
Cash and due from banks ........................................................ $ 750 588
Interest bearing deposits in other financial institutions ...................... 1,093 1,558
-------- --------
Cash and cash equivalents ........................................ 1,843 2,146
Certificates of deposit in other financial institutions ........................ 380 380
Investment securities at amortized cost, approximate market
value of $1,981 and $1,959 as of June 30, 1997
and September 30, 1996 .................................................... 1,996 1,994
Investment securities - available for sale, amortized cost
of $499 and $499 as of June 30, 1997
and September 30, 1996 .................................................... 491 486
Mortgage-backed securities at cost, approximate market
value of $233 and $250 as of June 30, 1997
and September 30, 1996 .................................................... 225 245
Mortgage-backed securities available for sale, amortized cost
of $7,157 and $4,499 as of June 30, 1997
and September 30, 1996 .................................................... 7,221 4,529
Loans receivable ............................................................... 35,363 30,009
Loans held for sale - at lower of cost or market ............................... 367 9,322
Property and equipment ......................................................... 355 362
Federal Home Loan bank stock - at cost ......................................... 453 430
Accrued interest receivable
Loans ..................................................................... 184 199
Mortgage-backed securities ................................................ 46 26
Investment securities ..................................................... 56 20
Prepaid expenses and other assets .............................................. 64 74
Prepaid federal income taxes ................................................... -- 9
-------- --------
$ 49,044 50,231
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits ....................................................................... $ 40,511 41,636
Advances from the Federal Home Loan Bank ....................................... 3,763 3,653
Accounts payable on mortgage loans services for others ......................... 139 37
Advances by borrowers for taxes and insurance .................................. 122 215
Other liabilities .............................................................. 96 417
Accrued federal income taxes ................................................... 46 --
Deferred federal income taxes .................................................. 46 34
-------- --------
Total liabilities ................................................ 44,723 45,992
-------- --------
<PAGE>
<CAPTION>
<S> <C> <C>
Commitments .................................................................... -- --
Stockholders' equity
Preferred stock - authorized 1,000,000 shares of $.01 par
value, none issued ..................................................... -- --
Common stock - authorized 4,000,000 shares of $.01 par
value; 295,133 shares issued and outstanding ........................... 3 3
Additional paid in capital ................................................ 1,771 1,771
Retained earnings - substantially restricted .............................. 2,646 2,597
Shares acquired by Management Recognition Plan ............................ (18) (18)
Less unearned ESOP shares ................................................. (119) (126)
Unrealized gain on available for sale securities, net of income tax ....... 38 12
-------- --------
Total stockholders' equity ....................................... 4,321 4,239
-------- --------
$ 49,044 50,231
======== ========
</TABLE>
- 3 -
<PAGE>
<TABLE>
<CAPTION>
KENWOOD BANCORP INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands)
(Unaudited)
Nine Months ended Three Months ended
June 30 June 30
1997 1996 1997 1996
------ ------ ------ ------
<S> <C> <C> <C> <C>
Interest income
Loans ..................................... $1,999 1,959 672 679
Mortgage-backed securities ................ 330 349 124 116
Investment securities ..................... 134 144 45 45
Interest bearing deposits and other ....... 101 90 20 20
------ ------ ------ ------
Total interest income .................. 2,564 2,542 861 860
Interest expense
Deposits .................................. 1,717 1,865 564 608
Borrowings ................................ 81 31 32 21
------ ------ ------ ------
Total interest expense ................. 1,798 1,896 596 629
------ ------ ------ ------
Net interest income .................... 766 646 265 231
Provision for losses on loans ................... -- 10 -- 4
------ ------ ------ ------
Net interest income after provision
for losses on loans ................ 766 636 265 227
------ ------ ------ ------
Other income
Gain on sale of mortgage loans ............ 163 159 26 52
Gain on sale of investments ............... -- 13 -- --
Other operating ........................... 14 12 4 4
------ ------ ------ ------
177 184 30 56
------ ------ ------ ------
General, administrative and other expenses
Employee compensation and benefits ........ 373 313 112 97
Occupancy and equipment ................... 98 91 31 32
Federal deposit insurance premiums ........ 42 75 10 25
Franchise taxes ........................... 51 31 22 10
Other ..................................... 221 185 73 66
------ ------ ------ ------
Total general, administrative and
other expenses ..................... 785 695 248 230
------ ------ ------ ------
Income before income taxes ............. 158 125 47 53
<PAGE>
<CAPTION>
<S> <C> <C> <C> <C>
Federal income taxes
Current ................................... 47 31 11 13
Deferred .................................. -- -- -- --
------ ------ ------ ------
47 31 11 13
------ ------ ------ ------
Net income ............................. $ 111 94 36 40
====== ====== ====== ======
Earnings per share, restated for effects
of conversion from mutual holding
company ............................ $ 0.39 0.33 0.13 0.14
====== ====== ====== ======
</TABLE>
- 4 -
<PAGE>
<TABLE>
<CAPTION>
KENWOOD BANCORP INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the nine months ended June 30,
(In thousands)
(Unaudited)
1997 1996
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income for the period ............................................ $ 111 94
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
Depreciation and amortization ................................. 24 25
Amortization of ESOP .......................................... 14 --
Loans disbursed for sale in the secondary market .............. (5,427) (10,177)
Proceeds from sale of loans in the secondary market ........... 6,262 9,751
Gain on sale mortgage loans ................................... (163) (159)
Gain on sale of investments ................................... -- (13)
Federal Home Loan Bank dividends .............................. (23) (21)
Amortization of deferred loan origination (fees) costs ........ 11 (7)
Provision for loan losses ..................................... -- 10
Increase (decrease) in cash due to changes in:
Accrued interest receivable ................................ (41) (68)
Prepaid expenses and other assets .......................... 19 (4)
Accounts payable on mortgage loans serviced for loans ...... 102 (85)
Other liabilities .......................................... (328) 40
Accrued federal income taxes ............................... 46 28
------- -------
Net cash provided by (used in) operating activities ..... 607 (586)
------- -------
Cash flows provided by (used in) investing activities:
Principal payments on loans and mortgage-backed securities ........... 3,853 7,370
Loan disbursements ................................................... (8,605) (10,055)
Proceeds from sale of loans .......................................... 8,322 --
Purchase of investment securities .................................... -- (500)
Maturity of investment securities .................................... -- 500
Purchase of mortgage-backed securities - available for sale .......... (3,293) (513)
Proceeds from sale of investments - available for sale ............... -- 513
Purchase of office premises and equipment ............................ (17) (7)
Decrease in certificates of deposit in other financial institutions .. -- 950
------- -------
Net cash provided by (used in) investing activities ..... 260 (1,742)
------- -------
Cash flows provided by (used in) financing activities:
Net decrease in deposits ............................................. (1,125) (2,073)
Borrowings from FHLB ................................................. 3,200 3,000
Repayment of FHLB advances ........................................... (3,090) (1,027)
Advances by borrowers for taxes and insurance ........................ (93) (48)
Net proceeds from the issuance of common stock ....................... -- 1,264
Dividends paid on common stock ....................................... (62) (41)
------- -------
Net cash provided by (used in) financing activities ..... (1,170) 1,075
------- -------
<PAGE>
<S> <C> <C>
Net decrease in cash and cash equivalents ................................ (303) (1,253)
Cash and cash equivalents - beginning of period .......................... 2,146 2,808
------- -------
Cash and cash equivalents - end of period ................................ 1,843 1,555
======= =======
Supplemental disclosure of cash flow information
Cash paid during the period for:
Federal income taxes .............................................. -- (8)
======= =======
Interest on deposits and borrowings ............................... 1,202 1,895
======= =======
Supplemental disclosure of non-cash investing activities
Transfer of investment securities to available for sale classifi$ation -- 7,253
======= =======
</TABLE>
- 5 -
<PAGE>
KENWOOD BANCORP, INC.
Notes to Consolidated Financial Statements
1. Organizational Summary:
Kenwood Bancorp, Inc. (the "Company" or "Bancorp") is a holding company
formed in March 1996, in conjunction with the second step conversion of
Kenwood Savings and Loan Association from a mutual holding company format
to a stock holding company format. The second step conversion was
completed on June 28, 1996, with all the stock of the Association canceled
and exchanged into stock of Bancorp. Bancorp's financial statements
include the accounts of its wholly owned subsidiary, Kenwood Savings Bank
(formerly Kenwood Savings and Loan Association).
2. Basis of Presentation:
The accompanying unaudited financial statements were prepared in
accordance with instructions for Form 10-QSB 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 adjustments
(consisting only of normal recurring accruals) which, in the opinion of
management, are necessary for a fair presentation of the financial
statements have been included. The results of operations for the nine
month period ended June 30, 1997, are not necessarily indicative of the
results which may be expected for the entire fiscal year.
3. Earnings Per Share:
Earnings per share for three month period ended June 30, 1997, is computed
based on 282,521 weighted average shares outstanding for Bancorp. Earnings
per share for the nine month period ended June 30, 1997, is computed based
on 282,521 weighted average shares outstanding as adjusted for the
reorganization from the mutual holding company to the stock holding
company form for Kenwood Savings Bank.
Weighted average shares for the nine months ended June 30, 1997, include
the effect of the issuance of 295,133 shares on June 28, 1996, of Kenwood
Bancorp, Inc. These shares were sold or converted pursuant to a plan of
conversion and agreement and plan of reorganization whereby, in addition
to newly issued shares, each share of common stock of Kenwood Savings and
Loan Association held by Kenwood Federal Mutual Holding Company were
canceled and each share of the Association common stock held by the
Association's public stockholders were converted into shares of Bancorp.
4. Effects of Recent Accounting Pronouncements:
In May 1995, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 122, "Accounting
for Mortgage Servicing Rights". This statement requires that a mortgage
banking enterprise recognize as separate assets rights to service mortgage
loans for others, however those servicing rights are acquired. A mortgage
banking enterprise that acquires mortgage servicing rights through either
the purchase or origination of
- 6 -
<PAGE>
mortgage loans and sells or securitizes those loans with servicing rights
retained would allocate the total cost of the mortgage loans to the
mortgage servicing rights and the loans based on their relative fair
value. Statement No. 122 is effective for fiscal years beginning after
December 15, 1995. Management has implemented the standard as of October
1, 1996, with no material effect on the consolidated financial statements.
In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock-Based
Compensation," establishing financial accounting and reporting standards
for stock-based employee compensation plans. SFAS No. 123 encourages all
entities to adopt a new method of accounting to measure compensation cost
of all employee stock compensation plans based on the estimated fair value
of the award at the date it is granted. Companies are, however, allowed to
continue to measure compensation cost of those plans using the intrinsic
value based method of accounting, which generally does not result in
compensation expense recognition for most plans. Companies that elect to
remain with the existing accounting are required to disclose in a footnote
to the financial statements pro forma net income and if presented,
earnings per share, as if SFAS No. 123 had been adopted. The accounting
requirements of SFAS No. 123 are effective for transactions entered into
during fiscal years that begin after December 15, 1995. Companies are
required, however, to disclose information for awards granted in their
first fiscal year ending after December 15, 1994. SFAS No. 123 had no
effect on the consolidated financial statements for the periods presented.
In June 1996, the FASB issued SFAS No. 125 "Accounting for Transfers and
Servicing of Financial Assets and Entinguishments of Liabilities" which
established accounting and reporting standards for transfers and servicing
of financial assets and extinguishments of liabilities. The standards are
based on a consistent application of a financial components approach that
focuses on control. Under that approach, after a transfer of financial
assets, an entity recognizes the financial and servicing assets it
controls and the liabilities it has incurred, derecognizes financial
assets when control has been surrendered, and derecognizes liabilities
when extinguished. SFAS No. 125 provides consistent standards for
distinguishing transfers of financial assets that are sales from transfers
that are secured borrowings. SFAS No. 125 supersedes SFAS No. 122. SFAS
No. 125 is effective for transactions occurring after December 31, 1996.
Management does not expect a material effect on its consolidated financial
statements.
In March 1997, the FASB issued SFAS No. 128, "Earnings per Share" which
will replace the current presentation on "primary" and "full diluted"
earnings per share with newly defined "basic" and "diluted" earnings per
share. "Basic" earnings per share will not include the dilutive effect of
certain common stock equivalents on earnings. Diluted earnings per share
will reflect the potential dilution of securities that could share in an
enterprises earnings. The statements will require dual presentation of
basic and diluted earnings per share on the income statements for all
entities having complex capital structures and will be effective for
financial statements issued for periods ending after December 15, 1997.
Management is currently assessing the impact of this statement on the
Company's financial statements.
- 7 -
<PAGE>
KENWOOD BANCORP INC.
Management's Discussion And Analysis Of Financial
Condition And Results Of Operations
Discussion of Financial Condition Changes from September 30, 1996, to June 30,
1997
At June 30, 1997, the Company had total assets $49.0 million, a decrease of
approximately $1.2 million or 2.4% from September 30, 1996. The reduction in
assets was due primarily to the sale of $8.2 million in adjustable-rate
single-family loans with the proceeds from the sale being used to repay FHLB
advances of $3 million and to purchase $3.2 million of mortgage-backed
securities.
Cash and cash equivalents decreased $303,000 or 14.1% during the nine months
ended June 30, 1997, as the Company used its excess liquidity to fund loan
demand.
Loans receivable (including loans held for sale) decreased $3.6 million or 9.2%
to $35.7 million at June 30, 1997, as compared to $39.3 million at September 30,
1996. As noted, the Company sold during the nine months ended June 30, 1997,
$8.2 million of adjustable-rate single-family loans to a third party. The
Company sold the loans to fund the repayment of FHLB advances which had funded
the past loan growth and to reinvest the additional proceeds from the loan sale
in mortgage-backed securities. The FHLB advances were short-term advances which
for the most part repriced daily and had a negative impact on the Company's
interest rate risk. The Company also sold an additional $6.2 million of
fixed-rate single family loans in the secondary market during the nine months
ended June 30, 1997. The Company continues to sell in the secondary market the
majority of fixed-rate one-to-four family residential loan originations.
The Company's investment portfolio consists of certificates of deposits,
investment securities, and mortgage-backed securities (held to maturity and
available for sale). The investment portfolio increased $2.7 million or 35.1%
over the level maintained at September 30, 1996. The increase in the investment
portfolio was due to the purchase of mortgage-backed securities with the funds
from the aforementioned loan sale.
Deposits totaled $40.5 million at June 30, 1997, a decrease of $1.1 million or
2.7% from the $41.6 million of deposits at September 30, 1996. The reduction in
deposits is due to the decrease in certificates of deposit, as consumers
continue to look for alternative savings vehicles. The Company does not offer
special rates or terms to attract deposits unless the terms and rates are
favorable for the Company for the long term. The current local market for
certificates of deposit remains competitive and the Company has priced its
certificates of deposit to remain competitive with the market. Demand accounts
have increased during the nine months ended June 30, 1997, as the Company's new
demand account products are generating new or increased accounts.
-8-
<PAGE>
The Company is required to meet each of three minimum capital standards
promulgated by the Office of Thrift Supervision. The capital standards require
the maintenance of regulatory capital standards sufficient to meet a tangible,
core, and risk-based capital requirement. At June 30, 1997, the Company's
tangible and core capital totaled $4.1 million or 8.4% of adjusted total assets,
which exceeded the respective minimum requirements at that date of 1.5% and 3.0%
by $3.4 million and $2.7 million respectively. The Company's risk-based capital
totaled $4.2 million at June 30, 1997, or 20.4% of risk weighted assets, which
exceeded the 8% requirement by $2.6 million.
Comparison of Operating Results for the Nine Months Ended June 30, 1997 and 1996
General
Net income for the nine months ended June 30, 1997 totaled $111,000, an increase
of $17,000 or 18.1% from the $94,000 recorded for the nine months ended June 30,
1996. The increase in net income resulted primarily from higher net interest
income, which was partially offset by an increase in operating expenses and
income taxes.
Net Interest Income
Interest income on loans for the nine months ended June 30, 1997, increased
$40,000 or 2.0% due to an increase in the average balance of loans outstanding
period-to-period. The Company sold in late November 1996, $8.2 million of
adjustable-rate loans. The effect of this sale on interest income impacted
interest income during the most recent nine months but has been partially offset
by new originations during the current quarter. Interest income on
mortgage-backed securities decreased $19,000 or 5.4%, due primarily to a lower
average balance outstanding during the nine months ended June 30, 1997. The
Company purchased $3.3 million of mortgage-backed securities in December 1996,
with the proceeds from the sale of the loans mentioned above. Interest income on
investment securities and interest bearing deposits have remained relatively
stable.
Interest expense on deposits decreased $148,000 or 7.9% during the nine months
ended June 30, 1997, as compared to the prior nine month period. This decrease
was due to a decrease in the average balance outstanding and a change in the mix
of deposits to a higher percentage of demand accounts. Interest expense on
borrowings increased $50,000 as the Company has utilized FHLB advances as an
alternative source of funding for loan growth. The Company repaid in December
1996, $3 million of the outstanding FHLB advances with the proceeds from the
aforementioned loan sale, but during the current quarter has borrowed additional
amounts to fund the current loan growth.
As a result of the foregoing changes in interest income and interest expense,
net interest income increased $120,000 or 18.6% during the nine months ended
June 30, 1997, as compared to the nine months ended June 30, 1996.
Provision for Losses on Loans
The Company did not record a provision for losses on loans for the nine month
period ended June 30, 1997. The provision for losses on loans for the nine
months ended June 30, 1996, was the result of loan portfolio growth during the
period and management's assessment of the inherent risk in lending.
- 9 -
<PAGE>
Other Income
Other income decreased by $7,000 or 3.8% during the nine months ended June 30,
1997, as compared to the nine months ended June 30, 1996. This decrease was due
to the Company's sale of investments in the prior period with no corresponding
sales in the current nine month period ending June 30, 1997, offset by an
increase in gain on sale of loans. The Company, as discussed above, sold $8.2
million of adjustable-rate loans to a third party during the first quarter of
the fiscal year generating a gain of approximately $72,000. The Company has
continued to sell loans in the secondary market as consumer demand for
fixed-rate loans has continued.
General, Administrative and Other Expenses
General, administrative and other expenses increased by $90,000 or 12.9% during
the nine months ended June 30, 1997, as compared to the same period in 1996.
This increase was due primarily to an increase of $60,000 or 19.2% in
compensation and benefits and a $36,000 increase in other operating expenses.
The increase in compensation and benefits related directly to the Company's
mortgage loan origination office. The increase in other operating expenses was
due to higher professional service fees in connection with securities and
regulatory filings.
Federal Income Taxes
The provision for federal income taxes increased $16,000 during the nine months
ended June 30, 1997, as compared to the same period in 1996. The increase in
federal income taxes was due to the higher level of taxable income during the
current period. The Company's effective tax rates amounted to 29.7% and 24.8%
during the nine months ended June 30, 1997 and 1996, respectively.
Comparison of Operating Results for the Three Months Ended June 30, 1997 and
1996
General
Net income for the three months ended June 30, 1997 totaled $36,000, a decrease
of $4,000 from the $40,000 in net income for the three months ended June 30,
1996. The decrease was due primarily to a decrease in other income of $26,000
and an increase in general, administrative and other expenses of $18,000, which
was partially offset by a decrease in the provision for income taxes of $2,000
and higher net interest income of $34,000.
Net Interest Income
Interest income on loans for the three months ended June 30, 1997 was $672,000
which represented a decrease of $7,000 or 1.0% as compared to the three month
period ended June 30, 1996. The Company's balance of average loans for the two
periods was relatively the same, and the flat interest rate environment allowed
for the relatively comparable income amounts. Interest income on mortgage-backed
securities increased $8,000 due to a higher level of average mortgage-backed
securities during the period from $7.0 million for the three months ended June
30, 1996, to $7.5 million for the three months ended June 30, 1997. Interest
income on investment securities and interest bearing deposits have remained
stable between the two periods.
- 10 -
<PAGE>
Interest expense on deposits totaled $564,000 for the three months ended June
30, 1997, a decrease of $44,000 or 7.2% as compared to the three months ended
June 30, 1996. The decrease was due primarily to the lower average balance on
deposits and the change in the mix from certificates of deposit to demand
accounts which offer lower rates. The Company had recently offered new demand
deposit accounts which have resulted in an increase in such accounts. Interest
expense on FHLB advances totaled $32,000 for the three months ended June 30,
1997, an increase of $11,000 over the same period for 1996. This increase was
due to higher level of advances period to period. The Company has used FHLB
advances to fund loan growth.
As a result of the above changes in interest income and interest expense, net
interest income increased $34,000 or 14.7% during the three months ended June
30, 1997, as compared to the three months ended June 30, 1996.
Provision for Losses on Loans
The Company had no provision for losses on loans for the three months ended June
30, 1997, as compared to $4,000 for the three months ended June 30, 1996. The
provision for losses on loans is based on the loan portfolio characteristics and
the inherent risk in lending.
Other Income
Other income decreased by $26,000 during the three months ended June 30, 1997,
as compared to the same period in 1996. This decrease was due to a decrease in
gains on sales of mortgage loans. The Company's secondary market activities have
decreased during the current period versus the prior period, primarily as a
result of the current interest rate environment and consumer demand.
General, Administrative and Other Expenses
General, administrative and other expenses increased by $18,000 or 7.8% to
$248,000 for the three month period ended June 30, 1997, as compared to $230,000
for the three month period ended June 30, 1996. The increase was due primarily
to a $15,000 increase in compensation and benefits due to higher salaries
relating to the Company's loan origination office, increased health insurance
costs and the compensation expense for the Company's employee stock ownership
plan. The increase was also due to an increase in other expenses to $73,000 for
the three months ended June 30, 1997, as compared to $66,000 for the three
months ended June 30, 1997, an increase of $7,000 or 10.6%. The increase was due
to higher professional service fees relating to various securities and
regulatory filings. The increase was partially offset by a decrease in FDIC
insurance premiums of $15,000 to $10,000 for the three months ended June 30,
1997, as compared to $25,000 for the three months ended June 30, 1996, due to
the reduction in insurance rates after the SAIF recapitalization.
Federal Income Taxes
The provision for federal income taxes decreased by $2,000 during the three
months ended June 30, 1997, as compared to the same period in 1996, due
primarily to a decrease in income before taxes of $6,000.
- 11 -
<PAGE>
KENWOOD BANCORP, INC.
PART II
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
Not applicable
- 12 -
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: August 11, 1997 By: /s/ THOMAS W. BURNS
-------------------
Thomas W. Burns
Executive Vice President,
Chief Executive Officer and
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> JUN-30-1997
<CASH> 750
<INT-BEARING-DEPOSITS> 1,093
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7,712
<INVESTMENTS-CARRYING> 3,054
<INVESTMENTS-MARKET> 3,047
<LOANS> 35,730
<ALLOWANCE> 95
<TOTAL-ASSETS> 49,044
<DEPOSITS> 40,511
<SHORT-TERM> 3,763
<LIABILITIES-OTHER> 449
<LONG-TERM> 0
0
0
<COMMON> 3
<OTHER-SE> 4,318
<TOTAL-LIABILITIES-AND-EQUITY> 49,044
<INTEREST-LOAN> 1,999
<INTEREST-INVEST> 464
<INTEREST-OTHER> 101
<INTEREST-TOTAL> 2,564
<INTEREST-DEPOSIT> 1,717
<INTEREST-EXPENSE> 1,798
<INTEREST-INCOME-NET> 766
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 785
<INCOME-PRETAX> 158
<INCOME-PRE-EXTRAORDINARY> 158
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 111
<EPS-PRIMARY> .39
<EPS-DILUTED> .39
<YIELD-ACTUAL> 2.19
<LOANS-NON> 77
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 95
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 95
<ALLOWANCE-DOMESTIC> 95
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
