SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-----------------------
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO 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 0-28696
Home Bancorp of Elgin, Inc.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 36-4090333
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
16 North Spring Street, Elgin, Illinois 60120
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(ZIP CODE)
(847) 742-3800
(REGISTRANT'S TELEPHONE NUMBER INCLUDING AREA CODE)
N/A
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed from last Report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding twelve 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 .
--- ---
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
Outstanding at
Class June 30, 1997
----- -------------
Common Stock,
par value $.01 6,855,799
<PAGE>
TABLE OF CONTENTS
PART I -- FINANCIAL INFORMATION
-------------------------------
Item 1. Financial Statements of Home Bancorp of Elgin, Inc.
Consolidated Balance Sheets (Unaudited) -- June 30, 1997
and December 31, 1996 .............................................. 1
Consolidated Statements of Earnings (Unaudited) -- Three
and six months ended June 30, 1997 and 1996 ........................ 2
Consolidated Statements of Cash Flows (Unaudited) -- Three
and six months ended June 30, 1997 and 1996 ........................ 3
Notes to Unaudited Consolidated Financial Statements ............... 4
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations .............................................. 5
Item 3. Quantitative and Qualitative Disclosure About Market Risk .......... 17
PART II -- OTHER INFORMATION
----------------------------
Item 1. Legal Proceedings .................................................. 17
Item 2. Changes in Securities .............................................. 17
Item 3. Defaults upon Senior Securities .................................... 17
Item 4. Submission of Matters to a Vote of Security Holders ................ 17
Item 5. Other Information .................................................. 18
Item 6. Exhibits and Reports on Form 8-K ................................... 18
Signatures .................................................................. 19
- i -
<PAGE>
Part I - FINANCIAL INFORMATION
---------------------
ITEM 1. FINANCIAL STATEMENTS -- The consolidated statements of earnings and cash
flows for the three months and six months ended June 30, 1996 are for Home
Federal Savings and Loan Association of Elgin ("Home Federal" or the
"Association") only, because Home Bancorp of Elgin, Inc. ("Home Bancorp" or the
"Company"), the holding company for the Association, did not commence operations
until September 26, 1996 in connection with the Association's conversion from
mutual to stock form. The financial statements for 1997 are for Home Bancorp and
its consolidated subsidiary.
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, Dec. 31,
1997 1996
---------- ----------
(In thousands, except shares
and per share amounts)
<S> <C> <C>
ASSETS
Cash and due from banks................................................ $ 3,030 $ 5,661
Interest-earning deposits.............................................. 22,969 22,341
Investment securities held to maturity................................. 33,887 53,786
Loans receivable, net.................................................. 279,866 261,306
Government National Mortgage Association
mortgage-backed securities held to maturity.......................... 114 142
Accrued interest receivable............................................ 1,770 1,701
Real estate owned and in judgment, at lower of cost or fair value...... 225 550
Federal Home Loan Bank of Chicago stock, at cost....................... 2,606 2,678
Office properties and equipment, net................................... 7,355 7,564
Prepaid expenses and other assets...................................... 755 606
---------- ----------
Total assets........................................................ $ 352,577 $ 356,335
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Savings deposits....................................................... $ 249,086 $ 251,795
Advances from Federal Home Loan Bank of Chicago........................ 5,000 --
Advance payments by borrowers for taxes and insurance.................. 2,090 2,012
Accrued interest payable and other liabilities......................... 2,279 2,647
---------- ----------
Total liabilities................................................... 258,455 256,454
---------- ----------
Stockholders' Equity:
Preferred stock, $.01 par value, 3,000,000 shares
authorized; none outstanding......................................... -- --
Common stock, $.01 par value; 12,000,000 shares authorized
7,009,250 shares issued at June 30, 1997 and December 31,
1996, 6,855,799 shares and 7,009,250 shares outstanding
at June 30, 1997 and at December 31, 1996, respectively.............. 70 70
Additional paid-in capital............................................. 68,105 67,953
Retained earnings, substantially restricted............................ 38,232 37,325
Treasury stock at cost (153,451 shares) ............................... (2,470) --
Unearned ESOP compensation............................................. (5,467) (5,467)
Unearned RRP compensation.............................................. (4,348) --
---------- ---------
Total stockholders' equity.......................................... 94,122 99,881
---------- ----------
Total liabilities and stockholders' equity............................. $ 352,577 $ 356,335
========== ==========
</TABLE>
See accompanying notes to unaudited consolidated financial statements.
- 1 -
<PAGE>
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
<TABLE>
<CAPTION>
For the Three For the Six
Months Ended Months Ended
June 30, June 30,
--------------- ---------------
1997 1996 1997 1996
---- ---- ---- ----
(In thousands, except
per share amounts)
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans secured by real estate ....................... $ 5,281 $ 5,242 $10,382 $10,553
Other loans ........................................ 15 13 30 28
Mortgage-backed securities held to maturity ........ 2 3 5 6
Investment securities held to maturity ............. 508 90 1,189 180
Interest-earning deposits .......................... 444 185 746 346
Federal Home Loan Bank of Chicago stock ............ 44 45 89 94
------- ------- ------- -------
Total interest income .......................... 6,294 5,578 12,441 11,207
INTEREST EXPENSE
Savings deposits ................................... 2,607 2,713 5,176 5,449
Borrowed funds ..................................... 5 -- 5 37
------- ------- ------- -------
Total interest expense ......................... 2,612 2,713 5,181 5,486
------- ------- ------- -------
Net interest income before provision for loan losses 3,682 2,865 7,260 5,721
Provision for loan losses .......................... 30 30 60 60
------- ------- ------- -------
Net interest income after provision for loan losses 3,652 2,835 7,200 5,661
------- ------- ------- -------
NON-INTEREST INCOME
Service fee income ................................. 245 300 495 594
Gain on sale of real estate owned .................. -- 3 34 21
Gain on sale of office properties and equipment .... -- -- -- 1
Other income ....................................... 6 6 194 11
------- ------- ------- -------
Total non-interest income ...................... 251 309 723 627
NON-INTEREST EXPENSE
Compensation and benefits .......................... 1,357 1,882 2,589 2,924
Occupancy expense .................................. 405 371 802 750
Federal deposit insurance premiums ................. 63 170 94 339
Advertising and promotion .......................... 111 92 208 174
Automated teller machines .......................... 107 107 203 221
Data processing .................................... 225 242 460 493
Other .............................................. 460 297 940 562
------- ------- ------- -------
Total non-interest expense ..................... 2,728 3,161 5,296 5,463
------- ------- ------- -------
Income before income tax expense ................... 1,175 (17) 2,627 825
Income tax expense ................................. 456 (7) 1,019 324
------- ------- ------- -------
Net income (loss) .............................. $ 719 $ (10) $ 1,608 $ 501
======= ======= ======= =======
Earnings per share: ................................. $ 0.11 NA $ 0.25 NA
======= ======= ======= =======
</TABLE>
See accompanying notes to unaudited consolidated financial statements.
- 2 -
<PAGE>
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the Three Months For the Six Months
Ended Ended
June 30, June 30,
-------------------- ------------------
1997 1996 1997 1996
-------- -------- -------- --------
(In thousands)
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income ........................................................................ $ 719 $ (10) $ 1,608 $ 501
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization ..................................................... 157 151 314 300
Provision for possible loan losses ................................................ 30 30 60 60
Accretion of discounts, net ....................................................... (166) (8) (476) (15)
Market adjustment for committed ESOP shares ....................................... 82 -- 152 --
Cost of RRP ....................................................................... 150 -- 150 --
Decrease in deferred loan fees .................................................... (70) (120) (119) (185)
Gain on sale of real estate owned ................................................. -- (3) (34) (21)
Gain on sale of office properties and equipment ................................... -- -- -- (1)
Decrease (increase) in accrued interest receivable ................................ (442) 49 (68) (14)
Increase in prepaid expenses and other assets, net ................................ (79) (309) (150) (375)
Increase (decrease) in accrued interest payable and other liabilities, net ........ 435 553 (368) 626
-------- -------- -------- --------
Net cash provided by operating activities ...................................... 816 333 1,069 876
-------- -------- -------- --------
Cash flows from investing activities:
Net decrease (increase) in loans receivable ....................................... (17,894) 280 (18,502) 3,386
Repayment of mortgage-backed securities held to maturity .......................... 18 13 28 26
Maturities of investment securities held to maturity .............................. 15,229 -- 20,374 --
Purchase of office properties and equipment ....................................... (20) (105) (105) (236)
Proceeds from the sale of REO ..................................................... -- 49 359 186
Proceeds from the sale of office properties and equipment ......................... -- -- -- 1
Redemption of stock in the Federal Home Loan Bank of Chicago ...................... 72 -- 72 378
-------- -------- -------- --------
Net cash provided by (used in) investing activities ............................ (2,595) 237 2,226 3,741
-------- -------- -------- --------
Cash flows from financing activities:
Increase (decrease) in Federal Home Loan Bank of Chicago advances ................. 5,000 -- 5,000 (4,000)
Net decrease in savings deposits .................................................. (3,950) (5,863) (2,708) (1,350)
Purchase of RRP stock ............................................................. (4,498) -- (4,498) --
Purchase of Treasury stock ........................................................ (2,470) -- (2,470) --
Dividends paid on common stock .................................................... (701) -- (701) --
Net increase (decrease) in advance payments by borrowers for taxes and
insurance ................................................................. (885) (971) 78 99
-------- -------- -------- --------
Net cash used in financing activities ............................................. (7,504) (6,834) (5,299) (5,251)
-------- -------- -------- --------
Decrease in cash and cash equivalents ............................................. (9,283) (6,264) (2,004) (634)
Cash and cash equivalents at beginning of period .................................. 35,282 24,239 28,003 18,609
-------- -------- -------- --------
Cash and cash equivalents at end of period ........................................ $ 25,999 $ 17,975 $ 25,999 $ 17,975
======== ======== ======== ========
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest ................................................................... $ 2,600 $ 2,719 $ 5,179 $ 5,543
Income taxes ............................................................... 445 530 496 550
</TABLE>
See accompanying notes to unaudited consolidated financial statements.
- 3 -
<PAGE>
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(1) Basis of Presentation
The consolidated financial statements included herein have been
prepared by the Company without audit. In the opinion of management, the
quarterly unaudited consolidated financial statements include all adjustments,
consisting of normal recurring accruals, necessary for a fair presentation of
the financial position and results of operations at and for the periods
presented. Certain information and footnote disclosures normally included in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to the rules and regulations of the Securities and Exchange
Commission. The Company believes that the disclosures are adequate to make the
information presented not misleading; however, the results for the periods
presented are not necessarily indicative of results to be expected for the
entire year.
(2) Stock Conversion
On September 26, 1996, the Association completed its conversion from
a federally chartered mutual savings and loan association to a federally
chartered stock savings and loan association, and all of the capital stock of
the Association was acquired by Home Bancorp. Home Bancorp issued and sold
7,009,250 shares of its common stock, $.01 par value, at a price of $10.00 per
share in a subscription offering (the "Offering") to certain depositors of Home
Federal and to the Company's Employee Stock Ownership Plan. Net proceeds from
the Offering were $62.4 million.
(3) Earnings Per Share
Earnings per share of common stock for the three months and six
months ended June 30, 1997 has been determined by dividing net income for the
three months and six months by 6,499,102 and 6,482,510 respectively, the
weighted average number of primary shares of common stock and common stock
equivalents. ESOP shares are only considered outstanding for earnings per share
calculations when they are committed to be released. Earnings per share
information for the three months and six months ended June 30, 1996 cannot be
computed, because the Company did not issue stock until September 26, 1996.
(4) Commitments and Contingencies
At June 30, 1997, the Company had outstanding commitments to
originate mortgage loans of $12.2 million, of which $6.9 million were fixed rate
commitments.
- 4 -
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
On September 26, 1996, Home Federal Savings and Loan Association of
Elgin ("Home Federal" or the "Association") completed its conversion from mutual
to stock form and became a wholly-owned subsidiary of Home Bancorp of Elgin,
Inc. ("Home Bancorp" or the "Company"). On such date, the Company sold 7,009,250
shares of its common stock, par value $.01 per share, to the public, at a per
share price of $10.00. The conversion and offering raised $62.4 million in net
proceeds. The Company's sole business activity consists of the ownership of the
Association. The Company also invests in short-term investment grade marketable
securities and other liquid investments. The financial data presented in this
Quarterly Report represents the activity of the Association for the three months
and six months ended June 30, 1996 and the activity of Home Bancorp and
subsidiary consolidated for the three month and six month period ended June 30,
1997. The Association's principal business consists of attracting deposits from
the public and investing those deposits, along with funds generated from
operations, primarily in loans secured by mortgages on one- to four-family
residences. The Association's results of operations are dependent primarily on
net interest income, which is the difference between the interest income earned
on its interest-earning assets, such as loans and securities, and the interest
expense incurred on its interest-bearing liabilities, such as savings deposits.
The Association also generates non-interest income such as service charges and
other fees. The Association's non-interest expenses primarily consist of
employee compensation and benefits, occupancy expenses, federal deposit
insurance premiums, net costs of real estate owned, data processing fees and
other operating expenses. The Association's results of operations are also
significantly affected by general economic and competitive conditions
(particularly changes in market interest rates), government policies and actions
of regulatory agencies.
- 5 -
<PAGE>
The selected financial ratios and other data of the Company set forth
below are derived in part from, and should be read in conjunction with, the
Financial Statements of the Company presented elsewhere in this report.
<TABLE>
<CAPTION>
At or For the At or For the
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
1997 1996 1997 1996
---- ---- ---- ----
(Dollars in thousands, except
shares and per share amounts)
(Unaudited)
<S> <C> <C> <C> <C>
SELECTED FINANCIAL RATIOS(1):
PERFORMANCE RATIOS:
Return (loss) on average assets ............. 0.81% (0.01)% 0.90% 0.33%
Return (loss) on average equity ............. 2.92 (0.11) 3.23 2.69
Interest rate spread(2) ..................... 3.09 3.55 3.07 3.54
Net interest margin(3) ...................... 4.29 4.01 4.25 3.99
Average interest-earning assets to average
interest-bearing liabilities .............. 139.59 111.93 138.98 111.90
Non-interest expense to average assets ...... 3.06 4.18 2.97 3.61
CAPITAL RATIOS(1):
Average equity to average assets ............ 27.57 12.34 27.87 12.29
Consolidated equity to total assets at end of
period .................................... 26.70 12.38 26.70 12.38
Tangible capital(4) ......................... 20.27 12.38 20.27 12.38
Core capital(4) ............................. 20.27 12.38 20.27 12.38
Total risk-based capital(4) ................. 39.45 23.80 39.45 23.80
ASSET QUALITY RATIOS AND OTHER DATA(1):
Total non-performing loans(5) ............... $ 1,214 $ 1,127 $ 1,214 $ 1,127
Real estate owned, net ...................... 225 331 225 331
Non-performing loans to total loans(6) ...... 0.43% 0.43% 0.43% 0.43%
Non-performing assets to total assets ....... 0.41 0.49 0.41 0.49
Allowance for loan losses to:
Non-performing loans ..................... 82.75 78.62 82.75 78.62
Total loans(6) ........................... 0.36 0.33 0.36 0.33
Number of shares outstanding(7) ............. 6,855,799 NA 6,855,799 NA
Book value per share(7) ..................... $ 13.73 NA $ 13.73 NA
</TABLE>
(1) With the exception of end-of-period ratios, all ratios are based on
average monthly balances during the indicated periods and are annualized
where appropriate. Capital Ratios and Asset Quality Ratios And Other Data
are end-of-period ratios and data.
(2) The interest rate spread represents the difference between the
weighted-average yield on interest-earning assets and the
weighted-average cost of interest-bearing liabilities.
(3) The net interest margin represents net interest income as a percentage of
average interest-earning assets.
(4) These regulatory capital ratios are for Home Federal Savings and Loan
Association of Elgin only.
(5) Non-performing loans consist of non-accrual loans; the Company did not
have any loans that were 90 days or more past due and still accruing at
any of the dates referred to in the table above.
(6) Total loans represents gross loans, less deferred loan fees and loans in
process.
(7) Share information for 1996 cannot be computed, because the Company did
not issue stock until September 26, 1996.
- 6 -
<PAGE>
ANALYSIS OF NET INTEREST INCOME
Net interest income represents the difference between income on
interest-earning assets and expense on interest-bearing liabilities. Net
interest income depends upon the relative amounts of interest-earning assets and
interest-bearing liabilities and the interest rates earned or paid on them.
The following tables set forth certain information relating to the
Company's statements of financial condition and the statements of operations for
the three month and six month periods ended June 30, 1997 and 1996, and reflect
the average yield on assets and average cost of liabilities for the periods
indicated. Such yields and costs are derived by dividing income or expense by
the average balance of assets or liabilities, respectively, for the periods
shown. Average balances are derived from average monthly balances. The yields
and costs include fees which are considered adjustments to yields.
- 7 -
<PAGE>
<TABLE>
<CAPTION>
For the Three Months Ended June 30,
---------------------------------------------------------------------------
1997 1996
------------------------------------- ------------------------------------
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
------- -------- ---- ------- -------- ----
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Interest-earning assets:
Real estate loans(1) ....................... $273,367 $ 5,281 7.73% $264,392 $ 5,242 7.93%
Other loans ................................ 652 15 9.20 571 13 9.11
Mortgage-backed securities ................. 122 2 6.56 166 3 7.23
Investment securities ...................... 33,843 508 6.00 5,960 90 6.04
Interest-earning deposits .................. 32,563 444 5.45 12,156 185 6.09
FHLB of Chicago stock ...................... 2,606 44 6.75 2,678 45 6.72
-------- -------- ---- -------- -------- ----
Total interest-earning assets .......... 343,153 6,294 7.34% 285,923 5,578 7.80%
-------- -------- ---- -------- -------- ----
Allowance for loan losses ..................... (995) (876)
Non-interest-earning assets ................... 14,593 17,524
-------- --------
Total assets ........................... $356,751 $302,571
======== ========
LIABILITIES AND EQUITY:
Interest-bearing liabilities:
NOW/Super NOW accounts ..................... $ 42,072 $ 230 2.19% $ 43,514 $ 230 2.11%
Money market accounts ...................... 16,450 130 3.16 17,360 141 3.25
Passbook accounts .......................... 63,260 484 3.06 65,840 503 3.06
Certificates of deposit .................... 123,714 1,763 5.70 128,742 1,839 5.71
Borrowed funds ............................. 330 5 6.06 -- -- --
-------- -------- ---- -------- -------- ----
Total interest-bearing liabilities ......... 245,826 2,612 4.25% 255,456 2,713 4.25%
-------- -------- ---- -------- -------- ----
Non-interest bearing NOW accounts.............. 5,928 4,796
Other non-interest-bearing liabilities......... 6,632 4,967
-------- --------
Total liabilities....................... 258,386 265,219
-------- --------
Stockholders' equity........................... 98,365 37,352
-------- --------
Total liabilities and stockholders'
equity ............................... $356,751 $302,571
======== ========
Net interest income............................ $ 3,682 $ 2,865
======== ========
Interest rate spread(2)........................ 3.09% 3.55%
==== ====
Net interest margin(3)......................... 4.29% 4.01%
==== ====
Ratio of interest-earning assets to
interest-bearing liabilities................. 139.59% 111.93%
======== ========
</TABLE>
- ----------
(1) In computing the average balance of loans, non-accrual loans have been
included.
(2) Interest rate spread represents the difference between the average yield
earned on interest-earning assets and the average cost of
interest-bearing liabilities.
(3) Net interest margin represents net interest income as a percentage of
average interest-earning assets.
- 8 -
<PAGE>
<TABLE>
<CAPTION>
For the Six Months Ended June 30,
---------------------------------------------------------------------------
1997 1996
------------------------------------- ------------------------------------
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
------- -------- ---- ------- -------- ----
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Interest-earning assets:
Real estate loans(1) ....................... $267,492 $ 10,382 7.76% $264,766 $ 10,554 7.97%
Other loans ................................ 652 30 9.20 597 28 9.38
Mortgage-backed securities ................. 129 5 7.75 171 6 7.01
Investment securities ...................... 42,228 1,189 5.63 5,956 180 6.04
Interest-earning deposits .................. 28,675 746 5.20 12,148 346 5.70
FHLB of Chicago stock ...................... 2,642 89 6.74 2,804 94 6.70
-------- -------- ---- -------- -------- ----
Total interest-earning assets .......... 341,818 12,441 7.28% 286,442 11,208 7.83%
-------- -------- ---- -------- -------- ----
Allowance for loan losses...................... (980) (861)
Non-interest-earning assets.................... 15,907 17,085
-------- --------
Total assets............................ $356,745 $302,666
======== ========
LIABILITIES AND EQUITY:
Interest-bearing liabilities:
NOW/Super NOW accounts ..................... $ 42,297 $ 453 2.14% $ 43,290 $ 459 2.12%
Money market accounts ...................... 16,647 262 3.15 17,519 283 3.23
Passbook accounts .......................... 63,033 962 3.05 65,807 1,019 3.10
Certificates of deposit .................... 123,805 3,499 5.65 128,072 3,688 5.76
Borrowed funds ............................. 165 5 6.06 1,300 37 5.69
-------- -------- ---- -------- -------- ----
Total interest-bearing liabilities ..... 245,947 5,181 4.21% 255,988 5,486 4.29%
-------- -------- ---- -------- -------- ----
Non-interest bearing NOW accounts.............. 5,701 4,555
Other non-interest-bearing liabilities......... 5,657 4,935
-------- --------
Total liabilities....................... 257,305 265,478
-------- --------
Stockholders' equity........................... 99,440 37,188
-------- --------
Total liabilities and stockholders'
equity................................ $356,745 $302,666
======== ========
Net interest income............................ $ 7,260 $ 5,722
======== ========
Interest rate spread(2)........................ 3.07% 3.54%
==== ====
Net interest margin(3)......................... 4.25% 3.99%
==== ====
Ratio of interest-earning assets to
interest-bearing liabilities................. 138.98% 111.90%
======== ========
</TABLE>
- ----------
(1) In computing the average balance of loans, non-accrual loans have been
included.
(2) Interest rate spread represents the difference between the average yield
earned on interest-earning assets and the average cost of
interest-bearing liabilities.
(3) Net interest margin represents net interest income as a percentage of
average interest-earning assets.
- 9 -
<PAGE>
COMPARISON OF FINANCIAL CONDITION AT JUNE 30, 1997 AND DECEMBER 31, 1996
Total assets decreased $3.7 million or 1.1% from $356.3 million at
December 31, 1996 to $352.6 million at June 30, 1997. The decrease in total
assets was primarily due to the disbursement of funds for the $2.7 million
decrease in savings deposits, $2.5 million purchase of treasury stock and $4.3
million purchase of stock for the Company's Recognition and Retention Plan
("RRP"), which were partially offset by the receipt of funds from a $5.0 million
advance from the Federal Home Loan Bank of Chicago and a $907,000 increase in
retained earnings.
Cash and due from banks decreased $2.7 million or 46.5% from $5.7
million at December 31, 1996 to $3.0 million at June 30, 1997. This decrease was
primarily due to the disbursement of funds for the $2.7 million decrease in
savings deposits.
Interest-earning deposits increased $628,000 or 2.8% from $22.3
million at December 31, 1996 to $23.0 million at June 30, 1997. This increase
was primarily due to funds received from the repayment and maturity of $19.9
million in investment securities held to maturity, sale of $325,000 in real
estate owned and in judgment, $5.0 million increase in advances from the Federal
Home Loan Bank of Chicago and a $907,000 increase in retained earnings which was
the net income for the six months ended June 30, 1997 less the dividends paid on
common stock. These increases were partially offset by the disbursement of funds
for the $18.6 million increase in loans receivable, $2.5 million for the
purchase of treasury stock and $4.3 million for the purchase of the Company's
common stock for the RRP.
Investment securities held to maturity decreased $19.9 million or
37.0% from $53.8 million at December 31, 1996 to $33.9 million at June 30, 1997.
This decrease was primarily due to the transfer of funds from maturing
securities to interest-earning deposits which were primarily used for funding
the increase in loans receivable, the purchase of treasury stock and the
purchase of the Company's common stock for the RRP.
Loans receivable increased $18.6 million or 7.1% from $261.3
million at December 31, 1996 to $279.9 million at June 30, 1997. This increase
was primarily the result of more aggressive advertising of the Association's
loan products.
Real estate owned and in judgment decreased $325,000 or 59.1% from
$550,000 at December 31, 1996 to $225,000 at June 30, 1997. This decrease was
primarily due to the sale of two properties of real estate owned and no
additions to real estate owned and in judgment during the six months ended June
30, 1997.
Savings deposits decreased $2.7 million or 1.1% from $251.8 million
at December 31, 1996 to $249.1 million at June 30, 1997. This decrease was
primarily the result of withdrawals exceeding deposits and interest credits.
Advances from the Federal Home Loan Bank of Chicago increased $5.0
million for the six months ended June 30, 1997. This increase was due to the
management's decision to utilize low cost borrowings, in part, to fund the
withdrawals from savings deposits and the increase in loan originations for the
six months ended June 30, 1997.
Retained earnings increased $907,000 or 2.4% from $37.3 million at
December 31, 1996 to $38.2 million at June 30, 1997. This increase is the net
income of $1.6 million for the six months ended June 30, 1997 which was
partially offset by the payment of $701,000 in dividends on the Company's common
stock.
Treasury stock increased $2.5 million for the six months ended June
30, 1997. This increase is due to the implementation of the Company's 5% Stock
Repurchase Program ("Repurchase Program") with the purchase of 153,431 shares of
common stock in the open market for an aggregate of $2.5 million. Pursuant to
the approval of the Office of Thrift Supervision, ("OTS"), the Association's
primary federal regulator, an additional 197,031 shares of common stock may be
repurchased by the Company under the Repurchase Program.
- 10 -
<PAGE>
Unearned RRP compensation increased $4.3 million for the six months
ended June 30, 1997. This increase is primarily due to the purchase of 280,370
shares of the Company's common stock for the Company's RRP. The cost of the
stock purchased for the RRP was $4.5 million, which was partially offset by RRP
expense of $150,000.
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
increased $729,000 from a $10,000 net loss for the three months June 30, 1996 to
$719,000 in net income for the three months ended June 30, 1997 or $0.11 per
share. The $729,000 increase was primarily due to an increase of $817,000 in net
interest income before provision for loan losses and a decrease of $433,000 in
non-interest expense. These increases were partially offset by a decrease of
$58,000 in non-interest income and an increase of $463,000 in income tax
expense.
INTEREST INCOME. Interest income increased $716,000 or 12.8% from
$5.6 million for the three months ended June 30, 1996 to $6.3 million for the
three months ended June 30, 1997. This was due primarily to an increase in the
average balance of interest-earning assets of $57.3 million or 20.0% from $285.9
million for the three months ended June 30, 1996 to $343.2 million for the three
months ended June 30, 1997. This increase was partially offset by a decrease in
the average yield earned on average interest-earning assets of 46 basis points
from 7.80% for the three months ended June 30, 1996 to 7.34% for the three
months ended June 30, 1997. The increase in the average balance of
interest-earning assets was primarily due to receipt of the net proceeds from
the Offering, which was partially offset by the decrease in interest-earning
assets due to market conditions. The average yield earned on interest-earning
assets decreased primarily as a result of the change in the composition of
interest-earning assets and lower average yields on real estate loans and
interest-earning deposits. The average balance of investment securities and
interest-earning deposits increased $48.3 million from $18.1 million for the
three months ended June 30, 1996 to $66.4 million for the three months ended
June 30, 1997. These assets are the lowest yielding components of
interest-earning assets, and, as a result of the large increase in these assets,
the average yield was reduced. The average yield on real estate loans decreased
as a result of the rates on new loan originations being lower than the rates on
loans repaid. The yield earned on interest-earning deposits declined due to
market conditions.
INTEREST EXPENSE. Interest expense decreased $101,000 or 3.7% from
$2.7 million for the three months ended June 30, 1996 to $2.6 million for the
three months ended June 30, 1997. This decrease was primarily due to the
decrease in the average balance of interest-bearing liabilities of $9.7 million
or 3.8% from $255.5 million for the three months ended June 30, 1996 to $245.8
million for the three months ended June 30, 1997. The decrease in the average
balance of interest-bearing liabilities was due to competitive market conditions
and the Association's decision not to offer above-market interest rates on its
savings deposits.
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES. Net interest
income before provision for loan losses increased $817,000 or 28.5% from $2.9
million for the three months ended June 30, 1996 to $3.7 million for the three
months ended June 30, 1997. This increase was primarily due to a 27.66% increase
in the ratio of average interest-earning assets to average interest-bearing
liabilities from 111.93% for the three months ended June 30, 1996 to 139.59% for
the three months ended June 30, 1997, which was offset in part by a 46 basis
point decrease in the interest rate spread from 3.55% for the three months ended
June 30, 1996 to 3.09% for the three months ended June 30, 1997. The decrease in
the interest rate spread was primarily due to a decrease in the average yield
earned on average interest-earning assets of 0.46% from 7.80% for the three
months ended June 30, 1996 to 7.34% for the three months ended June 30, 1997.
PROVISION FOR LOAN LOSSES. The provision for loan losses was $30,000
for each period. Management determined that keeping the provision for loan
losses at the same level was appropriate in light of its current review of the
Association's loan portfolio, asset quality, delinquent and non-performing
loans, the historically low loan loss experience and the national and regional
economies. The ratio of the allowance for loan losses to non-performing loans
was 82.75% and 78.62% at June 30, 1997 and June 30, 1996, respectively, and the
ratio of the allowance
- 11 -
<PAGE>
for loan losses to total loans was 0.36% and 0.33% at such respective dates.
Management believes that the provision for loan losses and the allowance for
loan losses are reasonable and adequate to cover any known losses and any losses
reasonably expected in the existing loan portfolio. While management estimates
loan losses using the best available information, such as independent appraisals
for significant collateral properties, no assurance can be given that future
additions to the allowance will not be necessary based on changes in economic
and real estate market conditions, further information obtained regarding known
problem loans, identification of additional problem loans, regulatory
examinations and other factors, both within and outside of management's control.
NON-INTEREST INCOME. Non-interest income decreased $58,000 or 18.8%
from $309,000 for the three months ended June 30, 1996 to $251,000 for the three
months ended June 30, 1997. The decrease was primarily due to the decrease in
service fee income of $55,000 from $300,000 for the three months ended June 30,
1996 to $245,000 for the three months ended June 30, 1997. This decrease was
primarily due to the changes made to the account pricing structures for NOW
accounts and ATM fees for competitive purposes in 1997.
NON-INTEREST EXPENSE. Non-interest expense decreased $433,000 or
13.7% from $3.2 million for the three months ended June 30, 1996 to $2.7 million
for the three months ended June 30, 1997. This decrease was primarily due to
decreases in compensation and benefits, federal deposit insurance premiums and
data processing expenses, which were offset by increases in occupancy,
advertising and promotion and other expenses. Compensation and benefits expense
decreased $525,000 or 27.9% from $1.9 million for the three months ended June
30, 1996 to $1.4 million for the three months ended June 30, 1997. This decrease
is primarily due to pension expense of $911,000, which included $837,000 for the
termination of the Association's pension plan, in the three month period ended
June 30, 1996. There was no pension expense for the three months ended June 30,
1997. This was offset in part by $222,000 of ESOP expense and $150,000 of RRP
expense for the three months ended June 30, 1997, which plans were not in effect
during the period ended June 30, 1996, and normal salary increases. Federal
deposit insurance premium expense decreased $107,000 or 62.9% from $170,000 for
the three months ended June 30, 1996 to $63,000 for the three months ended June
30, 1997. The decrease was primarily due to reduced federal deposit insurance
premiums as a result of the Deposit Insurance Funds Act of 1996. The decrease in
data processing expense of $17,000 or 7.0% from $242,000 for the three months
ended June 30, 1996 to $225,000 for the three months ended June 30, 1997 is
primarily due to the payment for the final portion of a nonrecurring charge for
processing that occurred in the three months ended June 30, 1996 of $15,000. The
increase in occupancy expense of $34,000 or 9.2% from $371,000 for the three
months ended June 30, 1996 to $405,000 for the three months ended June 30, 1997
was primarily due to a $20,000 increase in building repairs and maintenance
expense. The remainder of the increase was due primarily to increased real
estate taxes and additional expenses as a result of the opening and operating of
the new South Elgin office. Advertising and promotion expense increased $19,000
or 20.7% from $92,000 for the three months ended June 30, 1996 to $111,000 for
the three months ended June 30, 1997 primarily as a result of more aggressive
advertising in 1997. Other non-interest expense increased $163,000 or 54.9% from
$297,000 for the three months ended June 30, 1996 to $460,000 for the three
months ended June 30, 1997 primarily due to increases in professional fees,
stationery, printing and office supplies, transfer agent fees and franchise
taxes resulting from operations as a public company.
INCOME TAX EXPENSE. Income tax expense increased $463,000 from a
$7,000 tax benefit for the three months ended June 30, 1996 to a $456,000 tax
expense for the three months ended June 30, 1997. The effective tax rate was
38.8% for the three months ended June 30, 1997 and 41.2% for the three months
ended June 30, 1996.
- 12 -
<PAGE>
COMPARISON OF OPERATING RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
GENERAL. Net income for the six months ended June 30, 1997 increased
$1.1 million or 221.0% from $501,000 for the six months ended June 30, 1996 to
$1.6 million, or $0.25 per share, for the six months ended June 30, 1997. The
$1.1 million increase was primarily due to an increase of $1.6 million in net
interest income before provision for loan losses, a $96,000 increase in
non-interest income and a $167,000 decrease in non-interest expense. These were
partially offset by an increase of $695,000 in income tax expense.
INTEREST INCOME. Interest income increased $1.2 million or 11.0%
from $11.2 million for the six months ended June 30, 1996 to $12.4 million for
the six months ended June 30, 1997. This was due primarily to an increase in the
average balance of interest-earning assets of $55.4 million or 19.3% from $286.4
million for the six months ended June 30, 1996 to $341.8 million for the six
months ended June 30, 1997. This increase was partially offset by a decrease in
the average yield earned on average interest-earning assets of 55 basis points
from 7.83% for the six months ended June 30, 1996 to 7.28% for the six months
ended June 30, 1997. The increase in the average balance of interest-earning
assets was primarily due to receipt of the net proceeds from the Offering, which
was partially offset by the decrease in interest-earning assets due to market
conditions. The average yield earned on interest-earning assets decreased
primarily as a result of the change in the composition of interest-earning
assets and lower average yields on real estate loans, investment securities and
interest-earning deposits. The average balance of investment securities and
interest-earning deposits increased $52.8 million from $18.1 million for the six
months ended June 30, 1996 to $70.9 million for the six months ended June 30,
1997. These assets are the lowest yielding components of interest-earning
assets, and, as a result of the large increase in these assets, the average
yield was reduced. The average yield on real estate loans decreased as a result
of the rates on new loan originations being lower than the rates on loans
repaid. The yield earned on investment securities and interest-earning deposits
declined due to market conditions.
INTEREST EXPENSE. Interest expense decreased $305,000 or 5.6% from
$5.5 million for the six months ended June 30, 1996 to $5.2 million for the six
months ended June 30, 1997. This decrease was primarily due to the decrease in
the average balance of interest-bearing liabilities of $10.1 million or 3.9%
from $256.0 million for the six months ended June 30, 1996 to $245.9 million for
the six months ended June 30, 1997. Interest expense also decreased as a result
of the 8 basis point decrease in the average rate paid on interest-bearing
liabilities from 4.29% for the six months ended June 30, 1996 to 4.21% for the
six months ended June 30, 1997. The decrease in the average balance of
interest-bearing liabilities was due to competitive market conditions and the
Association's decision not to offer above-market interest rates on its savings
deposits.
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES. Net interest
income before provision for loan losses increased $1.6 million or 26.9% from
$5.7 million for the six months ended June 30, 1996 to $7.3 million for the six
months ended June 30, 1997. This increase was primarily due to a 27.08% increase
in the ratio of average interest-earning assets to average interest-bearing
liabilities from 111.90% for the six months ended June 30, 1996 to 138.98% for
the six months ended June 30, 1997, which was offset in part by a 47 basis point
decrease in the interest rate spread from 3.54% for the six months ended June
30, 1996 to 3.07% for the six months ended June 30, 1997. The decrease in the
interest rate spread was primarily due to a decrease in the yield earned on
average interest-earning assets of 0.55% from 7.83% for the six months ended
June 30, 1996 to 7.28% for the six months ended June 30, 1997. This decrease was
offset in part by a decrease in the average rate paid on average
interest-bearing liabilities of 0.08% from 4.29% for the six months ended June
30, 1996 to 4.21% for the six months ended June 30, 1997.
PROVISION FOR LOAN LOSSES. The provision for loan losses was $60,000
for each period. Management determined that keeping the provision for loan
losses at the same level was appropriate in light of its current review of the
Association's loan portfolio, asset quality, delinquent and non-performing
loans, the historically low loan loss experience and the national and regional
economies. The ratio of the allowance for loan losses to non-performing loans
was 82.75% and 78.62% at June 30, 1997 and June 30, 1996, respectively, and the
ratio of the allowance for loan losses to total loans was 0.36% and 0.33% at
such respective dates. Management believes that the
- 13 -
<PAGE>
provision for loan losses and the allowance for loan losses are reasonable and
adequate to cover any known losses and any losses reasonably expected in the
existing loan portfolio. While management estimates loan losses using the best
available information, such as independent appraisals for significant collateral
properties, no assurance can be given that future additions to the allowance
will not be necessary based on changes in economic and real estate market
conditions, further information obtained regarding known problem loans,
identification of additional problem loans, regulatory examinations and other
factors, both within and outside of management's control.
NON-INTEREST INCOME. Non-interest income increased $96,000 or 15.3%
from $627,000 for the six months ended June 30, 1996 to $723,000 for the six
months ended June 30, 1997. The increase was primarily due to an increase in
other income of $183,000 from $11,000 for the six months ended June 30, 1996 to
$194,000 for the six months ended June 30, 1997 due primarily to the receipt of
$182,000 in excess funds from the liquidation of the Association's pension plan
in connection with the Conversion. In addition, gain on sale of real estate
owned increased $13,000 or 61.9% from $21,000 for the six months ended June 30,
1996 to $34,000 for the six months ended June 30, 1997 primarily due to the sale
of more properties in 1997 than in 1996. These increases were partially offset
by the $99,000 decrease in service fee income from $594,000 for the six months
ended June 30, 1996 to $495,000 for the six months ended June 30, 1997. The
decrease in service fee income was primarily due to the changes made to the
account pricing structures for NOW accounts and ATM transaction fees for
competitive purposes.
NON-INTEREST EXPENSE. Non-interest expense decreased $167,000 or
3.1% from $5.5 million for the six months ended June 30, 1996 to $5.3 million
for the six months ended June 30, 1997. This decrease was primarily due to
decreases in compensation and benefits, federal deposit insurance premiums,
automated teller machines expense and data processing expense, which were offset
by increases in occupancy expense, advertising and promotion expense and other
expense. Compensation and benefits expense decreased by $335,000 or 11.5% from
$2.9 million for the six months ended June 30, 1996 to $2.6 million for the six
months ended June 30, 1997. This decrease is primarily due to pension expense of
$976,000, which included $837,000 for the termination of the Association's
pension plan, in the six month period ended June 30, 1996. There was no pension
expense for the six months ended June 30, 1997. This was offset, in part, by
$431,000 of ESOP expense and $150,000 of RRP expense for the six month period
ended June 30, 1997, which plans were not in effect as of June 30, 1996, and
normal salary increases. Federal deposit insurance premiums expense decreased
$245,000 or 72.3% from $339,000 for the six months ended June 30, 1996 to
$94,000 for the six months ended June 30, 1997. The decrease was primarily due
to reduced federal deposit insurance premiums as a result of the Deposit
Insurance Fund Act of 1996. Automated teller machine expenses decreased $18,000
or 8.1% from $221,000 for the six months ended June 30, 1996 to $203,000 for the
six months ended June 30, 1997. This decrease was primarily due to additional
expense in 1996 of $17,000 associated with the change in the Association's ATM
processors. Data processing expense decreased $33,000 or 6.7% from $493,000 for
the six months ended June 30, 1996 to $460,000 for the six months ended June 30,
1997. This decrease was primarily due to a $30,000 charge for nonrecurring
processing costs which occurred in March and April of 1996. Occupancy expense
increased $52,000 or 6.9% from $750,000 for the six months ended June 30, 1996
to $802,000 for the six months ended June 30, 1997. This increase was primarily
due to increased real estate taxes and additional expense as a result of opening
and operating the new South Elgin office. Advertising and promotion expense
increased $34,000 or 19.5% from $174,000 for the six months ended June 30, 1996
to $208,000 for the six months ended June 30, 1997. This increase was primarily
the result of more aggressive advertising in 1997. Other non-interest expense
increased $378,000 or 67.3% from $562,000 for the six months ended June 30, 1996
to $940,000 for the six months ended June 30, 1997. This increase was primarily
due to increases in professional fees, stationery, printing and office supplies,
transfer agent fees and franchise taxes resulting from operations as a public
company.
INCOME TAX EXPENSE. Income tax expense increased $695,000 or 214.5%
from $324,000 for the six months ended June 30, 1996 to $1.0 million for the six
months ended June 30, 1997. This increase was primarily due to more taxable
income. The effective tax rate was 38.8% for the six months ended June 30, 1997
and 39.3% for the six months ended June 30, 1996.
- 14 -
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of funds are savings deposits,
principal and interest payments on loans and securities and, to a limited
extent, borrowings from the FHLB of Chicago. While maturities and scheduled
amortization of loans and securities provide an indication of the timing of the
receipt of funds, changes in interest rates, economic conditions and competition
strongly influence mortgage prepayment rates and savings deposit flows, reducing
the predictability of the timing of sources of funds.
The Association is required to maintain an average daily balance of
liquid assets and short-term liquid assets as a percentage of net withdrawable
savings deposit accounts plus short-term borrowings, as defined by the
regulations of the OTS. The minimum required liquidity and short-term liquidity
ratios are currently 5.0% and 1.0%, respectively. At June 30, 1997, the
Association's liquidity ratio was 15.77%, and its short-term liquidity ratio was
15.77%. The levels of the Association's short-term liquid assets are dependent
on the Association's operating, financing and investing activities during any
given period. Management believes it will have adequate resources to fund all
commitments on a short-term and long-term basis in accordance with its business
strategy.
The primary investing activities of the Company are the origination
of mortgage and other loans and the purchase of U. S. government or U. S.
government agency securities. See the "Consolidated Statements of Cash Flows" in
the unaudited Consolidated Financial Statements included in this Form 10-Q for
the sources and uses of cash flows for operating activities, investing
activities and financing activities for the three and six months ended June 30,
1997 and 1996.
The Company has other sources of liquidity if a need for additional
funds arises, including the ability to obtain FHLB of Chicago advances of up to
$52.1 million based on the Association's current investment in FHLB of Chicago
stock. There were $5.0 million of such advances outstanding at June 30, 1997.
At June 30, 1997, the Association had outstanding loan origination
commitments of $12.2 million, undisbursed loans in process of $356,000 and
unused lines of consumer credit of $257,000. The Association anticipates that it
will have sufficient funds available to meet its current origination and other
lending commitments. Certificates of deposit scheduled to mature in one year or
less from June 30, 1997 totalled $73.6 million. Based upon the Association's
most recent experience and pricing strategy, management believes that a
significant portion of such deposits will remain with the Association.
At June 30, 1997, the Association exceeded all of its regulatory
capital requirements with a tangible capital level of $67.2 million, or 20.27%
of total adjusted assets, which is above the required level of $5.0 million or
1.5%; core capital of $67.2 million, or 20.27% of total adjusted assets, which
is above the required level of $9.9 million or 3.0%; and total risk-based
capital of $68.2 million, or 39.45% of risk-weighted assets, which is above the
required level of $13.8 million, or 8.0%.
At June 30, 1997, the total stockholders' equity of Home Bancorp was
$94.1 million. The ratio of total stockholders' equity to total assets at June
30, 1997 was 26.70%.
OTHER
On April 18, 1997, the Company's Recognition and Retention Plan was
approved by the Company's stockholders at its annual meeting. The RRP was
authorized to purchase 280,370 shares of the Company's common stock in the open
market. All of the shares were purchased in the three months period ended June
30, 1997.
On May 1, 1997, the Company adopted a stock repurchase program
("Repurchase Program"), which authorized the Company to repurchase up to 350,462
shares, or five percent, of its 7,009,250 outstanding common shares on that
date. The Repurchase Program received approval from the Office of Thrift
Supervision ("OTS"), and as of June 30, 1997, 153,451 shares of stock had been
purchased in the open market by the Company. An
- 15 -
<PAGE>
additional 197,031 shares of common stock may be repurchased by the Company
under the Repurchase Program at the discretion of management.
- 16 -
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Not applicable
Part II -- OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
The Company held its Annual meeting of Stockholders (the "Meeting")
on April 17, 1997. The purpose of the meeting was to vote on the following
proposals:
1. The election of three directors for terms of three years each;
2. The approval of the Home Bancorp of Elgin, Inc. 1997 Stock
option Plan;
3. The approval of the Home Bancorp of Elgin, Inc. 1997
Recognition and Retention Plan; and
4. The ratification of the appointment of KPMG Peat Marwick LLP as
independent auditors of the Company for the year ending
December 31, 1997.
With respect to Proposal 1, all of the directors nominated by the Company were
elected at the Meeting. In addition, Proposals 2,3 and 4 were approved at the
Meeting. The voting results for the Proposals were as follows:
Proposal 1: Henry R. Hines For 5,955,037
Against 238,304
Thomas S. Rakow For 6,021,978
Against 171,363
Richard S. Scheflow For 6,025,447
Against 167,894
Broker Non-Votes: None
Proposal 2: For 4,294,097
Against 538,173
Abstain 84,671
Broker Non-Votes 1,276,400
- 17 -
<PAGE>
Proposal 3: For 4,214,740
Against 709,936
Abstain 68,194
Broker Non-Votes 1,200,470
Proposal 4: For 6,034,658
Against 90,616
Abstain 68,066
Broker Non-Votes None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27-- Financial Data Schedule*
(b) Reports on Form 8-K
None
- ----------
*Submitted only with filing in electronic format.
- 18 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
HOME BANCORP OF ELGIN, INC.
---------------------------
(Registrant)
By: /s/ Lyle N. Dolan
----------------------
Lyle N. Dolan
Executive Vice President and Chief
Financial and Accounting Officer
August 11, 1997
- 19 -
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from
the consolidated balance sheets and the statements of income of Home Bancorp of
Elgin, Inc. and Subsidiary and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 3,030,436
<INT-BEARING-DEPOSITS> 22,968,886
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 34,001,029
<INVESTMENTS-MARKET> 34,018,311
<LOANS> 282,624,581
<ALLOWANCE> 1,004,932
<TOTAL-ASSETS> 352,576,691
<DEPOSITS> 249,086,421
<SHORT-TERM> 5,000,000
<LIABILITIES-OTHER> 4,368,810
<LONG-TERM> 0
0
0
<COMMON> 70,093
<OTHER-SE> 94,051,367
<TOTAL-LIABILITIES-AND-EQUITY> 352,576,691
<INTEREST-LOAN> 10,412,796
<INTEREST-INVEST> 2,028,306
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 12,441,102
<INTEREST-DEPOSIT> 5,175,757
<INTEREST-EXPENSE> 5,180,701
<INTEREST-INCOME-NET> 7,260,401
<LOAN-LOSSES> 60,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 5,296,654
<INCOME-PRETAX> 2,626,731
<INCOME-PRE-EXTRAORDINARY> 1,607,571
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,607,571
<EPS-PRIMARY> 0.25
<EPS-DILUTED> 0.25
<YIELD-ACTUAL> 4.25
<LOANS-NON> 1,214,426
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 513,379
<ALLOWANCE-OPEN> 944,799
<CHARGE-OFFS> 435
<RECOVERIES> 568
<ALLOWANCE-CLOSE> 1,004,932
<ALLOWANCE-DOMESTIC> 1,004,932
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
