U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from _____________ to _______________
Commission file number 0-21021
Enterprise Bancorp, Inc.
(Exact name of small business issuer as specified in its charter)
Massachusetts 04-3308902
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
222 Merrimack Street, Lowell, Massachusetts, 01852
(Address of principal executive offices)
(508) 459-9000
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act 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......
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: April 30, 1997, Common Stock - Par
Value $0.01 1,576,192 shares outstanding
Transitional Small Business Disclosure Format (check one): Yes .......... No X
<PAGE>
<TABLE>
<CAPTION>
ENTERPRISE BANCORP, INC.
INDEX
<S> <C> <C>
Page Number
Cover Page 1
Index 2
PART I - FINANCIAL INFORMATION
Item 1 Financial Statements of Enterprise Bancorp, Inc.
Consolidated Balance Sheet - March 31, 1997 and December 31, 1996 3
Consolidated Statements of Income -
Three months ended March 31, 1997 and 1996 4
Consolidated Statements of Cash Flows -
Three months ended March 31, 1997 and 1996 5
Notes to Financial Statements 6
Item 2 Business Review and Management's Discussion and
Analysis of Financial Condition and Results of Operations 7
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 12
Item 2 Changes in Securities 12
Item 3 Defaults upon Senior Securities 12
Item 4 Submission of Matters to a Vote of Security Holders 12
Item 5 Other Information 12
Item 6 Exhibits and Reports on Form 8-K 12
Signature Page 13
</TABLE>
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report contains certain "forward-looking statements" including statements
concerning plans, objectives, future events or performance and assumptions and
other statements which are other than statements of historical fact. Enterprise
Bancorp, Inc. (the "company") wishes to caution readers that the following
important factors, among others, may have affected and could in the future
affect the company's results and could cause the company's results for
subsequent periods to differ materially from those expressed in any
forward-looking statement made herein: (i) the effect of changes in laws and
regulations, including federal and state banking laws and regulations, with
which the company or its subsidiaries must comply, and the associated costs of
compliance with such laws and regulations either currently or in the future as
applicable; (ii) the effect of changes in accounting policies and practices, as
may be adopted by the regulatory agencies as well as by the Financial Accounting
Standards Board, or of changes in the company's organization, compensation and
benefit plans; (iii) the effect on the company's competitive position within its
market area of the increasing competition from larger regional and out-of-state
banking organizations as well as non-bank providers of various financial
services; (iv) the effect of unforeseen changes in interest rates; and (v) the
effect of changes in the business cycle and downturns in the local, regional or
national economies.
2
<PAGE>
<TABLE>
<CAPTION>
ENTERPRISE BANCORP, INC.
Consolidated Balance Sheets
March 31, December 31,
1997 1996
(Unaudited) (Audited)
------------- -------------
<S> <C> <C>
Assets
Cash and cash equivalents $ 18,715,038 14,507,497
Investment securities at fair value 122,986,100 119,395,742
Loans, less allowance for loan losses of $3,951,364
at March 31, 1997 and $3,894,520 at December 31, 1996 145,523,973 140,425,093
Premises and equipment 3,227,626 3,388,736
Accrued interest receivable 2,526,274 2,699,833
Prepaid expenses and other assets 617,091 491,277
Income taxes receivable -- 140,396
Real estate acquired by foreclosure 188,352 82,721
Deferred income taxes, net 2,149,484 1,884,283
------------- -------------
Total assets $ 295,933,938 283,015,578
============= =============
Liabilities and Stockholders' Equity
Deposits $ 247,247,799 243,428,800
Short-term borrowings 25,598,735 16,737,249
Escrow deposits of borrowers 502,281 411,050
Accrued expenses and other liabilities 1,097,286 1,297,699
Income taxes payable 61,415 --
Accrued interest payable 495,438 493,276
------------- -------------
Total liabilities 275,002,954 262,368,074
------------- -------------
Stockholders' equity
Common stock $.01 par value; 5,000,000 shares
authorized 1,576,192 shares issued and out-
standing at March 31, 1997 and December 31, 1996 15,762 15,762
Preferred stock, $.01 par value; 1,000,000 shares
authorized no shares issued at March 31, 1997 -- --
Additional paid-in capital 15,476,857 15,476,857
Retained earnings 5,891,775 5,263,074
Net unrealized gain (loss) on investment
securities, net of applicable income taxes (453,410) (108,189)
------------- -------------
Total stockholders' equity 20,930,984 20,647,504
------------- -------------
Total liabilities and stockholders' equity $ 295,933,938 283,015,578
============= =============
</TABLE>
3
<PAGE>
ENTERPRISE BANCORP, INC.
Consolidated Statements of Income
Three months ended March 31, 1997 and 1996
March 31, March 31,
1997 1996
(Unaudited) (Unaudited)
----------- -----------
Interest and dividend income:
Loans $3,404,792 2,898,706
Investment securities 1,874,310 1,408,096
Federal funds sold 14,749 83,691
---------- ----------
Total interest income 5,293,851 4,390,493
---------- ----------
Interest expense:
Deposits 1,986,632 1,727,939
Borrowed funds 234,891 73,881
---------- ----------
Total interest expense 2,221,523 1,801,820
---------- ----------
Net interest income 3,072,328 2,588,673
Provision for loan losses 60,000 --
---------- ----------
Net interest income after provision for
loan losses 3,012,328 2,588,673
---------- ----------
Non-interest income:
Deposit service fees 217,489 154,369
Trust fees 177,521 160,910
Gains on sales of loans 19,318 33,018
Other income 69,782 64,289
---------- ----------
Total non-interest income 484,110 412,586
---------- ----------
Non-interest expense:
Salaries and employee benefits 1,405,994 1,197,823
Occupancy expenses 374,337 330,669
Advertising and public relations 172,553 169,319
Office and data processing supplies 81,832 64,961
Audit, legal and other professional fees 76,056 98,226
Trust professional and custodial expenses 49,500 50,050
Postage 67,231 40,345
FDIC insurance 6,764 1,000
Other operating expenses 278,985 295,817
---------- ----------
Total non-interest expense 2,513,252 2,248,210
---------- ----------
Income before income taxes 983,186 753,049
Income tax expense 354,485 281,967
---------- ----------
Net income $ 628,701 471,082
========== ==========
Net income per average common share outstanding $ .40 .30
========== ==========
Weighted average common shares outstanding 1,576,192 1,575,899
========== ==========
4
<PAGE>
<TABLE>
<CAPTION>
ENTERPRISE BANCORP, INC.
Consolidated Statements of Cash Flows
Three months ended March 31, 1997 and 1996
March 31, March 31,
1997 1996
(Unaudited) (Unaudited)
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 628,701 471,082
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for loan losses 60,000 --
Depreciation and amortization 226,423 198,622
Gains on sales of loans (19,318) (33,018)
Decrease in loans held for sale 93,338 762,669
Increase(decrease) in accrued interest receivable 173,559 (454,390)
Increase in prepaid expenses and other assets (125,814) (82,194)
Provision for deferred income taxes (12,326) 1,374
Decrease in accrued expenses and other liabilities (200,413) (70,898)
Increase (decrease) in accrued interest payable 2,162 (83,740)
Change in income taxes payable/receivable 201,811 (155,118)
------------ ------------
Net cash provided by operating activities 1,028,123 554,389
------------ ------------
Cash flows from investing activities:
Proceeds from maturities, calls and paydowns
of investment securities 589,842 1,223,087
Purchase of investment securities (4,795,767) (29,398,683)
Proceeds from sales of real estate acquired by foreclosure 63,975 19,211
Net increase in loans (5,402,506) (1,987,198)
Additions to premises and equipment, net (47,842) (85,632)
------------ ------------
Net cash used in investing activities (9,592,298) (30,229,215)
------------ ------------
Cash flows from financing activities:
Net increase in deposits, including escrow deposits 3,910,230 6,639,701
Net increase in short-term borrowings 8,861,486 9,355,974
Net proceeds from exercise of stock options -- 300
------------ ------------
Net cash provided by financing activities 12,771,716 15,995,975
------------ ------------
Net increase (decrease) in cash and cash equivalents 4,207,541 (13,678,851)
Cash and cash equivalents at beginning of period 14,507,497 25,162,392
------------ ------------
Cash and cash equivalents at end of period 18,715,038 11,483,541
============ ============
Supplemental financial data:
Cash paid for:
Interest on deposits and short-term borrowings $ 2,219,361 1,825,560
Income taxes 165,000 343,399
Transfers from loans to real estate acquired by foreclosure 169,606 --
</TABLE>
5
<PAGE>
ENTERPRISE BANCORP, INC.
Notes to Financial Statements
(1) Organization of Holding Company
Enterprise Bancorp, Inc. (the "company") is a Massachusetts corporation, which
was organized on February 29, 1996, at the direction of Enterprise Bank and
Trust Company, a Massachusetts trust company (the "bank"), for the purpose of
becoming the holding company for the bank. The company had no material assets or
operations prior to completion of the holding company reorganization on July 26,
1996. To the extent that the accompanying financial statements contain
information as of a date or for a period prior to July 26, 1996, such
information pertains to the bank.
(2) Basis of Presentation
The accompanying unaudited financial statements should be read in conjunction
with the company's December 31, 1996, audited financial statements and notes
thereto. Interim results are not necessarily indicative of results to be
expected for the entire year.
In preparing the financial statements, management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities as of
the date of the balance sheet and revenues and expenses for the period. Actual
results could differ from those estimates. Material estimates that are
particularly susceptible to change relate to the determination of the allowance
for loan losses and valuation of other real estate owned.
In the opinion of management, the accompanying financial statements reflect all
necessary adjustments consisting of normal recurring accruals for a fair
presentation.
(3) Earnings per share
Earnings per share are calculated based on the average number of common shares
outstanding during the period.
Three Months Ended March 31,
----------------------------
1997 1996
--------- ---------
Average Common Shares Outstanding 1,576,192 1,575,899
(4) Reclassification
Certain fiscal 1996 information has been reclassified to conform with 1997
presentation.
6
<PAGE>
ITEM 2 - Business Review and Management's Discussion and Analysis of Financial
Condition and Results of Operations
Capital Resources
The company's actual capital amounts and capital adequacy ratios are presented
in the table below. The bank's capital amounts and ratios do not differ
materially from the amounts and ratios presented.
<TABLE>
<CAPTION>
For Bank To Be Well
Capitalized under
For Capital Prompt Correction
Actual Adequacy Purposes Action Provisions
------------------- -------------------- ----------------------
($ in Thousands) Amount Ratio Amount Ratio Amount Ratio
------ ----- ------ ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
As of March 31, 1997:
Total Capital
(to risk weighted assets) $ 25,203 15.12% $ 13,330 8.0% $ 16,662 > or = 10.0%
Tier 1 Capital
(to risk weighted assets) 21,252 12.75% 6,665 4.0% 9.997 > or = 6.0%
Tier 1 Capital
(to average assets) 21,252 7.42% 11,462 4.0% 14,327 > or = 5.0%
</TABLE>
At the April 15, 1997 meeting of the board of directors, a dividend of $.325 per
share was declared to be paid on or about July 1, 1997 to shareholders of record
as of the close of business on June 13, 1997. The board of directors intends to
consider the payment of future dividends on an annual basis.
Balance Sheet
Total Assets
Total assets increased $12.9 million, or 4.6%, since December 31, 1996. The
increase is primarily attributable to an increase in gross loans of $5.2
million, an increase in investments of $3.6 million, and an increase in cash and
due from banks of $4.2 million. The increase in assets was funded by increases
in short-term borrowings and deposits of $8.9 million and $3.9 million,
respectively.
Investments.
At March 31, 1997 all of the bank's investment securities were classified as
available for sale and carried at market value. The net unrealized loss at March
31, 1997, net of tax effects, is shown as a separate component of stockholders'
equity in the amount of $453,410.
Loans
Total loans, before the allowance for loan losses, were $149.5 million, or 50.5%
of total assets, at March 31, 1997, compared to $144.3 million, or 51.0% of
total assets, at December 31, 1996. The increase in loans of $5.2 million was
primarily attributed to increased loan originations in the commercial real
estate and commercial loan portfolios. The bank continues to pursue active
customer calling efforts as well as increased marketing and advertising to
identify quality lending opportunities.
Deposits and Borrowings
Total deposits, including escrow deposits of borrowers, increased $3.9 million,
or 1.6%, during the first three months of 1997 from $243.8 million at December
31, 1996, to $247.8 million at March 31, 1997. The increase was primarily due to
increases in deposits in the newer branches in Leominster, Billerica and
Tewksbury.
Total borrowings, consisting of securities sold under agreements to repurchase
and FHLB (Federal Home Loan Bank) borrowings, increased $8.9 million, or 52.9%,
from $16.7 million at December 31, 1996 to $25.6 million at March 31, 1997. The
increase was primarily attributable to an increase in securities sold under
agreements to repurchase of $7.5 million, plus an increase in FHLB borrowings of
$1.4 million. Management periodically takes advantage of opportunities to fund
asset growth with borrowings, but on a long-term basis the bank intends to
replace the FHLB borrowings with deposits. Management also actively uses FHLB
borrowings in managing the bank's asset/liability position. FHLB borrowings, at
March 31, 1997, were $6.4 million with additional available borrowings of
approximately $89.4 million.
7
<PAGE>
Loan Loss Experience/Non-performing Assets
The following table summarizes the activity in the allowance for loan losses for
the periods indicated:
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1997 1996
----------- ------------
<S> <C> <C>
Balance at beginning of year $3,894,520 4,106,659
Loans charged off
Commercial 42,003 3,377
Real Estate -- 46,000
Consumer -- 8,143
Credit Card -- 5,447
---------- ----------
42,003 62,967
Recoveries on loans charged off
Commercial 2,809 328
Real Estate 34,247 2,476
Consumer 1,761 432
Credit Card 30 --
---------- ----------
38,847 3,236
Net loans charged off 3,156 59,731
Provision charged to income 60,000 --
---------- ----------
Balance at March 31 $3,951,364 4,046,928
========== ==========
Allowance for loan losses : Gross loans 2.63% 3.39%
========== ==========
Annualized net charge-offs : Average loans outstanding .01% .200%
========== ==========
Allowance for loans losses : Non-performing loans 156.12% 145.70%
========== ==========
<CAPTION>
The following table sets forth non-performing assets at March 31:
1997 1996
---------- ----------
<S> <C> <C>
Loans on non accrual:
Commercial $ 679,474 610,002
Residential real estate 248,633 119,730
Commercial real estate 962,958 1,502,244
Construction 75,000 --
Consumer, including home equity 465,999 545,102
---------- ----------
Total loans on non-accrual 2,432,064 2,777,078
Loans past due >90 days, still accruing 98,917 463
---------- ----------
Total non-performing loans 2,530,981 2,777,541
Other real estate owned 188,352 376,691
---------- ----------
Total non-performing loans and real
estate owned $2,719,333 3,154,232
========== ==========
Non-performing loans : Gross loans 1.68% 2.32%
========== ==========
Non-performing loans and real estate owned : Total assets 0.92% 1.32%
========== ==========
Delinquent loans 30-89 days past due : Gross loans 1.16% 1.59%
========== ==========
</TABLE>
Total non-performing loans decreased $246,560 or 8.88% from March 31, 1996, to
March 31, 1997. The primary cause for the decline was the removal of two non
accrual loans in the commercial real estate loan category. These loans were
either paid in full or brought current and assessed as fully collectable by
management.
8
<PAGE>
Results of Operations
Three Months Ended March 31, 1997 vs. Three Months Ended March 31, 1996
The company reported net income of $628,701 for the three months ended March 31,
1997, versus $471,082 for the three months ended March 31, 1996, or an increase
of 33.5%. The company had earnings per common share of $.40 for the three months
ended March 31, 1997, compared with $.30 for the three months ended March 31,
1996.
The following table highlights changes which affected the company's earnings for
the periods indicated:
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1997 1996
---- ----
(Dollars in thousands)
<S> <C> <C>
Average assets $286,410 226,652
Average deposits and short-term borrowings 263,625 205,639
Average investment securities (1) 120,625 92,208
Average loans 146,507 116,586
Net interest income 3,072 2,589
Provision for loan losses 60 --
Tax expense 354 282
Average loans : Average deposits and borrowings 55.57% 56.69%
Non interest expense : Average assets (2) 3.56% 3.98%
Non interest income, exclusive of securities
gains : Average assets (2) .69% .73%
Average tax equivalent rate earned on interest earning assets 8.13% 8.35%
Average rate paid on interest bearing deposits and
short-term borrowings 4.03% 4.13%
Net interest rate spread 4.10% 4.22%
<FN>
(1) Average investment securities are shown at average amortized cost
(2) Ratios have been annualized based on number of days for the period
</FN>
</TABLE>
Net Interest Income
The company's net interest income was $3,072,328 for the three months ended
March 31, 1997, an increase of $483,655, or 18.7% from $2,588,673 for the three
months ended March 31, 1996, primarily a result of an increase in the bank's
asset size, specifically the bank's loans and investments. These increases were
partially offset by increased interest expense from an increase in deposit
balances and average borrowings.
The average tax equivalent yield on earning assets in the three months ended
March 31, 1997, was 8.13% down 22 basis points from 8.35% in the three months
ended March 31, 1996. The average rate paid on interest bearing deposits and
borrowings in the three months ended March 31, 1997, was 4.03%, a decrease of 10
basis points from 4.13% in the three months ended March 31, 1996. The resulting
interest rate spread decreased 12 basis points to 4.10% in the three months
ended March 31, 1997, from 4.22% in the three months ended March 31, 1996. The
principal reason for the increase in the bank's net interest income and the
decrease in the interest rate margin during the first three months of 1997 was
the increase in average loans and investments of $58.3 million which was funded
by increases in interest bearing and non-interest bearing deposits and an
increase in short-term borrowings.
The following table sets forth, among other things, the extent to which changes
in interest rates and changes in the average balances of interest-earning assets
and interest-bearing liabilities have affected interest income and expense
during the three months ended March 31, 1997, and 1996. For each category of
interest-earning assets and interest-bearing liabilities, information is
provided on changes attributable to (1) changes in volume (change in average
portfolio balance multiplied by prior year average rate); (2) changes in
interest rates (change in average interest rate multiplied by prior year average
balance); and (3) changes in rate and volume (the remaining difference).
9
<PAGE>
<TABLE>
<CAPTION>
AVERAGE BALANCES, INTEREST AND AVERAGE INTEREST RATES
--------------------------------------------------------------------------------------------
Three Months Ended Three Months Ended
March 31, 1997 March 31, 1996 Changes due to
---------------------------- ---------------------------- -------------------------------
Average Interest Average Interest Interest Rate/
(Dollars in thousands) Balance Interest Rates(3) Balance Interest Rates (3) Total Volume Rate Volume
------- -------- -------- ------- -------- --------- ----- ------ ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Loans (1) (2) $146,507 $3,405 9.43% $116,586 $2,899 9.97% $ 506 $ 746 $(160) $(80)
Investment securities (3) 120,625 1,874 6.59 92,208 1,408 6.45 466 458 32 (24)
Federal funds sold 1,170 15 5.20 5,835 84 5.77 (69) (67) (8) 6
-------- ------ -------- ------ ----- ------ ----- ----
Total interest earnings assets 268,302 5,294 8.13% 214,629 4,391 8.35% 903 1,137 (136) (98)
------ ------ ----- ------ ----- ----
Other assets (4) 18,108 12,023
-------- -------
Total assets $286,410 $226,652
======== ========
Liabilities and stockholders' equity:
Savings, NOW and money market $ 96,232 531 2.24% $ 78,253 444 2.28% 87 102 (7) (8)
Certificate of deposit 107,170 1,456 5.51 88,962 1,284 5.79 172 264 (62) (30)
Short-term borrowings 20,374 235 4.68 7,683 74 3.86 161 123 16 22
-------- ------ -------- ------ ----- ------ ----- ----
Total deposits and borrowings 223,776 2,222 4.03% 174,898 1,802 4.13% 420 489 (53) (16)
------ ------ ----- ------ ----- ----
Non-interest bearing deposits 39,849 30,741
Other liabilities 1,695 1,883
-------- --------
Total liabilities 265,320 207,522
Stockholders' equity 21,090 19,130
-------- --------
Total liabilities and
stockholder's equity $286,410 $226,652
======== ========
Net interest rate spread 4.10% 4.22%
Net interest income $3,072 $2,589 $ 483 $ 648 $ (83) $(82)
Net yield on average earning assets 4.77% 4.98%
<FN>
(1) Average loans include non accrual loans.
(2) Average loans are net of average deferred loan fees.
(3) Average balances are presented at average amortized cost and average interest rates are presented on a tax-equivalent basis.
(4) Other assets include cash and due from banks, accrued interest receivable, allowance for loan losses, real estate acquired by
foreclosure, deferred income taxes and other miscellaneous assets.
</FN>
</TABLE>
The bank manages its earning assets by fully using available capital resources
within what management believes are prudent credit and leverage parameters.
Loans, investment securities, and short-term investments comprise the bank's
earning assets.
10
<PAGE>
The provision for loan losses amounted to $60,000 and $0 in for the three month
periods ended March 31, 1997 and 1996, respectively. The provision for loan
losses was reinstated in the first quarter of 1997 as a result of loan growth
over the past year. Loans, before the allowance for loan losses, have increased
from $118.9 million, at March 31, 1996, to $149.5 million, at March 31, 1997, or
an increase of 25.8%. Although there has not been an increase in problem assets,
management recognizes the increased risk and the need for additional reserves as
the loan balances increase. The provision reflects real estate values and
economic conditions in New England and in Greater Lowell, in particular, the
level of non-accrual loans, levels of charge-offs and recoveries, levels of
outstanding loans, known and inherent risks in the nature of the loan portfolio
and management's assessment of current risk. It is a significant factor in the
bank's operating results.
Non-Interest Income
Non-interest income, exclusive of security gains, increased by $71,524 to
$484,110 for the three months ended March 31, 1997, compared to $412,586 for the
three months ended March 31, 1996. This increase was primarily caused by an
increase in deposit service fees of $63,120. The increase was partially offset
by a decrease in gains on sales of loans of $13,700 due to a decline in
originations in the first quarter of 1997 compared to the first quarter of 1996.
Trust fees increased by $16,611, or 10.3%, for the three months ended March 31,
1997 compared to the same period in the prior year due to an increase in trust
assets.
Deposit fees increased by $63,120, or 40.9% for the three months ended March 31,
1997, compared to the three months ended March 31, 1996. The 1997 growth was
primarily the result of an increase in transaction deposit accounts, activity
volume and increased fees.
Other income for the three months ended March 31, 1997, was $69,782, an increase
of 8.5% from $64,289 for the three months ended March 31, 1996, due primarily to
increases in safe deposit fees and merchant assessment fees.
Non-Interest Expenses
Salaries and benefits expense totaled $1,405,994 for the three months ended
March 31, 1997, compared with $1,197,823 for the three months ended March 31,
1996, an increase of $208,171 or 17.4%. This increase was primarily the result
of the addition of the Tewksbury branch in the fourth quarter of 1996, increases
in benefit expenses, and annual salary increases.
Occupancy expense was $374,337 for the three months ended March 31, 1997,
compared with $330,669 for the three months ended March 31, 1996, an increase of
$43,668 or 13.2%, primarily due to the opening of the Tewksbury branch.
FDIC insurance expense increased by $5,764 for the first three months of 1997
compared to the same period in the previous year. The increase was due to a
change in the rates charged by the FDIC to its member banks.
Office and data processing supplies expense increased by $16,871, or 26.0%, for
the three months ended March 31, 1997 compared to the same period in the prior
year, primarily due to increased volume and resulting increase in costs bankwide
as well as the addition in Tewksbury.
Postage increased by $26,886 for the first three months of 1997 compared to the
same period in the prior year. The increase was due to increased direct mail
activity in the first quarter of 1997 and increased courier expenses related to
the addition of the Tewksbury branch.
Audit, legal and other professional expenses decreased by $22,170, or 22.6% for
the three months ended March 31, 1997 compared to the prior year period,
primarily as a result of consulting, audit services and other legal services
incurred in 1996 related to the formation of the holding company.
Other non-interest expenses decreased slightly by $16,832, or 5.7% for the three
months ended March 31, 1997 compared to the same period in the prior year. The
decrease was due to various cost saving initiatives.
11
<PAGE>
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
None
Item 6 Exhibits and Reports on Form 8-K
None
12
<PAGE>
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.
ENTERPRISE BANCORP, INC.
DATE: May 9, 1997 /s/ John P. Clancy, Jr.
John P. Clancy, Jr.
Senior Vice President, Chief Financial Officer, Treasurer
and Investment Manager
13
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from unaudited
financial statements of Enterprise Bancorp, Inc. at and for the period ended
March 31, 1997 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-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 18,715,038
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0
0
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</TABLE>
