SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 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 0-21687
IFB HOLDINGS, INC.
- -----------------------------------------------------------------
(Exact name of Registrant as specified in its Charter)
Delaware 43-1760023
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(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
522 Washington Street, Chillicothe, Missouri 64601
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(660) 646-3733
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes (x) No ( )
Indicate the number of shares outstanding of each of the issuer's
common stock as of the latest practicable date.
Class Outstanding at September 30, 1997
- -----------------------------------------------------------------
Common stock, $01 par value 592,523
<PAGE>
IFB HOLDINGS, INC.
FORM 10-QSB
Index
Part I. Financial Information
<TABLE>
<S> <C> <C>
Item 1 Financial Statements Page
Consolidated Statements of Financial Condition
as of September 30, 1997 (unaudited) and
June 30, 1997 2
Consolidated Statements of Income for the Three
Months ended September 30, 1997 and 1996
(unaudited) 3
Consolidated Statements of Changes in Stockholders'
Equity for the Three Months ended September 30, 1997
(unaudited) 4
Consolidated Statements of Cash Flows for the
Three Months ended September 30, 1997 and 1996
(unaudited) 5
Notes to Unaudited Consolidated Financial
Statements 7
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
Part II. Other Information
Item 1 Legal Proceedings 15
Item 2 Changes in Securities 15
Item 3 Default upon Senior Securities 15
Item 4 Submission of Matters to a Vote of Security
Holders 15
Item 5 Other Information 15
Item 6 Exhibits and Reports on Form 8-K 15
Signature Page 16
</TABLE>
<PAGE>
IFB HOLDINGS, INC.
Consolidated Statements of Financial Condition
<TABLE>
September 30, June 30,
1997 1997
(Unaudited)
ASSETS (In thousands)
<S> <C> <C>
Cash on hand and noninterest-earning deposits $ 508 $ 581
Interest-earning deposits in other institutions 1,492 2,422
Investment securities:
Securities available-for-sale at fair value 5,834 4,760
Securities held-to-maturity at amortized cost 1,212 2,209
Mortgage-backed and related securities
available-for-sale, at fair value 21,217 18,501
Loans receivable, net 31,702 29,962
Accrued interest receivable 555 446
Investment required by law:
FHLB and FRB stock, at cost 1,118 897
Premises and equipment 405 357
Other assets 93 85
Total assets $ 64,136 $ 60,220
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $ 34,201 $ 34,980
Advances from Federal Home Loan Bank 20,696 16,265
Advances from borrowers for taxes and insurance 44 33
Income taxes payable 202 144
Accrued expenses and other liabilities 163 157
Total liabilities $ 55,306 $ 51,579
Preferred stock, $.01 par value;
authorized 100,000 shares; none outstanding $ - $ -
Common stock, $.01 par value; authorized 900,000
shares, issued 592,523 shares at September 30, 1997
and June 30, 1997 59 59
Additional paid-in capital 5,481 5,477
Retained earnings, substantially restricted 3,708 3,559
Less:
Common stock acquired by the ESOP (410) (421)
Unrealized loss on securities available-for-sale,
net of applicable deferred income taxes (8) (33)
Total stockholders' equity $ 8,830 $ 8,641
Total liabilities and stockholders' equity $ 64,136 $ 60,220
</TABLE>
See accompanying Notes to Unaudited Consolidated Financial Statements
<PAGE>
IFB HOLDINGS, INC.
Consolidated Statements of Income
(Unaudited)
<TABLE>
Three Months Ended
September 30,
1997 1996
(In thousands
except share data)
<S> <C> <C>
Interest income:
Loans receivable $ 645 $ 585
Investment securities 109 62
Mortgage-backed and related securities 341 310
Other interest-earning assets 12 10
Total interest income 1,107 967
Interest expense:
Deposits 398 409
FHLB Advances 268 210
Total interest expense 666 619
Net interest income 441 348
Provision for loan losses - -
Net interest income after provision
for loan losses 441 348
Noninterest income:
Fees and service charges 55 53
Gain on sales or mortgage-backed
securities 8 -
Other 9 12
Total noninterest income 72 65
Noninterest expense:
Compensation and benefits 170 136
Occupancy and equipment 26 19
SAIF deposit insurance premiums 5 251
Other 55 53
Total noninterest expense 256 459
Income (loss) before income taxes 257 (46)
Income tax expense 108 (20)
Net income (loss) 149 (26)
Earnings per share:
Primary and fully diluted $0.27 n/a
Weighted average number of
shares outstanding:
Primary and fully diluted 547,333 n/a
</TABLE>
See accompanying Notes to Unaudited Consolidated Financial Statements
<PAGE>
IFB HOLDINGS, INC.
Consolidated Statements of Changes in Stockholders' Equity
(Unaudited)
<TABLE>
Unrealized
Gain (Loss)
Securities
Available-
For-Sale,
Net of
Common Applicable
Additional Stock Deferred
Common Paid-In Retained Acquired Income
Stock Capital Earnings by ESOP Taxes Total
(In thousands)
Three Months Ended
September 30, 1997
<S> <C> <C> <C> <C> <C> <C>
Balance at June 30, 1997 $59 $5,477 $3,559 $(421) ($33) $8,641
Additions (deductions) for
the three months ended
September 30, 1997
Net income - - 149 - - 149
Compensation expense
related to ESOP - 4 - - - 4
Reduction of ESOP
obligation - - - 11 - 11
Unrealized gain (loss) on
securities available-for-
sale, net of deferred
Income tax of $13,000 - - - - 25 25
Balance, September 30, 1997 $59 $5,481 $3,708 ($410) ($8) $8,830
</TABLE>
See accompanying Notes to Unaudited Consolidated Financial Statements
<PAGE>
IFB HOLDINGS, INC.
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
Three Months Ended
March 31,
1997 1996
(In thousands)
<S> <C> <C>
Cash flow from operating activities:
Net income (loss) $ 149 $ (26)
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Net loss (gain) on sale of investments (8) -
Depreciation 12 10
Amortization of premiums and discounts 3 3
Compensation expense related to ESOP 15 -
Decrease (increase) in interest receivable (109) (77)
Decrease (increase) in other assets (8) (20)
Increase (decrease) in income tax payable 58 (72)
Increase (decrease) in other liabilities 6 179
Net cash provided by operating activities $ 118 $ (3)
Cash flow from investing activities:
Loans purchased (1,387) (213)
(Increase) decrease in loans, net (353) (274)
Proceeds from sales of available-for-sale
investment securities 491 -
Proceeds from maturities of investment securities 1,000 -
Purchase of available-for-sale investment securities (1,544) (155)
Purchase of available-for-sale mortgage-backed
and related securities (3,437) (1,485)
Principal collected on repayments and maturities of
available-for-sale mortgage-backed and related
securities 728 703
Purchase of FHLB and FRB stock (222) (49)
Purchase of equipment (60) (4)
Net cash provided (used) by investing activities ($4,784) ($1,477)
Cash flows from financing activities:
Net increase (decrease) in deposits (779) (303)
Net increase (decrease) in advances from
borrowers for taxes and insurance 11 13
Proceeds from FHLB advances 7,650 8,200
Principal payments on FHLB advances (3,219) (6,213)
Net cash provided (used) by financing activities 3,663 1,697
Increase (decrease) in cash and cash equivalents (1,003) 217
Cash and cash equivalents at beginning of period 3,003 2,080
Cash and cash equivalents at end of period $2,000 $2,297
</TABLE>
<PAGE>
IFB HOLDINGS, INC.
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
Three Months Ended
September 30,
1997 1996
(In thousands)
<S> <C> <C>
Supplemental cash flow disclosures:
Cash paid for:
Interest $339 $322
Income Taxes $ 65 $ 36
Noncash activity:
Loans transferred to real estate owned $ - $ -
</TABLE>
See accompanying Notes to Unaudited Consolidated Financial Statements
<PAGE>
(1) Basis of Presentation
The accompanying unaudited consolidated financial statements
have been prepared in accordance with Generally Accepted
Accounting Principles (GAAP) for interim financial information
and with the instructions to Form 10-QSB and Article 10 of
Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by GAAP for complete financial
statements. In the opinion of management, all adjustments
(consisting of only normal recurring accruals) necessary for a
fair presentation have been included. The results of operations
and other data for the three month period ended September 30,
1997 are not necessarily indicative of results that may be
expected for the entire fiscal year ending June 30, 1998.
The unaudited consolidated financial statements include the
amounts of IFB Holdings, Inc. (the "Holding Company") and its
wholly-owned subsidiary, Investors Federal Bank, National
Association, (the "Bank"), and the Bank's wholly-owned
subsidiary, Investors Federal Service Corporation for the three
months ended September 30, 1997. The consolidated financial
statements for the prior periods include accounts of the Bank and
its subsidiaries. Material intercompany accounts and
transactions have been eliminated in consolidation.
(2) Conversion to Stock Ownership and National Bank
The Board of Directors of the Bank, on September 23, 1996,
unanimously adopted a Plan of Conversion pursuant to which the
Bank converted from a federally chartered mutual savings bank to
a federally chartered stock savings bank, with the concurrent
formation of the Holding Company. The Holding Company, on
December 30, 1996, sold 592,523 shares of common stock at $10.00
per share during the subscription offering. The proceeds from
the conversion, after recognizing conversion expenses and
underwriting costs of approximately $403,000, were $5,522,000 and
are recorded as common stock and additional paid in capital on
the accompanying unaudited consolidated statement of financial
condition. The Holding Company utilized approximately $2,762,000
of the net proceeds to purchase all of the capital stock of the
Bank.
On January 30, 1997, the Bank changed its charter from a
federally chartered savings bank to a national bank.
The Bank has established for eligible employees an Employee
Stock Ownership Plan ("ESOP") in connection with the conversion.
The ESOP borrowed $474,010 from the Holding Company and purchased
47,401 common shares issued in the conversion. The Bank is
making the scheduled discretionary cash contributions to the ESOP
sufficient to service the amount borrowed. To date, the Bank
has made payments of $91,823 ($64,449 principal) to the Holding
Company. The $409,561 ESOP obligation ($474,010 in stock issued
by the Holding Company on December 30, 1996 less the principal
payments made by the Bank) is reflected in the accompanying
consolidated financial statements as a charge to unearned
compensation and a credit to common stock and paid-in capital.
The unamortized balance of unearned compensation is shown as a
deduction of stockholders' equity. The unpaid balance of the
ESOP loan is eliminated in consolidation.
<PAGE>
(3) Earnings Per Share
On December 30, 1996, 592,523 shares of the Company's stock
were issued, including 47,401 shares issued to the ESOP.
Earnings per share amounts for the three month period ended
September 30, 1997 are based upon 547,333 shares, exclusive of
unallocated shares issued to the ESOP, as though those shares
were outstanding for the entire period.
(4) Commitments and Contingencies
Commitments to originate and purchase mortgage loans of
$537,000 at September 30, 1997, represent amounts which the Bank
plans to fund within the normal commitment period of sixty to
ninety days. As of September 30, 1997, the Bank had no
commitments to purchase mortgage-backed securities, CMOs or
investment securities. The Bank had no commitments outstanding
to sell mortgage loans, mortgage-backed securities, CMOs or
investment securities at September 30, 1997.
(5) Reclassification
None.
(6) Recent Accounting Developments
The Financial Accounting Standards Board (the "FASB")
recently adopted or issued proposals and guidelines which may
have a significant impact on the accounting practices of
commercial enterprises in general and financial institutions in
particular.
SFAS No. 123, Accounting for Stock-Based Compensation, is
effective for fiscal years beginning after December 15, 1995.
This statement established financial accounting and reporting
standards for stock-based employee compensation plans, including
stock option plans. These plans include all arrangements by
which employees receive shares of stock or other equity
investments of the employer or where an employer incurs
liabilities to employees in amounts based on the price of the
employer's stock. This statement also applies to transactions in
which an entity issues its equity instruments to acquire goods
and services from nonemployees.
SFAS 128, "Earnings Per Share", will be adopted for the
three months ending December 31, 1997 as required by the
statement. This statement revises the method of computing
"basic" and "diluted" earnings per share, which replaces the
current "primary" and "fully diluted" earnings per share. Basic
earnings per share does not include the effect of common stock
equivalents such as stock options, which were included in primary
earnings per share. The Company has a simple capital structure
since it has no convertible securities or options; therefore, it
will present only basic earnings per share.
SFAS No. 130, "Reporting Comprehensive Income," will be
adopted July 1, 1998. This statement provides accounting and
reporting standards to report a measure of all changes in equity
of an enterprise that results from recognized transactions and
economic events of the period. The major component of
comprehensive income for the Company will be unrealized gains and
losses on certain investments in debt and equity securities.
Management has not determined the effect on the financial
position or the results of operations that adoption of SFAS 123,
128, and 130 will have.
<PAGE>
(7) Subsequent Event-Officer, Director and Employee Plans
The Company's Board of Directors has approved a stock option
and incentive plan and a recognition and retention plan (RRP)
which are to be submitted to the Company's shareholders for their
approval at the Annual meeting in November, 1997.
Stock Option and Incentive Plan
If approved, the plan will be implemented for the benefit of
directors, officers and employees of the Company and its
affiliates. The maximum number of shares to be issued from
authorized but not currently outstanding shares under the plan is
59,252 or 10% of the total shares issued in the conversion. The
exercise price of the options shall not be less than the common
stock market value at the date the options are granted.
Recognition and Retention Plan
If approved, the RRP would award shares authorized but not
currently outstanding to directors and to employees in key
management positions in order to provide them with a proprietary
interest in the Company in a manner designed to encourage such
employees to remain with the Company. The maximum number of
shares authorized under the plan is 23,700 or 4% of the total
shares issued in the conversion.
Under the terms of the stock option and incentive plan, the
effective date of the plan would be January 1, 1998. The term of
the plan would be ten years. The future impact of the plan would
be to increase (1) the number of outstanding shares of common
stock, and (2) compensation expense, and decrease (1) net income
per share, and (2) book value per share. It is not possible to
quantify the effect on the financial position or results of
operations from implementing the plan at this time.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
IFB Holdings, Inc. was organized, as a Delaware corporation,
in October 1996 at the direction of the Bank's Board of Directors
to acquire all of the capital stock that the Bank issued upon its
conversion from mutual to stock form of ownership. The business
of the Holding Company consists primarily of the business of the
Bank. There are no current arrangements, understandings or
agreements to expand its business activities or make any business
acquisitions.
Investors Federal Bank, National Association was originally
founded in 1934 as a federally chartered savings and loan
association located in Chillicothe, Missouri under the name
Chillicothe Federal Savings and Loan Association. In 1974, the
Bank changed its name to Investors Federal Savings and Loan
Association, and in 1988 the Bank changed its name to Investors
Federal Bank and Savings Association. On December 30, 1996, the
Bank completed a conversion from mutual to stock ownership. On
January 30, 1997, the Bank changed its charter to a national bank
charter and its name to Investors Federal Bank, National
Association. Its deposits are insured up to the maximum
allowable amount by the Federal Deposit Insurance Corporation
(the "FDIC"). The Bank serves Livingston, Caldwell, and Daviess
Counties, Missouri. The Bank conducts business through its main
office and two branches located in Hamilton and Gallatin,
Missouri.
The Bank's business strategy is to operate as a well-
capitalized, profitable and independent community financial
institution dedicated to home-mortgage lending and to providing
quality service to its customers. The Bank intends to implement
this strategy by (i) closely monitoring the needs of its
customers and providing quality service; (ii) maintaining asset
quality; (iii) utilizing investments in mortgage-backed
securities and other investment securities to invest excess funds
and to increase net interest income; (iv) maintaining capital in
excess of the regulatory requirements; (v) attempting to increase
the Bank's earnings; and (vi) managing interest rate risk by
attempting to match asset and liability maturities and rates.
The earnings of the Bank depend primarily on its net
interest income, which is the difference between interest earned
on its loans and investments and the interest paid on its
interest-bearing liabilities, consisting of deposits and FHLB
advances. The Bank, like other financial institutions, is
subject to interest-rate risk to the degree that its interest-
earning assets mature or reprice at different times, or on
different bases, than its interest-bearing liabilities. The
Bank's operating results are also affected by the amount of its
noninterest income, including gain on the sales of investments,
service charges, and other income. Non-interest expense consists
primarily of employee compensation, occupancy expenses, FDIC
insurance premiums and other general and administrative expenses.
The Bank's operating results are significantly affected by
general economic and competitive conditions, in particular, the
changes in market interest rates, government policies and actions
by regulatory authorities.
Liquidity and Capital Resources
The Company's most liquid assets are cash and cash
equivalents, which includes short-term investments. The levels
of these assets are dependent on the Bank's lending, investing,
operating, and deposit activities during any given period. At
September 30, 1997 and June 30, 1997, cash and cash equivalents
totalled $2 million and $3 million, respectively.
The Bank's primary sources of funds are deposits, FHLB
advances, repayments on loans, the maturity of investment
securities and income from operations. While maturity and
scheduled amortization of loans and investment securities are
predictable sources of funds, deposit inflows and mortgage
prepayments are greatly influenced by local conditions, general
interest rates and regulatory changes.
<PAGE>
The primary investment activity of the Bank is the
origination and purchase of mortgage loans. Another investment
activity of the Bank is the investment of funds in U.S. agency
bonds, mortgage-backed securities, collateralized mortgage
obligations and FHLB overnight funds. During periods when the
Bank's loan demand is limited, the Bank may purchase short-term
investment securities to obtain a higher yield than otherwise
available.
At September 30, 1997, the Bank had outstanding loan
commitments of $537,000. The Bank anticipates it will have
sufficient funds available to meet its commitments. Certificates
of deposit that were scheduled to mature in one year or less at
September 30, 1997 were $13.2 million. Management believes that
a significant portion of such deposits will remain with the Bank.
Under federal law, the Bank is required to meet certain
leverage and risk-based capital requirements. The leverage ratio
requires a minimum ratio of "Tier 1 capital" to adjusted total
assets. At September 30, 1997, the Bank exceeded both of the
capital requirements. The Bank's capital ratios were: 10.05%
leverage capital and 25.76% risk-based capital. The Bank had
"Tier 1 capital" of $6 million at September 30, 1997 and risk-
based capital of $6.3 million.
Financial Condition
Total assets increased $3.9 million, or 6.5%, to $64.1
million at September 30, 1997 from $60.2 million at June 30,
1997. This was primarily due to increases of $2.7 million, or
14.7%, in mortgage-backed and related securities, $1.7 million,
or 5.8%, in loans receivable, and $221,000, or 24.6%, in FHLB
stock. The increases were funded primarily from an increase in
FHLB advances of $4.4 million which reflected management's
asset/liability strategy of seeking to earn the spread between
the yield earned on adjustable-rate earning assets and the rates
paid on the FHLB advances. In addition, interest-earning
deposits in other institutions decreased $930,000 or 38.4%, from
$2.4 million at June 30, 1997, to $1.5 million at September 30,
1997.
Total liabilities increased $3.7 million, or 7.2%, from
$51.6 million at June 30, 1997, to $55.3 million at September 30,
1997. The increase was a result of the increases in FHLB
advances and a decrease in deposits of $779,000, or 2.2% from
$35 million at June 30, 1997, to $34.2 million at September 30,
1997.
Total equity increased $189,000, or 2.2%, from $8.6 million
at June 30, 1997 to $8.8 million at September 30, 1997. The
increase was due primarily to net income for the first quarter
ended September 30, 1997, of $149,000 and a decrease in
unrealized loss on securities available-for-sale, net of deferred
income tax of $25,000.
Asset Quality
The Bank regularly reviews interest earning assets to
determine proper valuation. Management's monitoring of the asset
portfolio includes reviews of historical loss experience, known
and inherent risks in the portfolio, the value of any underlying
collateral, prospective economic conditions and the regulatory
environment. The Bank's non-accrual mortgage loans increased
from $203,000 at June 30, 1997 to $229,000 at September 30, 1997.
The table on the following page sets forth information
regarding the Bank's non-accrual loans and foreclosed real estate
at the dates indicated. The Bank discontinues accruing interest
on delinquent loans no later than ninety days past due. At
September 30, 1997, the Bank had no restructured loans within the
meaning of Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 15.
<PAGE>
IFB HOLDINGS, INC.
Asset Quality
<TABLE>
September 30, June 30,
1997 1997
<S> <C> <C>
Non-accrual mortgage loans
delinquent more than 90 days $ 229 $ 203
Non-accrual other loans
delinquent more than 90 days 55 21
Total non-performing loans $ 284 $ 224
Real estate owned and in-
substance foreclosed loans,
net of allowance 0 0
Total non-performing assets $ 284 $ 224
Non-performing loans to
total loans 0.90% 0.75%
Non-performing assets to
total assets 0.44% 0.37%
Allowance for loan losses
to non-performing loans 100% 127.23%
</TABLE>
<PAGE>
Results of Operations
Comparisons of quarterly results in this section are between
the three month periods ended September 30, 1997, and September
30, 1996.
General
Net income for the first quarter ended September 30, 1997
was $149,000, an increase of $175,000 from the $26,000 net loss
for the first quarter ended September 30, 1996.
Interest Income
Interest income for the first quarter ended September 30,
1997, was $1.1 million an increase of $140,000, or 14.5%,
compared to the $967,000 for the first quarter ended September
30, 1996. Interest on loans receivable increased $60,000, or
10.3%, from $585,000 for the first quarter ended September 30,
1996, to $645,000 for the same period ended September 30, 1997.
Interest on investment securities increased $47,000, or 75.8%,
from $62,000 for the three months ended September 30, 1996, to
$109,000 for the three months ended September 30, 1997. Interest
on mortgage-backed and related securities increased $31,000, or
10%, from $310,000 for the quarter ended September 30, 1996, to
$341,000 for the quarter ended September 30, 1997. The increases
are a result of the increases in the amount of investment
securities, mortgage-backed and related securities, and loans
receivable outstanding at September 30, 1997, as compared to
September 30, 1996.
Interest Expense
Interest expense for the quarter ended September 30, 1997
was $666,000 as compared to $619,000 for the quarter ended
September 30, 1996, an increase of $47,000, or 7.6%. Interest on
advances from FHLB was $268,000 for the three months ended
September 30, 1997, as compared to $210,000 for the same period
ended September 30, 1996, an increase of $58,000 or 27.6%. The
increase was due to an increase in the amount of advances
outstanding during the three month period ended September 30,
1997, as compared to the three month period ended September 30,
1996. Interest on deposits decreased $11,000 from $409,000 for
the quarter ended September 30, 1996 to $398,000 for the quarter
ended September 30, 1997 as a result of a decrease in the amount
of deposits.
Net Interest Income
Net interest income before provisions for loan losses was
$441,000 for the quarter ended September 30, 1997, as compared to
$348,000 for the quarter ended September 30, 1996, an increase of
$93,000 or 26.7%.
Noninterest Income
Noninterest income was $72,000 for the quarter ended
September 30, 1997 as compared to $65,000 for the quarter ended
September 30, 1996, an increase of $7,000 or 10.8% primarily due
to an increase in gains on the sales of mortgage-backed and
related securities of $8,000 for the quarter ended September 30,
1997, as compared to the quarter ended September 30, 1996.
Noninterest expense
Noninterest expense for the quarter ended September 30, 1997
decreased $203,000, or 44.2%, from $459,000 for the quarter
ended September 30, 1996 to $256,000 for the quarter
<PAGE>
ended September 30, 1997. The decrease was due to a decrease of
$246,000, or 98%, in the amount of SAIF insurance premiums as
compared to the same period ended September 30, 1996. On
September 30, 1996, the Bank incurred a one time SAIF assessment
of approximately $226,000. Compensation and benefit expense
increased $34,000, or 25%, from $136,000 for the quarter ended
September 30, 1996, to $170,000 for the quarter ended September
30, 1997. The increase was due in part to compensation expense
related to the Employee Stock Ownership Plan of $16,000. In
addition, the three month period ended September 30, 1997,
included one additional pay period compared to the period ended
September 30, 1996.
Provision for Loan Losses
For the three months ended September 30, 1997 and 1996, the
provision for loan losses was not increased.
Income Tax
The provision for income taxes increased $128,000, from a
tax benefit of $20,000 for the quarter ended September 30, 1996,
to $108,000 in expense for the quarter ended September 30, 1997.
The increase is due to an increase in income for the quarter.
<PAGE>
IFB HOLDINGS, INC.
Part II -- Other Information
Item 1 Legal Proceedings
The Holding Company and the Bank are not involved in any
pending legal proceedings other than legal proceedings incident
to the business of the Holding Company and the Bank, which
involve amounts in the aggregate which management believes are
immaterial to the financial condition and results of operations
of the Holding Company and the Bank.
Item 2 Changes in Securities
Not applicable.
Item 3 Default 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
(A) Exhibits; Financial Data Schedule--Exhibit 27
(B) Reports on Form 8-K; No reports on Form 8-K have been
filed during the quarter for which this report is filed.
<PAGE>
IFB HOLDINGS, INC.
Signatures
Pursuant to the requirement 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.
IFB Holdings, Inc.
----------------------------------------
(Registrant)
Dated November 6, 1997 /s/ Earle S. Teegarden, Jr.
-----------------------------------
Earle S. Teegarden, Jr.
President and Chief Executive
Officer
(Duly Authorized Officer)
Dated November 6, 1997 /s/ Sherri Williams
-----------------------------------
Sherri Williams
Chief Accounting Officer
(Principal Financial Officer)
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> SEP-30-1997
<CASH> 508
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0
0
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</TABLE>
