- --------------------------------------------------------------------------------
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
X Quarterly report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1999
____ Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from _____________ to ___________________
Commission file number 333-19201
THE COMMERCIAL BANCORP, INC.
----------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Florida 59-3396236
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
258 North Nova Road
Ormond Beach, Florida 32174
(Address of Principal Executive Offices)
(904) 672-3003
(Issuer's Telephone Number, Including Area Code)
(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 12, 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;
Common stock, par value $.01 per share
--------------------------------------
(class)
467,041 shares outstanding at April 26, 1999
--------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements Page
<S> <C>
Condensed Consolidated Balance Sheets -
At March 31, 1999 (unaudited) and At December 31, 1998...................................................2
Condensed Consolidated Statements of Operations -
Three Months ended March 31, 1999 and 1998 (unaudited)...................................................3
Condensed Consolidated Statement of Stockholders' Equity -
Three Months ended March 31, 1999 (unaudited)............................................................4
Condensed Consolidated Statements of Cash Flows -
Three Months ended March 31, 1999 and 1998 (unaudited)...................................................5
Notes to Condensed Consolidated Financial Statements (unaudited).........................................6-7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations...............................................................................8-10
Item 3. Quantitative and Qualitative Disclosures About Market Risk..........................................11
PART II. OTHER INFORMATION
Item 1. Legal Proceedings..................................................................................11
Item 2. Changes in Securities and Use of Proceeds..........................................................11
Item 6. Exhibits and Reports on Form 8-K...................................................................11
SIGNATURES.....................................................................................................12
</TABLE>
1
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>
At
---------------------------
March 31, December 31,
--------- ------------
Assets 1999 1998
---- ----
(unaudited)
<S> <C> <C>
Cash and due from banks......................................................... $ 567,261 689,903
Federal funds sold.............................................................. 2,817,476 4,258,602
----------- ----------
Total cash and cash equivalents..................................... 3,384,737 4,948,505
Securities available for sale................................................... 2,528,740 3,302,486
Loans, net of allowance for loan losses of $787,000
in 1999 and $760,000 in 1998................................................ 12,193,823 11,563,373
Premises and equipment, net..................................................... 829,970 838,931
Accrued interest receivable..................................................... 75,573 89,527
Restricted security, Federal Home Loan Bank stock, at cost 64,500 50,000
Deferred tax asset.............................................................. 897,321 824,981
Other assets.................................................................... 59,051 58,003
------------ ------------
Total assets........................................................ $ 20,033,715 21,675,806
========== ==========
Liabilities and Stockholders' Equity
Liabilities:
Demand deposits............................................................. 746,128 904,585
Savings and NOW deposits.................................................... 4,086,681 5,068,758
Money-market deposits....................................................... 352,325 329,293
Time deposits............................................................... 10,019,242 10,482,545
---------- ----------
Total deposits...................................................... 15,204,376 16,785,181
Advance from Federal Home Loan Bank......................................... 1,000,000 1,000,000
Other borrowings............................................................ 407,249 364,749
Official checks............................................................. 124,396 127,342
Accrued interest payable and other liabilities.............................. 138,220 141,642
----------- -----------
Total liabilities................................................... 16,874,241 18,418,914
---------- ----------
Stockholders' equity:
Common stock, $.01 par value; 10,000,000 shares authorized,
467,041 and 464,791 shares issued and outstanding....................... 4,670 4,648
Additional paid-in capital.................................................. 4,651,020 4,628,542
Accumulated deficit......................................................... (1,497,050) (1,370,803)
Accumulated other comprehensive income...................................... 834 (5,495)
------------- ------------
Total stockholders' equity.......................................... 3,159,474 3,256,892
---------- ----------
Total liabilities and stockholders' equity.......................... $ 20,033,715 21,675,806
========== ==========
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements.
2
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Operations
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
1999 1998
---- ----
(unaudited)
Interest income:
<S> <C> <C>
Loans............................................................................... $ 242,218 122,657
Securities available for sale....................................................... 31,420 -
Other interest-earning assets....................................................... 43,177 46,294
-------- -------
Total interest income....................................................... 316,815 168,951
------- -------
Interest expense:
Deposits............................................................................ 178,926 80,842
Other............................................................................... 19,054 -
-------- -------
Total interest expense...................................................... 197,980 80,842
------- --------
Net interest income ........................................................ 118,835 88,109
Provision for loan losses............................................................... 27,000 29,000
-------- --------
Net interest income after provision for
loan losses............................................................... 91,835 59,109
-------- --------
Noninterest income-
Service charges and fees............................................................ 11,341 9,514
-------- --------
Noninterest expense:
Salaries and employee benefits...................................................... 165,716 97,322
Occupancy expense................................................................... 55,195 41,672
Professional fees................................................................... 29,181 11,809
Advertising......................................................................... 1,511 28,439
Other 54,020 48,999
-------- -------
Total noninterest expense................................................... 305,623 228,241
------- -------
Loss before income tax benefit.......................................................... (202,447) (159,618)
Income tax benefit.......................................................... (76,200) (49,700)
-------- --------
Net loss................................................................................ $(126,247) (109,918)
======= =======
Loss per share, basic................................................................... $ (.27) (.24)
========== ==========
Dividends per share..................................................................... $ - -
=========== ==========
Weighted-average number of shares outstanding for
basic............................................................................... 464,916 464,791
======= =======
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements.
3
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statement of Stockholders' Equity
Three Months Ended March 31, 1999
<TABLE>
<CAPTION>
Accumulated
Other
Additional Compre- Total
Common Paid-In Accumulated hensive Stockholders'
Stock Capital Deficit Income Equity
----- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1998......................... $ 4,648 4,628,542 (1,370,803) (5,495) 3,256,892
--------- ----- ---------
Comprehensive income:
Net loss (unaudited)............................ - - (126,247) - (126,247)
Net change in unrealized gain on
securities available for sale,
net of tax of $3,860
(unaudited)................................. - - - 6,329 6,329
-------------- ----- -----------
Comprehensive income (unaudited) - - (126,247) 6,329 (119,918)
Issuance of 2,250 shares of common
stock upon exercise of 2,250
warrants (unaudited)............................ 22 22,478 - - 22,500
------- ---------- ------------- -------- ----------
Balance at March 31, 1999 (unaudited) $ 4,670 4,651,020 (1,497,050) 834 3,159,474
======= ========= ========== === =========
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements.
4
<PAGE>
<TABLE>
<CAPTION>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Cash Flows
Three Months Ended
March 31,
1999 1998
---- ----
(unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net loss......................................................................... $ (126,247) (109,918)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation................................................................. 21,742 17,899
Provision for loan losses.................................................... 27,000 29,000
Credit for deferred income taxes............................................. (76,200) (49,700)
Net amortization of loan fees, premiums and discounts 20,904 (7,120)
Deferral of loan fees collected, net of costs deferred (4,105) 4,944
Decrease (increase) in accrued interest receivable and
other assets............................................................... 12,906 (79,677)
(Decrease) increase in official checks, accrued interest
payable and other liabilities.............................................. (6,368) 108,868
----------- ----------
Net cash used in operating activities........................................ (130,368) (85,704)
--------- -----------
Cash flows from investing activities:
Principal repayments on securities available for sale 768,061 -
Net increase in loans............................................................ (658,375) (2,543,560)
Purchase of premises and equipment............................................... (12,781) (73,475)
Purchase of Federal Home Loan Bank stock......................................... (14,500) -
---------- ---------
Net cash provided by (used in) investing activities 82,405 (2,617,035)
---------- ---------
Cash flows from financing activities:
Net (decrease) increase in demand, savings, NOW and money-
market deposits.............................................................. (1,117,502) 621,647
Net (decrease) increase in time deposits......................................... (463,303) 6,438,193
Net increase in other borrowings................................................. 42,500 -
Proceeds from issuance of common stock upon exercise of
warrants..................................................................... 22,500 -
----------- ---------
Net cash (used in) provided by financing activities (1,515,805) 7,059,840
--------- ---------
Net (decrease) increase in cash and cash equivalents (1,563,768) 4,357,101
Cash and cash equivalents at beginning of period 4,948,505 2,465,817
--------- ---------
Cash and cash equivalents at end of period........................................... $ 3,384,737 6,822,918
========= =========
Supplemental disclosure of cash flow information: Cash paid during the period
for:
Interest..................................................................... $ 200,616 62,775
========== =========
Income taxes................................................................. $ - -
============= =========
Noncash transactions-
Accumulated other comprehensive income, net change
in unrealized gain on securities available for sale,
net of tax................................................................. $ 6,329 (5,495)
=========== ==========
</TABLE>
See Accompanying Notes to Condensed Consolidated Financial Statements.
5
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Notes to Condensed Consolidated Financial Statements (unaudited)
(1) Basis of Presentation. In the opinion of the management the
accompanying condensed consolidated financial statements contain all
adjustments (consisting of normal recurring accruals) necessary to
present fairly the financial position at March 31, 1999 and the
results of operations and cash flows for the three-month periods
ended March 31, 1999 and 1998. The results of operations and other
data for the three- month period ended March 31, 1999, are not
necessarily indicative of results that may be expected for the year
ending December 31, 1999.
The condensed consolidated financial statements include the accounts
of The Commercial Bancorp, Inc. (the "Holding Company") and its
wholly-owned subsidiary, The Commercial Bank of Volusia County (the
"Bank") (together, "TCB"). All significant intercompany accounts and
transactions have been eliminated in consolidation.
(2) Loan Impairment and Loan Losses. The average net investment in
impaired loans and interest income recognized and received on
impaired loans is as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
1999 1998
---- ----
<S> <C> <C>
Average net investment in impaired loans....................................... $ 599,513 -
======= ======
Interest income recognized on impaired loans.................................. $ - -
=========== ======
Interest income received on impaired loans..................................... $ - -
=========== ======
The activity in the allowance for loan losses was as follows:
Three Months Ended
March 31,
------------------
1999 1998
---- ----
<S> <C> <C>
Balance at beginning of period................................................. $ 760,000 35,000
Provision for loan losses...................................................... 27,000 29,000
------- ------
Balance at end of period....................................................... $ 787,000 64,000
======= ======
</TABLE>
(3) Loss Per Share. Basic loss per share of common stock has been
computed on the basis of the weighted-average number of shares of
common stock outstanding. TCB's common stock equivalents are not
dilutive due to the net losses incurred by TCB during the three
months ended March 31, 1999 and 1998.
(continued)
6
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Notes to Condensed Consolidated Financial Statements (unaudited), Continued
(4) Regulatory Matters. The Holding Company and the Bank are subject to
various regulatory capital requirements administered by various
regulatory banking agencies. Failure to meet minimum capital
requirements can initiate certain mandatory and possibly additional
discretionary actions by regulators that, if undertaken, could have a
direct material effect on TCB's financial statements. Under capital
adequacy guidelines and the regulatory framework for prompt
corrective action, the Bank must meet specific capital guidelines
that involve quantitative measures of the Bank's assets, liabilities,
and certain off-balance-sheet items as calculated under regulatory
accounting practices. The Bank's capital amounts and classification
are also subject to qualitative judgements by the regulators about
components, risk weightings, and other factors.
Quantitative measures established by regulation to ensure capital
adequacy require the Bank to maintain minimum amounts and ratios (set
forth in the table below) of total and Tier I capital (as defined in
the regulations) to risk-weighted assets (as defined), and of Tier I
capital (as defined) to average assets (as defined). Management
believes, at March 31, 1999, that the Company meets all capital
adequacy requirements to which it is subject.
As of March 31, 1999, the most recent notification from the
regulatory authorities categorized the Bank as well capitalized under
the regulatory framework for prompt corrective action. To be
categorized as well capitalized, the Bank must maintain minimum total
risk-based, Tier I risk-based, and Tier I leverage ratios as set
forth in the table. There are no conditions or events since that
notification that management believes have changed the Bank's
category. The Bank's actual capital amounts and ratios are also
presented in the table (dollars in thousands).
<TABLE>
<CAPTION>
To Be Well
Minimum Capitalized Under
For Capital Prompt Corrective
Actual Adequacy Purposes: Action Provisions:
------ ------------------ ------------------
Amount % Amount % Amount %
------ - ------ - ------ -
<S> <C> <C> <C> <C> <C> <C>
At March 31, 1999:
Total capital (to Risk-
Weighted Assets)........... $ 2,563 19.6% $ 1,048 8.0% $ 1,310 10.0%
Tier I Capital (to Risk-
Weighted Assets)........... 2,392 18.3 524 4.0 786 6.0
Tier I Capital
(to Average Assets)........ 2,392 12.1 792 4.0 988 5.0
</TABLE>
7
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
Comparison of March 31, 1999 and 1998 (Unaudited) and December 31, 1998
General
The Holding Company was incorporated on August 15, 1996. The Holding
Company owns 100% of the outstanding common stock of the Bank. The Holding
Company was organized simultaneously with the Bank and its only business is
the ownership and operation of the Bank. The Bank is a Florida
state-chartered commercial bank and is insured by the Federal Deposit
Insurance Corporation. The Bank opened for business on October 14, 1997,
and provides community banking services to businesses and individuals in
Volusia County, Florida.
New Bank Charter
TCB along with a group of local organizers made application to the state of
Florida for a bank charter in Highlands County, Florida. Management planned
to raise the capital for the new bank from a public offering of TCB's
common stock. In early 1999, TCB withdrew their application and management
terminated its planned public offering.
Liquidity and Capital Resources
TCB's primary source of cash during the three months ended March 31, 1999
was from principal repayments on securities available for sale. Cash was
used primarily to fund loan originations and to fund net deposit outflows.
At March 31, 1999, TCB had unfunded lines of credit of approximately $1.4
million and approximately $4.5 million in time deposits maturing in one
year or less. At March 31, 1999, the Bank exceeded its regulatory liquidity
requirements.
The following table shows selected ratios for the periods ended or at the
dates indicated:
<TABLE>
<CAPTION>
Three Months Three Months
Ended Year Ended Ended
March 31, December 31, March 31,
1999 1998 1998
--------------- --------------- ---------
<S> <C> <C> <C>
Average equity as a percentage
of average assets...................................... 15.30% 22.51% 38.26%
Total equity to total assets at end of period 15.77% 15.03% 29.88%
Return on average assets (1).............................. (2.41)% (6.35)% (3.93)%
Return on average equity (1).............................. (15.74)% (28.23)% (10.28)%
Noninterest expense to average assets (1)................. 5.83% 7.32% 8.16%
Nonperforming loans and foreclosed
real estate as a percentage of total assets
at end of period....................................... 6.42% 5.53% NIL
Allowance for loan losses as a percentage of
total loans at end of period........................... 6.06% 6.17% 1.01%
</TABLE>
- ----------------------
(1) Annualized for the three months ended March 31, 1999 and 1998.
8
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations, Continued
Changes in Financial Condition
Total assets decreased $1.6 million from $21.7 million at December 31, 1998
to $20.0 million at March 31, 1999, primarily as a result of decreases in
cash and cash equivalents of $1.6 million and securities available for
sale of $.8 million, partially offset by an increase in loans of $.6
million. Deposits decreased $1.6 million from $16.8 million at December
31, 1998 to $15.2 million at March 31, 1999.
Results of Operations
Comparison of the Three-Month Periods Ended March 31, 1999 and 1998
General. Net loss for the three months ended March 31, 1999 was $126,247, or
$.27 per basic share, compared to a net loss for the three months ended
March 31, 1998 of $109,918, or $.24 per basic share. At March 31, 1999 and
1998, the Bank had not achieved the asset size to operate profitably.
Interest Income and Expense. Interest income increased to $316,815 for the
three months ended March 31, 1999 from $168,951 for the three months ended
March 31, 1998. Interest income earned on loans increased $119,561 to
$242,218 in 1999 due to an increase in the average loan portfolio balance
to $12.1 million for the three months ended March 31, 1999 from $5.7
million for the comparable period in 1998, partially offset by a decrease
in the average yield earned to 7.99% in 1999 from 8.56% in 1998.
Interest expense increased to $197,980 for the three months ended March
31, 1999 from $80,842 for the three months ended March 31, 1998. Interest
expense on deposits increased $98,084 due to an increase in average
balance of deposits to $15.3 million for the three months ended March 31,
1999 from $6.5 million for the comparable period in 1998, partially offset
by a decrease in the average cost to 4.67% in 1999 from 4.97% in 1998.
Provision for Loan Losses. The provision for loan losses is charged to
earnings to increase the total allowance to a level deemed appropriate by
management and is based upon the volume and type of lending conducted by
the Company, industry standards, the amount of nonperforming loans and
general economic conditions, particularly as they relate to the Company's
market areas, and other factors related to the collectibility of the
Company's loan portfolio. The provision for loan losses for the three
months ended March 31, 1999 was $27,000 and the allowance for loan losses
was $787,000 at March 31, 1999. Management believes the allowance is
adequate at March 31, 1999.
Noninterest Expense. Noninterest expense totaled $305,623 for the three
months ended March 31, 1999 compared to $228,241 for the three months
ended March 31, 1998. Salaries and employee benefits was the largest
noninterest expense during 1999, increasing to $165,716 from $97,322 in
the 1998 period.
Income Tax Benefit. The income tax benefit for the three months ended March
31, 1999 was $76,200 (an effective rate of 37.6%) compared to $49,700 (an
effective rate of 31.1%) for the three months ended March 31, 1998.
9
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Year 2000
TCB is acutely aware of the many areas affected by the Year 2000 computer issue,
including those addressed by the Federal Financial Institutions Examination
Council ("FFIEC") in its interagency statement which provided an outline for
institutions to effectively manage the Year 2000 challenges. A Year 2000 plan
has been approved by the Board of Directors which includes multiple phases,
tasks to be completed, and target dates for completion. Issues addressed therein
include awareness, assessment, renovation, validation, implementation, testing
and contingency planning.
TCB has formed a Year 2000 committee that is charged with the oversight of
completing the Year 2000 project on a timely basis. TCB has completed its
awareness, assessment and renovation phases and is actively involved in
validating and implementing its plan. At the present time, TCB has substantially
completed its testing phase. Since it routinely upgrades and purchases
technologically advanced software and hardware on a continual bases, TCB has
determined that the costs of making modifications to correct any Year 2000
issues will not materially affect reported results from operations.
TCB's vendors and suppliers have been contacted for written confirmation of
their product's readiness for the Year 2000 compliance. All significant vendors
of TCB have provided confirmation that they are Year 2000 compliant. TCB's main
service provider has completed testing of its mission critical application
software; the test results, which have been documented and validated, are deemed
to be Year 2000 compliant. FFIEC guidance on testing Year 2000 compliance of
service providers states that proxy tests are acceptable compliance tests. In
proxy testing, the service provider tests with a representative sample of
financial institutions that use a particular service, with the results of such
testing shared with all similarly situated clients of the service provider. TCB
has authorized the acceptance of proxy testing since the proxy tests have been
conducted with financial institutions that are similar in type and complexity to
its own, using the same version of Year 2000 ready software and the same
hardware and operating systems. TCB personnel have also performed Year 2000
testing on their computer databases and software applications and have found
them to be Year 2000 ready.
TCB also recognizes the importance of determining that its borrowers are facing
the Year 2000 problem in a timely manner to avoid deterioration of the loan
portfolio solely due to this issue. All material relationships have been
identified and questionnaires have been completed to assess the inherent risks.
Deposit customers have received statement stuffers and information material in
this regard. TCB plans to work on a one-on-one basis with any borrower who has
been identified as having high Year 2000 risk exposure.
Accordingly, management does not believe that TCB has incurred or will incur
material costs associated with the Year 2000 issue. Yet, there can be no
assurances that all hardware and software that TCB will use will be Year 2000
compliant. Management cannot predict the amount of financial difficulties it may
incur due to customers and vendors inability to perform according to their
agreements with TCB or the effects that other third parties may cause as a
result of this issue. Therefore, there can be no assurance that the failure or
delay of others to address the issue or that the costs involved in such process
will not have a material adverse effect on TCB's business, financial condition,
and results of operations.
TCB's contingency plans relative to Year 2000 issues have not been finalized.
These plans are evolving as the testing of systems proceeds. During the
completion of the testing phase management will determine if it is necessary to
develop a "worst case scenario" contingency plan. Based on testing results to
date (as noted above), TCB's mission critical systems have been deemed to be
Year 2000 compliant and, therefore a contingency plan has not been developed
with respect to those systems. Alternatively, some systems could be handled
manually on an interim basis. It is anticipated that TCB's deposit customers
will have increased demands for cash in the latter part of 1999 and
correspondingly TCB will maintain higher liquidity levels.
10
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk is the risk of loss from adverse changes in market prices and rates.
The Company's market risk arises primarily from interest rate risk inherent in
its lending and deposit taking activities. The Company has little or no risk
related to trading accounts, commodities or foreign exchange.
Management actively monitors and manages its interest rate risk exposure. The
primary objective in managing interest-rate risk is to limit, within established
guidelines, the adverse impact of changes in interest rates on the Company's net
interest income and capital, while adjusting the Company's asset-liability
structure to obtain the maximum yield-cost spread on that structure. Management
relies primarily on its asset-liability structure to control interest rate risk.
However, a sudden and substantial increase in interest rates could adversely
impact the Company's earnings, to the extent that the interest rates borne by
assets and liabilities do not change at the same speed, to the same extent, or
on the same basis. There have been no significant changes in the Company's
market risk exposure since December 31, 1998.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
There are no material pending legal proceedings to which The Commercial Bancorp,
Inc. or its subsidiary is a party or to which any of their property is subject.
Item 2. Changes in Securities and Use of Proceeds
During the quarter ended March 31, 1999, 2,250 shares were issued to holders of
warrants at a purchase price of $10.00 per share.
Proceeds were used for general corporate purposes.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits. The following exhibits are filed with or incorporated by
reference into this report. The exhibits which are denominated by an
asterisk (*) were previously filed as a part of, and are hereby
incorporated by reference from TCB's Registration Statement on Form SB-2
under the Securities Act of 1933 for TCB, as effective with the
Securities and Exchange Commission on April 28, 1997, Registration No.
333-19201 (referred to as "Registration Statement"). The exhibits which
are denominated by a double asterisk (**) where filed with TCB's 1998
Form 10- KSB. The exhibit numbers correspond to the exhibit numbers in
the referenced documents.
<TABLE>
<CAPTION>
Exhibit Number Description of Exhibit
-------------- ----------------------
<S> <C>
*3.1 Amended and Restated Articles of Incorporation of TCB
*3.2 By-laws of TCB (Registration Statement)
*4.1 Specimen Common Stock Certificate (Registration Statement)
*4.2 Specimen Warrant Certificate (Registration Statement)
*4.4 Company's Warrant Plan (Registration Statement)
**22.1 TCB's 1999 Annual Meeting Proxy Statement
**22.2 TCB's 1998 Annual Report
27 Financial Data Schedule (for SEC use only)
</TABLE>
(b) Reports on Form 8-K. There were no reports on Form 8-K filed for the
three months ended March 31, 1999.
11
<PAGE>
THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY
PART II. OTHER INFORMATION
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.
THE COMMERCIAL BANCORP, INC.
(Registrant)
Date: , 1999 By: /s/Gary G. Campbell
------------------ --------------------
Gary G. Campbell, President and
Chief Executive Officer
Date: , 1999 By: /s/Harvey E. Buckmaster
------------------ ------------------------
Harvey E. Buckmaster,
Chief Financial Officer
12
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from Form 10-QSB
for the period ended March 31, 1999 and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 567
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 2,817
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 2,529
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 12,981
<ALLOWANCE> 787
<TOTAL-ASSETS> 20,034
<DEPOSITS> 15,204
<SHORT-TERM> 407
<LIABILITIES-OTHER> 263
<LONG-TERM> 1,000
0
0
<COMMON> 5
<OTHER-SE> 3,154
<TOTAL-LIABILITIES-AND-EQUITY> 20,034
<INTEREST-LOAN> 242
<INTEREST-INVEST> 32
<INTEREST-OTHER> 43
<INTEREST-TOTAL> 317
<INTEREST-DEPOSIT> 179
<INTEREST-EXPENSE> 198
<INTEREST-INCOME-NET> 119
<LOAN-LOSSES> 27
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 306<F1>
<INCOME-PRETAX> (202)
<INCOME-PRE-EXTRAORDINARY> (202)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (126)
<EPS-PRIMARY> (.27)
<EPS-DILUTED> (.27)
<YIELD-ACTUAL> 0
<LOANS-NON> 0<F2>
<LOANS-PAST> 0<F2>
<LOANS-TROUBLED> 0<F2>
<LOANS-PROBLEM> 0<F2>
<ALLOWANCE-OPEN> 760
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 787
<ALLOWANCE-DOMESTIC> 787
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
<FN>
<F1>Other expense includes: salaries and employee benefits of $166, occupancy
expense of $55, professional fees of $29 and other expenses which totaled $56.
<F2>Items are only disclosed on an annual basis in the Company's Form 10-KSB, and
are, therefore, not included in this Financial Data Schedule.
</FN>
</TABLE>
