<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from..........................
Commission file number 333-16951
BSM BANCORP
(Exact name of registrant as specified in its charter)
CALIFORNIA NO. 77-0442667
(State or other jurisdiction of incorporation) (IRS Employer Identification No.)
2739 Santa Maria Way, Santa Maria, California 93455
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (805) 937-8551
Not applicable
(Former name or former address, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(c) of the Securities Exchange Act of 1934 during
the preceding 12 months (of shorter period that the registrant was required to
file such reports) Yes [X], and (2) has been subject to such filing requirements
for the past 90 days. Yes[ ] No[X]
APPLICABLE ONLY TO CORPORATE ISSUERS
On October 27, 1997, there were 2,981,339 shares of BSM Bancorp Common Stock
outstanding.
1
<PAGE>
BSM BANCORP
September 30, 1997
INDEX
PART I - FINANCIAL INFORMATION PAGE
----
Item 1 - Financial Statements
Consolidated Balance Sheet at September 30, 1997 and
December 31, 1996............................................ 3
Consolidated Statement of Income for the nine months ended
September 30, 1997 and 1996.................................. 4
Consolidated Statement of Cash Flows for the nine months ended
September 30, 1997 and 1996.................................. 5
Consolidated Statement of Changes in Capital from January 1, 1996
through September 30, 1997 .................................. 6
Notes to Consolidated Financial Statements......................... 7
Item 2 - Management's Discussion and Analysis of Financial Condition
and Results of Operations.................................... 8
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K............................... 11
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
BSM BANCORP AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
SEPTEMBER 30, 1997 DECEMBER 31, 1996
------------------ -----------------
<S> <C> <C>
Cash and due from banks $ 18,483,726 $ 17,643,554
Federal funds sold 17,074,000 13,920,000
------------- -------------
Cash and cash equivalents 35,557,726 31,563,554
Investments:
Securities available-for-sale 43,887,311 23,865,611
Securities held-to-maturity (market value of
$56,728,847 and $68,331,524, respectively) 56,620,480 68,339,127
Loans, net of unearned income 181,757,346 179,391,366
Allowance for loan losses (2,239,520) (2,701,876)
------------- -------------
Net loans 179,517,826 176,689,490
Premises and equipment 12,941,255 12,648,207
Accrued interest receivable and other assets 7,304,788 8,291,296
------------- -------------
Total Assets $ 335,829,386 $ 321,397,285
------------- -------------
------------- -------------
LIABILITIES
Deposits:
Noninterest-bearing demand $ 68,101,862 $ 67,181,717
Interest-bearing demand 117,750,093 111,528,482
Time deposits under $100,000 78,272,183 70,229,443
Time deposits $100,000 or more 35,144,449 37,338,194
------------- -------------
Total deposits 299,268,587 286,277,386
Accrued interest payable and other liabilities 1,838,220 2,487,932
------------- -------------
Total liabilities 301,106,807 288,765,768
------------- -------------
Shareholders' equity:
Common stock, 50,000,000 authorized;
Issued and outstanding
2,980,939 as of September 30, 1997
2,973,631 as of December 31, 1996 11,536,339 11,460,488
Undivided profits 23,127,097 21,176,801
Valuation of securities available-for-sale,
net of tax 59,143 (5,772)
------------- -------------
Total capital 34,722,579 32,631,517
------------- -------------
Total Liabilities & Capital $ 335,829,386 $ 321,397,285
------------- -------------
------------- -------------
</TABLE>
3
<PAGE>
BSM BANCORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTH PERIOD NINE MONTH PERIOD
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------------- ---------------------------
1997 1996 1997 1996
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
INTEREST INCOME:
Interest and fees on loans $ 4,744,167 $ 4,594,386 $ 13,901,268 $ 13,149,758
Interest on investment securities-taxable 1,238,066 1,133,991 3,518,716 3,078,012
Interest on investment securities-nontaxable 174,727 87,763 544,985 394,524
Other interest income 187,890 252,361 459,404 581,044
----------- ----------- ------------ ------------
TOTAL INTEREST INCOME 6,344,850 6,068,501 18,424,373 17,203,338
----------- ----------- ------------ ------------
INTEREST EXPENSE:
Interest on demand and savings deposits 605,261 648,589 1,784,617 1,887,364
Interest on time deposits 1,533,157 1,431,924 4,443,428 4,012,463
----------- ----------- ------------ ------------
TOTAL INTEREST EXPENSE 2,138,418 2,080,513 6,228,045 5,899,827
NET INTEREST INCOME BEFORE PROVISION 4,206,432 3,987,988 12,196,328 11,303,511
----------- ----------- ------------ ------------
Less: Provision for loan losses 0 5,000 30,000 20,500
----------- ----------- ------------ ------------
NET INTEREST INCOME AFTER PROVISION 4,206,432 3,982,988 12,166,328 11,283,011
OTHER OPERATING INCOME:
Service charges and fees 507,844 471,592 1,500,643 1,346,194
Other fee income 227,837 157,774 547,271 432,449
Merchant discount fees 147,978 137,658 438,250 374,189
Other income (20,072) 42,401 89,786 168,669
----------- ----------- ------------ ------------
TOTAL OTHER OPERATING INCOME 863,587 809,425 2,575,950 2,321,501
----------- ----------- ------------ ------------
OTHER OPERATING EXPENSES:
Salaries and employee benefits 1,673,511 1,695,636 5,312,625 4,873,487
Occupancy expenses 238,131 248,654 723,588 711,638
Furniture and equipment 350,332 354,540 1,073,073 1,041,830
Advertising and promotion 181,103 162,584 535,010 423,308
Professional expenses 90,276 139,221 259,225 368,833
Office expenses 220,976 207,466 722,684 586,710
Merchant processing costs 148,328 196,564 404,820 421,868
Other expenses 285,143 286,090 834,168 687,903
----------- ----------- ------------ ------------
TOTAL OTHER OPERATING EXPENSES 3,187,800 3,290,755 9,865,193 9,115,577
----------- ----------- ------------ ------------
Income before taxes 1,882,219 1,501,658 4,877,085 4,488,935
Provision for income taxes 740,000 607,000 1,884,800 1,748,000
----------- ----------- ------------ ------------
NET INCOME $ 1,142,219 $ 894,658 $ 2,992,285 $ 2,740,935
----------- ----------- ------------ ------------
----------- ----------- ------------ ------------
EARNING PER SHARE $ 0.38 $ 0.30 $ 0.99 $ 0.91
Number of shares used in computation 3,032,000 3,004,000 3,029,000 2,998,000
----------- ----------- ------------ ------------
----------- ----------- ------------ ------------
</TABLE>
4
<PAGE>
BSM BANCORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTH PERIOD NINE MONTH PERIOD
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
---------------------------- -----------------------------
1997 1996 1997 1996
------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net income $ 1,142,219 $ 894,658 $ 2,992,285 $ 2,740,935
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 316,458 285,504 929,261 853,144
Provision for credit losses 0 5,000 30,000 20,500
Net amortization of premium/
discounts-investments 44,282 59,743 255,923 263,548
Loans originated for sale (469,800) (2,221,750) (2,024,941) (4,708,950)
Proceeds from loan sales 387,000 1,366,750 2,726,479 5,163,484
Net loss (gain) from sale of fixed assets 31,625 (3,927) (14,312) (52,319)
Net loss (gain) from sale of oth. real
estate loans (207,747) (13,341) (172,361) (39,095)
Net change in accrued interest, other
assets and other liabilities 830,518 1,145,592 (178,099) 250,052
------------- ------------ ------------- -------------
Net cash provided by operating activities 2,074,555 1,518,229 4,544,235 4,491,299
INVESTING ACTIVITIES
Proceeds from maturities of securities held
to maturity 12,003,700 9,590,000 21,863,777 28,916,923
Proceeds from maturities of securities
available for sale 5,000,000 3,000,000 12,173,000 3,000,000
Purchases of held-to-maturity securities (4,802,534) (9,434,859) (12,984,128) (25,720,465)
Purchases of available-for-sale securities (20,342,967) (9,010,962) (29,501,553) (21,589,931)
Net decrease in loans (5,654,643) 682,308 (3,979,543) 4,436,178
Purchases of premises and equipment (103,889) (1,086,224) (1,263,387) (2,301,018)
Proceeds from the sale of other real
estate owned 359,171 788,341 1,061,767 1,114,643
Proceeds for the sale of equipment 5,650 3,927 55,390 64,073
Net cash received for purchase of
Citizens Bank 0 0 0 8,067,071
------------- ------------ ------------- -------------
Net cash provided (used) by investing
activities (13,535,512) (5,467,469) (12,574,677) (4,012,526)
FINANCING ACTIVITIES
Net decrease in demand and savings deposits 11,789,554 265,696 7,141,756 (13,482,865)
Net increase in time deposits 2,729,627 2,626,823 5,848,995 12,690,490
Payments for dividends/distributions (595,986) (414,339) (1,041,989) (964,191)
Proceeds from the exercise of stock options 30,201 19,000 75,851 137,500
------------- ------------ ------------- -------------
Net cash provided (used) by financing
activities 13,953,396 2,497,180 12,024,613 (1,619,066)
------------- ------------ ------------- -------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 2,492,439 (1,452,060) 3,994,171 (1,140,293)
------------- ------------ ------------- -------------
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 33,065,286 30,436,661 31,563,554 30,124,894
------------- ------------ ------------- -------------
CASH AND CASH EQUIVALENTS, SEPTEMBER 30, $ 35,557,725 $ 28,984,601 $ 35,557,725 $ 28,984,601
------------- ------------ ------------- -------------
------------- ------------ ------------- -------------
Cash paid during the year for interest 2,130,919 1,893,578 6,699,391 5,336,803
Cash paid during the year for income taxes 395,085 569,535 1,511,162 1,759,807
</TABLE>
5
<PAGE>
BSM BANCORP
STATEMENT OF CHANGES IN CAPITAL
(Unaudited)
<TABLE>
<CAPTION>
NET
COMMON SHARES UNREALIZED
----------------------- ADJUSTMENT IN
NUMBER OF UNDIVIDED AVAILABLE FOR
SHARES AMOUNT PROFITS SALE SECURITIES TOTAL
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE AT JANUARY 1, 1996 2,950,081 $ 11,250,288 $ 18,673,257 $ 51,221 $ 29,974,766
Proceeds from exercise of
stock options 16,000 137,500 137,500
Dividends paid (964,191) (964,191)
Net income for the period 2,740,935 2,740,935
Adjustment in available for sale
Securities, net of taxes of $ 71,817 (107,726) (107,726)
--------- ------------ ------------ --------- ------------
BALANCE AT SEPTEMBER 30, 1996 2,966,081 11,387,788 20,450,001 (56,505) 31,781,284
Issuance of organizational stock 150 1,500 1,500
Proceeds from exercise of
stock options 7,400 71,200 71,200
Adjustment in available for sale
Securities, net of taxes of $(33,822) 50,733 50,733
Net income for the period 726,800 726,800
--------- ------------ ------------ --------- ------------
BALANCE AT DECEMBER 31, 1996 2,973,631 11,460,488 21,176,801 (5,772) 32,631,517
Retirement of organizational stock (150) (1,500) (1,500)
Proceeds from exercise of
stock options 7,600 79,550 79,550
Partial distribution-El Camino Merger (142) (2,199) (2,199)
Dividends paid (1,041,989) (1,041,989)
Net income for the period 2,992,285 2,992,285
Adjustment in available for sale
Securities, net of taxes of $(43,277) 64,915 64,915
--------- ------------ ------------ --------- ------------
BALANCE AT SEPTEMBER 30, 1997 2,980,939 $ 11,536,339 $ 23,127,097 $ 59,143 $ 34,722,579
--------- ------------ ------------ --------- ------------
--------- ------------ ------------ --------- ------------
</TABLE>
See notes to consolidated financial statements
6
<PAGE>
BSM BANCORP AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION AND MANAGEMENT REPRESENTATION
BSM Bancorp (the "Company") was incorporated on November 12, 1996, for the
sole purpose of becoming a bank holding company for Bank of Santa Maria (the
"Bank"). Following regulatory consent and with the approval of the Bank's
shareholders, the Bank merged with BSM Merger Company (a wholly-owned
subsidiary of the Company) (the "Merger"), as of the close of business on
March 11, 1997 and thereby became a wholly-owned subsidiary of the Company.
As of December 31, 1996, the Company had only one shareholder and it had no
SEC nor Federal Reserve Bank reporting requirements. Following completion of
the Merger, the Company is required to file periodic reports under section
15(d) of the Exchange Act. A quarterly report on Form 10Q was filed on March
31, 1997, for the first time. As the Merger was recorded using the pooling
of interest method, restatement of prior balances was necessary to meet
accounting standards. Accordingly, the financial statements herein contain
balances prior to the actual existence of the Company which reflect what the
"consolidated" entity would have reported as restated for all acquisitions,
either recorded by pooling or purchase accounting.
The unaudited consolidated financial statements have been prepared in
accordance with generally accepted accounting principles and with the
instructions to Form 10-Q. On January 10, 1997, the Bank acquired El Camino
National Bank through an exchange of Bank stock. This acquisition was
accounted for by using the pooling of interest method. The annual report for
Bank of Santa Maria, although disclosing the merger, did not restate the 1996
financial numbers as the effect on the reported numbers was not deemed
material. Concurrently, the Bank was in the process of obtaining regulatory
approval to form the Company. While the management of BSM Bancorp believes
that the disclosures presented are sufficient to make the information not
misleading, reference should be made to the Bank's Annual Report for the year
ended December 31, 1996. Management had elected to include a CONSOLIDATED
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY to assist the reader in the
analysis of the Merger and the acquisition, both of which occurred during
the first quarter.
The accompanying consolidated balance sheets, statements of income,
statements of changes in shareholders' equity and statement of cash flows (as
restated for the acquisition of El Camino National Bank and the subsequent
Merger of the Bank of Santa Maria by the Company), reflect all material
adjustments necessary for fair presentation of the Company's financial
position as of September 30, 1997 and December 31, 1996 and the results of
operations for the nine months ended September 30, 1997 and 1996. All such
adjustments were of a normal recurring nature.
NOTE 2 - CAPITAL SECTION OF THE CONSOLIDATED BALANCE SHEET.
As explained in Note 1, BSM Bancorp acquired Bank of Santa Maria on March 11,
1997. Prior to that date, there were only 150 shares of BSM Bancorp Common
Stock outstanding. The Bank, as of December 31, 1996, as restated for the
acquisition of El Camino, was authorized to issue 25,000,000 shares of Common
Stock and had 2,973,481 outstanding.
NOTE 3 - EARNINGS PER SHARE
Earnings per common share are based upon weighted average number of shares
outstanding during the period plus shares issuable upon the assumed exercise
of outstanding common stock options rounded to the nearest 1,000 shares.
7
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
For the nine months ended September 30, 1997, the Company reported net income
of $2,992,000, or $.99 per share compared to a net income of $2,741,000, or
$.91 per share for the same nine month period in 1996. Earnings per share
for the third quarter of this year was up 22.6% to $.38 compared to $.30 for
the same period in 1996. The annualized return on average assets was 1.26%
for 1997 compared to 1.24% for 1996, as restated for the El Camino merger.
Annualized return on average shareholders' equity for 1997 and 1996 was
11.72% and 11.83% respectively.
FINANCIAL CONDITION
Total assets as of September 30, 1997, increased 4.5% to $335.8 million in
comparison to restated total assets of $321.4 million as of December 31,
1996. Comparable asset totals for the first nine months of 1996, recorded a
.4% increase after factoring out the purchase of approximately $29 million in
assets in conjunction with the May, 1996 Citizens acquisition. Cash and cash
equivalents increased by $4.0 million with funds provided by the operating
activities. Loans increased by $2.8 million during the first nine months of
1997, compared to a $6.0 million decline during the same period in 1996,
after factoring the purchase of approximately $18 million dollars in loans in
conjunction with the May, 1996 Citizens acquisition. The percentage of
increase was 1.6% for 1997, versus a decline of 3.7% for 1996.
Total investment dollars increased by 9.0% to $100.5 million as of September
30, 1997. The mix between securities held to maturity and available for sale
reflects the Company's policy to have a larger percentage of security
dollars available to meet liquidity needs. This was accomplished by
purchasing "available for sale" securities from the proceeds of maturing
"held to maturity" securities as well as investing the funds made available
from increasing deposit dollars. The increase in premises and equipment by a
net of $293,000 included the purchase of land adjacent to the Bank's main
office previously leased for employee parking, cost associated with the
purchase and refurbishing of the building used for the newly opened
Atascadero Branch, a $300,000 expenditure to upgrade the Bank's mainframe
computer offset by the sale of the Templeton Main Street Branch facilities.
The Bank's cash flow continued to benefit from several sales of other real
estate owned properties during the third quarter.
Deposits increased by $13.0 million during the first nine months of 1997,
versus virtually no increase during the same period in 1996, after factoring
in the purchase of approximately $29 million in deposits in conjunction with
the May 1996 Citizens acquisition. The percentage of increase was 4.5% for
1997, occurring primarily during the third quarter. The earlier decline
appears to attributable to be the runoff of deposit dollars associated with
the acquisition of El Camino National Bank in January of 1997 and the
acquisition of Citizens in May of 1996. A certain level of runoff was
anticipated by Company management.
The Bank, prior to its acquisition by the Company, paid semi-annual
dividends, a policy which was first implemented in mid 1996. During the
first quarter of 1996, the Directors of the Bank paid a $.20 per share annual
cash dividend which was augmented in August of 1996, with the first
semi-annual dividend of $.15 per share. In January of 1997, the Bank again
paid a $.15 per share cash dividend. The Company was the beneficiary of two
organizational dividends from the Bank during the first nine months of 1997.
A dividend in the amount of $150,000 payable on March 12, 1997 and a
dividend in the amount of $700,000 payable on August 17, 1997. With the
Company now fully organized, a $.20 per share cash dividend was declared in
July, 1997, payable on August 15, 1997. Both the Bank and the Company
maintain strong liquidity positions.
8
<PAGE>
RESULTS OF OPERATIONS
Interest income on loans was up by $752,000 in the first nine months of 1997,
compared with the same period during 1996. The increase in interest income
was primarily attributable to the increase in average outstanding loans,
which were up by $7.1 million. The effective yield increased only by
approximately 18 basis points. Approximately 70% of this positive variance
is due to the volume increase, primarily from the purchase of loans in
conjunction with the Citizens acquisition. There was also a difference
caused by the number of days during the respective first quarters which
accounts for approximately $45,000.
Interest income on investments, including Federal funds transactions,
increased by $470,000 during the first nine months of 1997 over the
comparable period in 1996. This increase, as with loans, was primarily
attributable to the increase in funds available for investment, which was up
by $11.0 million. The effective yield increased 2.5 basis points.
Approximately 96% of this positive variance is due to the volume increase
(primarily from the investible cash, $8.1 million), made available in
conjunction with the Citizens acquisition. There was also a difference
caused by the number of days during the respective first quarters which
accounts for approximately $14,000.
Interest expense on interest-bearing deposits were up by $328,000 in the
first nine months of 1997, compared with the first nine months of 1996. The
increase in interest expense was attributable to the increase in average
interest-bearing deposits which were up by $11.6 million. The effective rate
increased less than 2 basis points. The increase in the rate raised the
overall interest expense cost by about $22,000. There was also a difference
caused by the number of days during the respective first quarters which
accounts for approximately $21,000.
Net interest margin improved from 5.75% for the first nine months of 1996, to
5.82% for the same period in 1997. The provision for loan losses of $30,000
is sufficient to bring the allowance for loan losses to a balance considered
to be adequate to absorb potential losses in the portfolio. Management's
determination of the adequacy of the allowance is based upon a detailed
evaluation of the portfolio, current economic conditions and trends,
historical loan loss experience and other risk factors.
Noninterest income increased $254,000 or 10.96% to $2,576,000 as of September
30, 1997. While the effect of the mergers contributed to the increased
service fee base, fees from the sale of loans into the secondary market also
are reflected in the overall increase in 1997. Non interest expenses
increased $750,000 or 8.22% to $9,865,000 as of September 30, 1997.
Approximately 55% of this overall increase is related to increased salary
expense, due directly to the three additional operating branches reflected in
the first nine months of 1997. Two of these branches (Citizens Bank) were
acquired in May of 1996 and accounted for using purchase accounting. Salary
dollars are, therefore, not included in the 1996 reported numbers for the
first four months. The number of full-time equivalents, as restated for the
El Camino merger, was reported at 195 as of September 30, 1996, as well as
September 30, 1997. Also during the first nine months of 1997, the Bank
absorbed certain costs associated with the El Camino merger totaling
approximately $56,000, goodwill amortization from the Citizens acquisition
totaling $99,000, increased occupancy costs for the three additional
locations of approximately $67,000, as well as increased promotional expenses
associated with the El Camino merger and the opening of the Atascadero Branch
of approximately $33,000. There was also a writedown of $54,000 to one of
the Bank's OREO properties which occurred during the first nine months as
well as costs associated with the closure of the Main Street Branch in
Templeton. While some of these aforementioned expenses will be ongoing,
approximately $200,000 appear to be of a non-reoccurring nature. Excluding
these dollars would bring the percentage of increase in noninterest expenses
for the first nine months of 1997 (when compared to first half 1996), down to
6.0%, which is more in line with the increase in noninterest income.
9
<PAGE>
CAPITAL RESOURCES
The Company and its bank subsidiary are subject to risk-based capital
regulations adopted by the federal banking regulators. These guidelines are
used to evaluate capital adequacy and are based upon an institution's assets
risk profile and off-balance sheet exposures, such as unused loan commitments
and letters of credit. The following table sets forth the Company's and the
Bank's leverage and risk-based capital ratios at September 30, 1997:
(In thousands) COMPANY BANK
- ---------------------------------------------------------------------
Amount % Amount %
--------------------------------------------
LEVERAGE RATIO $ 32,952 10.18% $ 32,639 10.15%
Regulatory minimum $ 12,945 4.00% $ 12,868 4.00%
Excess $ 20,007 6.18% $ 19,771 6.15%
RISKED-BASED RATIOS
Tier 1 capital $ 32,952 15.05% $ 32,639 14.90%
Tier 1 minimum $ 8,758 4.00% $ 8,762 4.00%
Excess $ 24,194 11.05% $ 23,877 10.90%
Total capital $ 35,191 16.07% $ 34,878 15.92%
Total capital minimum $ 17,517 8.00% $ 17,523 8.00%
Excess $ 17,674 8.07% $ 17,355 7.92%
The management of the Company is not aware of any trends, events,
uncertainties or recommendations by regulatory authorities that will have or
that are reasonably likely to have material effect on the liquidity, capital
resources or operations of the Company.
10
<PAGE>
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
A) Exhibits
Exhibit No. Exhibit
---------------------------------------------------------------------------
2.1 Plan of Reorganization and Merger Agreement - Annex 1 of
Written Consent Statement/Prospectus*
3.1 Articles of Incorporation of Registrant*
3.2 Amendment to Articles of Incorporation of Registrant*
3.3 Amendment to Articles of Incorporation of Registrant*
3.4 Bylaws of the Registrant*
10.1 Form of Indemnification Agreement*
10.2 BSM Bancorp 1996 Stock Option agreement as approved by
California Department of Corporations**
10.3 Form of Written Consent*
10.4 Nipomo Branch Land Lease*
10.5 Lompoc Branch Lease*
10.6 Form of "Change in Control" Employment Contract**
27 Financial Data Schedule (for SEC use only)
*All documents listed are incorporated by reference and can be found
in the Registration Statement of the Company filed on Form S-4.
**This exhibit is contained in BSM Bancorp's Quarterly Report on Form
10-Q for the period ended March 31, 1997, filed with the Commission
on May 15, 1997 (Commission File No. 333-16951), and incorporated
by reference.
B) Reports on Form 8-K
There were no reports on Form 8-K during the nine months ended
September 30, 1997.
11
<PAGE>
SIGNATURES
Pursuant to the requirement 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.
BSM Bancorp
(Registrant)
/s/ William A. Hares
Date: October 27, 1997 William A. Hares
President and
Chief Executive Officer
/s/ F. Dean Fletcher
Date: October 27, 1997 F. Dean Fletcher
Executive Vice President
and Chief Financial Officer
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 18,483,726
<INT-BEARING-DEPOSITS> 231,166,725
<FED-FUNDS-SOLD> 17,074,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 43,887,311
<INVESTMENTS-CARRYING> 56,620,480
<INVESTMENTS-MARKET> 56,728,847
<LOANS> 181,757,346
<ALLOWANCE> (2,239,520)
<TOTAL-ASSETS> 335,829,386
<DEPOSITS> 299,268,587
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,838,220
<LONG-TERM> 0
0
0
<COMMON> 11,536,339
<OTHER-SE> 23,186,240
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<INTEREST-INVEST> 4,063,701
<INTEREST-OTHER> 459,404
<INTEREST-TOTAL> 18,424,373
<INTEREST-DEPOSIT> 6,228,045
<INTEREST-EXPENSE> 6,228,045
<INTEREST-INCOME-NET> 12,196,328
<LOAN-LOSSES> 30,000
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<EXPENSE-OTHER> 9,865,193
<INCOME-PRETAX> 4,877,085
<INCOME-PRE-EXTRAORDINARY> 4,877,085
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<EPS-PRIMARY> .99
<EPS-DILUTED> .99
<YIELD-ACTUAL> 5.45
<LOANS-NON> 850,155
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<ALLOWANCE-DOMESTIC> 2,239,520
<ALLOWANCE-FOREIGN> 0
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</TABLE>
