U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
--------------------
FORM 10-QSB
[X] Quarterly report under Section 13 or 15 (d) of the Securities Exchange
Act of 1934
For the period ended September 30, 1999
or
[ ] Transition report under Section 13 or 15(d) of the Exchange Act For the
transition period from ________ to ________
Commission file number: 333-17317
MICHIGAN HERITAGE BANCORP, INC.
(Exact name of small business issuer as specified in its charter)
Michigan 38-3318018
-------- ----------
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification no.)
21211 Haggerty Road, Novi, MI 48375-5306
----------------------------------------
(Address of principal executive offices)
248-380-6590
------------
(Issuer's telephone number, including area code)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes: [X] No: [ ]
At November 9, 1999, there were 1,488,765 shares of Common Stock of the
issuer issued and outstanding.
Traditional Small Business Disclosure Format (check one): Yes: [ ] No: [X]
PART I--FINANCIAL INFORMATION
Item 1. Financial Statements
Michigan Heritage Bancorp, Inc.
Consolidated Balance Sheets
September 30, 1999 and September 30, 1998
(000s omitted)
(Unaudited)
September 30, September 30,
1999 1998
------------- -------------
ASSETS
Cash and due from banks, noninterest bearing $ 1,948 $ 494
Interest bearing deposits with banks 5,391 2,286
Federal funds sold 8,300 5,200
--------- ---------
Cash and cash equivalents 15,639 7,980
U.S. Treasury and agency securities 4,922 13,958
Other securities and stock 296 1,237
--------- ---------
Total investments 5,218 15,195
Loans, gross 79,570 63,120
Less: allowance for loan losses 1,627 847
--------- ---------
Net loans 77,943 62,273
Leasehold improvements, net 91 29
Furniture & equipment, net 587 390
Operating lease equipment, net 1,535 2,598
--------- ---------
Total fixed assets 2,213 3,017
Accrued interest receivable 402 687
Other assets 709 355
--------- ---------
Total other assets 1,111 1,042
--------- ---------
Total assets $ 102,124 $ 89,507
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Total deposits $ 91,349 $ 78,618
Other liabilities 452 516
--------- ---------
Total liabilities 91,801 79,134
Stockholders' Equity
Preferred stock--no par value;
500,000 shares authorized, none issued 0 0
Common stock--no par value;
4,500,000 shares authorized, shares issued
and outstanding--1,265,000 shares 12,482 12,482
Retained deficit (2,105) (2,082)
Accumulated other comprehensive loss (54) (27)
--------- ---------
Total stockholders' equity 10,323 10,373
--------- ---------
Total liabilities and stockholders'
equity $ 102,124 $ 89,507
========= =========
Total loan loss reserve ratio 2.04% 1.34%
Total loan to deposit ratio 87% 80%
-2-
Michigan Heritage Bancorp, Inc.
Consolidated Statement of Earnings
Three and Nine Month Periods Ended
September 30, 1999 and 1998
(000s omitted except per share data)
(Unaudited)
Three Months Nine Months
Ended Sept. 30, Ended Sept. 30,
--------------- ---------------
1999 1998 1999 1998
------ ------ ------ ------
OPERATING INCOME:
Interest income $2,051 $1,739 $6,261 $4,213
Interest expense 1,224 1,071 3,723 2,485
------ ------ ------ ------
Net interest income before
provision for loan losses 827 668 2,538 1,728
Less: provision for loan losses 5 155 614 380
------ ------ ------ ------
Net interest income after
provision for loan losses 822 513 1,924 1,348
Operating lease income 309 206 927 206
Gain on sale of loans 31 0 247 0
Other income 26 5 77 35
------ ------ ------ ------
Total other operating income 366 211 1,251 241
------ ------ ------ ------
Total operating income 1,188 724 3,175 1,589
OTHER OPERATING EXPENSES:
Salaries and employee benefits 327 229 934 619
Occupancy expense 40 25 102 57
Equipment expense 309 209 925 261
Data processing expense 16 16 44 34
Insurance expense 6 5 17 13
Advertising/promotion expense 45 39 101 108
Office supplies and printing expense 8 7 25 16
Professional fees 67 47 203 105
Provision for other asset losses expense 137 0 137 0
Organization amortization expense 0 6 0 19
Other expense 64 35 163 100
------ ------ ------ ------
Total other operating expense 1,019 618 2,651 1,332
------ ------ ------ ------
Net operating income 169 106 524 257
Provision for federal income taxes 58 0 179 0
------ ------ ------ ------
Net income $ 111 $ 106 $ 345 $ 257
====== ====== ====== ======
Per Common Share Data:*
Net income per primary share $ 0.09 $ 0.08 $ 0.27 $ 0.20
Net income per fully diluted share $ 0.09 $ 0.08 $ 0.27 $ 0.19
* Per share amounts have been restated for 1998
to reflect a 10% stock dividend declared on April 16, 1998.
-3-
Michigan Heritage Bancorp, Inc.
Consolidated Statement of Cash Flow
Nine Month Periods Ended September 30, 1999 and 1998
(000s omitted)
(Unaudited)
Nine Months Ended
September 30,
--------------------
1999 1998
-------- --------
Operating activities:
Net income $ 345 $ 257
Adjustments to reconcile net income to net
cash provided in operating activities:
Discount accretion and premium
amortization of investment securities 8 97
Provision for loan losses 614 380
Depreciation 915 250
(Increase) decrease in other assets 95 (574)
Decrease in other liabilities (370) (49)
-------- --------
Net cash provided by operating activities 1,607 361
Investing activities:
Purchase of U.S. Treasury and agency securities (10,000) (19,120)
Proceeds from matured or called U.S. Treasury
and agency securities 13,000 13,600
Proceeds from other securities sold -- 4,000
Purchase of Federal Reserve Bank and other stock (57) --
Purchase of leasehold improvements, furniture
and equipment (342) (2,883)
Net change in gross loans 1,228 (30,515)
-------- --------
Net cash provided (used) by investing
activities 3,829 (34,918)
Financing activities:
Increase in deposits 3,695 37,890
Decrease in borrowed funds (1,750) --
-------- --------
Net cash provided by financing activities 1,945 37,890
-------- --------
Increase in cash and cash equivalents 7,381 3,333
Cash and cash equivalents at beginning of year 8,258 4,647
-------- --------
Cash and cash equivalents at end of period $ 15,639 $ 7,980
======== ========
-4-
<TABLE>
<CAPTION>
Michigan Heritage Bancorp, Inc.
Consolidated Statement of Changes in Stockholders' Equity
December 31, 1996 to September 30, 1999
(000s omitted)
(Unaudited)
Accumulated
Other
Comprehensive
Common Retained Income
Shares Stock Deficit (Loss) Total
------ ------- --------- ------------ -------
<S> <C> <C> <C> <C> <C>
December 31, 1996 1 $ -- $ (68) $ -- $ (68)
Issuance of common stock,
net of offering costs 1,150 10,815 -- -- 10,815
Retirement of initial share (1) -- -- -- --
Comprehensive loss--net loss -- -- (602) -- (602)
----- ------- ------- ------ -------
Balance-December 31, 1997 1,150 10,815 (670) -- 10,145
Comprehensive loss:
Net loss -- -- (113) -- (113)
Change in net unrealized gain
on securities available for
sale, net of tax effect -- -- -- 9 9
-------
Total comprehensive loss (104)
Stock dividend paid 115 1,667 (1,667) -- --
----- ------- ------- ------ -------
Balance-December 31, 1998 1,265 12,482 (2,450) 9 10,041
Comprehensive income:
Net income -- -- 345 -- 345
Change in net unrealized gain
on securities available for
sale, net of tax effect -- -- -- (63) (63)
-------
Total comprehensive income 282
----- ------- ------- ------ -------
Balance-September 30, 1999 1,265 $12,482 $(2,105) $ (54) $10,323
===== ======= ======= ====== =======
</TABLE>
-5-
Michigan Heritage Bancorp, Inc.
Notes to Financial Statements
September 30, 1999
(Unaudited)
Item 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization:
Michigan Heritage Bancorp, Inc. (the "Company") was incorporated in the State
of Michigan on September 22, 1989. The Company was inactive from that time
until its Articles of Incorporation were amended on November 6, 1996 into its
current form. The Company is a bank holding company whose primary purpose is
to own and operate Michigan Heritage Bank (the "Bank") as the Bank's sole
stockholder. Organizational and other start-up costs were funded with loans
from organizers. Proceeds from the Company's initial public offering were
primarily used to capitalize the Bank which is currently headquartered in
Novi, Michigan. The Company completed an initial public offering of common
stock during the first quarter of 1997, realizing a total of $10.9 million
(after payment of underwriters' commissions and offering expenses). During
the fourth quarter of 1999, the Company competed a rights offering to
existing shareholders raising $1.3 million in additional capital after
payment of offering expenses. The consolidated financial statements of the
Company include its only subsidiary, the Bank. The quarter ended September
30, 1999 was the Bank's tenth full quarter of operation. All adjustments,
which in the opinion of management are necessary in order to ensure that the
interim unaudited financial statements are not misleading, have been
included.
Basis of Presentation:
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the amounts reported in the financial statements. Actual results
could differ from those estimates and assumptions.
-6-
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
PRELIMINARY NOTE: The Company wishes to caution readers not to place undue
reliance on any "forward-looking statements" contained in the following
discussion and advises readers that various factors, including regional and
national economic conditions, substantial changes in levels of market
interest rates, credit and other risks of lending and investment activities
and competitive and regulatory factors, could affect the Company's financial
performance and could cause the Company's actual results for future periods
to differ materially from those anticipated or projected. The Company does
not undertake, and specifically disclaims any obligation, to update any
forward-looking statements to reflect occurrences or unanticipated events or
circumstances after the date of such statements.
The Company experienced its sixth quarter of positive earnings with net
income of $111,000 for the quarter ending September 30, 1999 which is only
the tenth full quarter of operations for the Company. Total assets at the end
of the quarter were $102,124,000, a 12-month increase of $12,617,000 from the
$89,507,000 of total assets at September 30, 1998. Total loans outstanding
grew to $79,570,000 which is a 12-month increase of $16,450,000. Loan growth
was funded primarily by a $12,731,000 increase in deposits, resulting in
total outstanding deposits of $91,349,000 at September 30, 1999. Additional
loan growth came from a $2,318,000 net reduction in investments and cash and
cash equivalents.
Results for the Quarters Ended September 30, 1999 and 1998
The $111,000 net income for the quarter ended September 30, 1999 increased
$5,000 over the same quarter last year. Net interest income before allowances
for loan losses increased $159,000 to $827,000 primarily due to volume
increases in earning assets. Provision for loan losses decreased $150,000 to
$5,000. The loan loss reserves were increased during the first and second
quarter of 1999 to address increases in specific loan classifications. During
the third quarter of 1999, the loan portfolio decreased $908,000 due
primarily to loan sales and there was a $68,000 loan recovery previously
charged-off in the first quarter of this year. Other operating income
increased by $155,000 due mostly to a $103,000 increase in operating lease
income resulting from a $2,775,000 operating lease recorded during the third
quarter of 1998. There was also a $31,000 gain on sale of loans in the third
quarter of 1999 as compared to no loan sales in the same quarter last year.
Other miscellaneous income increased by $21,000 over the quarter ended
September 30, 1998 due primarily to a $19,000 increase in loan participation
and servicing fee income. Other operating expense increased by $401,000.
Salaries and employee benefits increased by $98,000 due to additional
employees and salary increases. Occupancy expense increased by $15,000
primarily due to the opening of a bank branch in January 1999 and temporary
additional office space acquired during the third quarter of 1998. Equipment
expense increased by $100,000 due mostly to 3 months of operating lease
equipment depreciation expense of $89,000 per month during the third quarter
this year as compared to only 2 months of depreciation for the third quarter
last year. Professional fees increased by $20,000 due mostly to additional
legal fees addressing primarily loan related issues. Provision for other
asset losses expense was $137,000 for the quarter ended September 30, 1999 to
adjust repossessed loan collateral to market value. There was no provision
for other asset losses for the same quarter last year. Telephone and FDIC
expense went up $9,000 and $8,000, respectively. Remaining expenses increased
a net $14,000.
The resulting income before federal income tax increased by $63,000 for the
same time period. Federal income tax was $58,000 for the third quarter of
1999. There was no federal income tax for the same quarter in 1998 as the
Company had a net operating loss carryforward.
Net income per average primary share outstanding was $0.09 for the quarter
ended September 30, 1999 compared to $0.08 for the same quarter in 1998. On a
fully diluted basis, net income per share was also $0.09 for the quarter
ended September 30, 1999 compared to $0.08 for the quarter ended September
30, 1998.
Results for the Nine Months Ended September 30, 1999 and 1998
The $345,000 net income for the nine-month period ended September 30, 1999
increased by $88,000 over the same period last year. Net interest income
before allowances for loan losses increased by $810,000 to $2,538,000
primarily due to volume increases in earning assets. Provision for loan
losses increased by $234,000 to $614,000 primarily due to additional reserves
for specific allocations. Other operating income increased by $1,010,000 due
mostly to operating lease income of $927,000 which was a $721,000 increase
over this quarter last year. The $2,775,000 operating lease was recorded
during the third quarter of 1998. In addition, there was a $247,000 gain on
-7-
<PAGE>
loans sold in 1999--there were no loan sales in 1998. Other income increased
by $42,000 primarily due to loan participation fees and servicing income.
Other operating expense increased by $1,319,000. Salaries and employee
benefits increased by $315,000 due to additional employees and salary
increases. Occupancy expense increased by $45,000 primarily due to the
opening of a bank branch in January 1999 and temporary additional office
space acquired during the third quarter of 1998. Equipment expense increased
by $664,000 due mostly to a $620,000 increase in operating lease equipment
depreciation expense. Regular bank equipment depreciation expense increased
$34,000 and equipment maintenance increased $7,000. Data processing expense
increased $10,000 primarily due to additional accounts and Y2K testing.
Advertising and promotion expense decreased by $7,000 due to reductions in
both radio and newspaper advertising in 1999. Office supplies and printing
increased $9,000 due to increases in both supplies and printing expense.
Professional fees increased by $98,000 due mostly to additional legal fees of
$70,000 addressing primarily loan issues relating to Mortgage Corporation of
America ("MCA") and additional operating lease broker fees of $23,000
relating to the $2,775,000 operating lease recorded during the third quarter
of 1998. Provision for other asset losses expense was $137,000 for the
nine-month period ended September 30, 1999 to adjust repossessed loan
collateral to market value. There was no provision for other asset losses for
the same period last year. Remaining expenses increased by a net $48,000,
which includes a $30,000 increase in telephone expense primarily due to
additional locations and an increase of $11,000 in FDIC insurance expense.
The resulting income before federal income tax increased by $267,000 for the
same time period. Federal income tax was $179,000 for the first nine months
of 1999. There was no federal income tax for the same period in 1998 as the
Company had a net operating loss carryforward.
Net income per average primary share outstanding was $0.27 for the nine
months ended September 30, 1999 compared to $0.20 for the same period in
1998. On a fully diluted basis, net income per share was $0.27 for the nine
months ended September 30, 1999 compared to $0.19 for the nine months ended
September 30, 1998.
Loans and Allowances for Loan Losses
The categories of loans outstanding at September 30, 1999 in dollars and as a
percentage of total loans outstanding are as follows
(000s omitted for dollars)
Percentage
of total
Loan Category Amount loans
------ ----------
Commercial, financial and agricultural $72,112 90.6%
Real estate-construction 315 0.4%
Real estate-mortgage 6,036 7.6%
Installment loans to individuals 136 0.2%
Lease financing 971 1.2%
------- -----
Total loans $79,570 100.0%
======= =====
Note: There were no agricultural loans as of September 30, 1999.
There were $620,000 in loans charged off during the first quarter of 1999
against specific reserves previously allocated in 1998 and an additional
$247,000 charged off during the second quarter of 1999. These charged off
loans are primarily related to MCA, which filed for protection under the
bankruptcy laws during the first quarter of 1999. Management is continually
working diligently to protect the Bank's rights and to minimize net
charge-offs resulting from the MCA situation. Remaining MCA related loans of
$353,000 transferred to other assets were netted out of proceeds received
from the sale of collateral controlled by Michigan Heritage Bank and residual
balances charged off. There were no charge-offs prior to 1999. There was a
$4,000 charge-off during the third quarter of 1999. Also during the third
quarter of 1999 there was a $68,000 MCA related loan recovery.
As of September 30, 1999, management allocated $306,000 in specific reserves
for a $1,531,000 series of lease financing loans made to a major national
hospital company. The financial condition of this company has deteriorated
primarily due
-8-
to changes in government reimbursement policies resulting from the Balanced
Budget Act of 1997. At this time, the company has made full and timely
payment on the loans. Michigan Heritage Bank has received assurances from the
company that the collateral underlying the loans is critical to its
operations and that it will continue to make full and timely payments. In
addition, under the terms of the loans, portions of the outstanding balances
are now guaranteed by the manufacturer of the collateral. The manufacturer
may guarantee additional portions after the passage of a certain amount of
time. Despite these guarantees and the fact that none of the loans are past
due, management reclassified these loans as substandard and allocated
appropriate reserves. Additional specific reserves of $307,000 have also been
allocated for various other loans.
The loan portfolio overall 12-month increase from September 30, 1998 to
September 30, 1999 of $16,450,000 or 26%, has not increased the proportionate
level of credit risk in the loan portfolio, although more funds are at risk
given that the aggregate size of the loan portfolio has increased. Management
continues to strengthen the credit underwriting and approval processes in
anticipation of a future economic downturn. Management believes that the
level of risk in the current loan portfolio is, on a relative basis, no
greater than in the past.
At September 30, 1999 there were no non-accruing loans. There were $1,041,000
in accruing loans past due 30 days or more: $598,000 past due 30 to 59 days,
$227,000 past due 60 to 89 days and $216,000 past due 90 days or more. Of
these loans, $564,000 were mortgages originally serviced by MCA. No servicing
of the loans took place during the first quarter of 1999 due to MCA filing
for protection under the bankruptcy laws. Bank management transferred the
servicing of those mortgages to another mortgage servicing company in April
1999. Management fully expects that diligent servicing of these mortgages
will minimize delinquencies.
Total loan reserves of $1,627,000 at September 30, 1999 were 2.04% of total
loans, which included $613,000 in specific allowances. The following
highlights the allocations of allowances for loan losses as of September 30,
1999.
(000s omitted for dollars)
Percent of
Loan loss loan loss
allowance Loan amounts allowance to
amount outstanding loan amounts
--------- ------------ ------------
Domestic:
Commercial, financial and
agricultural $ 1,301 $72,112 1.80%
Real estate-construction 4 315 1.25%
Real estate-mortgage 245 6,036 4.06%
Installment loans to individuals 2 136 1.25%
Lease financing 12 971 1.25%
Foreign -- -- 0.00%
Off-balance sheet items and
Y2K issues 63 -- n/a
------- ------- -----
Total $ 1,627 $79,570 2.04%
======= ======= =====
In management's opinion, the total loan reserve position is adequate relative
to the overall quality of the loan portfolio.
-9-
Financial Condition
Michigan Heritage Bank's current cash projections as of September 30, 1999
indicate adequate cash balances. The Bank has additional line of credit
facilities with national lending institutions to add funding capacity. Bank
management also has established a network of banks that can be used to sell
or participate a portion of the Bank's loan portfolio. These techniques allow
the Bank to service its business relationships and generate fee and servicing
revenue.
The Company's liquidity remained adequate during the 12-month period ended
September 30, 1999. Michigan Heritage Bancorp had $15,639,000 in cash and
cash equivalents as of September 30, 1999 including $5,391,000 in interest
bearing deposits in other banks and $8,300,000 in Federal funds sold. The
investment securities portfolio, with a total book value of $5,218,000, has
$3,966,000 in securities maturing during the fourth quarter of 1999. In
addition, the Bank has proven its ability to attract deposits and build a
stable deposit base from which to fund loans.
Michigan Heritage Bank is subject to various regulatory capital requirements
and as a "de novo" or start-up bank, the minimum for the Tier 1 leverage
capital ratio is 9.0%. Normally, to be considered adequately capitalized,
Michigan Heritage Bank must maintain a Tier 1 leverage capital ratio of 4.0%.
The Bank's Tier 1 leverage capital ratios were 9.7% and 11.1% at September
30, 1999 and 1998, respectively. Michigan Heritage Bank plans to maintain at
least a 9.0% Tier 1 leverage capital ratio throughout its de novo status and
to remain well-capitalized thereafter.
Year 2000 Readiness
The Bank, being a new business, does not have major issues concerning older
systems to update. All applicable components of both the Company and the Bank
have been identified and addressed as to being Y2K compliant. In addition,
the Company has completed its Business Resumption Contingency Plan (the
"BRCP") and has successfully completed various phases of testing the BRCP.
Additional BRCP testing is scheduled to be completed during the fourth
quarter of 1999 to ensure that all areas have been addressed.
The cost to become fully Y2K compliant for both the Company and the Bank was
not material. In addition, the Bank is communicating with both vendors and
appropriate customers concerning Y2K compliance to help ensure their smooth
transition into the next century.
Common Stock Offering
The Company completed a rights offering to existing shareholders in October
1999. Up to 500,000 shares of common stock were offered for sale in order to
contribute additional capital to Michigan Heritage Bank. The shares were
offered for a limited period of time exclusively to shareholders of Michigan
Heritage Bancorp, Inc. at $6.00 per share. Shareholders were entitled to
purchase one share for each three shares they owned on July 14, 1999. The
common stock offering to existing shareholders began on July 30, 1999 and
ended on October 1, 1999. A total of 223,765 shares of common stock were sold
resulting in $1.3 million in additional capital after payment of offering
expenses. The number of shares of common stock now outstanding after the
rights offering is 1,488,765.
-10-
PART II--OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit Description
- ------- -----------
27 Financial Data Schedule (EDGAR filing only)
(b) Reports on Form 8-K
No reports on Form 8-K have been filed during the quarter for
which this report is filed.
-11-
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MICHIGAN HERITAGE BANCORP, INC.
By: /s/ Anthony S. Albanese
_____________________________________
Anthony S. Albanese
President and Chief Operating Officer
And: /s/ Darryle J. Parker
_____________________________________
Darryle J. Parker
Secretary, Treasurer, and
Chief Financial Officer
(Duly authorized officer)
DATED: November 9, 1999
-12-
EXHIBIT INDEX
Exhibit Description
- ------- -----------
27 Financial Data Schedule (EDGAR filing only)
-13-
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,948
<INT-BEARING-DEPOSITS> 5,391
<FED-FUNDS-SOLD> 8,300
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 5,218
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 79,570
<ALLOWANCE> 1,627
<TOTAL-ASSETS> 102,124
<DEPOSITS> 91,349
<SHORT-TERM> 0
<LIABILITIES-OTHER> 452
<LONG-TERM> 0
0
0
<COMMON> 12,482
<OTHER-SE> (2,159)
<TOTAL-LIABILITIES-AND-EQUITY> 102,124
<INTEREST-LOAN> 5,654
<INTEREST-INVEST> 607
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 6,261
<INTEREST-DEPOSIT> 3,723
<INTEREST-EXPENSE> 3,723
<INTEREST-INCOME-NET> 2,538
<LOAN-LOSSES> 614
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2,651
<INCOME-PRETAX> 524
<INCOME-PRE-EXTRAORDINARY> 524
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 345
<EPS-BASIC> 0.27
<EPS-DILUTED> 0.27
<YIELD-ACTUAL> 3.46
<LOANS-NON> 0
<LOANS-PAST> 216
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 100
<ALLOWANCE-OPEN> 1,816
<CHARGE-OFFS> 871
<RECOVERIES> 68
<ALLOWANCE-CLOSE> 1,627
<ALLOWANCE-DOMESTIC> 613
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,014
</TABLE>
