U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998
Commission File Number: 000-23909
PINNACLE BANKSHARES CORPORATION
(Exact name of small business issuer as specified in its charter)
VIRGINIA 54-1832714
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
P.O. Box 29
Altavista, Virginia 24517
(Address of principal executive offices)
(804) 369-3000
(Issuer's telephone number, including area code)
Check whether the issuer (1) has 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 July 14, 1998, 719,025 shares of Pinnacle Bankshares Corporation's common
stock, $3 par value, were outstanding.
Transitional small business disclosure format: Yes No x .
<PAGE>
PINNACLE BANKSHARES CORPORATION
FORM 10-QSB
JUNE 30, 1998
INDEX
Part I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1998
and December 31, 1997 3
Consolidated Statements of Income for the three
month periods ended June 30, 1998 and 1997 4
Consolidated Statements of Income for the six
month periods ended June 30, 1998 and 1997 5
Consolidated Statements of Cash Flows for the six
month periods ended June 30, 1998 and 1997 6
Notes to Consolidated Financial Statements 7-9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation 10
Part II. OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 4. Submission of Matters to a Vote of
Security Holders 15
Item 6. Exhibits and Reports on Form 8-K 16
SIGNATURES
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
PINNACLE BANKSHARES CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Amounts in thousands of dollars)
<TABLE>
<CAPTION>
ASSETS June 30, 1998 December 31, 1997
- ------ ------------- -----------------
<S> <C>
Cash and cash equivalents: (note 2)
Cash and due from banks $2,545 $3,304
Federal funds sold 3,431 3,387
----- -----
Total cash and cash equivalents 5,976 6,691
Securities (note 3):
Available-for-sale, at fair value 21,089 22,039
Held-to-maturity, at amortized cost 13,546 10,701
Federal Reserve Bank stock, at cost 75 75
Federal Home Loan Bank Stock, at cost 409 409
Loans, net (note 4) 84,796 86,816
Bank premises and equipment, net 3,660 3,158
Other real estate owned 151
Accrued income receivable 1,118 1,045
Other assets 703 565
--- ---
Total assets $131,372 $131,650
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Demand 9,976 9,524
Savings and NOW accounts 36,931 37,104
Time 67,750 68,905
------ ------
Total deposits 114,657 115,533
Note payable to Federal Home Loan Bank 950 1,000
Accrued interest payable 551 534
Other liabilities 647 541
Total liabilities 116,805 117,608
-------- -------
Stockholders' equity:
Common stock, $3 par value. Authorized 3,000,000 shares,
issued and outstanding 719,025 shares in 1998 and 1997 2,157 2,157
Capital surplus 338 338
Retained earnings 11,934 11,409
Accumulated other comprehensive income 138 138
------- ------
Total stockholders' equity 14,567 14,042
Total liabilities and stockholders' equity $131,372 $131,650
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
PINNACLE BANKSHARES CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Amounts in thousands of dollars, except for per share amounts)
<TABLE>
<CAPTION>
For Three Months For Three Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
<S> <C>
Interest Income:
Interest and fees on loans $1,983 $1,931
Interest on securities:
U.S. Treasury 57 64
U.S. Government agencies 252 286
Corporate 53 43
States and political subdivisions (tax exempt) 139 130
Other 28 20
Interest on federal funds sold 103 16
--- --
Total interest income 2,615 2,490
----- -----
Interest expense:
Interest on deposits:
Savings and NOW accounts 281 279
Time - other 834 780
Time - $100,000 and over 169 122
Other interest expense 15 5
-- -
Total interest expense 1,299 1,186
----- -----
Net interest income 1,316 1,304
Provision for loan losses 75 150
-- ---
Net interest income after provision for loan losses 1,241 1,154
Noninterest income:
Service charges on deposit accounts 67 63
Net gain(loss) on calls and sales of securities 3 --
Other operating income 46 38
-- --
Total noninterest income 116 101
--- ---
Noninterest expense:
Salaries and employee benefits 468 407
Occupancy expense 44 24
Furniture and equipment 75 79
Other operating expenses 232 204
--- ---
Total noninterest expense 819 714
--- ---
Income before income tax expense 538 541
Income tax expense 160 149
--- ---
Net income $378 $392
==== ====
Net income per share (note 5) $0.53 $0.55
===== =====
See accompanying notes to consolidated financial statements.
</TABLE>
4
<PAGE>
PINNACLE BANKSHARES CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Amounts in thousands of dollars, except for per share amounts)
<TABLE>
<CAPTION>
For Six Months For Six Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
<S> <C>
Interest Income:
Interest and fees on loans $3,979 $3,802
Interest on securities:
U.S. Treasury 115 129
U.S. Government agencies 498 582
Corporate 98 86
States and political subdivisions (tax exempt) 268 266
Other 43 32
Interest on federal funds sold 198 46
--- --
Total interest income 5,199 4,943
----- -----
Interest expense:
Interest on deposits:
Savings and NOW accounts 564 555
Time - other 1,646 1,554
Time - $100,000 and over 336 260
Other interest expense 30 5
-- -
Total interest expense 2,576 2,374
----- -----
Net interest income 2,623 2,569
Provision for loan losses 150 210
--- ---
Net interest income after provision for loan losses 2,473 2,359
Noninterest income:
Service charges on deposit accounts 129 124
Net gain(loss) on calls and sales of securities 4 4
Other operating income 104 85
--- --
Total noninterest income 237 213
--- ---
Noninterest expense:
Salaries and employee benefits 926 815
Occupancy expense 79 48
Furniture and equipment 149 158
Other operating expenses 467 399
--- ---
Total noninterest expense 1,621 1,420
----- -----
Income before income tax expense 1,089 1,152
Income tax expense 320 318
--- ---
Net income $769 $834
==== ====
Net income per share (note 5) $1.07 $1.16
===== =====
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE>
PINNACLE BANKSHARES CORPORATION
CONSOLIDATED STATEMENTS ON CASH FLOWS
(Unaudited)
(Amounts in thousands of dollars)
<TABLE>
<CAPTION>
For Six Months For Six Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
<S> <C>
Cash flows from operating activities:
Net income $769 $834
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation of bank premises and equipment 99 106
Amortization of core deposit premium 7 8
Amortization of organization costs 3 1
Amortization of net unearned fees (65) (50)
Net amortization (accretion) of premiums and
discounts on securities 11 3
Provision for loan losses 150 210
Provision for deferred income taxes (39) 52
Net (gain) loss on sale of premises and equipment (6) ---
Net (gain) loss on calls and sales of securities (4) (4)
Net (increase) decrease in:
Accrued income receivable (73) 32
Other assets (76) (174)
Net increase (decrease) in:
Accrued interest payable 17 (35)
Other liabilities 106 (18)
--- ---
Net cash provided by operating activities 899 965
=== ===
Cash flows from investing activities:
Purchases of held-to-maturity securities (3,386) ---
Purchases of available-for-sale securities (7,003) (217)
Proceeds from maturities and calls of held-to-maturity securities 541 573
Proceeds from sale, maturities and calls of available-for-sale
securities 7,946 1,440
Purchase of Federal Home Loan Bank stock --- (6)
Net (increase) decrease in loans 1,843 (4,038)
Recoveries on loans charged off 59 81
Increase in federal funds purchased --- 644
Purchases of bank premises and equipment (605) (480)
Proceeds from sale of bank premises and equipment 10 ---
Sale of and rent payments on other real estate owned 151 6
--- ------
Net cash used in investing activities (444) (1,997)
==== ======
Cash flows from financing activites:
Net increase (decrease) in demand, savings and NOW deposits 279 (62)
Net decrease in time deposits (1,155) (1,059)
Dividends paid (244) (236)
Repayment of note payable to Federal Home Loan Bank (50) ---
--- ------
Net cash used by financing activities (1,170) (1,357)
====== ======
Net increase in cash and cash equivalents (715) (2,389)
Cash and cash equivalents, beginning of period 6,691 5,744
----- -----
Cash and cash equivalents, end of period $5,976 $3,355
====== ======
See accompanying notes to consolidated financial statements.
</TABLE>
6
<PAGE>
PINNACLE BANKSHARES CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
(IN THOUSANDS, EXCEPT FOR SHARE DATA)
(1) GENERAL
The consolidated financial statements include the accounts of Pinnacle
Bankshares Corporation (the "Company") and its wholly-owned subsidiary, The
First National Bank of Altavista (the "Bank"). All material intercompany
accounts and transactions have been eliminated. The consolidated financial
statements conform to generally accepted accounting principles and to general
banking industry practices. In the opinion of the Company's management, the
accompanying unaudited consolidated financial statements contain all adjustments
of a normal recurring nature, necessary to present fairly the financial position
as of June 30, 1998, the results of operations for the three-month and six-month
periods ended June 30, 1998 and 1997, and cash flows for the six-month periods
ended June 30, 1998 and 1997.
These consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto included in Pinnacle
Bankshares Corporation's Annual Report for the year ended December 31, 1997.
The results of operations for the interim periods are not necessarily
indicative of the results to be expected for the full year ending December 31,
1998.
(2) CASH AND CASH EQUIVALENTS
For purposes of reporting cash flows, cash and cash equivalents include
cash on hand, amounts due from banks, interest-bearing deposits, and federal
funds sold.
(3) SECURITIES
The amortized costs, gross unrealized gains, gross unrealized losses, and
fair values for securities at June 30, 1998, are shown in the table below. As of
June 30, 1998, securities with amortized costs of $3,149 and fair values of
$3,216 were pledged as collateral for public deposits.
7
<PAGE>
(3) (CONTINUED)
Gross Gross
Amortized Unrealized Unrealized Fair
Available-for-Sale: Costs Gains Losses Values
U.S. Treasury securities
and obligations of U.S.
Government corporations
and agencies $ 10,699 58 ( 2) 10,755
Obligations of states and
political subdivisions 4,139 99 ( 1) 4,237
Mortgage-backed securities-
Government 5,425 60 ( 8) 5,477
Other securities 107 - - 107
Corporate securities 509 4 - 513
------------------------------------------------------------------
TOTALS $ 20,879 221 ( 11) 21,089
------------------------------------------------------------------
Gross Gross
Amortized Unrealized Unrealized Fair
Held-to-Maturity: Costs Gains Losses Values
U.S. Treasury securities
and obligations of U.S.
Government corporations
and agencies $ 3,407 16 ( 4) 3,419
Obligations of states and
political subdivisions 10,129 175 ( 60) 10,244
Mortgage-backed securities-
Private 10 - ( 1) 9
- ------------------------------------------------------------------------
TOTALS $ 13,546 191 ( 65) 13,672
------------------------------------------------------------------
(4) ALLOWANCE FOR LOAN LOSSES
Changes in the allowance for loan losses are as follows:
1998 1997
---- ----
Balance at January 1, $747 $674
Provision for loan losses 150 210
Loans charged off (141) (264)
Recoveries 59 81
---- ----
Balance at June 30, $815 $701
==== ====
(5) NET INCOME PER SHARE
Net income per share is based upon the weighted average number of common
stock shares outstanding during the period. Shares outstanding for all periods
presented were 719,025.
8
<PAGE>
(6) COMPREHENSIVE INCOME
In June 1997, the Financial Accounting Standards Board(FASB) issued
Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income." Statement 130 establishes standards for reporting and display of
comprehensive income and its components (revenues, expenses, gains and losses)
in a full set of general purpose financial statements. Statement 130 was issued
to address concerns over the practice of reporting elements of comprehensive
income directly in equity.
This statement requires all items that are required to be recognized under
accounting standards as components of comprehensive income be reported in a
financial statement that is displayed in equal prominence with the other
financial statements. It does not require a specific format for that financial
statement but requires that an enterprise display an amount representing total
comprehensive income for the period in that financial statement. Enterprises are
required to classify items of "other comprehensive income" by their nature in
the financial statement and display the accumulated balance of other
comprehensive income separately from retained earnings and additional paid-in
capital in the equity section of the balance sheet. It does not require per
share amounts of comprehensive income to be disclosed.
Statement 130 is effective for fiscal years beginning after December 15,
1997. Comparative financial statements provided for earlier periods are required
to be reclassified to reflect the provisions of this statement. Publicly traded
enterprises that issue condensed financial statements for interim periods are
required to report a total for comprehensive income in those financial
statements.
Adoption of Statement 130 on January 1, 1998 did not have any effect on
the consolidated financial position, results of operation or liquidity of the
Company. However, Statement 130 does have an effect on financial statement
displays presented by the Company, since the Company has net unrealized
gains(losses) on available-for-sale securities, an item of other comprehensive
income. For the six months ended June 30, 1998 and 1997, total comprehensive
income was $769 and $865, respectively. For the three months ended June 30, 1998
and 1997, total comprehensive income was $380 and $559, respectively.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS(Amounts in 000's)
The following discussion supplements and provides information about the
major components of the results of operations and financial condition, liquidity
and capital resources of Pinnacle Bankshares Corporation (the "Company"). The
discussion below reflects the Consolidated Financial Statements of the Company
and its subsidiary. This discussion and analysis should be read in conjunction
with the Consolidated Financial Statements, and supplemental financial data.
OVERVIEW
Total assets at June 30, 1998 were $131,372, down .21% from $131,650 at
December 31, 1997. The principal components of the Company's assets at the end
of the period were $34,635 in securities and $84,796 in net loans. During the
six month period, gross loans decreased 2.30% or $2,023. The Company's lending
activities are a principal source of income. The Company's premises and
equipment grew 15.90%, which was related to completion of an addition to the
main office facility and purchasing and preparing land for a new branch
location.
Total liabilities at June 30, 1998 were $116,805, down from $117,608 at
December 31, 1997, with the decrease reflective of a decline in deposits of 876
or .76%. Non-interest bearing demand deposits increased $452 or 4.75% and
represented 8.70% of total deposits. The Company's deposits are provided by
individuals and businesses located within the communities served.
Total stockholders' equity at June 30, 1998 was $14,567. At December 31,
1997, total shareholder's equity was $14,042.
The Company had net income of $769 for the six months ended June 30, 1998,
compared with net income of $834 for the comparable period in 1997, a decrease
of 7.79%. The Company had net income of $378 for the three months ended June 30,
1998, compared with net income of $392 for the comparable period in 1997, a
decrease of 3.57%. The results of operations for the six month periods ended
June 30, 1998 and 1997 are not necessarily indicative of the results to be
expected for the full year.
Profitability as measured by the Company's return on average assets (ROA)
was 1.15% for the six months ended June 30, 1998, down from 1.34% for the same
period of 1997. Another key indicator of performance, the return on average
equity (ROE) for the six months ended June 30, 1998 was 10.75%, compared to
13.29% for the six months ended June 30, 1997.
10
<PAGE>
NET INTEREST INCOME
Net interest income represents the principal source of earnings for the
Company. Net interest income equals the amount by which interest income exceeds
interest expense. Changes in the volume and mix of earning assets and
interest-bearing liabilities, as well as their respective rates and yields, have
a significant impact on the level of net interest income.
The net interest margin decreased from 4.55% for the six months ended
June 30, 1997, to 4.35% for the six months ended June 30, 1998. Net interest
income was $2,623 for the six months ended June 30, 1998 and is attributable to
interest income from loans and securities exceeding the cost associated with
interest paid on deposits.
Net interest income for the three months ended June 30, 1998 was $1,316,
up $12, or .92% from $1,304 for the same three months of 1997.
NON-INTEREST INCOME
The Company's principal sources of non-interest income are service charges
and fees on deposits accounts, particularly transaction accounts, and fees from
loans. Non-interest income increased $24 or 11.27% for the six month period
ended June 30, 1998 over the same period of 1997. Non-interest income increased
$15, or 14.85% when comparing the three months ended June 30, 1998 to the same
period of 1997. The majority of this increase is attributed to income generated
from fees on various loan and deposit products.
NON-INTEREST EXPENSE
Non-interest expense increased $201 or 14.15%, for the six month period
ended June 30, 1998 over the same period of 1997. An increase of $105 or 14.71%
is reflected when comparing the three month period ended June 30, 1998 to the
same period of 1997. The increase in non-interest expense when comparing the
periods is attributed to overall growth of the Company. Specific examples of
growth contributing to the increase in non-interest expense include additions to
the Company's Mortgage Lending Division staff (and programs) and expansion of
the Company's main office facility which was completed and occupied in the first
quarter of 1998.
ALLOWANCE AND PROVISION FOR LOAN LOSSES
A provision for loan losses of $150 was made for the first six months of
1998 compared with $210 in the first six months of 1997. The provisions for loan
losses for the three month periods ended June 30, 1998 and 1997 were $75 and
$150, respectively. Provisions are in recognition of management's estimate of
risks inherent with lending activities. Among other factors, management
considers the Company's historical loss experience, the size and composition of
the loan portfolio, the value and adequacy of collateral and guarantors,
11
<PAGE>
non-performing credits, and current and anticipated economic conditions. There
are additional risks of future loan losses which cannot be precisely quantified
or attributed to particular loans or classes of loans. Since those risks include
general economic trends as well as conditions affecting individual borrowers,
the allowance for loan losses is an estimate. The allowance is also subject to
regulatory examinations and determination as to adequacy, which may take into
account such factors as the methodology used to calculate the allowance. The
allowance for loan losses was $815 as of June 30, 1998, and represents
approximately .95% of gross loans outstanding. The allowance for loan losses was
$747 as of December 31, 1997, and represented .85% of gross loans outstanding.
The allowance for loan losses was $700 as of June 30, 1997, and represented .83%
of gross loans outstanding. Management believes the allowance was adequate as of
June 30, 1998. Management evaluates the reasonableness of the allowance for loan
losses on a quarterly basis and adjusts the provision as deemed necessary.
NON-PERFORMING ASSETS
Total nonperforming assets, which consist of nonaccrual loans, were $45 at
June 30, 1998 and $38 at December 31, 1997. Management believes losses, if any,
will be minimal. Loans are generally placed in nonaccrual status when the
collection of principal and interest is 90 days or more past due, unless the
obligation is both well-secured and in the process of collection.
LIQUIDITY
Liquidity represents an institution's ability to meet present and future
financial obligations through either the sale or maturity of existing assets or
the acquisition of additional funds from alternative funding sources. Liquid
assets include cash, interest bearing deposits with banks, federal funds sold,
and investments and loans maturing within one year. The Company's ability to
obtain deposits and purchase funds at favorable rates also affects it liquidity.
As a result of the Company's management of liquid assets and the ability to
generate liquidity through alternative funding sources, management believes that
the bank maintains overall liquidity which is sufficient to satisfy its
depositors' requirements and to meet customers' credit needs. At June 30, 1998,
cash, securities classified as available for sale and federal funds sold were
21.73% of total earning assets compared to 23.70% at December 31,1997.
Additional sources of liquidity available to the Company include its capacity to
borrow additional funds through correspondent banks.
12
<PAGE>
CAPITAL
The Company's financial position at June 30, 1998 reflects liquidity and
capital levels currently adequate to fund anticipated future business expansion.
Capital ratios are well in excess of required regulatory minimums for a
well-capitalized institution. The assessment of capital adequacy depends on a
number of factors such as asset quality, liquidity, earnings performance, and
changing competitive conditions and economic forces. The adequacy of the
Company's capital is reviewed by management on an ongoing basis. Management
seeks to maintain a capital structure that will assure an adequate level of
capital to support anticipated asset growth and to absorb potential losses.
Stockholders' equity reached $14,567 at the end of the second quarter of
1998 compared to $14,042 at December 31, 1997. The leverage ratio consists of
Tier I capital divided by quarterly average assets. At June 30, 1998, the
Company's leverage ratio was 10.68% compared to 10.65% at December 31, 1997.
Each of these exceeds the required minimum leverage ratio of 3%.
OTHER
The Company continues to diligently address potential problems that the
Year 2000 may pose for our operation as well as for our borrowers. A Year 2000
committee which has representation from all areas of the Bank, including senior
management and internal audit, has been working to identify all technology
items, establish compliance status of each item, develop a plan for replacement
or determine strategies to bring necessary items into compliance, and arrange
testing for the appropriate critical items. The board is kept apprised of the
progress of this project.
The Company neither develops or supports code for any information systems.
The Company has identified all core and business critical applications and the
hardware utilized for each. Year 2000 compliance from the vendors for these
areas has been sought, and the Company notes that many of these applications are
currently compliant or the vendor has submitted an acceptable timeline for
compliance. The Company is monitoring the compliance efforts of such vendors.
A written testing strategy has been developed and testing is underway.
On-site testing on critical applications will be completed by year-end 1998.
Testing with third party servicers will be completed by March, 1999. Testing
will include data exchange where appropriate.
The Company has completed the identification of credit risks associated
with borrowers who may not be Year 2000 prepared. A bankwide credit risk
assessment will be completed by September, 1998. Contingency plans are in the
process of being completed for all mission critical items.
13
<PAGE>
EFFECTS OF INFLATION
The effect of changing prices on financial institutions is typically
different from other industries as the Company's assets and liabilities are
monetary in nature. Interest rates are significantly impacted by inflation, but
neither the timing nor the magnitude of the changes are directly related to
price level indices.
14
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company is a
party or of which the property of the Company is subject.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The 1998 Annual Meeting of Shareholders of Pinnacle Bankshares
Corporation was held on April 14, 1998.
(b) The April 14, 1998, annual meeting of the shareholders of the Company
involved the election of directors. The following persons were elected to serve
as Class I Directors, serving until the 2001 Annual Meeting.
Name For Against Abstain
John P. Erb 596,406 0 0
Robert L. Finch 597,918 0 0
Robert H. Gilliam, Jr. 597,918 0 0
R.B. Hancock, Jr. 597,918 0 0
Class II and III directors will continue in office until the 1999 and 2000
Annual Meetings of Shareholders, respectively.
Class II Class III
Alvah P. Bohannon, III Herman P. Rogers, Jr.
James P. Kent, Jr. Carroll E. Shelton
Percy O. Moore Kenneth S. Tyler, Jr.
John L. Waller
(c)The Company's 1997 Incentive Stock Plan(the"Incentive Plan") was
adopted by the Board of Directors to be effective on May 1, 1997, subject to the
approval by the holders of a majority of the Company's Common Stock represented
at the Annual Meeting. The Incentive Plan makes available up to 25,000 shares of
Common Stock for awards to key employees of the Company and its subsidiaries in
the form of stock options, stock appreciation rights and restricted stock. The
votes cast for, against or withheld for the Incentive Plan were as follows:
For Against Abstentions
584,706 11,496 4,080
(d) None
15
<PAGE>
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27-Financial Data Schedule
(b) Reports on Form 8-K
None.
16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
PINNACLE BANKSHARES CORPORATION
AUGUST 6, 1998 /s/ Robert H. Gilliam, Jr.
- -------------------- --------------------------
Date Robert H. Gilliam, Jr., President and
Chief Executive Officer
AUGUST 6, 1998 /s/ Dawn P. Crusinberry
- -------------------- -----------------------
Date Dawn P. Crusinberry, Secretary,
Treasurer and Chief Financial Officer
17
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FORM
10-QSB FOR THE QUARTERLY PERIOD ENDING JUNE 30, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH 10-QSB
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 5,976
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 21,089
<INVESTMENTS-CARRYING> 13,546
<INVESTMENTS-MARKET> 13,672
<LOANS> 84,796
<ALLOWANCE> 815
<TOTAL-ASSETS> 131,372
<DEPOSITS> 114,657
<SHORT-TERM> 0
<LIABILITIES-OTHER> 2,148
<LONG-TERM> 0
0
0
<COMMON> 2,157
<OTHER-SE> 12,410
<TOTAL-LIABILITIES-AND-EQUITY> 131,372
<INTEREST-LOAN> 3,979
<INTEREST-INVEST> 1,022
<INTEREST-OTHER> 198
<INTEREST-TOTAL> 5,199
<INTEREST-DEPOSIT> 2,546
<INTEREST-EXPENSE> 2,576
<INTEREST-INCOME-NET> 2,623
<LOAN-LOSSES> 150
<SECURITIES-GAINS> 4
<EXPENSE-OTHER> 1,621
<INCOME-PRETAX> 1,089
<INCOME-PRE-EXTRAORDINARY> 1,089
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 769
<EPS-PRIMARY> 1.07
<EPS-DILUTED> 1.07
<YIELD-ACTUAL> 4.35
<LOANS-NON> 45
<LOANS-PAST> 407
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 747
<CHARGE-OFFS> 141
<RECOVERIES> 59
<ALLOWANCE-CLOSE> 815
<ALLOWANCE-DOMESTIC> 815
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 566
</TABLE>
