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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q\A, NO. 1
(Mark One)
/X/ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended June 30, 1997, OR
Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period from ________ to ________.
Commission File Number: 000-22797
TEHAMA BANCORP
(Exact name of registrant as specified in its charter)
CALIFORNIA 91-1775524
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
239 SOUTH MAIN STREET, RED BLUFF, CALIFORNIA 96080
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code): (916) 528-3000
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock, No Par Value: 1,610,940 shares outstanding (July 1, 1997)
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The registrant hereby amends the following Items of its Quarterly Report on
Form 10-Q for the quarter ended June 30, 1997, as set forth on the following
pages:
(1) Item 1: Financial Statements
Tehama Bancorp/Tehama Bank, Condensed Consolidated Statement of Income
(2) Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations
Non-Interest Income
Non-Interest Expense
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TEHAMA BANCORP/TEHAMA BANK
CONDENSED CONSOLIDATED STATEMENT OF INCOME
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<CAPTION>
Three months ended Six months ended
June 30, June 30,
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1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $2,430,003 $1,961,072 $4,614,238 $3,878,693
Interest on Federal funds sold 185,194 166,637 350,343 373,784
Interest on investment securities:
Taxable 146,660 136,799 680,221 416,151
Exempt from Federal income taxes 356,455 216,689 294,164 272,157
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Total interest income 3,118,312 2,481,197 5,938,966 4,940,785
Interest expense on deposits 1,315,663 1,051,055 2,516,473 2,117,960
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Net interest income 1,802,649 1,430,142 3,422,493 2,822,825
Provision for loan losses 190,000 135,000 360,000 255,000
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Net interest income after
provision for loan losses 1,612,649 1,295,142 3,062,493 2,567,825
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Non-interest income:
Service charges 133,262 90,311 235,272 177,223
Merchant processing fees 330,643 309,285 647,830 600,673
Loan servicing fees 17,810 19,376 37,485 38,814
Gain on sale of loans 8,653 3,917 20,403 6,812
Other income 37,591 38,151 71,924 75,626
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Total non-interest income 527,959 461,040 1,012,914 899,148
Non-interest expense:
Salaries and employee benefits 670,255 551,139 1,297,589 1,101,910
Occupancy 218,485 123,010 380,211 235,215
Other 571,033 421,550 1,060,632 791,813
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Total non-interest expense 1,459,773 1,095,699 2,738,432 2,128,938
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Income before income taxes 680,835 660,483 1,336,975 1,338,035
Income taxes 232,272 215,022 465,391 440,042
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Net income $ 448,563 $ 445,461 $ 871,584 $ 897,993
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Earnings per share $0.27 $0.27 $0.52 $0.55
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Weighted average number of shares outstanding 1,662,885 1,643,968 1,662,885 1,643,968
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The financial information included herein is unaudited; however, the information
reflects all adjustments (consisting solely of normal recurring adjustments)
that are, in the opinion of management, necessary to a fair presentation of the
financial position, results of operations, and cash flows for the interim
periods presented.
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NON-INTEREST INCOME
Non-interest income consists primarily of service charges on deposit
accounts, other fees and charges collected by the Bank for both deposit accounts
and loans, gain on sale of loans and fee income generated by the Bank's Merchant
Bankcard department. Non-interest income totaled $1,012,914 as of June 30, 1997,
an increase of 12.6% over the same period in 1996. Income generated by the
Merchant Bankcard department contributed 64% of total non-interest income during
the first half of 1997 and 67% during the same period in 1996.
Deposit account service charges for the six months ended June 30, 1997
increased 32.7% from the same period in 1996. The combined gain on sale of loans
and servicing fees on loans sold for the six months ended June 30, 1997
increased 26.9% from the same period in 1996. The increases are due primarily to
variations in the volume of loan sales and related servicing income.
NON-INTEREST EXPENSE
Non-interest expense consists of salaries and related benefits, occupancy
and equipment expense and other expenses. Non-interest expense totaled
$2,738,432 as of June 30, 1997, an increase of 28.6% over the same period in
1996. For the second quarter non-interest expenses totaled $1,459,773 an
increase of 33.2% over the same period in 1996. This category of expense was
heavily impacted by the acquisition of the two new branches earlier in the
year. Together, the ordinary non-interest expenses of these branches account
for approximately 47% of the total increase in year-to-date non-interest
expense over the prior year-to-date total.
INCOME TAXES
Income taxes accrued through June 30, 1997 totaled $465,391 or 34.8% of net
income before taxes. Accrued income taxes through the same period in 1996
totaled $440,042 or 32.9% of net income before taxes. Variations in volumes of
tax-exempt securities, loans and leases, and their respective income, are
primarily responsible for the increased tax rate compared to the decreased
income before taxes in the two periods.
LIQUIDITY AND CAPITAL
Liquidity, the ability of a company to generate sufficient amounts of cash
to meet its short-term and long-term needs, is commonly measured by the ratio of
net loans to total deposits. The lower the ratio the more liquid the Bank's
current position. However, since loans are generally the highest yielding
earning asset, the Bank attempts to maximize earnings through the generation of
additional loans, while maintaining sufficient liquidity to meet its
obligations. The loan-to-deposit ratio as of June 30, 1997 was 71.7%, a decrease
from the 75.4% ratio at December 31, 1996. For additional reference, this ratio
was 71.7% at December 31, 1995 and 78.3% at December 31, 1994. Even with the
significant growth in loans during the first two quarters of 1997, the growth in
deposits has helped maintain a low ratio and satisfactory liquidity position.
Capital adequacy is generally quantified by measures established by
regulatory agencies and requires the Bank to maintain minimum amounts of capital
and ratios of capital to assets. The Bank's total risk-based capital ratio as of
June 30, 1997 was 13.76%, compared to 17.7% at December 31, 1996 and a
regulatory minimum of 10.0 for "Well-Capitalized" banking institutions.
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Company duly caused this amendment of its quarterly report on Form 10-Q to be
signed by the undersigned thereunto duly authorized.
August 12, 1997 BY: /s/ William M. Jenkins
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Date William M. Jenkins
Vice President
