<PAGE>
SECURITY AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1997
-------------
OR
( ) TRANSITION RE PORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 0-29276
-------
FIRST ROBINSON FINANCIAL CORPORATION
---------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 36-4145294
- -------------------------------- ---------------------------
(State or other jurisdiction (I.R.S. Employer ID Number)
of incorporation or organization)
501 EAST MAIN STREET, ROBINSON, ILLINOIS 62454
- -------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (618) 544-8621
--------------
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 NO X
---- -----
As of August 31, 1997, the Registrant had 859,625 shares of Common Stock, par
value $0.01, issued and outstanding.
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
Index to Form 10-QSB
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements
<S> <C>
Consolidated Balance Sheets as of July 31, 1997
and October 31, 1996 3
Consolidated Statements of Income for the Three-Month and
and Nine-Month Periods Ended July 31, 1997 4
Consolidated Statements of Stockholders' Equity for the
Nine-Month Period Ended July 31, 1997 5
Consolidated Statements of Cash Flows for the Three-Month and
and Nine-Month Periods Ended July 31, 1997 and 1996 6
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
PART II OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults Upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 18
</TABLE>
2
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
July 31 October 31
1997 1996
------- -------
Unaudited Audited
--------- --------
ASSETS (1,000's)
--------------------------
<S> <C> <C>
Cash and Cash Equivalents:
Cash $ 348 $ 385
Interest bearing deposits 3,002 868
------- -------
Total Cash and Cash Equivalents 3,350 1,253
Securities available for sale, amortized cost of $3,668 and $4,090
at July 31, 1997 and October 31, 1996, respectively 3,710 4,133
Securities held to maturity, estimated market value of $503 and
$589 at July 31, 1997 and October 31, 1996, respectively 503 592
Loans receivable, net 62,596 54,448
Accrued interest receivable 624 514
Premises and equipment, net 2,674 2,564
Foreclosed real estate 302 278
Prepaid income taxes 0 19
Other assets 96 68
------- -------
Total Assets $73,855 $63,869
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $60,387 $56,691
Advances from Federal Home Loan Bank 0 1,500
Advances from borrowers for taxes and insurance 37 35
Accrued interest payable 320 353
Accrued income taxes 213 0
Deferred income taxes 90 91
Other liabilities 157 541
------- -------
Total Liabilities 61,204 59,211
------- -------
Commitments and Contingencies
Stockholders' Equity
Common stock, $0.01 par value; authorized 2,000,000 shares
859,625 shares issued and outstanding 9 0
Paid-in capital 8,184 0
Retained earnings 5,120 4,631
Unrealized gain on securities held available for sale 26 27
Unearned employee stock ownership plan ( 688)
------- -------
Total Stockholders' Equity 12,651 4,658
------- -------
Total Liabilities and Stockholders' Equity $73,855 $63,869
======= =======
</TABLE>
3
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31 July 31
----------------------- -----------------------
1997 1996 1997 1996
------ ------ ------ ------
(1,000's)
---------------------------------------------------------
<S> <C> <C> <C> <C>
Interest income:
Interest on loans $1,429 $1,148 $4,032 $3,217
Interest on mortgage-backed securities 60 72 182 187
Interest and dividends on securities 66 29 144 114
------ ------ ------ ------
Total interest income 1,555 1,249 4,358 3,518
------ ------ ------ ------
Interest expense:
Interest on deposits 767 655 2,208 1,914
Interest on Federal Home
Loan Bank advances 35 19 124 28
------ ------ ------ ------
Total interest expense 802 674 2,332 1,942
------ ------ ------ ------
Net interest income 753 575 2,026 1,576
Provision for loan losses 48 30 78 83
------ ------ ------ ------
Net interest income after
provision for loan losses 705 545 1,948 1,493
------ ------ ------ ------
Non-interest income:
Service charges 46 46 131 126
Loan fees 24 44 99 115
Gain on sale of loans 113 0 113 45
Other non-interest income 17 3 39 8
------ ------ ------ ------
Total other income 200 93 382 294
------ ------ ------ ------
Non-interest expense:
Compensation and employee benefits 311 236 836 685
Occupancy and equipment 92 81 250 230
Data processing 16 13 43 36
Audit, legal and other professional 7 7 20 20
SAIF deposit insurance 10 29 36 82
Advertising 24 14 54 37
Other 87 73 290 225
------ ------ ------ ------
547 453 1,529 1,315
------ ------ ------ ------
Income before income taxes 358 185 801 472
Provision for income taxes 138 72 311 184
------ ------ ------ ------
Net Income $ 220 $ 113 $ 490 $ 288
------ ------ ------ ------
Earnings Per Share: $ 0.06 $ N/A $ 0.06 $ N/A
------ ------ ------ ------
</TABLE>
4
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
Unrealized
Gain
Unearned (Loss) on
Employee Securities
Stock Available
Common Paid-in Retained Ownership For
Stock Capital Earnings Plan Sale, Net Total
------- ------- ------- ------- ------- -------
(1,000's)
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at October 31, 1996,
bank only $ 0 $ 0 $ 4,630 $ 0 $ 28 $ 4,658
Net income 0 490 0 0 490
Change in unrealized gain on
securities available for sale 0 0 0 0 ( 2) ( 2)
Stock issued 9 8,184 0 0 0 8,193
ESOP shares acquired 0 0 0 ( 688) 0 ( 688)
------- ------- ------- ------- ------- -------
Balance at July 31, 1997 $ 9 $ 8,184 $ 5,120 ($ 688) $ 26 $12,651
======= ======= ======= ======= ======= =======
</TABLE>
5
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31 July 31
----------------------------- -----------------------------
1997 1996 1997 1996
------------- ------------- ------------ -------------
(1,000's)
----------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating activities:
Net income $ 220 $ 113 $ 490 $ 288
Adjustments to reconcile net income to net
cash provided by operating activities
Provision for depreciation 44 40 124 106
Provision for loan losses 48 30 78 83
Premiums and discounts on securities 2 6 9 13
Decrease (increase) in accrued interest receivable ( 131) ( 49) ( 110) ( 124)
Decrease (increase) in other assets 156 ( 47) ( 28) ( 22)
Increase (decrease) in accrued interest payable ( 7) 42 ( 33) 76
Increase (decrease) in income taxes 134 23 232 18
------------- ------------- ------------ -------------
Net cash provided by operating activities 337 9 378 273
------------- ------------- ------------ -------------
Investing activities:
Proceeds from sales of available-for-sale securities 0 0 0 0
Proceeds from securities held to maturity
and certificates of deposit 15 10 35 520
Proceeds from matured securities available for sale 0 0 0 0
Purchase of securities available for sale ( 123) 0 ( 176) ( 2,258)
Proceeds from sales and participation of loans 1,100 0 2,153 713
Repayment of mortgage-backed securities 137 310 643 919
Increase in loans receivable ( 2,132) ( 4,619) ( 10,405) ( 9,746)
Purchase of premises and equipment ( 116) ( 55) ( 234) ( 167)
------------- ------------- ------------ -------------
Net cash used in investing activities ( 1,119) ( 4,354) ( 7,984) ( 10,019)
------------- ------------- ------------ -------------
</TABLE>
6
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31 July 31
------------------------------- ------------------------------
1997 1996 1997 1996
-------------- ------------- ------------ -------------
(1,000's)
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
Financing activities:
Net increase (decrease) in deposits ($ 1,035) $ 1,801 $ 3,696 $ 6,989
Net advances from Federal Home Loan Bank ( 5,500) 1,000 ( 1,500) 1,000
Proceeds from stock conversion 8,193 0 8,193 0
ESOP shares purchased ( 688) 0 ( 688) 0
Increase (decrease) in advances from borrowers
for taxes and insurance ( 24) ( 23) 2 ( 5)
------------- ------------- ------------ -------------
Net cash provided by financing activities 946 2,778 9,703 7,984
------------- ------------- ------------ -------------
Increase (decrease) in cash and cash equivalents 164 ( 1,567) 2,097 ( 1,762)
Cash and cash equivalents at beginning of period 3,186 2,579 1,253 2,774
------------- ------------- ------------ -------------
Cash and cash equivalents at end of period $ 3,350 $ 1,012 $ 3,350 $ 1,012
============= ============= ============ =============
Supplemental Disclosures:
Additional Cash Flows Information:
Cash paid for:
Interest on deposits, advances and
other borrowings $ 809 $ 632 $ 2,365 $ 1,866
Income taxes:
Federal $ 45,520 $ 49,675 $ 119,911 $ 166,427
State
Schedule of Noncash investing activities:
Unrealized gain on securities available for sale ($ 8) ($ 7) ($ 1) $ 20
Deferred tax on unrealized gain on
securities available for sale $ 4 $ 3 $ 0 ($ 8)
Transfers to foreclosed real estate $ 0 $ 23 $ 24 $ 51
</TABLE>
7
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) Basis of Presentation
---------------------
The consolidated financial statements include the accounts of First
Robinson Financial Corporation (the Company) and its wholly owned
subsidiary, First Robinson Savings Bank, National Association (the
Bank). All significant intercompany accounts and transactions have been
eliminated in consolidation. The accompanying consolidated financial
statements are unaudited and should be read in conjunction with the
consolidated financial statements and notes thereto included in the
Company's prospectus dated May 14, 1997. The accompanying unaudited
consolidated financial statements have been prepared in accordance with
the instructions for Form 10-QSB and, therefore, do not include
information or footnotes necessary for a complete presentation of
financial condition, results of operations, and cash flows in conformity
with generally accepted accounting principles. In the opinion of
management of the Company the unaudited consolidated financial
statements reflect all adjustments (consisting only of normal occurring
accruals) necessary to present fairly the financial position of the
Company at July 31, 1997, and the results of its operations and cash
flows for the three months and nine months ended July 31, 1997 and 1996.
Information for the year ended October 31, 1996 and prior periods is for
the Bank only. Information for the nine months ended July 31, 1997 is
for the Company and the Bank. Operating results for the nine months
ended July 31, 1997 are not necessarily indicative of the results that
may be expected for the year ending October 31, 1997.
(2) Stock Conversion
----------------
On June 27, 1997, First Robinson Savings and Loan, F.A. (the Bank)
completed its conversion from a Federally-chartered mutual savings bank
to a National Bank and was simultaneously acquired by First Robinson
Financial Corporation (the Company), a Delaware corporation, which was
formed to act as the holding company of the Bank. At the date of the
conversion, the Company completed the sale of 859,625 shares of common
stock, $.01 par value, to its Eligible Account Holders and Employee
Stock Ownership Plan (ESOP), at $10.00 per share. Net proceeds from the
above transactions, after deducting offering expenses, underwriting
fees, and amounts retained to fund the ESOP, totaled $7,504,657.
(3) Earnings Per Share
------------------
Earnings per share of common stock has been calculated based on the
shares outstanding less the shares owned by the ESOP. ESOP shares are
considered outstanding when they have been allocated or committed to be
released. With the conversion being completed on June 27, 1997, the
earnings per shares amount contained in the consolidated income
statement was calculated for the one month period ended July 31, 1997.
The average shares outstanding used in this calculation was 790,855 for
all periods. See Exhibit II for the earnings per share calculation.
8
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(4) Employee Stock Ownership Plan
-----------------------------
In connection with the conversion to the stock form of ownership, the
Board of Directors established an employee stock ownership plan (ESOP)
for the exclusive benefit of participating employees. Employees age 21
or older who have completed one year of service are eligible to
participate. Upon the issuance of the common stock, the ESOP acquired
68,770 shares of $0.01 par value common stock at the subscription price
of $10.00 per share. The Bank makes contributions to the ESOP equal to
the ESOP's debt service less dividends received by the ESOP. All
dividends received by the ESOP are used to pay debt service. As the debt
is repaid, shares are released from collateral and allocated to active
employees, based on the proportion of debt service paid in the year. The
Bank accounts for its ESOP in accordance with Statement of Position
93-6. Accordingly, the debt of the ESOP is recorded as debt and the
shares pledged as collateral are reported as unearned ESOP shares in the
consolidated balance sheets. As shares are released from collateral, the
Bank reports compensation expense equal to the current market price of
the shares, and the shares become outstanding for earnings-per-share
calculations. Dividends on allocated shares are recorded as a reduction
of retained earnings; dividends on unallocated ESOP shares are recorded
as a reduction of debt or accrued interest. ESOP compensation expense
was $0 for the nine months ended July 31, 1997 and 1996, respectively.
The ESOP shares at July 31, 1997 were as follows:
Allocated shares 0
Shares released for allocation 0
Unallocated shares 68,770
-------------
Total ESOP shares 68,770
-------------
Fair value of unallocated shares $ 1,134,705
=============
9
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
Management Discussion and Analysis of Financial
Condition and Results of Operations
General
The principal business of First Robinson Financial Corporation
(Company), through its operating subsidiary, First Robinson Savings Bank,
National Association (Bank), consists of accepting deposits from the general
public and investing these funds primarily in loans, mortgage-backed
securities and other securities. The Bank's loans consist of primarily of
loans secured by residential real estate located in its market area, consumer
loans and commercial loans.
The Bank's net income is dependent primarily on its net interest
income, which is the difference between interest earned on interest-earning
assets and the interest paid on interest-bearing liabilities. Net interest
income is a function of the Bank's "interest rate spread," which is the
difference between the average yield earned on interest-earning assets and the
average rate paid on interest-bearing liabilities. The interest rate spread is
affected by regulatory, economic and competitive factors that influence
interest rates, loan demand and deposit flows. To a lesser extent, the Bank's
net income also is affected by the level of general and administrative
expenses and the level of other income, which primarily consists of service
charges and other fees.
The operations of the Bank are significantly affected by prevailing
economic conditions, competition and the monetary, fiscal and regulatory
policies of government agencies. Lending activities are influenced by the
demand for and supply of housing, competition among lenders, the level of
interest rates and the availability of funds. Deposit flows and costs of funds
are influenced by prevailing market rates of interest, primarily on competing
investments, account maturities and the levels of personal income and savings
in the Bank's market area.
Historically, the Bank's mission has been to originate loans on a
profitable basis to the communities it serves. In seeking to accomplish its
mission, the Board of Directors and management have adopted a business
strategy designed (I) to maintain the Bank's capital level in excess of
regulatory requirements; (ii) to maintain the Bank's asset quality; (iii) to
maintain, and if possible, increase the Bank's earnings; and (iv) to manage
the Bank's exposure to changes in interest rates.
Business Strategy
First Robinson's business strategy is to continue to be a
community-oriented, locally-owned financial institution offering financial
services to residents and businesses of Crawford County, Illinois (the primary
market area). The Board of Directors and management are strategically planning
the Bank's future. New products and services are being discussed and reviewed
for their effect on profitability and customer service. In the past quarter,
the Bank opened a new drive-up facility in Oblong and two new drive-up ATM's,
one in Robinson and one in Oblong. The Board of Directors intends to maintain
a strong presence in the one-to-four family real estate market and plans are
to institute new programs to increase the Bank's market share.
The Board of Directors approved changing the Bank's fiscal year from October
31 to March 31, effective March 31, 1998.
10
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
Management Discussion and Analysis of Financial
Condition and Results of Operations
Financial Condition
Comparison at July 31, 1997 and October 31, 1996
The Company's total assets increased by approximately $10.0 million or
15.6%, to $73.9 million at July 31, 1997 from $63.9 million at October 31,
1996. This increase in total assets was primarily the result of a $2.1 million
increase in cash and cash equivalents and a $8.1 million increase in loans
receivable, net. This increase was primarily due to competitive rates and
terms, the conversion to stock form of ownership and to a national bank
charter, growing customer desire to do business with a locally-owned
institution, and attracting new customer relationships. These increases were
funded by an increase in deposits of approximately $3.7 million and the net
proceeds from the sale of stock.
Liabilities increased approximately $2.0 million or 3.4% to $61.2
million at July 31, 1997 from $59.2 million at October 31, 1996. This increase
in liabilities was primarily the result of a $3.7 million or 6.5% increase in
deposits to $60.4 million at July 31, 1997 from $56.7 million at October 31,
1996 and an increase of $213,000 in accrued income taxes which was partially
offset by decrease in FIILB advances to none at July 31, 1997 from $1.5
million at October 31, 1996 and a decrease in accrued expense of $384,000.
Deposits have increased due to the Bank's focus on providing competitive
pricing and service in its market area. FHLB advances in the amount of $3.8
million were paid off from the proceeds of the stock conversion.
Stockholders' equity increased $8.0 million to $12.7 million as of
July 31, 1997 from $4.7 million as of October 31, 1996. This increase was
primarily from the net proceeds from the sale of the Company's stock.
Regulatory Capital
At July 31, 1997, the Bank exceeded all regulatory capital
requirements, with tangible capital of $9.3 million (12.5% of adjusted total
assets), core capital of $9.3 million (12.5% of adjusted total assets) and
risk-based capital of $9.7 million (17.9% of risk-weighted assets).
Results of Operation Net Income
The Company reported net income of $220,000 and $490,000 during the
three and nine months ended July 31, 1997, respectively, as compared to
$113,000 and $288,000 during the three and nine months ended July 31, 1996.
The $107,000 or 94.7% increase in net income during the three months ended
July 31, 1997, as compared to the same period in the prior year, was primarily
attributable to an increase of $160,000 or 29.4% in net interest income after
provision for loan losses and an increase of $107,000 or 115.1% in
non-interest income offset by an increase of $94,000 or 20.8% in non-interest
expense and an increase of $66,000 or 91.7% in provision for income tax. The
Company reported a $202,000 or 70.1% increase in net income during the nine
months ended July 31, 1997, as compared to the same period in the prior year.
This increase was primarily attributable to an increase of $455,000 or 30.5%
in net interest income after provision for loan losses and an increase of
$88,000 or 29.9% in non-interest income offset by an increase in non-interest
expense of $214,000 or 16.3% and an increase of $127,000 or 69.0% in provision
for income tax.
11
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
Management Discussion and Analysis of Financial
Condition and Results of Operations
Net Interest Income
Net interest income increased by $178,000 or 31.0% during the three
months ended July 31, 1997, as compared to the same period in the prior year.
Interest rate spread for the three months ended July 31, 1997 was 4.04%
compared to 3.84% for the same period in 1996. The increase was caused by an
increase $306,000 or 24.5% in total interest income, which was partially
offset by an increase of $128,000 or 19.0% in total interest expense. Net
interest income increased by $450,000 or 28.5% during the nine months ended
July 31, 1997, as compared to the same period in the prior year. Interest rate
spread for the nine months ended July 31, 1997 was 3.92% compared to 3.67% for
the same period in 1996. The increase in total net interest income during such
period was attributable to an increase of $840,000 or 23.9% in total interest
income which was offset by an increase of $390,000 or 20.1% in total interest
expense.
Non-Interest Income
Total non-interest income increased by $107,000 or 115.1% during the
three months ended July 31, 1997, as compared to the same period in the prior
year. This increase was due primarily from a $113,000 gain on the sale of a
government guaranteed loan. Total non-interest income increased by $88,000 or
29.9% during the nine months ended July 31, 1997, as compared to the same
period in the prior year. This increase was primarily due to the gain on the
sale of a government guaranteed loan offset by expenses on other real estate
owned.
Non-Interest Expense
Total non-interest expense increased by $94,000 or 20.8% during the
three months ended July 31, 1997, as compared to the same period in the prior
year. This increase was due primarily from additional compensation and
employee benefits and office occupancy and equipment expense. Total
non-interest expense increased by $214,000 or 16.3% during the nine months
ended July 31, 1997, as compared to the same period in the prior year. This
increase was primarily due to additional compensation and employee benefits
and office occupancy expense and equipment expense.
Provision for Loan Losses
During the three and nine months ended July 31, 1997, the Bank
recorded provision for loan losses of $48,000 and $78,000, respectively, as
compared to $30,000 and $83,000 for the same respective periods of the prior
year. The Bank recorded such provisions to adjust the Bank's allowance for
loan losses to a level deemed appropriate based on an assessment of the volume
and lending presently being conducted by the Bank, industry standards, past
due loans, economic conditions in the Bank's market area generally and other
factors related to the collectibility of the Bank's loan portfolio. The Bank's
non-performing assets as a percentage of total assets was .63% at July 31,
1997, as compared to .60% at April 30, 1997 and .61% at October 31, 1996.
12
<PAGE>
FIRST ROBINSON FINANCIAL CORPORATION
Management Discussion and Analysis of Financial
Condition and Results of Operations
Provision for Income Taxes
The Bank recognized provision for income taxes of $138,000 and
$311,000 for the three and nine months ended July 31, 1997, respectively, as
compared to $72,000 and $184,000 for the same period in the prior year. The
effective tax rate during the three and nine months ended July 31, 1997 was
38.5% and 38.8% (federal and state), respectively, as compared to 38.9% and
39.0% during the same respective periods in the prior year.
Liquidity and Capital Resources
The Company's principal sources of funds are deposits and principal
and interest payments collected on loans, investments and related securities.
While scheduled loan repayments and maturing investments are relatively
predictable, deposit flows and early loan prepayments are more influenced by
interest rates, general economic conditions and competition. Additionally, the
Company may borrow funds from the FHLB of Chicago or utilize other borrowings
of funds based on need, comparative costs and availability at the time.
At July 31, 1997, the Company had no advances from the FHLB of Chicago
outstanding down from $3.8 million at April 30, 1997. The Company uses its
liquidity resources principally to meet ongoing commitments, to fund maturing
certificates of deposit and deposit withdrawals and to meet operating
expenses. The Company anticipates that it will have sufficient funds available
to meet current loan commitments. At July 31, 1997, the Company had
outstanding commitments to extend credit which amounted to $3.3 million
(including $1.4 million, in available revolving commercial lines of credit).
Management believes that loan repayments and other sources of funds will be
adequate to meet the Company's foreseeable liquidity needs.
Liquidity management is both a daily and long-term responsibility of
management. The Company adjusts its investments in liquid assets based upon
management's assessment of (i) expected loan demand, (ii) expected deposit
flows, (iii) yields available on interest-bearing investments and (iv) the
objectives of its asset/liability management program. Excess liquidity
generally is invested in interest-earning overnight deposits and other
short-term government and agency obligations.
13
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
-----------------
None.
Item 2. Changes in Securities
---------------------
None.
Item 3. Defaults Upon Senior Securities
-------------------------------
None.
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
Not applicable.
Item 5. Other Information
-----------------
Item 6. Exhibits and Reports on Form 8-K
----------------------------------
Exhibits: I. Statement Regarding Computation of Earnings
II. Financial Data Schedule
Reports on Form 8-K:
None
14
<PAGE>
EXHIBIT I
Statement Regarding Computation of Earnings per Share
<TABLE>
<CAPTION>
One Month
Ended
7-31-97
--------------
<S> <C>
Net Earnings (in thousands) $ 50
==============
Primary earnings per share:
Weighted average shares outstanding $ 859,625
Less unearned employee stock ownership plan shares ( 68,770)
Average option shares granted 0
Less assumed purchase of shares using treasury method
--------------
Common and common equivalent shares outstanding $ 790,855
==============
Earnings per common share - primary $ 0.06
==============
Fully - diluted earnings per share:
Weighted average shares outstanding $ 859,625
Less unearned employee stock ownership plan shares ( 68,770)
Average option shares granted 0
Less assumed purchase of shares using treasury method 0
--------------
Common and common equivalent shares outstanding $ 790,855
==============
Earnings per common share - fully diluted $ 0.06
==============
</TABLE>
The conversion to stock form was on June 27, 1997. For the period June 28
to June 30, 1997 was considered immaterial and the earnings per share
computation is based on one month of operations (July, 1997).
15
<PAGE>
EXHIBIT II
This schedule contains summary financial information extracted from the
consolidated financial statements of First Robinson Financial Corporation
for the quarterly period ended July 31, 1997 and is qualified in its
entirety by reference to such financial statements.
<TABLE>
<CAPTION>
(In thousands, except per share amounts)
<S> <C> <C>
Period Type 3 Months
Fiscal Year End October 31, 1996
Period End July 31, 1997
9-03(1) Cash and due from banks $ 348
9-03(2) Interest-bearing deposits 3,002
9-03(3) Federal funds sold - purchased securities for resale 0
9-03(4) Trading account assets 0
9-03(6) Investment and mortgage backed securities held for sale 3,710
9-03(6) Investment and mortgage backed securities
held to maturity-carrying value 503
9-03(6) Investment and mortgage backed securities
held to maturity-market value 503
9-03(7) Loans 63,039
9-03(7)(2) Allowance for losses 443
9-03(11) Total assets 73,855
9-03(12) Deposits 60,387
9-03(13) Short-term borrowings 0
9-03(15) Other liabilities 817
9-03(16) Long-term debt 0
9-03(19) Preferred stock - mandatory redemption 0
9-03(20) Preferred stock - no mandatory redemption 0
9-03(21) Common stocks 9
9-03(22) Other stockholders' equity 12,642
9-03(23) Total liabilities and stockholders' equity 73,855
9-04(1) Interest and fees on loans 1,429
9-04(2) Interest and dividends on investments 126
9-04(4) Other interest income 0
9-04(5) Total interest income 1,555
9-04(6) Interest on deposits 767
9-04(9) Total interest expense 802
9-04(10) Net interest income 753
9-04(11) Provision for loan losses 48
9-04(13)(h) Investment securities gains/losses 0
9-04(14) Other expenses 547
9-04(15) Income/loss before income tax 358
9-04(17) Income/loss before extraordinary items 358
9-04(18) Extraordinary items, less tax 0
9-04(19) Cumulative change in accounting principles 0
9-04(20) Net income or loss 220
9-04(21) Earnings per share-primary 0.06
9-04(21) Earnings per share-fully diluted 0.06
</TABLE>
16
<PAGE>
EXHIBIT II
<TABLE>
<CAPTION>
<S> <C> <C>
1.B.5 Net yield-interest earnings assets-actual 4.24%
III.C.1(a) Loans on non accrual $ 95
III.C.1(b) Accruing loans past due 90 days or more 35
III.C.1(c) Troubled debt restructuring 164
III.C.2 Potential problem loans
IV.A.1 Allowance for loan loss-beginning of period 399
IV.A.2 Total chargeoffs 16
IV.A.3 Total recoveries 12
IV.A.4 Allowance for loan loss-end of period 443
IV.B.1 Loan loss allowance allocated to domestic loans 365
IV.B.2 Loan loss allowance allocated to foreign loans 0
IV.B.3 Loan loss allowance-unallocated 78
</TABLE>
17
<PAGE>
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FIRST ROBINSON FINANCIAL CORPORATION
Date: September 10, 1997 /s/ Rick L. Catt
------------------ ----------------------------------------
Rick L. Catt
President and Chief Operations Officer
Date: September 10, 1997 /s/ Jamie E. McReynolds
------------------ -----------------------------------------
Jamie E. McReynolds
Chief Financial Officer and Vice President
18
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> MAY-01-1997
<PERIOD-END> JUL-31-1997
<CASH> 348
<INT-BEARING-DEPOSITS> 3,002
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 3,710
<INVESTMENTS-CARRYING> 503
<INVESTMENTS-MARKET> 503
<LOANS> 63,039
<ALLOWANCE> 443
<TOTAL-ASSETS> 73,855
<DEPOSITS> 60,387
<SHORT-TERM> 0
<LIABILITIES-OTHER> 817
<LONG-TERM> 0
0
0
<COMMON> 9
<OTHER-SE> 12,642
<TOTAL-LIABILITIES-AND-EQUITY> 73,855
<INTEREST-LOAN> 1,429
<INTEREST-INVEST> 126
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 1,555
<INTEREST-DEPOSIT> 767
<INTEREST-EXPENSE> 802
<INTEREST-INCOME-NET> 753
<LOAN-LOSSES> 48
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 547
<INCOME-PRETAX> 358
<INCOME-PRE-EXTRAORDINARY> 358
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 220
<EPS-PRIMARY> .06
<EPS-DILUTED> .06
<YIELD-ACTUAL> 4.24
<LOANS-NON> 95
<LOANS-PAST> 35
<LOANS-TROUBLED> 164
<LOANS-PROBLEM> 332
<ALLOWANCE-OPEN> 399
<CHARGE-OFFS> 16
<RECOVERIES> 12
<ALLOWANCE-CLOSE> 443
<ALLOWANCE-DOMESTIC> 365
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 78
</TABLE>
