SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED MARCH 31, 2000
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: 000-23313
CITIZENS BANCORP
(Exact name of registrant specified in its charter)
Indiana 35-2017500
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
60 South Main Street
Frankfort, Indiana 46041
(Address of principal executive offices,
including Zip Code)
(765) 654-8533
(Registrant's telephone number, including area code)
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 report), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
The number of shares of the Registrant's common stock, without par value,
outstanding as of May 10, 2000 was 959,401.
1
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Citizens Bancorp
Form 10-Q
Index
PART I. FINANCIAL INFORMATION Page No.
Item 1. Financial Statements
Consolidated Statements of Financial Condition
as of March 31, 2000 and June 30, 1999
(Unaudited) 3
Consolidated Statements of Income for the three
months ended March 31, 2000 and 1999
(Unaudited) 4
Consolidated Statements of Income for the nine
months ended March 31, 2000 and 1999
(Unaudited) 5
Consolidated Statement of Shareholders' Equity
for the nine months ended March 31, 2000
(Unaudited) 6
Consolidated Statements of Cash Flows for the
nine months ended March 31, 2000 and 1999
(Unaudited) 7
Notes to Unaudited Consolidated Financial
Statements 8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations. 9
Item 3. Quantitative and Qualitative Disclosures about Market Risk 11
Part II. OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities and Use of Proceeds 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
2
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PART I FINANCIAL INFORMATION
Item 1. Financial Statements
CITIZENS BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION
(dollars in thousands)
<TABLE>
<CAPTION>
March 31, June 30,
2000 1999
---------- ---------
(Unaudited) (Note A)
<S> <C> <C>
Assets
Cash and due from banks $ 607 $ 444
Interest-bearing demand deposits 867 152
-------- --------
Cash and cash equivalents 1,474 596
Interest-bearing time deposits 1,486 1,486
Investment securities - available for sale 391 388
Loans receivable, net of allowance for loan
losses of $340,000 and $426,000 55,969 53,104
Land held for development 868 913
Cash surrender value of life insurance contracts 1,194 1,162
Premises and equipment 560 567
Federal Home Loan Bank stock 625 419
Other assets 917 835
-------- --------
Total assets $ 63,484 $ 59,470
======== ========
Liabilities
Deposits $ 36,323 $ 36,976
Federal Home Loan Bank advances 11,000 7,000
Other liabilities 740 605
-------- --------
Total liabilities 48,063 44,581
-------- --------
Equity Received From Contributions to the ESOP 343 249
-------- --------
Shareholders' equity
Preferred stock , no par value
Authorized and unissued - 2,000,000 shares -- --
Common Stock , no par value
Authorized - 5,000,000 shares
Issued and outstanding - 874,761 and 881,114 shares 8,230 8,293
Unearned Recognition and Retention Plan ("RRP") (440) (538)
Retained Earnings 7,309 6,903
Accumulated other comprehensive income (loss) (21) (18)
-------- --------
Total shareholders' equity 15,078 14,640
-------- --------
Total liabilities and shareholders' equity $ 63,484 $ 59,470
======== ========
</TABLE>
See notes to consolidated unaudited financial statements.
3
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CITIZENS BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands)
<TABLE>
<CAPTION>
Three months ended March 31,
2000 1999
-------- --------
(Unaudited)
<S> <C> <C>
Interest income:
Loans receivable $ 1,134 $ 1,056
Investment securities 16 10
Deposits with financial institutions 34 34
-------- --------
Total interest income 1,184 1,100
-------- --------
Interest expense:
Interest on deposits 368 381
Interest on borrowings 163 91
-------- --------
Total interest expense 531 472
-------- --------
Net interest income 653 628
Provision for loan losses 15 15
-------- --------
Net interest income after provision for loan losses 638 613
-------- --------
Other income:
Service charges on deposit accounts and other 32 31
Gain on sales of land held for development -- 2
Other income 19 14
-------- --------
Total other income 51 47
-------- --------
Other expenses:
Salaries and employee benefits 182 157
Net occupancy expenses 17 17
Equipment expenses 27 24
Data processing fees 35 33
Deposit insurance expense 2 6
Legal and professional fees 12 7
Other expenses 75 57
-------- --------
Total other expenses 350 301
-------- --------
Income before income tax 339 359
Income tax expense 122 132
-------- --------
Net income $ 2 $ 227
======== ========
Basic earnings per share $ .24 $ .24
Diluted earnings per share $ .24 $ .24
Weighted average shares outstanding 899,441 949,507
</TABLE>
4
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See notes to consolidated unaudited financial statements.
CITIZENS BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands)
<TABLE>
<CAPTION>
Nine months ended March 31,
2000 1999
(Unaudited)
Interest income:
<S> <C> <C>
Loans receivable $ 3,327 $ 3,153
Investment securities 44 30
Deposits with financial institutions 88 141
-------- --------
Total interest income 3,459 3,324
-------- --------
Interest expense:
Interest on deposits 1,126 1,204
Interest on borrowings 422 238
-------- --------
Total interest expense 1,548 1,442
-------- --------
Net interest income 1,911 1,882
Provision for loan losses 45 50
-------- --------
Net interest income after provision for loan losses 1,866 1,832
-------- --------
Other income:
Service charges on deposit accounts and other 101 102
Gain on sales of land held for development 10 13
Other income 50 43
-------- --------
Total other income 161 158
-------- --------
Other expenses:
Salaries and employee benefits 539 490
Net occupancy expenses 49 52
Equipment expenses 72 66
Data processing fees 100 103
Deposit insurance expense 14 18
Legal and professional fees 49 65
Other expenses 200 181
-------- --------
Total other expenses 1,023 975
-------- --------
Income before income tax 1,004 1,015
Income tax expense 395 407
--------
Net income $ 6 $ 608
======== ========
Basic earnings per share $ .68 $ .63
Diluted earnings per share $ .68 $ .63
Weighted average shares outstanding 900,214 967,852
</TABLE>
5
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See notes to consolidated unaudited financial statements.
CITIZENS BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(dollars in thousands)
<TABLE>
<CAPTION>
Unearned Accumulated
Common Stock Recognition Other Total
Shares Comprehensive Retained and Comprehensive Shareholders'
Outstanding Amount Income Earnings Retention Plan Income (Loss) Equity
----------- ------ ------ -------- -------------- --------------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, July 1, 1999 881,114 $ 8,293 $ 6,903 $(538) $ (18) $ 14,640
Comprehensive
income
Net income $609 609 609
Unrealized gains (losses)
on securities, net of tax (3) (3) (3)
-------
Comprehensive income $606
=======
Cash dividends (187) (187)
($0.21 per share)
Purchase of stock (6,353) (63) (16) (79)
RRP shares earned 98 98
------------------------- -------------------------------------------------------
Balance,
March 31, 2000 874,761 $ 8,230 $ 7,309 $(440) $ (21) $ 15,078
========================= =======================================================
</TABLE>
See notes to consolidated unaudited financial statements.
6
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CITIZENS BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
<TABLE>
<CAPTION>
Nine months ended March 31,
2000 1999
------- -------
(Unaudited)
Operating activities:
<S> <C> <C>
Net income $ 609 $ 608
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses 45 50
Depreciation and amortization 42 34
Deferred federal income tax credit -- 3
ESOP/RRP shares earned 192 173
Net change in
Other assets and cash surrender value (114) (125)
Other liabilities 127 (338)
------- -------
Net cash provided by operating activities 901 405
------- -------
Investing activities:
Net change in interest-bearing deposits -- 297
Purchases of securities available for sale (7) (107)
Net change in loans (2,910) (4,381)
Purchases of premises and equipment (35 (37)
Net change in land held for development 45 42
Purchase of FHLB stock (206) --
------- -------
Net cash used by investing activities (3,113) (4,186)
------- -------
Financing activities:
Net change in
Demand and savings deposits 82 32
Certificates of deposit (735) 2,545
Proceeds from borrowings 6,500 6,500
Repayment of borrowings (2,500) (4,000)
Purchase of stock (79) (482)
Cash dividends (178) (154)
------- -------
Net cash provided by financing activities 3,090 4,441
------- -------
Net change in cash and cash equivalents 878 660
Cash and cash equivalents at beginning of period 596 750
------- -------
Cash and cash equivalents at end of period $ 1,474 $ 1,410
======= =======
</TABLE>
See notes to consolidated unaudited financial statements.
7
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CITIZENS BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
NOTE A: Basis of Presentation
The unaudited interim consolidated financial statements include the accounts of
Citizens Bancorp ("Company") and its wholly-owned subsidiary, Citizens Savings
Bank of Frankfort ("Citizens").
The unaudited interim consolidated financial statements have been prepared in
accordance with the instructions to Form 10-Q and, therefore, do not include all
information and disclosures required by generally accepted accounting principles
for complete financial statements. The significant accounting policies followed
by the Company and Citizens for interim financial reporting are consistent with
the accounting policies followed for annual financial reporting. All
adjustments, consisting of normal recurring adjustments, which in the opinion of
management are necessary for a fair presentation of the results for the periods
reported, have been included in the accompanying consolidated financial
statements. The results of operations for the three- and nine-month periods
ended March 31, 2000 are not necessarily indicative of those expected for the
remainder of the year.
The balance sheet at June 30, 1999, has been derived from the audited
consolidated financial statements at that date, but does not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements.
NOTE B: Conversion to Federal Stock Savings Bank
In April, 1997, the Board of Directors adopted a Plan of Conversion ("Plan") to
convert Citizens from a federal-chartered mutual savings bank to a
federal-chartered stock savings bank (the "Conversion"). The Plan provided for
the sale of Citizens' capital stock to the Company, which was formed in
connection with the Conversion.
On September 18, 1997, Citizens completed the Conversion and the formation of
the Company as the holding company of Citizens. As part of the Conversion, the
Company issued 1,058,000 shares of common stock at $10 per share of which 84,640
shares were issued to an Employee Stock Ownership Plan (the "ESOP"). Net
proceeds of the Company's stock issuance, after costs, were approximately
$9,216,000 of which $5,031,000 was used to acquire 100% of the stock and
ownership of Citizens. Costs associated with the Conversion were deducted from
the proceeds of stock sold by the Company. The transaction was accounted for in
a manner similar to a pooling of interests.
At the date of the Conversion, Citizens established a liquidation account of
$5,691,000 which equaled Citizens' retained earnings as of the most recent
financial statements, June 30, 1997, contained in the final Conversion
prospectus. The liquidation account was established to provide a limited
priority claim to the assets of Citizens to qualifying depositors who continue
to maintain deposits with Citizens after the Conversion. In the unlikely event
of a complete liquidation of Citizens, and only in such event, qualifying
depositors would receive a liquidation distribution based on their proportionate
share of the then total remaining qualifying deposits.
The Company, subject to certain supervisory policies of the Office of Thrift
Supervision, may pay dividends to its shareholders if its assets exceed its
liabilities and it is able to pay its debts as they come due. Current
regulations allow Citizens, after filing a notice with the OTS, to pay dividends
on its stock if its regulatory capital would not be reduced below the amount
then required for the liquidation account. In addition, without prior approval,
current regulations allow Citizens to pay dividends to the Company not exceeding
net profits (as defined) for the current calendar year to date plus Citizens
retained net income for the preceding two years.
NOTE C: Employee Benefit Plans
Citizens has a Recognition and Retention Plan ("RRP"). Effective on March 24,
1998, awards of grants for 32,798 shares were issued to various directors and
officers of Citizens. These awards generally are to vest and be earned by the
recipient at a rate of 20 percent per year, commencing March 24, 1999.
An ESOP covers substantially all employees of Citizens. The ESOP acquired 84,640
shares at $10.00 per share in the Conversion with funds provided by a loan from
the Company. The ESOP provides for the Company to issue a put option ("option")
to any participant who receives a distribution of Company stock. The option
permits the participant to sell the stock to the Company at any time during two
option periods, as defined in the plan, at the fair market value of the stock.
Accordingly, the $846,400 of stock acquired by the ESOP was reflected as a
reduction to the ESOP equity accounts. Unearned ESOP shares totaled 58,763 and
66,192 at March 31, 2000 and June 30, 1999 and had a fair value of $1,002,644 at
March 31, 2000 and $835,674 at June 30, 1999. Shares are released to
participants proportionately as the loan is repaid. Dividends
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on allocated shares are recorded as dividends and charged to retained earnings.
Cash dividends on unallocated shares will be applied to principal and interest
due on the loan. Compensation expense is recorded equal to the fair market value
of the stock when contributions, which are determined annually by the Board of
Directors of Citizens, are made to the ESOP.
Below are the transactions affecting the ESOP equity accounts (dollars in
thousands):
Additional Unearned
Common Paid-in ESOP
Stock Capital Shares Total
------------------------------------------------
Balance, July 1, 1999 $847 $64 $(662) $249
ESOP shares earned 20 74 94
------------------------------------------------
Balance, March 31, 2000 $847 $84 $(588) $343
================================================
NOTE D: Earnings Per Share
The Company had $.24 earnings per share for the three months ended March 31,
2000, which was the same as its earnings per share for the three months ended
March 31, 1999. Earnings per share for the nine months ended March 31, 2000 was
$.68, compared to earnings per share of $.63 for the nine months ended March 31,
1999. Earnings per share have been computed based upon the weighted average
common shares outstanding during the period. Unearned ESOP shares have been
excluded from the computation of average common shares outstanding.
NOTE E: Merger
On March 21, 2000, the Company entered into an agreement with Lincoln Bancorp
("Lincoln") pursuant to which the Company will be merged with and into Lincoln.
The agreement is subject to regulatory and shareholder approval. The agreement
provides that upon the effective date of the merger, which is yet to be
determined, each shareholder of the Company will receive .9375 shares of
Lincoln's common stock and 49.375 in cash for each share of the Company's common
stock owned by such shareholder. The transaction will be recorded under the
purchase method of accounting.
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations.
General
The Company was organized in June, 1997. On September 18, 1997, it acquired the
common stock of Citizens upon the conversion of Citizens from a federal mutual
savings bank to a federal stock savings bank.
Citizens was organized as a state-chartered building and loan association in
1916 and currently conducts its business from one full-service office located in
Frankfort, Indiana. Citizens' principal business consists of attracting deposits
from the general public and originating fixed-rate and adjustable-rate loans
secured primarily by first mortgage liens on one- to four-family real estate.
Citizens' deposit accounts are insured up to applicable limits by the Savings
Association Insurance Fund ("SAIF") of the Federal Deposit Insurance Corporation
("FDIC"). Citizens offers a number of consumer and commercial financial
services. These services include: (i) residential real estate loans; (ii)
multi-family loans; (iii) construction loans; (iv) nonresidential real estate
loans; (v) home equity loans; (vi) single-pay loans; (vii) installment loans;
(viii) automobile loans; (ix) NOW accounts; (x) money market demand accounts
("MMDAs"); (xi) passbook savings accounts; (xii) certificates of deposit; and
(xiii) individual retirement accounts.
Citizens currently owns one subsidiary, Citizens Loan and Service Corporation
("CLSC"), which primarily engages in the purchase and development of tracts of
undeveloped land. Because CLSC engages in activities that are not permissible
for a national bank, OTS regulations prohibit Citizens from including its
investment in CLSC in its calculation of regulatory capital. CLSC purchases
undeveloped land, constructs improvements and infrastructure on the land, and
then sells lots to builders, who construct homes for sale to home buyers. CLSC
ordinarily receives payment when title is transferred.
Citizens' results of operations depend primarily upon the level of net interest
income, which is the difference between the interest income earned on
interest-earnings assets, such as loans and investments, and costs incurred with
respect to interest-bearing liabilities, primarily deposits and borrowings.
Results of operations also depend upon the level of the Company's non-interest
income, including fee income and service charges, and the level of its
non-interest expenses, including general and administrative expenses.
Financial Condition
Total assets increased to $63.5 million at March 31, 2000, compared to $59.5
million at June 30, 1999. Cash increased $163,000 to $607,000 at March 31, 2000,
from $444,000 at June 30, 1999, while interest bearing-deposits, consisting
primarily of overnight deposits at the Federal Home Loan Bank ("FHLB") of
Indianapolis and certificates of deposit at other FDIC insured financial
institutions, increased to $2.4 million at March 31, 2000, from $1.6 million at
June 30, 1999. Net loans receivable increased $2.9 million to $56.0 million at
March 31, 2000, from $53.1 million at June 30, 1999. The increase in loans and
interest-bearing deposits was funded by an increase in borrowings during the
period. Borrowings at the Federal Home Loan Bank increased $4.0 million to $11.0
million as of March 31, 2000, from $7.0 million at June 30, 1999. This was
offset
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by a decrease in deposits of $0.7 million to $36.3 million at March 31, 2000,
from $37.0 million at June 30, 1999.
Shareholders' equity increased $438,000 during the nine months ended March 31,
2000. This was primarily a result of the profit of $609,000 for the period,
which increased shareholders' equity, less the cost of the Company's repurchase
of $79,000 of its common stock (6,353 shares) at various times and market prices
during the period. The Company declared a dividend of $.07 per share of common
stock held as of March 31, 2000, payable on April 14, 2000. Shareholders' equity
decreased by $62,000 as a result of the declaration of the dividend.
Comparison of operating results for the three-month periods ended March 31, 2000
and 1999.
The Company had a decrease in net income of $10,000 to $217,000 for the three
months ended March 31, 2000, compared to a net income of $227,000 for the
three-month period ended March 31, 1999. The decrease was primarily due to an
increase of $49,000 in non-interest expense during the three-month period ended
March 31, 2000, offset by an increase of $25,000 in net interest income during
the same period.
Net interest income increased $25,000 to $653,000 for the quarter ended March
31, 2000, compared to $628,000 for the same period in 1999. The increase
resulted primarily from an increase in earning assets during the 2000 period,
offset by a decrease in net interest margin to 4.46% for the quarter ended March
31, 2000, from 4.52% for the same period in 1999.
The provision for loan losses was $15,000 for the three-month periods ended
March 31, 2000 and March 31, 1999. At March 31, 2000, the allowance for loan
loss was 0.61% of total loans, which was unchanged from June 30, 1999.
Total non-interest income increased $4,000 to $51,000 for the quarter ended
March 31, 2000, compared to $47,000 during the same period in 1999.
Total non-interest expense increased $49,000 to $350,000 for the quarter ended
March 31, 2000, compared to $301,000 for the same quarter in 1999. The increase
was primarily due to an increase of $25,000 in salaries and benefits to $182,000
for the three months ended March 31, 2000, compared to $157,000 for the same
period in 1999. Legal and professional fees increased $5,000 to $12,000 for the
three months ended March 31, 2000, compared to $7,000 for the same period in
1999. Office occupancy, equipment and data processing expenses increased by
$5,000 during the period ended March 31, 2000, offset by a $4,000 decrease in
deposit insurance premiums during the 2000 period. Other expenses increased
$18,000 during the three months ended March 31, 2000, due primarily to an
initial payment of $15,000 under an agreement with Trident Securities to deliver
a fairness opinion and to negotiate and arrange the Merger Agreement and Plan of
Reorganization between the Company and Lincoln Bancorp of Plainfield, IN.
Income tax expense decreased by $10,000 to $122,000 for the three months ended
March 31, 2000, compared to $132,000 for the three months ended March 31, 1999.
Comparison of operating results for the nine-month periods ended March 31, 2000
and 1999.
The Company had an increase in net income of $1,000 to $609,000 for the nine
months ended March 31, 2000, compared to net income of $608,000 for the nine
months ended March 31, 1999. The increase was primarily due to an increase of
$29,000 in net interest income and a decrease in income tax expense of $12,000
during the nine months ended March 31, 2000, offset by an increase of $48,000 in
non-interest expense during the same period.
Net interest income increased $29,000 to $1,911,000 for the nine months ended
March 31, 2000, compared to $1,882,000 for the same period in 1999. The increase
resulted primarily from an increase in earning assets during the 2000 period,
offset by a decrease in net interest margin to 4.43% for the nine months ended
March 31, 2000, from 4.57% for the same period in 1999.
The provision for loan losses was $45,000 for the nine months ended March 31,
2000, compared to $50,000 for the same period in 1999. At March 31, 2000, the
allowance for loan loss was 0.61% of total loans, which was unchanged from June
30, 1999.
Total non-interest income increased $3,000 to $161,000 for the nine months ended
March 31, 2000, compared to $158,000 for the nine months ended March 31, 1999.
Total non-interest expense increased $48,000 to $1,023,000 for the nine months
ended March 31, 2000, compared to $975,000 for the same period in 1999. Salaries
and benefits increased $49,000 during the 2000 period, due primarily to expenses
related to the early vesting of the RRP shares of Advisory Director Ralph C.
Hinshaw. This increase was offset by a decrease in legal and professional fees
of $16,000 to $49,000 for the nine months ended March 31, 2000, compared to
$65,000 for the same period in 1999. Office occupancy, equipment, data
processing and deposit
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insurance expenses decreased $4,000 during the 2000 period. Other expenses
increased $19,000 during the nine months ended March 31, 2000, due primarily to
an initial payment of $15,000 under an agreement with Trident Securities to
deliver a fairness opinion and to negotiate and arrange the Merger Agreement and
Plan of Reorganization between the Company and Lincoln Bancorp.
Income tax expense decreased by $12,000 to $395,000 for the nine months ended
March 31, 2000, compared to $407,000 for the nine months ended March 31, 1999.
Asset Quality
The allowance for loan losses was $340,000 at March 31, 2000, compared to
$326,000 at June 30, 1999. Management considered the allowance for loan losses
at March 31, 2000 to be adequate to cover estimated losses inherent in the loan
portfolio at that date, taking into consideration probable losses that could be
reasonably estimated. Such belief is based upon an analysis of loans currently
outstanding, past loss experience, current economic conditions and other factors
and estimates which are subject to change over time. The following table sets
forth the changes affecting the allowance for loan losses for the nine months
ended March 31, 2000.
Balance, July 1, 1999 $326,249
Provision for loan losses 45,000
Recoveries 2,033
Charge-offs (32,799)
----------
Balance, March 31, 2000 $340,483
========
Non-performing loans totaled $523,000 or .93% of total loans at March 31,2000,
compared to $197,000 or .37% of total loans at June 30, 1999.
Liquidity and Capital Resources
The Company's most liquid assets are cash and interest-bearing deposits. The
levels of these assets are dependent on the Company's operating, financing, and
investing activities. At March 31, 2000 and June 30, 1999, cash and
interest-bearing deposits totaled $3.0 million and $2.1 million, respectively.
The Company's primary sources of funds are deposits, borrowings and the proceeds
from principal and interest payments on loans. While maturities and scheduled
amortization of loans are a predictable source of funds, deposit flows and
mortgage prepayments are greatly influenced by general interest rates, economic
conditions and competition.
If the Company requires funds beyond its ability to generate them internally, it
has the ability to borrow funds from the FHLB of Indianapolis. Federal law
limits an institution's borrowings from the FHLB to 20 times the amount paid for
capital stock in the FHLB, subject to regulatory capital requirements. As a
policy matter, however, the FHLB of Indianapolis typically limits the amount of
borrowings from the FHLB to 50% of adjusted assets (total assets less
borrowings). At March 31, 2000, borrowings from the FHLB totaled $11.0 million.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes in market interest rates or in the Company's
interest rate sensitive instruments which would cause a material change in the
market risk exposures which affect the quantitative and qualitative risk
disclosures as presented in Item 7A of the Registrant's Annual Report on Form
10-K for the year ended June 30,1999.
The Securities and Exchange Commission maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants with the commission, including the Company. The address of that Web
site is http://www.sec.gov.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities and Use of Proceeds
None.
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Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) The exhibits filed herewith or incorporated by reference
herein are set forth on the Exhibit Index on page 13.
(b) The Company filed a Current Report on Form 8-K on March 23, 2000
disclosing the proposed merger between Lincoln Bancorp and the Company, and
attached to which is the Agreement and Plan of Reorganization between the
Company and Lincoln Bancorp dated March 21, 2000.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CITIZENS BANCORP
Date: May 10, 2000 By:/s/ Fred W. Carter
------------------
Fred W. Carter
President and Chief Executive Officer
Date: May 10, 2000 By: /s/ Stephen D. Davis
---------------------
Stephen D. Davis
Treasurer
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
3(1) Registrant's Articles of Incorporation are incorporated
by reference to Exhibit 3(1) to the Registration
Statement on Form S-1 (Registration No. 333-29031) (the
"Registration Statement")
(2) Registrant's Code of By-Laws are incorporated by
reference to Exhibit 3(2) to the Registration Statement
10(4) Citizens Bancorp Employee Stock Ownership Plan and
Trust Agreement is incorporated by reference to Exhibit
10(4) to the Registrant's Form 10-K for the period
ended June 30, 1997 (the "1997 Form 10-K")
(5) Employment Agreement between Citizens Savings Bank of
Frankfort and Fred W. Carter is incorporated by
reference to Exhibit 10(5) to the Registration
Statement
(6) Director Deferred Compensation Agreement -- Fred W.
Carter is incorporated by reference to Exhibit 10(6) to
the Registration Statement
(7) Executive Supplemental Retirement Agreement -- Fred W.
Carter is incorporated by reference to Exhibit 10(7) to
the Registration Statement
(8) Executive Supplemental Retirement Agreement -- Stephen
D. Davis is incorporated by reference to Exhibit 10(8)
to the Registration Statement
(9) Executive Supplemental Retirement Agreement -- Cindy S.
Chambers is incorporated by reference to Exhibit 10(9)
to the Registration Statement
(10) Exempt Loan and Share Purchase Agreement between Trust
under Citizens Bancorp Employee Stock Ownership Plan
and Trust Agreement and Citizens Bancorp is
incorporated by reference to Exhibit 10(10) of the 1997
Form 10-K
27 Financial Data Schedule
14
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS
ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001040734
<NAME> Citizens Bancorp
<MULTIPLIER> 1,000
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-1-1999
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1.000
<CASH> 607
<INT-BEARING-DEPOSITS> 2,353
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 391
<INVESTMENTS-CARRYING> 625
<INVESTMENTS-MARKET> 625
<LOANS> 55,969
<ALLOWANCE> 340
<TOTAL-ASSETS> 63,484
<DEPOSITS> 36,323
<SHORT-TERM> 5,000
<LIABILITIES-OTHER> 740
<LONG-TERM> 6,000
0
0
<COMMON> 8,230
<OTHER-SE> 6,848
<TOTAL-LIABILITIES-AND-EQUITY> 63,484
<INTEREST-LOAN> 3,327
<INTEREST-INVEST> 44
<INTEREST-OTHER> 88
<INTEREST-TOTAL> 3,459
<INTEREST-DEPOSIT> 1,126
<INTEREST-EXPENSE> 1,548
<INTEREST-INCOME-NET> 1,911
<LOAN-LOSSES> 45
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,023
<INCOME-PRETAX> 1,004
<INCOME-PRE-EXTRAORDINARY> 609
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 609
<EPS-BASIC> 0.68
<EPS-DILUTED> 0.68
<YIELD-ACTUAL> 4.43
<LOANS-NON> 367
<LOANS-PAST> 123
<LOANS-TROUBLED> 33
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 326
<CHARGE-OFFS> 33
<RECOVERIES> 2
<ALLOWANCE-CLOSE> 340
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 340
</TABLE>
