SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1997 Commission File Number 0-22961
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ANNAPOLIS NATIONAL BANCORP, INC.
--------------------------------
(Exact name of small business issuer as specified in its charter)
Maryland 52-1648903
- ------------------------------- ------------------------------------
(State or other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
180 Admiral Cochrane Drive, Suite 300, Annapolis, Maryland 21401
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(Address of principal executive offices)
(410) 224-4455
--------------
(Issuer's telephone number, including area code)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 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.
(1) YES X NO
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(2) 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.
At November 14, 1997, the Registrant had 2,312,306 shares of Common
Stock outstanding.
Transitional Small Business Disclosure Format
YES NO X
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<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE
- ------------------------------ ----
<S> <C>
Item 1 - Financial Statements...................................................................1
Consolidated Balance Sheets as of September 30, 1997 and December 31, 1996......................1
Consolidated Income Statements for the Three Months Ended
September 30, 1997 and 1996 and for the Nine Months Ended
September 30, 1997 and 1996.....................................................................2
Consolidated Statements of Cash Flows for the Nine Months Ended
September 30, 1997 and 1996.....................................................................3
Consolidated Statement of Changes in Stockholders' Equity.......................................5
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations.............................................................6
PART II - OTHER INFORMATION
- ---------------------------
Item 1 - Legal Proceedings.....................................................................10
Item 2 - Changes in Securities.................................................................10
Item 3 - Defaults Upon Senior Securities.......................................................10
Item 4 - Submission of Matters to a Vote of Security Holders...................................10
Item 5 - Other Information.....................................................................10
Item 6 - Exhibits and Reports on Form 8-K......................................................10
SIGNATURES..............................................................................................11
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - Financial Statements
Annapolis National Bancorp, Inc. and Subsidiary
Consolidated Balance Sheets
As of September 30, 1997 and December 31, 1996
(In thousands)
(UNAUDITED) (AUDITED)
SEPTEMBER 30, DECEMBER 31,
1997 1996
--------- ---------
ASSETS
Cash and due from banks ........................ $ 4,938 $ 6,084
Federal funds sold ............................. 20,076 4,379
Securities purchased under agreement to resell . -- 4,750
Federal Reserve Bank stock, at cost ............ 215 194
Investment securities available-for-sale ....... 16,221 11,140
Investment securities held-to-maturity ......... 4,240 1,993
Loans, less allowance for credit losses ........ 73,125 68,800
Premises and equipment ......................... 1,207 1,335
Core deposits and other intangible assets
acquired .................................... 238 788
Accrued interest receivable .................... 603 437
Deferred income taxes .......................... 817 --
Other real estate owned ........................ 52 140
Other assets ................................... 318 187
--------- ---------
Total assets ............................. $ 122,050 $ 100,227
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits ....................................... $ 11,528 $ 10,052
Noninterest-bearing ............................ 85,639 77,054
--------- ---------
Interest-bearing ............................... 97,167 87,106
Securities sold under agreements to
repurchase .................................. 13,470 6,345
Accrued interest and other liabilities ......... 408 302
Note and accrued interest payable to stockholder -- 1,003
--------- ---------
Total liabilities ........................ $ 111,045 $ 94,756
--------- ---------
Stockholders' equity
Preferred stock - $.01 par value ............ $ -- $ --
Common stock - $.01 par value ............... 23 15
Capital surplus ............................. 13,135 8,634
Accumulated deficit ......................... (2,170) (3,162)
Unrealized losses on investments in available
For sale securities ...................... 17 (16)
--------- ---------
Total stockholders' equity ............... $ 11,005 $ 5,471
--------- ---------
Total liabilities and stockholders' equity $ 122,050 $ 100,227
========= =========
<PAGE>
ANNAPOLIS NATIONAL BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTH PERIODS ENDED SEPTEMBER 30, 1997 AND 1996
AND THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited and in thousands)
<TABLE>
<CAPTION>
FOR THE THREE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------------
1997 1996 1997 1996
------ ------- ------- -------
<S> <C>
INTEREST INCOME:
Loans ........................................ $ 1,943 $ 1,708 $ 5,573 $ 4,804
Investment securities ........................ 307 266 645 788
Federal funds sold and securities purchased .. 182 119 489 410
------- ------- ------- -------
Total interest income ..................... 2,432 2,093 6,707 6,002
INTEREST EXPENSE:
Interest bearing deposits .................... 890 751 2,384 2,306
Securities sold under agreements to repurchase 98 68 212 177
Interest on notes payable .................... 20 20 59 59
------- ------- ------- -------
Total interest expense .................... 1,008 839 2,655 2,542
------- ------- ------- -------
Net interest income ....................... 1,424 1,254 4,052 3,460
Provision for credit losses .................. 75 105 394 220
------- ------- ------- -------
Net interest income after provision
for credit losses ...................... 1,349 1,149 3,658 3,240
OTHER INCOME:
Service charges and fees ..................... 147 95 308 260
Mortgage banking fees ........................ 27 6 69 22
Other fee income ............................. 40 46 177 121
------- ------- ------- -------
214 147 554 403
OPERATING EXPENSES:
Personnel .................................... 512 570 1,572 1,651
Occupancy and equipment ...................... 136 109 424 369
Restructuring ................................ -- -- 830 --
Other operating expenses ..................... 397 378 1,132 1,070
Amortization of intangible assets
acquired ................................... 22 36 79 108
------- ------- ------- -------
1,067 1,093 4,037 3,198
INCOME (LOSS) BEFORE INCOME TAXES ............ 496 203 175 445
INCOME TAX (EXPENSE) BENEFIT ..................... (168) -- 817 --
------- ------- ------- -------
NET INCOME ................................... $ 328 $ 203 $ 992 $ 445
======= ======= ======= =======
Earnings per common share ........................ $ 0.22 $ 0.14 $ 0.67 $ 0.30
======= ======= ======= =======
</TABLE>
<PAGE>
ANNAPOLIS NATIONAL BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited and in thousands)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
--------------------
1997 1996
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<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income ...................................................................... $ 992 $ 445
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED
BY OPERATING ACTIVITIES
Deferred income taxes ....................................................... (817) --
Write-off of intangibles .................................................... 471 --
Depreciation and amortization of furniture, equipment,
and leasehold improvements ................................................ 148 136
Amortization of intangible assets acquired .................................. 79 108
Decrease (increase) in accrued interest receivable .......................... (166) (15)
Accrued interest on note to stockholder ..................................... (215) 59
Provision for credit losses ................................................. 394 220
Other ....................................................................... (232) (174)
-------- --------
Net cash provided by operating activities ................................ $ 654 $ 779
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans ....................................................... $ (4,325) $(10,106)
Investment in securities - held-to-maturity ................................. (2,247) --
Investment in securities - available-for-sale ............................... (42,852) 1,145
Proceeds from redemption of securities
and principal repayments .................................................. 37,750 1,980
Net decrease (increase) in federal funds sold ............................... (15,697) (967)
Net decrease (increase) in securities purchased
under agreement to resell ................................................. 4,750 4,550
Purchase of furniture, equipment, and leasehold improvements ................ (26) (460)
-------- --------
Net cash used in investing activities .................................... $(22,647) $ (3,858)
-------- --------
</TABLE>
(Continued)
<PAGE>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
--------------------
1997 1996
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in deposits .............. $ 10,061 $ 1,786
Net increase (decrease) in securities sold
under agreements to repurchase .................. 7,125 (75)
Principal repayment of note payable to stockholder (848) --
Net proceeds from sale of common stock ........... 4,509 --
-------- --------
Net cash provided by financing activities .... $ 20,847 $ 1,711
-------- --------
Net increase (decrease) in cash .................. (1,146) (1,368)
Cash, beginning of period ........................ 6,084 4,993
-------- --------
Cash, end of period .............................. 4,938 3,625
<PAGE>
ANNAPOLIS NATIONAL BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997
(Dollars in thousands)
<TABLE>
<CAPTION>
UNREALIZED
GAIN
COMMON STOCK (LOSS) ON
---------------------------------------- ACCUMULATED INVESTMENT
SHARES PAR VALUE SURPLUS DEFICIT SECURITIES TOTAL
------------ ------------ ------------- -------------- ------------- -------------
<S> <C>
BALANCE, DECEMBER 31, 1996........... 1,478,972 $ 15 $8,634 $(3,162) $ (16) $5,471
Net income........................... -- -- -- 992 -- 992
Net Changes in Unrealized Gain
(Loss) on Investments.............. -- -- -- -- 33 33
Sale of Stock........................ 833,334 8 4,501 -- -- 4,509
------- ---- ----- -------- -------- -----
BALANCE, SEPTEMBER 30, 1997 ......... 2,312,306 $ 23 $13,135 $(2,170) $ 17 $11,005
========= ==== ======= ========= ====== =======
</TABLE>
<PAGE>
ITEM 2 - MANAGEMENT DISCUSSION AND ANALYSES OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
COMPARISON OF FINANCIAL CONDITION AT SEPTEMBER 30, 1997 AND DECEMBER 31, 1996.
Total assets at September 30, 1997 were $122.1 million an increase of
$21.9 million or 21.86% from total assets at December 31, 1996 of $100.2
million. The increase was primarily due to an increase in federal funds sold and
securities purchased under agreements to resell of $10.9 million or 119.91%. The
increase in federal funds sold was due in part to the Company's initial public
stock offering that closed on September 30, 1997 with net proceeds of $4.5
million. In addition, net loans grew by $4.3 million or 4.29% of total assets,
and investment securities increased by $7.3 million or 7.29%.
Net loans receivable at September 30, 1997 were $73.1 million, an
increase of $4.3 million or 6.25% from net loans receivable of $68.8 million at
December 31, 1996. The increase was due to a $1.7 million or 5.55% increase in
commercial loans and $2.0 million or 7.92% increase in loans secured by real
estate.
The allowance for loan losses increased by $175,000 or 22.88% to
$940,000 at September 30, 1997 from $765,000 at December 31, 1996. The increase
in the allowance for loan losses was due primarily to additional reserves on
specific commercial loans that management has identified and believes may become
non-performing and monthly general provisions of $25,000. The allowance for loan
losses to total loans increased to 1.30% at September 30, 1997 from 1.04% at
September 30, 1996. Management makes periodic provisions to the allowance for
loan losses to maintain the allowance at an acceptable level commensurate with
management's assessment of the credit risk inherent in the loan portfolio.
Intangible assets decreased by $550,000 or 69.80% due to management's
analysis of the intangible assets related to the June 1990 acquisition of
another financial institution and amortization of $79,000.
Deferred income taxes increased by $817,000 from zero as a result of
the Company recording the tax effect of net operating loss carryforwards and
other deferred tax assets. The Company recorded a federal tax expense of
$161,000 for the quarter ended September 30, 1997, at an effective federal tax
rate of 34%, which reduced deferred income taxes from $978,000 at June 30, 1997
to $817,000 at September 30, 1997.
Deposits of $97.2 million at September 30, 1997 represent a $10.1
million or 11.60% increase from December 31, 1996 deposits of $87.1 million. The
increase was due in part to a $13.5 million or 15.50% increase in certificates
of deposit and an $1.4 million or 1.61% increase in demand deposit accounts,
offset by a decrease of $3.7 million or 4.25% in NOW accounts and an $1.2
million or 1.38% decrease in savings accounts.
Stockholders' equity increased by $5.5 million during the first nine
months of 1997 as a result of an increase in net retained earnings of $992,000,
a $4.5 million increase from the sale of 833,334 shares of common stock as a
result of the company's initial public stock offering which closed on September
30, 1997, and an increase of $33,000 in the net change in unrealized gain (loss)
on investments in available for sale securities.
<PAGE>
COMPARISON OF OPERATING RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND
1996.
General. Net income for the nine months ended September 30, 1997
totaled $992,000 or $0.67 per share as compared to $445,000 or $0.30 per share
for the nine months ended September 30, 1996. The increase in net income can be
attributed mainly to a one time recognition of a deferred tax adjustment in the
amount of $1.1 million at March 31, 1997 as a result of the Company recording
the tax effect of net operating loss carryforwards and other deferred tax
assets. The increase was partially offset by accrued federal income taxes of
$302,000 and a $830,000 one time restructuring expense resulting from the
revised business strategy. See "Operating Expense." At September 30, 1997, the
net interest margin increased to 5.45% from 5.08% at September 30, 1996. The
increase in the net interest margin was the result of an increase in the average
balances of loans receivable offset by a decrease in the average balance of
investment securities and securities purchased under agreements to resell.
Net interest income. Net interest income increased by $592,000 or 17.1%
for the nine months ended September 30, 1997 to $4.1 million from $3.5 million
for the nine months ended September 30, 1996, due primarily to an increase in
interest income of $705,000 offset in part by a increase in interest expense of
$113,000.
The increase in interest income was derived primarily from interest on
loans receivable which increased by $769,000 or 16.01% from $4.8 million for the
nine months ended September 30, 1996 to $5.6 million for the nine months ended
September 30, 1997. This increase was due primarily to an increase in the
average balance of loans receivable from $60.5 million at September 30, 1996 to
$72.3 million at September 30, 1997. This increase was offset by a decrease of
$143,000 or 18.15% in interest on investment securities as a result of a
decrease in the average balance of $600,000 or 3.02% from $19.9 million at
September 30, 1996 to $19.3 million at September 30, 1997.
Interest expense increased by $113,000 or 4.45% for the nine months
ended September 30, 1997 as compared to the nine months ended September 30,
1996, due primarily to a increase in the average balance of deposits and
commercial repurchase agreements from $81.2 million at September 30, 1996 to
$87.4 million at September 30, 1997.
Provision for Loan Losses. The provision for loan losses for the nine
months ended September 30, 1997 and 1996 totaled $394,000 and $220,000
respectively. The increase in the provision for loan losses at September 30,
1997 was primarily attributable to additional specific reserves established
during the first quarter of 1997. The specific reserves were primarily related
to certain commercial loans that management believes may become non-performing.
Other Income. Other income, which is comprised primarily of fees and
charges on deposit accounts, increased by $151,000 or 37.47% to $554,000 at
September 30, 1997 from $403,000 at September 30, 1996. The increase in other
income was primarily due to an increase in fees and charges on deposit accounts
of $48,000, mortgage banking fees of $47,000 and other income of $56,000. The
increase in other income is due primarily to fees assessed on foreign ATM
transactions which began during the second quarter of 1997. At September 30,
1997 these fees totalled $52,000.
<PAGE>
Operating Expense. Operating expense increased by $839,000 or 26.24%
for the nine months ended September 30, 1997 from $3.2 million for the nine
months ended September 30, 1996 to $4.0 million for the nine months ended
September 30, 1997. The increase in operating expense was due to a one time
restructuring expense of $830,000 for the nine months ended September 30, 1997
resulting from the implementation of a revised business strategy by the Board of
Directors and senior management beginning in February 1997. The increase
includes $471,000 of expense written off in relation to the intangible assets
acquired in the June 1990 acquisition of another financial institution,
severance payments and benefits of $136,000, branch consolidation expense of
$119,000, $50,000 related to the termination of a planned de novo bank
organization in accordance with Mr. Marhefka's employment agreement, and various
other expenses of $54,000. The goodwill portion of the intangible asset,
representing $296,701 or 62.79% of the amount written off at March 31, 1997, was
deemed impaired at March 31, 1997 and related to key former employees and
management of the financial institution acquired in June 1990 whose employment
with the Company ended during the quarter ended March 31, 1997. The amortization
of the goodwill paralleled the expected service life of these employees and
management personnel. Other expenses increased by $62,000 primarily due to
additional data processing expense which was primarily the result of additional
volume of transaction accounts.
Income Tax Expense. The Company had approximately $2.4 million of net
operating loss carryforwards at September 30, 1997. The Company recorded income
tax expense for the nine month period ended September 30, 1997 of $302,000 based
on a federal income tax rate of 34% which reduced the deferred tax asset
established at March 31, 1997 of $1.1 million to $817,000 at September 30, 1997.
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997
AND 1996.
General. Net income for the three months ended September 30, 1997
totaled $328,000 or $0.22 per share as compared to $203,000 or $0.14 per share
for the three months ended September 30, 1996. The increase in net income can be
attributed mainly to an increase in the average balance of loans from $64.3
million at September 30, 1996 to $74.9 million at September 30, 1997. This
increase was offset by a decrease in the net interest margin which decreased to
5.20% at September 30, 1997 from 5.33% at September 30, 1996. The decrease in
the net interest margin was the result of a decrease in the net yield on loans
from 10.53% at September 30, 1996 to 10.29% at September 30, 1997 and an
increase in the cost of interest bearing liabilities from 3.98% at September 30,
1996 to 4.11% at September 30, 1997. In addition, the provision for loan losses
decreased by $30,000, and other income increased by $67,000 mainly due to
increased service fees and charges. These increases were partially offset by an
increase in the provision for income taxes of $161,000.
Net interest income. Net interest income increased by $170,000 or
13.56% for the three months ended September 30, 1997 to $1.4 million from $1.3
million for the three months ended September 30, 1996, due primarily to an
increase in interest income of $339,000, offset by an increase in interest
expense of $169,000.
The increase in interest income was derived primarily from interest on
loans receivable which increased by $235,000 or 13.76% from $1.7 million for the
three months ended September 30, 1996 to $1.9 million for the three months ended
September 30, 1997. This increase was due primarily to an increase in the
average balance of loans receivable from $64.4 million for the three months
ended September 30, 1996 to $74.9 million for the three months ended September
<PAGE>
30, 1997. In addition, interest on investments increased by $39,000 or 14.55% as
a result of an increase in the average balance of $600,000 or 3.03% from $19.8
million for the three months ended September 30, 1996 to $20.4 million for the
three months ended September 30, 1997.
Interest expense increased by $169,000 or 20.14% for the three months
ended September 30, 1997 as compared to the three months ended September 30,
1996, due primarily to an increase in the average volume of deposits from $74.0
million for the three months ended September 30, 1996 to $83.5 million for the
three months ended September 30, 1997.
Provision for Loan Losses. The provision for loan losses for the three
months ended September 30, 1997 and 1996 totaled $75,000 and $105,000
respectively. The decrease in the provision for loan losses at September 30,
1997 was attributable to management's assessment of the credit risk inherent in
the loan portfolio.
Other Income. Other income increased by $67,000 or 45.58% to $214,000
for the three months ended September 30, 1997 from $147,000 for the three months
ended September 30, 1996. The increase in other income was primarily due to an
increase of fees. The increase in other income is due primarily to fees assessed
on foreign ATM transactions which began during the second quarter of 1997. For
the quarter ended September 30, 1997 these fees totalled $34,000.
Operating Expense. Operating expense decreased by $26,000 or 2.38% for
the three months ended September 30, 1997. The decrease in operating expense was
primarily due to a $58,000 decrease in compensation and related benefits
primarily due to staff reductions. This decrease was offset by a $27,000
increase in occupancy expense and a $19,000 increase in other expenses primarily
related to data processing expense due to an increase in the volume of
transaction accounts. In addition, amortization of intangible asset expense
decreased by $14,000. The decrease in amortization expense relates to the
analysis conducted by management in the first quarter of 1997 and the resulting
decrease in the intangible assets acquired in the June 1990 acquisition of
another financial institution.
Income Tax Expense. The Company has approximately $2.4 million of net
operating loss carryforwards at September 30, 1997. The Company recorded income
tax expense for the three month period ended September 30, 1997 of $161,000
based on a federal tax rate of 34% which reduced the deferred tax asset
established at March 31, 1997 to $817,000.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Company is not involved in any legal proceedings of a material
nature at this time other than those occurring in the ordinary course of
business which in the aggregate involves amounts which are believed by
management to be immaterial to the financial condition of the Company.
ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS
The Company issued 833,334 shares of common stock at $6.00 per share
for a total of $5.0 million in its initial public offering that closed on
September 30, 1997. The offering expenses and commissions paid to underwriters
and brokers totaled $491,000. In addition, the Company retired debt and related
accrued interest of $1.06 million. The net proceeds of $3.4 million will be used
for general corporate purposes.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5 - OTHER INFORMATION
None
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3.1 Certificate of Incorporation of Annapolis
National Bancorp, Inc.*
3.2 Bylaws of Annapolis National Bancorp, Inc.*
11 Statement re: Computation of Per Share Earnings
27 Financial Data Schedule
(b) Reports on Form 8-K
None
*Incorporated by reference to Registration Statement on Form SB-2,
as amended, Commission File Number 333-29841, originally filed
with the Securities and Exchange Commission on June 23, 1997.
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange Act
of 1934, the registrant caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ANNAPOLIS NATIONAL BANCORP, INC.
(Registrant)
Date: 10/14/97 /s/ John W. Marhefka, Jr.
-------- ----------------------------------
John W. Marhefka, Jr.
Chief Executive Officer
Date: 10/14/97 /s/ Russell J. Grimes
-------- ----------------------------------
Russell J. Grimes
Chief Financial Officer
EXHIBIT 11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
(In thousands, except Earnings per Common Share)
<TABLE>
<CAPTION>
Three Months Ended
September 30, 1997 September 30, 1996
------------------ ------------------
<S> <C>
Net income $ 328 $ 203
Average Shares outstanding 1,488 1,479
Earnings per Common Share $ 0.22 $ 0.14
<CAPTION>
Nine Months Ended
September 30, 1997 September 30, 1996
------------------ ------------------
<S> <C>
Net income $ 992 $ 445
Average Shares outstanding 1,482 1,479
Earnings per Common Share $ 0.67 $ 0.30
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 4,938
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 20,076
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 16,221
<INVESTMENTS-CARRYING> 4,240
<INVESTMENTS-MARKET> 4,240
<LOANS> 73,125
<ALLOWANCE> 940
<TOTAL-ASSETS> 122,050
<DEPOSITS> 97,167
<SHORT-TERM> 0
<LIABILITIES-OTHER> 408
<LONG-TERM> 0
0
0
<COMMON> 23
<OTHER-SE> 10,982
<TOTAL-LIABILITIES-AND-EQUITY> 122,050
<INTEREST-LOAN> 5,573
<INTEREST-INVEST> 645
<INTEREST-OTHER> 489
<INTEREST-TOTAL> 6,707
<INTEREST-DEPOSIT> 2,384
<INTEREST-EXPENSE> 2,655
<INTEREST-INCOME-NET> 4,052
<LOAN-LOSSES> 394
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,037
<INCOME-PRETAX> 175
<INCOME-PRE-EXTRAORDINARY> 175
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 992
<EPS-PRIMARY> 0.67
<EPS-DILUTED> 0.67
<YIELD-ACTUAL> 5.45
<LOANS-NON> 1,256
<LOANS-PAST> 280
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 1,285
<ALLOWANCE-OPEN> 765
<CHARGE-OFFS> 246
<RECOVERIES> 27
<ALLOWANCE-CLOSE> 940
<ALLOWANCE-DOMESTIC> 940
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 686
</TABLE>
