<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 25049
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
------------------------------------------
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 000-23465
---------
Coddle Creek Financial Corp.
----------------------------
(Exact name of registrant as specified in its charter)
North Carolina 56-2045998
-------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
347 North Main Street/Post Office Box 117
Mooresville, North Carolina 28115
---------------------------------
(Address of principal executive offices) (Zip code)
(704) 664-4888
--------------
(Issuer's telephone number)
N/A
---
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check X whether the issuer (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceeding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
As of May 1, 1998 there were issued and outstanding 674,475 shares of the
Registrant's common stock, no par value.
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE
----
<S> <C>
Item 1. Financial Statements
Condensed Consolidated Statements of Financial Condition as of
March 31, 1998 (Unaudited) and December 31, 1997 1
Condensed Consolidated Statements of Income and Comprehensive Income for
the Three Months ended March 31, 1998 and 1997 (Unaudited) 2
Condensed Consolidated Statements of Cash Flows for the Three Months
ended March 31, 1998 and 1997 (Unaudited) 3
Notes to Condensed Consolidated Financial Statements (Unaudited) 4-5
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 6-8
Item 3. Quantitative and Qualitative Disclosures about Market Risk 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 2. Changes in Securities and Use of Proceeds 9
Item 3. Defaults Upon Senior Securities 9
Item 4. Submission of Matters to a Vote of Security Holders 9
Item 5. Other Information 9
Item 6. Exhibits and Reports on Form 8-K 9
SIGNATURES 10
</TABLE>
This Form 10-Q contains forward-looking statements consisting of estimates with
respect to the financial condition, results of operations and other business of
Coddle Creek Financial Corp. that are subject to various factors which could
cause actual results to differ materially from those estimates. Factors which
could influence the estimates include changes in the national, regional and
local market conditions, legislative and regulatory conditions, and an adverse
interest rate environment.
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
March 31, 1998 and December 31, 1997
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 1998 1997
-----------------------------------------------------------------------------------------------------------------
(Unaudited) (Note)
<S> <C> <C>
Cash and cash equivalents $ 10,018,000 $ 37,071,000
Certificates of deposit 100,000 100,000
Securities available for sale 13,909,000 3,054,000
Securities held to maturity 2,207,000 2,708,000
Federal Home Loan Bank stock 964,000 930,000
Loans receivable, net 103,249,000 101,982,000
Office properties and equipment, net 881,000 891,000
Accrued interest receivable 857,000 755,000
Cash value of life insurance 985,000 971,000
Real estate owned 81,000 81,000
Deferred income taxes 1,016,000 1,008,000
Prepaid expenses and other assets 71,000 34,000
--------------------------------------
Total assets $ 134,338,000 $ 149,585,000
======================================
LIABILITIES AND STOCKHOLDERS' EQUITY
-----------------------------------------------------------------------------------------------------------------
Liabilities:
Deposits $ 87,565,000 $ 99,382,000
Advances from borrowers for taxes and insurance 169,000 105,000
Accounts payable and other liabilities 562,000 835,000
Deferred compensation 2,337,000 2,270,000
--------------------------------------
Total liabilities 90,633,000 102,592,000
--------------------------------------
Stockholders' Equity:
Preferred stock, authorized 5,000,000 shares; none issued - -
Common stock, no par value, authorized 20,000,000 shares;
issued 674,475 shares - -
Additional paid-in capital 32,494,000 32,494,000
Retained earnings, substantially restricted 15,415,000 15,051,000
Unearned ESOP shares (4,216,000) (577,000)
Accumulated other comprehensive income, unrealized gain
on securities available for sale, net of tax 12,000 25,000
--------------------------------------
Total stockholders' equity 43,705,000 46,993,000
--------------------------------------
Total liabilities and stockholders' equity $ 134,338,000 $ 149,585,000
======================================
</TABLE>
NOTE: The Condensed Consolidated Statement of Financial Condition as of
December 31, 1997 has been taken from the audited financial statements
at that date.
See Notes to Condensed Consolidated Financial Statements.
1
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
COMPREHENSIVE INCOME
For the Three Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
------------------------------------------------------------------------------------------------------
(Unaudited)
Interest income:
<S> <C> <C>
Loans $ 2,194,000 $ 2,028,000
Investment securities 185,000 133,000
Other 283,000 18,000
------------------------------
2,662,000 2,179,000
------------------------------
Interest expense:
Deposits 1,060,000 1,146,000
Federal Home Loan Bank advances - 31,000
------------------------------
1,060,000 1,177,000
------------------------------
Net interest income 1,602,000 1,002,000
Provision for loan losses 60,000 -
------------------------------
Net interest income after provision for loan 1,542,000 1,002,000
------------------------------
Noninterest income 48,000 45,000
------------------------------
Noninterest expenses:
Compensation and employee benefits 477,000 489,000
Net occupancy 53,000 52,000
Deposit insurance premiums 15,000 -
Data processing 48,000 43,000
Other 110,000 105,000
------------------------------
703,000 689,000
------------------------------
Income before income taxes 887,000 358,000
Income taxes 368,000 143,000
------------------------------
Net income 519,000 215,000
------------------------------
Other comprehensive income, unrealized holding losses arising
during the period, net of tax (13,000) (15,000)
------------------------------
Comprehensive income $ 506,000 $ 200,000
==============================
Basic earnings per share $ 0.84 $ n/a
==============================
Diluted earnings per share $ 0.84 $ n/a
==============================
Dividends per share $ 0.25 $ n/a
==============================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
2
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
- -------------------------------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
Cash Flows From Operating Activities
Net income $ 519,000 $ 215,000
Adjustments to reconcile net income to cash provided by
operating activities:
Provision for loan losses 60,000 -
Provision for depreciation 10,000 4,000
Changes in assets and liabilities:
(Increase) decrease in:
Interest receivable (102,000) (50,000)
Cash value of life insurance (14,000) 12,000
Prepaid expenses and other assets (37,000) 36,000
Increase (decrease) in:
Accounts payable and other liabilities 149,000 (20,000)
Deferred compensation 67,000 66,000
------------------------------
Net cash provided by operating activities 652,000 263,000
------------------------------
Cash Flows From Investing Activities
Net (increase) decrease in investments (10,409,000) 440,000
Net (increase) decrease in loans receivable (1,327,000) 221,000
------------------------------
Net cash provided by (used in) investing activities (11,736,000) 661,000
------------------------------
Cash Flows From Financing Activities
Net decrease in deposits (11,817,000) (246,000)
Loan to ESOP for purchase of stock, net of principle payment (4,216,000) -
Increase in advances from borrowers for taxes and insurance 64,000 59,000
------------------------------
Net cash used in financing activities (15,969,000) (187,000)
------------------------------
Net increase (decrease) in cash and cash equivalents (27,053,000) 737,000
Cash and cash equivalents:
Beginning 37,071,000 2,675,000
------------------------------
Ending $ 10,018,000 $ 3,412,000
==============================
Supplemental Disclosure of Cash Flow Information
Cash payments for:
Interest $ 1,140,000 $ 1,199,000
Income taxes 137,000 9,000
Supplemental Schedule of Noncash Financing Transactions
Dividends declared, accrued and deducted from retained earnings $ 155,000 $ -
</TABLE>
See Notes to Condensed Consolidated Financial Statements
3
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
Note 1. Nature of Business
On December 30, 1997, pursuant to a Plan of Conversion which was approved by it
members and regulators, Mooresville Savings Bank, Inc., SSB (the "Bank" or
"Mooresville Savings Bank") converted from a North Carolina-chartered mutual
savings bank to a North Carolina-chartered stock savings bank and became a
wholly-owned subsidiary of Coddle Creek Financial Corp (the "Company"). Coddle
Creek was formed to acquire all of the common stock of the Bank upon its
conversion to stock form. The Company has no operations and conducts no
business of its own other than owning Mooresville Savings, investing its portion
of the net proceeds received in the Conversion, and lending funds to the
Employee Stock Ownership Plan (the "ESOP"), which was established in connection
with the Conversion. The closing of the offering occurred on December 30, 1997
and resulted in the issuance of 674,475 shares of common stock at a price of
$50.00 per share, for proceeds of $32,494,000 (net of $1,230,000 in conversion
costs). The Company transferred $14,134,000 of the net proceeds to Mooresville
Savings for the purchase of all of the common stock of the Bank. The Company
then loaned the ESOP trust $4,216,000 to purchase 53,958 shares of common stock
in the open market.
Mooresville Savings Bank's results of operations depend primarily on its net
interest income, which is the difference between interest income from interest-
earning assets and interest expense on interest-bearing liabilities. The Bank's
operations are also affected by noninterest income, such as miscellaneous income
from loans, customer deposit account service charges, and other sources of
revenue. The Bank's principal operating expenses, aside from interest expense,
consist of compensation and associated benefits, occupancy costs, furniture and
fixture expense, data processing charges, and other general and administrative
expenses.
Concurrent with the conversion, and pursuant to North Carolina regulations, the
Bank established a liquidation account in an amount equal to its net worth as
reflected in its latest statement of financial condition contained in the
prospectus used in connection with the Company's initial public offering. The
liquidation account will be maintained for the benefit of eligible deposit
account holders who continue to maintain their deposit accounts in the Bank
after conversion. Only in the event of a complete liquidation of the Company
will each deposit account holder be entitled to receive a liquidation
distribution from the liquidation account in the amount of the then current
adjusted subaccount balance for deposit accounts then held before any
liquidation distribution may be made with respect to common stock. Dividends
paid by the Bank subsequent to the conversion cannot be paid from this
liquidation account.
In connection with the Conversion, the Bank has agreed with the FDIC that,
within the first three years after completion of the Conversions, neither the
Company nor the Bank will pay any taxable dividend or make any taxable
distribution in excess of their current and retained earnings. The Company and
the Bank have agreed to notify the FDIC before make a return of capital during
the first three years following the conversion.
The Bank may not declare or pay a cash dividend on or repurchase any of its
common stock if its net worth would thereby be reduced below either the
aggregate amount then required for the liquidation account or the minimum
regulatory capital requirements imposed by federal and state regulations. For a
period of five years after its conversion from mutual to stock form, the Bank
must obtain written approval from the Administrator of the North Carolina
Savings Institutions Division before declaring or paying a cash dividend on its
common stock in an amount in excess of one-half of the greater of (i) the Banks
net income for the most recent fiscal year end, or (ii) the average of the Banks
net income after dividends for the most recent year end and not more than two
of the immediately preceding fiscal year ends.
4
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
Note 2. Basis of Presentation
The accompanying unaudited financial statements (except for the statement of
financial condition at December 31, 1997, which is from audited financial
statements at that date) have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (none of which were other than normal recurring accruals) necessary
for a fair presentation of the financial position and results of operations for
the periods presented have been included. The results of operations for the
three month period ended March 31, 1998 are not necessarily indicative of the
results of operations that may be expected for the year ended December 31, 1998.
The financial statements as of and for the three months ended March 31, 1997
reflect activity of the Bank only. The accounting policies followed are as set
forth in Note 1 of the Notes to Financial Statements in the 1997 annual report
of the Company.
Note 3. Earnings Per Share
Earnings per share has been calculated in accordance with Financial Accounting
Standards Board Statement No. 128, "Earnings Per Share," and Statement of
Position 93-6, "Employers' Accounting for Employee Stock Ownership Plans." For
purposes of this computation, the number of shares of common stock purchased by
the Bank's employee stock ownership plan which have not been allocated to
participant accounts are not assumed to be outstanding. The following are
reconciliations of the amounts used in the per share calculations for 1998:
<TABLE>
<CAPTION>
For the Three Months Ended March 31,
1998
-----------------------------------------
Per
Income Shares Share
(Numerator) (Denominator) Amount
-----------------------------------------
<S> <C> <C> <C>
Basic and Diluted EPS
Income available to stockholders $ 519,000 621,014 $ 0.84
</TABLE>
4. Dividends Declared
On March 10, 1998, the Board of Directors of Coddle Creek Financial Corp.
declared a dividend of $.25 per share for stockholders of record as of March 31,
1998 and payable on April 15, 1998. The dividends declared were accrued and
reported as other liabilities in the March 31, 1998 consolidated statement of
financial condition.
5. Comprehensive Income
The Company was required to adopt Financial Accounting Standards Board Statement
No. 130, "Reporting Comprehensive Income", during the three months ended March
31, 1998. The Statement establishes standards for reporting and display of
comprehensive income and its components (revenues, expenses, gains and losses)
in a full set of general-purpose financial statements. The financial statements
for the three months ended March 31, 1997 have also been restated to reflect the
new statement.
5
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- --------------------------------------------------------------------------------
Comparison of Financial Condition at March 31, 1998 and December 31, 1997:
At March 31, 1998 and December 31, 1997 total assets amounted to $134.3 million
and $149.6 million, respectively. The decrease from December 31, 1997 to March
31, 1998 is attributed to a decrease in cash and deposits, as the Company
refunded deposits to customers as a result of the oversubscription of the stock
offering. Loans receivable, net, increased from $102.0 million at December 31,
1997 to $103.2 million at March 31, 1998, a $1.2 million increase. Savings
deposits decreased $11.8 million from $99.4 million at December 31, 1997 to
$87.6 million at March 31, 1998, due to refunding deposits to customers as a
result of the oversubscription of the stock offering. Investment securities
increased $10.4 million from $6.8 million at December 31, 1997 to $17.2 million
at March 31, 1998, as stock offering proceeds were used to purchase securities
during the first quarter of 1998. Stockholders' equity decreased by $3.3
million for the three months ended March 31, 1998. This decrease is due to $3.6
million of funds used to fully fund the ESOP loan in order to purchase common
stock in the open market and $155,000 of dividends declared, offset by net
income of $519,000.
The Bank's level of nonperforming loans, defined as loans past due 90 days or
more, has historically been and continues to be low as a percentage of total
loans outstanding. The Bank had $682,000 of loans outstanding which were
delinquent more than 90 days at March 30, 1998, compared to $1.4 million at
December 31, 1997. Based on management's analysis of the adequacy of the
allowance for loan losses, the composition of the loan portfolio, the credit
risk inherent in the portfolio and historical loan loss experience, the
allowance for loan losses was increased by $60,000 to $753,000 at March 31, 1998
from $693,000 at December 31, 1997. Management believes the allowance to be
adequate to absorb any future losses in the portfolio.
At March 31, 1998, the Company's capital amounted to $43.7 million, which as a
percentage of total consolidated assets was 32.5%, and was considerably in
excess of the regulatory capital requirements at such date.
Comparison of Operating Results for the Three Months Ended March 31, 1998 and
1997:
General. Net income for the three months ended March 31, 1998 was $519,000
compared to $215,000 during the same quarter in 1997. As discussed below, the
increase in earnings was primarily attributable to interest income earned on the
increase in average outstanding earning assets due to proceeds received in the
stock offering.
Interest income. Interest income increased by $483,000 from $2.2 million for
the three months ended March 31, 1997 to $2.7 million for the three months ended
March 31, 1998. The increase is primarily due to an increase in interest-
earning assets, which amounted to $130.4 million at March 31, 1998 as compared
to $110.2 million at March 31, 1997. Approximately 97% of the Bank's assets
were interest-earning at March 31, 1998, and approximately 78% of such interest-
earning assets were held in the form of loans receivable.
Interest Expense. Interest expense decreased by $117,000 from $1.2 million
during the three months ended March 31, 1997 to $1.1 million for the three
months ended March 31, 1998. There was a lower level of average interest-
bearing liabilities outstanding during the first quarter of 1998 in comparison
to the same quarter a year earlier due to deposits utilized to purchase stock.
6
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULT OF OPERATIONS
- --------------------------------------------------------------------------------
Net interest income. Net interest income increased by $600,000 from $1.0
million for the three months ended March 31, 1997 to $1.6 million for the three
months ended March 31, 1998, primarily due to the increase in interest income
discussed above.
Provision for loan losses. The Bank added $60,000 and $-0- in loan loss
provisions during the quarters ended March 31, 1998 and 1997, respectively.
Provisions, which are charged to operations, and the resulting loan loss
allowances, are amounts the Bank's management believes will be adequate to
absorb losses on existing loans that may become uncollectible. Loans are charged
off against the allowance when management believes that collectibility is
unlikely. The evaluation to increase or decrease the provision and resulting
allowances is based both on prior loan loss experience and other factors, such
as changes in the nature and volume of the loan portfolio, overall portfolio
quality, and current economic conditions.
The Bank's level of nonperforming loans has remained consistently low in
relation to prior periods and total loans outstanding. However, during the
three months ended March 31, 1998, management determined that its allowance for
loan losses should be increased to reflect the credit risk inherent in the
portfolio resulting from the changing economic environment in the Bank's market
area. At March 31, 1998, the Bank's level of general valuation allowances for
loan losses amounted to $753,000, which management believes is adequate to
absorb potential losses in its loan portfolio.
Noninterest expense. Noninterest expense was relatively flat at $703,000 and
$689,000 for the three month period ended March 31, 1998 and 1997, respectively.
Compensation expense included $39,000 of ESOP expense for the three months ended
March 31, 1998. Compensation expense for the three months ended March 31, 1997
includes $45,000 for the defined benefit pension plan, which was terminated in
the third quarter of 1997. All other categories of noninterest expense
fluctuated by insignificant amounts between the two periods.
Capital Resources and Liquidity:
The term "liquidity" generally refers to an organization's ability to generate
adequate amounts of funds to meet its needs for cash. More specifically for
financial institutions, liquidity ensures that adequate funds are available to
meet deposit withdrawals, fund loan and capital expenditure commitments,
maintain reserve requirements, pay operating expenses, and provide funds for
debt service, dividends to stockholders, and other institutional commitments.
Funds are primarily provided through financial resources from operating
activities, expansion of the deposit base, borrowings, through the sale or
maturity of investments, the ability to raise equity capital, or maintenance of
shorter term interest-bearing deposits.
Mooresville Savings Bank must maintain liquidity in the form of cash, cash
equivalents and investment securities, including mortgage-backed securities,
equal to at least 10% of total assets. The Bank's liquidity ratio at March 31,
1998 was considerably in excess of such requirements. The Bank's liquidity has
decreased from December 31, 1997 as deposits were refunded to customers due to
the stock oversubscription. Given its excess liquidity and its ability to
borrow from the Federal Home Loan Bank, the Bank believes that it will have
sufficient funds available to meet anticipated future loan commitments,
unexpected deposit withdrawals, and other cash requirements.
7
<PAGE>
CODDLE CREEK FINANCIAL CORP. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- --------------------------------------------------------------------------------
Year 2000 Issue:
The Year 2000 Issue relates to whether computer systems will properly recognize
and process date sensitive information on and after January 1, 2000. Systems
that do not properly recognize such information could generate erroneous data or
fail. The Company is heavily dependent on computer systems in the conduct of
substantially all of its business activities. The Company is conducting a
comprehensive review of its computer systems, including its core processing
systems maintained by an independent data processing service center, to
identify the systems that could be affected by the Year 2000 Issue. Upon
completion of the assessment phase of the review, management expects to identify
the corrective action required to ensure that the Company's internal and vendor-
maintained systems that are date sensitive are Year 2000 compliant and to test
all such systems prior to the year 2000. Because the Company has not completed
its review of the computer systems, management is unable to estimate the cost of
making all of its systems Year 2000 compliant.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company has not experienced any substantive changes in its portfolio risk
during the three month period ended March 31, 1998.
8
<PAGE>
- --------------------------------------------------------------------------------
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not engaged in any material legal proceedings at the
present time. From time to time, the Company is a party to legal proceedings
within the normal course of business wherein it enforces its security interest
in loans made by it, and other matters of a like kind.
Item 2. Changes in Securities and Use of Proceeds
Not applicable
Item 3. Defaults Upon Senior Securities
Not applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
(a) 27 - Financial Data Schedule
(b) Not applicable
9
<PAGE>
- --------------------------------------------------------------------------------
SIGNATURES
Pursuant to the requirements 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.
Coddle Creek Financial Corp.
Dated May 1, 1998 By: /s/ George W. Brawley, Jr.
------------------- ------------------------------
George W. Brawley
President and CEO
Dated May 1, 1998 By: /s/ Billy R. Williams
------------------- ------------------------------
Billy R. Williams
Secretary/Controller
10
<PAGE>
- --------------------------------------------------------------------------------
SIGNATURES
Pursuant to the requirements 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.
Coddle Creek Financial Corp.
Dated May 1, 1998 By:
-------------------- -------------------------------
George W. Brawley
President and CEO
Dated May 1, 1998 By:
-------------------- -------------------------------
Billy R. Williams
Secretary/Controller
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CODDLE CREEK
FINANCIAL CORP, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1997
<PERIOD-START> JAN-01-1998 JAN-01-1997
<PERIOD-END> MAR-31-1998 MAR-31-1997
<CASH> 10,018 3,412
<INT-BEARING-DEPOSITS> 9,736 3,152
<FED-FUNDS-SOLD> 0 0
<TRADING-ASSETS> 0 0
<INVESTMENTS-HELD-FOR-SALE> 13,909 3,632
<INVESTMENTS-CARRYING> 3,271 4,538
<INVESTMENTS-MARKET> 3,294 4,509
<LOANS> 103,249 97,730
<ALLOWANCE> 754 387
<TOTAL-ASSETS> 134,338 112,611
<DEPOSITS> 87,565 93,539
<SHORT-TERM> 0 2,000
<LIABILITIES-OTHER> 3,068 2,460
<LONG-TERM> 0 0
0 0
0 0
<COMMON> 0 0
<OTHER-SE> 43,705 14,612
<TOTAL-LIABILITIES-AND-EQUITY> 134,338 112,611
<INTEREST-LOAN> 2,194 2,028
<INTEREST-INVEST> 185 133
<INTEREST-OTHER> 283 18
<INTEREST-TOTAL> 2,662 2,179
<INTEREST-DEPOSIT> 1,060 1,146
<INTEREST-EXPENSE> 1,060 1,177
<INTEREST-INCOME-NET> 1,602 1,002
<LOAN-LOSSES> 60 0
<SECURITIES-GAINS> 0 0
<EXPENSE-OTHER> 703 644
<INCOME-PRETAX> 887 358
<INCOME-PRE-EXTRAORDINARY> 887 358
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 519 215
<EPS-PRIMARY> 0.84 0
<EPS-DILUTED> 0.84 0
<YIELD-ACTUAL> 7.52 7.94
<LOANS-NON> 639 996
<LOANS-PAST> 0 41
<LOANS-TROUBLED> 0 0
<LOANS-PROBLEM> 0 0
<ALLOWANCE-OPEN> 693 388
<CHARGE-OFFS> 0 1
<RECOVERIES> 1 0
<ALLOWANCE-CLOSE> 754 387
<ALLOWANCE-DOMESTIC> 278 330
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 476 57
</TABLE>
