As filed with the Securities and Exchange Commission on January 11, 1999
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
|X| AMENDMENT TO QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 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: 0-23293
WARWICK COMMUNITY BANCORP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 06-1497903
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
18 OAKLAND AVENUE, WARWICK, NEW YORK 10990-0591
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(914) 986-2206
(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 reports), and (2) has been subject to such
filing for the past 90 days.
Yes X No
--- ----
As of November 6, 1998, there were 6,606,548 shares of the registrant's
common stock outstanding.
<PAGE>
The Registrant hereby amends the items, financial statements, exhibits
or other portions of its Quarterly Report on Form 10-Q for the period ended
September 30, 1998, which was filed with the Commission on November 16, 1998, as
set forth below:
FORM 10-Q/A
WARWICK COMMUNITY BANCORP, INC.
INDEX
Page
Part I -- FINANCIAL INFORMATION Number
- ------------------------------- ------
Item 1. Financial Statements -- Unaudited
Consolidated Statements of Financial Condition at
September 30, 1998 and December 31, 1997 3
Consolidated Statements of Income for the three and nine
months ended September 30, 1998 and 1997 4
Consolidated Statement of Changes in Equity for
the nine months ended September 30, 1998 5
Consolidated Statements of Cash Flows for the nine
months ended September 30, 1998 and 1997 6
Notes to Unaudited Consolidated Financial Statements 7-11
Signature Page 12
================================================================================
Statements contained in this Form 10-Q which are not historical facts are
forward-looking statements, as that term is defined in the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are subject to
risks and uncertainties which could cause actual results to differ materially
from those projected. Such risks and uncertainties include, but are not limited
to, general economic conditions, changes in interest rates, deposit flows, loan
demand, real estate values and competition; changes in accounting principles,
policies or guidelines; changes in legislation or regulation; other economic,
competitive, governmental, regulatory or technological factors affecting the
Company's operations, pricing, products and services; and other risks detailed
in documents filed by the Company with the Securities and Exchange Commission
from time to time.
================================================================================
2
<PAGE>
PART I -- FINANCIAL INFORMATION
- --------- ---------------------
ITEM 1. FINANCIAL STATEMENTS -- UNAUDITED
---------------------------------
<TABLE>
<CAPTION>
WARWICK COMMUNITY BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)
September 30, 1998 December 31, 1997
--------------------- ---------------------
(Dollars in thousands)
<S> <C> <C>
ASSETS
Cash on hand and in banks.................................. $ 10,361 $ 12,843
Federal funds sold......................................... -- 9,700
Securities:
Available-for-sale, at fair value................... 147,269 122,175
Held-to-maturity, at amortized cost (fair value of
$7,550 at September 30, 1998 and $5,327 at
December 31, 1997).................................. 7,553 5,388
--------- ---------
Total securities.................................. 154,822 127,563
--------- ---------
Mortgage loans, net........................................ 182,279 139,385
Commercial loans........................................... 36,350 28,468
Consumer loans............................................. 16,442 13,716
--------- ---------
Total loans....................................... 235,071 181,569
Allowance for loan losses.................................. (1,673) (1,372)
--------- ---------
Total loans, net.................................. 233,398 180,197
--------- ---------
Accrued interest receivable................................ 2,376 2,161
Federal Home Loan Bank stock............................... 3,915 1,731
Bank premises & equipment, net............................. 5,973 3,200
Other assets............................................... 12,163 3,414
--------- ---------
Total assets..................................... $ 423,008 $ 340,809
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
NOW and money market....................................... $ 55,010 $ 39,784
Savings.................................................... 79,734 75,146
Certificates of deposit.................................... 70,010 75,520
Non-interest bearing checking.............................. 23,299 23,064
--------- ---------
Total depositor accounts.......................... 228,053 213,514
Mortgage escrow funds...................................... 711 1,529
Accrued interest payable................................... 613 208
Securities sold under agreements to repurchase............. 25,310 22,755
FHLB advances.............................................. 71,080 5,250
Other liabilities.......................................... 14,380 11,364
--------- ---------
Total liabilities................................. 340,147 254,620
--------- ---------
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 5,000,000 authorized;
none issued......................................... -- --
Common stock, $.01 par value; 15,000,000 shares
authorized; 6,606,548 shares issued and outstanding
as of September 30, 1998............................ 66 66
Additional paid-in capital................................. 63,392 63,366
Retained earnings.......................................... 30,142 27,382
Net unrealized gain (loss) on securities, net of taxes..... 1,082 1,634
Unearned ESOP common stock................................. (7,413) (6,259)
Unearned RRP common stock.................................. (4,408) --
--------- ---------
Total stockholders' equity........................ 82,861 86,189
--------- ---------
Total liabilities and stockholders' equity........ $ 423,008 $ 340,809
========= =========
</TABLE>
SEE ACCOMPANYING NOTES TO UNAUDITED FINANCIAL STATEMENTS.
3
<PAGE>
<TABLE>
<CAPTION>
WARWICK COMMUNITY BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
For the three months For the nine months
ended September 30, ended September 30,
1998 1997 1998 1997
---- ---- ---- ----
(Dollars in thousands, except per share amounts)
<S> <C> <C> <C> <C>
Interest Income:
Interest on mortgage loans.......................... $3,334 $2,286 $ 9,091 $ 6,231
Interest on other loans............................. 1,038 884 3,041 2,693
Interest and dividends on securities................ 2,821 2,092 8,596 6,760
Interest on federal funds sold...................... ----- 26 70 45
Interest on short-term money market instruments..... 8 7 27 17
----- ----- ------ ------
Total interest income.......................... 7,201 5,295 20,825 15,746
--------- ----- ------ ------
Interest Expense:
Time deposits....................................... 869 984 2,682 2,923
Money market deposits............................... 294 217 712 646
Savings deposits.................................... 668 654 1,931 1,904
Mortgagors' escrow deposits......................... 35 26 75 64
Interest on borrowings.............................. 1,318 463 3,170 1,534
----- ----- ------ ------
Total interest expense......................... 3,184 2,344 8,570 7,071
----- ----- ------ ------
Net interest income........................... 4,017 2,951 12,255 8,675
----- ----- ------ ------
Provision for Loan Losses............................... (125) (260) (375) (394)
----- ----- ------ ------
Net interest income after provision for loan losses. 3,892 2,691 11,880 8,281
----- ----- ------ ------
Other Income (Loss):
Service and fee income.............................. 568 527 1,673 1,514
Securities transactions............................. 217 295 851 369
Loan transactions................................... 93 15 130 88
Other income or (loss).............................. 166 24 220 44
----- ----- ------ ------
Total other income, net........................ 1,044 861 2,874 2,015
----- ----- ------ ------
Other Expenses:
Salaries and employee benefits...................... 1,813 1,294 5,134 4,027
ESOP benefits....................................... 191 -- 302 --
RRP benefits........................................ 159 -- 159 --
FDIC insurance...................................... 7 7 21 21
Occupancy........................................... 147 172 525 535
Data processing..................................... 213 158 579 467
Advertising......................................... 125 34 187 127
Professional Fees................................... 199 69 595 110
Other............................................... 845 612 2,125 1,886
----- ----- ------ ------
Total other expenses........................... 3,699 2,346 9,627 7,173
----- ----- ------ ------
Income before provision for income taxes............ 1,237 1,206 5,127 3,123
Provision for Income Taxes.............................. 503 486 2,103 1,289
----- ----- ------ ------
Net Income.......................................... $ 734 $ 720 $ 3,024 $ 1,834
===== ===== ====== ======
Weighted Average:
Common shares....................................... 5,871 N/A 6,033 N/A
Dilutive stock options.............................. -- N/A -- N/A
----- ------
5,871 N/A 6,033 N/A
===== ======
Earnings per Share:
Basic............................................... $ 0.12 N/A $ 0.50 N/A
Diluted............................................. $ 0.12 N/A $ 0.50 N/A
</TABLE>
SEE ACCOMPANYING NOTES TO UNAUDITED FINANCIAL STATEMENTS.
4
<PAGE>
<TABLE>
<CAPTION>
WARWICK COMMUNITY BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
Unrealized
Gain/(Loss) Unearned Unearned
Additional on A-F-S ESOP RRP
Common Paid In Retained Securities, Common Common
Stock Capital Earnings net Stock Stock Total
--------- ---------- ------------ ------------ ------------- ---------- ----------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, December 31,1996 -- -- $26,384 $ 141 -- -- $26,525
Net Income, January 1, 1997 -
September 30, 1997 -- -- 1,833 -- -- -- 1,833
Deferred tax adjustment -- -- 99 -- -- -- 99
Change in unrealized gain or loss on
securities available-for-sale, net -- -- -- 1,399 -- -- 1,399
----- ------- ------- ------ -------- ------- --------
BALANCE, September 30, 1997 -- -- 28,316 1,540 -- -- 29,856
----- ------- ------- ------ -------- ------- --------
BALANCE, December 31, 1997 66 63,366 27,382 1,634 (6,259) -- 86,189
Net Income, January 1, 1997 -
September 30, 1998 -- -- 3,024 -- -- -- 3,024
Open market purchases of Warwick
Community Bancorp, Inc. common
stock by ESOP trustee -- -- -- -- (1,563) -- (1,563)
Open market purchases of Warwick
Community Bancorp, Inc. common
stock by RRP trustee -- -- -- -- -- (4,408) (4,408)
Cash dividends on common stock ($.04) -- -- (264) -- -- -- (264)
Allocation from shares purchased with
1998 contribution -- 26 -- -- 409 -- 435
Change in unrealized gain or loss on
securities available-for-sale, net -- -- -- (552) -- -- (552)
----- ------- ------- ------ -------- ------- --------
BALANCE, September 30, 1998 $ 66 $63,392 $30,142 $1,082 $ (7,413) $(4,408) $ 82,861
----- ------- ------- ------ -------- ------- --------
</TABLE>
SEE ACCOMPANYING NOTES TO UNAUDITED FINANCIAL STATEMENTS.
5
<PAGE>
<TABLE>
<CAPTION>
WARWICK COMMUNITY BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the nine months
ended September 30,
1998 1997
--------- ---------
(in thousands)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income....................................................................... $3,024 $1,833
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
Depreciation................................................................... 353 352
Accretion of (discount)/amortization of premium on investment securities...... (1,025) 283
Net (increase)/decrease in accrued interest receivable......................... (215) (120)
(Increase)/decrease in mortgage servicing rights and other assets (8,749) (2,088)
Provision for loan losses...................................................... 375 394
Net (gain) or loss on sale of loans............................................ (130) (88)
Net (gain) or loss on sale of securities....................................... (851) (369)
Increase/(decrease) in accrued interest payable................................ 405 (43)
Increase/(decrease) in accrued expenses and other liabilities.................. 3,016 3,000
----- -----
Total reconciliation adjustments................................................. (6,821) 4,572
------ -----
Net cash provided by operating activities.............................. (3,797) 6,405
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and calls of securities, H-T-M.......................... -- --
Proceeds from maturities and calls of securities, A-F-S.......................... 26,810 3,100
Purchases of securities, H-T-M................................................... -- --
Purchases of securities, A-F-S................................................... (83,080) (22,167)
Purchases of trading securities.................................................. (55,692) (9,938)
Proceeds from sale of trading securities and securities
available-for-sale............................................................... 67,085 46,226
Principal repayments from mortgage-backed securities............................. 19,132 8,384
Purchases of FHLBNY capital stock................................................ (2,184) (553)
Net (increase)/decrease in loans................................................. (53,201) (30,732)
Purchases of fixed assets, net................................................... (3,126) (1,140)
------- ------
Net cash used in investing activities.................................. (84,256) (6,820)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in deposits.............................................. 14,539 (813)
Net increase (decrease) in escrow deposits....................................... (818) (453)
Net increase (decrease) in borrowed funds........................................ 68,385 (835)
Dividends on common stock........................................................ (264) --
Purchase of ESOP common stock.................................................... (1,563) --
Purchase of RRP common stock..................................................... (4,408) --
Net cash provided by financing activities.............................. 75,871 (2,101)
Net increase (decrease) in cash ....................................... (12,182) (2,516)
CASH AT BEGINNING OF PERIOD...................................................... 22,543 11,769
CASH AT END OF PERIOD............................................................ 10,361 9,253
======= ======
CHANGE IN CASH................................................................... $(12,182) $(2,516)
</TABLE>
SEE ACCOMPANYING NOTES TO UNAUDITED FINANCIAL STATEMENTS.
6
<PAGE>
WARWICK COMMUNITY BANCORP, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements include
the accounts of Warwick Community Bancorp, Inc. ("Company") and its wholly owned
subsidiary The Warwick Savings Bank ("Bank"). In July 1998, the Company changed
its fiscal year end from May 31st to December 31st, and, accordingly, the
accompanying unaudited consolidated financial statements have been prepared
based on the Company's new fiscal year end.
The unaudited consolidated financial statements included herein reflect
all normal recurring adjustments which are, in the opinion of management,
necessary to present a fair statement of the results for the interim periods
presented. The results of operations for the three and nine months ended
September 30, 1998 are not necessarily indicative of the results of operations
that may be expected for the entire year ending December 31, 1998. Certain
information and note disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to the rules and regulations of the U.S.
Securities and Exchange Commission.
These unaudited consolidated financial statements should be read in
conjunction with the Company's audited consolidated financial statements and
notes thereto included in the Company's Annual Report to Shareholders for the
fiscal year ended May 31, 1998.
2. EARNINGS PER SHARE
On December 23, 1997, the Company completed its initial public offering
of 6,606,548 shares of common stock. In connection with the offering,
approximately 8% of the shares issued (528,523) were purchased by the Warwick
Community Bancorp Inc. Employee Stock Ownership Plan ("ESOP") using the proceeds
of a loan from the Company to the ESOP. Through September 30, 1998, 31,016
shares were allocated to participants and 39,639 shares were committed to be
released. The remaining 457,868 shares have not yet been released and, under
AICPA Statement of Position 93-6, these shares will not be considered
outstanding for purposes of calculating per share amounts. Earnings per share
are not presented for periods prior to the initial public offering because the
Company had no stock outstanding prior to that time. As of September 30, 1998,
the Company had no securities that could be converted into common stock, nor did
the Company have any contracts that could result in the issuance of common
stock. Hence, in accordance with Statement of Financial Accounting Standards No.
128 "Earnings per Share," basic and diluted earnings per share are identical.
On June 24, 1998, the Stock Option Plan of Warwick Community Bancorp,
Inc. ("Option Plan") and the Recognition and Retention Plan of Warwick Community
Bancorp, Inc. ("RRP") were approved by the Company's shareholders. The Company
has reserved 660,654 shares of common stock for issuance upon exercise of stock
options granted under the Option Plan. The trust established for the RRP ("RRP
Trust") purchased 264,261 shares of common stock of the Company in open market
purchases. As of September 30, 1998, all of the shares of common stock held in
the trust had been awarded, but not distributed, to participants. Such shares
generally vest and become distributable to participants at a rate of 20% per
year beginning on June 24, 1999.
3. COMPREHENSIVE INCOME
The Company adopted Statement of Financial Accounting Standards No. 130
"Reporting Comprehensive Income" ("SFAS No. 130") in 1997. All comparative
financial statements provided for earlier periods have been reclassified to
reflect application of the provisions of this statement.
7
<PAGE>
Comprehensive income includes net income and all other changes in
equity during a period except those resulting from investments by owners and
distributions to owners. Other comprehensive income includes revenues, expenses,
gains and losses that under generally accepted accounting principles are
included in comprehensive income but excluded from net income.
Comprehensive income and accumulated other comprehensive income are
reported net of related income taxes. Accumulated other comprehensive income for
the Company consists solely of unrealized holding gains or losses on available
for sale securities.
For the nine months ended September 30, 1998 and 1997, comprehensive
income consisted of the following:
<TABLE>
<CAPTION>
September 30, September 30,
1998 1997
------------- ------------
(Dollars in thousands)
<S> <C> <C>
Net income......................................................... $3,024 $1,833
Change in unrealized gain (loss) on securities available for sale.. (552) 1,399
------ ------
Comprehensive income............................................... $2,472 $3,232
====== ======
</TABLE>
For the three months ended September 30, 1998 and 1997, comprehensive
income consisted of the following:
<TABLE>
<CAPTION>
September 30, September 30,
1998 1997
------------- --------------
(Dollars in thousands)
<S> <C> <C>
Net income........................................................... $734 $ 720
Change in unrealized gain (loss) on securities available for sale.... (325) 448
---- ---
Comprehensive income................................................. $409 $1,168
==== ======
</TABLE>
8
<PAGE>
4. LOAN PORTFOLIO COMPOSITION
The following table sets forth the composition of the Company's loan
portfolio in dollar amounts and percentage of the portfolio at the dates
indicated.
<TABLE>
<CAPTION>
At September 30, 1998 At December 31, 1997
--------------------------- ----------------------------
Percent Percent
Amount of Total Amount of Total
------------ ------------- ------------ ------------
(Dollars in thousands)
<S> <C> <C> <C> <C>
MORTGAGE LOANS:
Conventional one- to four-family loans......... $145,423 61.86% $114,229 62.91%
Mortgage loans held for sale................... 10,936 4.66 5,334 2.94
VA and FHA loans............................... 266 0.11 555 0.31
Home equity loans.............................. 17,275 7.35 15,618 8.60
Residential construction loans................. 16,268 6.92 6,159 3.39
Undisbursed portion of construction loans...... (7,890) (3.36) (2,510) (1.38)
-------- ------ -------- ------
Total mortgage loans........................ 182,279 77.54 139,385 76.77
------- ------ -------- ------
CONSUMER AND OTHER LOANS:
Commercial loans by type:
Non-farm and non-residential................ 18,238 7.76 13,278 7.31
One- to four-family residential............. 2,104 0.90 1,128 0.62
Multi-family................................ 3,782 1.61 3,664 2.02
Farm........................................ 999 0.42 411 0.23
Acquisition, development and
construction............................... 4,810 2.05 2,841 1.56
Term loans.................................. 377 0.16 444 0.24
Installment loans........................... 2,264 0.96 2,037 1.13
Demand loans................................ 637 0.27 497 0.27
Time loans.................................. 120 0.05 87 0.05
SBA loans................................... 337 0.14 533 0.29
Lines-of-credit............................. 2,514 1.07 2,907 1.60
Loans and draws disbursed................... 50 0.02 430 0.24
Non-accrual................................. 118 0.05 211 0.12
-------- ------ -------- ------
Total commercial loans..................... 36,350 15.46 28,468 15.68
Automobile..................................... 10,468 4.45 8,125 4.47
Student........................................ 1,572 0.67 1,194 0.66
Credit card.................................... 1,271 0.54 1,402 0.77
Other consumer loans........................... 3,131 1.33 2,995 1.65
-------- ------ -------- ------
Total consumer Loans........................... 16,442 6.99 13,716 7.55
Total consumer and other loans.............. 52,792 22.46 42,184 23.23
-------- ------ --------
Total loans............................. 235,071 100.00% 181,569 100.00%
====== ======
Allowance for loan losses..................... (1,673) (1,372)
-------- --------
Total loans, net............................ $233,398 $180,197
======== ========
</TABLE>
9
<PAGE>
5. NON-PERFORMING ASSETS
The following table sets forth information regarding non-accrual loans,
other past due loans and other real estate owned at the dates indicated.
<TABLE>
<CAPTION>
September 30, December 31,
1998 1997
------------------ ----------------
(Dollars in thousands)
<S> <C> <C>
Non-accrual mortgage loans delinquent more
than 90 days....................................................... $ 883 $ 1,165
Non-accrual other loans delinquent more than 90 days............... 156 246
------- ------
Total non-accrual loans............................................ 1,039 1,411
Total 90 days or more delinquent and still accruing................ 81 114
------- -------
Total non-performing loans......................................... $ 1,120 $ 1,525
Total foreclosed real estate, net of related allowance for losses.. 617 322
Total non-performing assets........................................ $ 1,737 $ 1,847
======= =======
Non-performing loans to total loans................................ 0.48% 0.85%
Total non-performing assets to total assets........................ 0.41% 0.54%
</TABLE>
10
<PAGE>
6. ALLOWANCE FOR LOAN LOSSES
The following table sets forth the activity in the Company's allowance
for loan losses at and for the periods indicated.
<TABLE>
<CAPTION>
Nine Months Ended At or For the Year
September 30, Ended December 31,
------------------------------ ------------------
1998 1997 1997
------------- -------------- ------------------
(Dollars in thousands)
ALLOWANCE FOR LOAN LOSSES:
- --------------------------
<S> <C> <C> <C>
Balance at beginning of period................ $1,372 $1,184 $1,184
CHARGE-OFFS:
Real estate mortgage loans.............. 25 110 160
Commercial loans........................ 51 1 1
Consumer loans.......................... 26 90 118
------ ------ ------
Total charge-offs....................... 102 201 279
RECOVERIES:
Real estate mortgage loans.............. 0 0 1
Commercial loans........................ 19 0 0
Consumer loans.......................... 9 10 12
------ ------ ------
Total recoveries........................ 28 10 13
Provision for loan losses..................... 375 394 454
------ ------ ------
Balance at end of Period...................... $1,673 $1,387 $1,372
====== ====== ======
Ratio of net charge-offs during the period to
average loans outstanding..................... 0.04% 0.12% 0.15%
Ratio of allowance for loan losses to total
loans at end of period........................ 0.71% 0.86% 0.76%
Ratio of allowance for loan losses to non-
performing loans.............................. 149.38% 93.65% 89.98%
</TABLE>
11
<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.
WARWICK COMMUNITY BANCORP, INC.
(Registrant)
Date: January 12, 1999 By: /s/ Ronald J. Gentile
-------------------------------------
Ronald J. Gentile
President and Chief Operating Officer
Date: January 12, 1999 By: /s/ Arthur W. Budich
-------------------------------------
Arthur W. Budich
Senior Vice President and
Chief Financial Officer
12
