<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended Commission File Number:
June 30, 1999 333-39203
MARINE BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Florida 65-0729764
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
501 Goodlette Road North, Suite D-12, Naples, Florida 34102
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (941) 434-0441
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Not Applicable
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(Former name, former address and former fiscal year, if changed since last
report)
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.
Yes X No
-----
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Common Stock, $.01 Par Value 1,150,000
---------------------------------
Class Outstanding as of June 30, 1999
Transitional Small Business Disclosure Format:
Yes No X
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<PAGE> 2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
MARINE BANCSHARES, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, 1999 December 31, 1998
------------- -----------------
ASSETS (Unaudited)
<S> <C> <C>
Cash and due from banks $ 26,968 $ 9,104
Federal funds sold 9,760,000 --
------------ -----------
Total cash and cash equivalents 9,786,968 9,104
Securities available for sale -- --
Loans -- --
Less allowance for loan losses -- --
------------ -----------
Net loans -- --
Deferred offering costs -- 199,718
Premises and equipment, net 289,629 15,234
Accrued interest & other assets 76,705 56,191
------------ -----------
Total assets $ 10,153,302 $ 280,247
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Non-interest bearing $ -- $ --
Interest bearing -- --
------------ -----------
Total deposits -- --
Accounts payable 198,757 79,774
Loans payable -- 845,000
Advances from organizers -- 50,000
Customer repurchase agreements -- --
Accrued interest & other liabilities -- 169,023
------------ -----------
Total liabilities 198,757 1,143,797
Shareholders' equity:
Preferred stock, par value $.01 per share,
2,000,000 shares authorized; no shares
issued and outstanding -- --
Common stock, par value $.01 per share,
10,000,000 shares authorized; 1,150,000 shares
issued and outstanding 11,500 1
Additional paid-in capital 10,831,123 99
Deficit (888,078) (863,650)
Unrealized loss on securities available for sale -- --
------------ -----------
Total shareholders' equity 9,954,545 (863,550)
------------ -----------
Total liabilities and shareholders' equity $ 10,153,302 $ 280,247
============ ===========
</TABLE>
See accompanying notes to financial statements
<PAGE> 3
MARINE BANCSHARES, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended June 30,
---------------------------
1999 1998
---- ----
<S> <C> <C>
Interest income:
Interest and fees on loans $ -- $ --
Interest on securities -- --
Interest on federal funds sold 117,204 --
Interest on reverse repurchase agreement -- --
Interest other 272 655
---------- -------
Total interest income 117,476 655
Interest expense:
Interest on deposits -- --
Interest on repurchase agreements -- --
Interest other -- --
---------- -------
Total interest expense -- --
---------- -------
Net interest income 117,476 655
Provision for loan losses -- --
---------- -------
Net interest income after
Provision for loan losses 117,476 655
Non-interest income
Non-interest expense:
Salaries and benefits 67,902 --
Occupancy and equipment expense 3,093 873
Other expense 31,919 7,715
---------- -------
Total non-interest expense 102,914 8,588
---------- -------
Net income (loss) 14,562 (7,933)
---------- -------
Other comprehensive income (loss) -- --
---------- -------
Comprehensive income (loss) $ 14,562 $(7,933)
========== =======
Net loss per share $ 0.01 $(79.33)
========== =======
Average shares outstanding 1,150,000 100
========== =======
</TABLE>
See accompanying notes to financial statements
<PAGE> 4
MARINE BANCSHARES, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended June 30,
----------------------------
1999 1998
---- ----
<S> <C> <C>
Interest income:
Interest and fees on loans $ -- $ --
Interest on securities -- --
Interest on federal funds sold 177,363 --
Interest on reverse repurchase agreement -- --
Interest other 272 3,026
--------- --------
Total interest income 177,635 3,026
Interest expense:
Interest on deposits -- --
Interest on repurchase agreements -- --
Interest other 10,129 --
--------- --------
Total interest expense 10,129 --
--------- --------
Net interest income 167,506 3,026
Provision for loan losses -- --
--------- --------
Net interest income after
Provision for loan losses 167,506 3,026
Non-interest income
Non-interest expense:
Salaries and benefits 118,209 221
Occupancy and equipment expense 6,901 968
Other expense 66,824 27,610
--------- --------
Total non-interest expense 191,934 28,799
--------- --------
Net loss (24,428) (25,773)
--------- --------
Other comprehensive income (loss) -- --
--------- --------
Comprehensive income (loss) $ (24,428) $(25,773)
========= ========
Net loss per share $ (0.03) $(257.73)
========= ========
Average shares outstanding 888,078 100
========= ========
</TABLE>
See accompanying notes to financial statements
<PAGE> 5
MARINE BANCSHARES, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended June 30,
--------------------------------
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 14,562 $ (7,933)
Adjustments to reconcile net income (loss) to net
cash used in operating activities:
Depreciation 1,012 --
Provision for loan losses -- --
Decrease in deferred
offering costs -- --
(Increase) Decrease in accrued interest
and other assets (34,866) (5,000)
Increase (Decrease) in accrued interest
and other liabilities 191,628 6,190
----------- ---------
Total adjustments 157,774 1,190
----------- ---------
Net cash used in operating activities 172,336 (6,743)
----------- ---------
Cash flow from investing activities:
Net increase in loans -- --
Purchase of securities available for sale -- --
Maturity of securities available for sale -- --
Purchase of premises and equipment (247,072) --
----------- ---------
Net cash used in investing activities (247,072) --
----------- ---------
Cash flow from financing activities:
Net proceeds (retirement) of common stock -- --
Payments on loans payable -- (25,000)
Increase in customer repurchase agreements --
Proceeds (Repayments) on organizers advances -- --
----------- ---------
Net cash provided by financing activities -- (25,000)
----------- ---------
Increase (Decrease) in cash and cash equivalents (74,736) (31,743)
Cash and cash equivalents, beginning of period 9,861,704 106,371
----------- ---------
Cash and cash equivalents, end of period $ 9,786,968 $ 74,628
=========== =========
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ -- $ 1,810
=========== =========
Supplemental schedule of noncash financing activities:
Settlement of organizers advances in exchange
for issuance of common stock $ -- $ --
=========== =========
</TABLE>
See accompanying notes to financial statements
<PAGE> 6
MARINE BANCSHARES, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended June 30,
--------------------------------
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (24,428) $ (25,773)
Adjustments to reconcile net income (loss) to net
cash used in operating activities:
Depreciation 2,024 --
Provision for loan losses -- --
Decrease in deferred
offering costs 199,718 --
(Increase) Decrease in accrued interest
and other assets (20,513) (10,646)
Increase (Decrease) in accrued interest
and other liabilities (50,040) (22,821)
------------ ---------
Total adjustments 131,189 (33,467)
------------ ---------
Net cash used in operating activities 106,761 (59,240)
------------ ---------
Cash flow from investing activities:
Net increase in loans -- --
Purchase of securities available for sale -- --
Maturity of securities available for sale -- --
Purchase of premises and equipment (276,420) (2,232)
------------ ---------
Net cash used in investing activities (276,420) (2,232)
------------ ---------
Cash flow from financing activities:
Net proceeds (retirement) of common stock 10,842,523 (1,100)
Payments on loans payable (845,000) (50,000)
Increase in customer repurchase agreements --
Proceeds (Repayments) on organizers advances (50,000) 40,000
------------ ---------
Net cash provided by financing activities 9,947,523 (11,100)
------------ ---------
Increase (Decrease) in cash and cash equivalents 9,777,864 (72,572)
Cash and cash equivalents, beginning of period 9,104 147,200
------------ ---------
Cash and cash equivalents, end of period $ 9,786,968 $ 74,628
============ =========
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 94,108 $ 3,196
============ =========
Supplemental schedule of noncash financing activities:
Settlement of organizers advances in exchange
for issuance of common stock $ -- $ --
============ =========
</TABLE>
See accompanying notes to financial statements
<PAGE> 7
MARINE BANCSHARES, INC.
NOTES TO FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 1999
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION
Organization:
Marine Bancshares, Inc. (the "Company") was incorporated under the laws
of the state of Florida on January 23, 1997. The Company is in the development
stage and its activities have been limited to the organization of the Bank, as
well as the offering of $11,500,000 in common stock (the "Offering").
Approximately $9 million of the proceeds of the Offering are intended to be used
by the Company to provide for the capitalization of the Bank.
Basis of Presentation:
The accompanying unaudited financial statements include the accounts of
the Company. No intercompany accounts or transactions exist.
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and in accordance with instructions to Form 10-QSB. 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 (consisting of normal recurring accruals)
considered necessary have been made for the fair presentation of the Company's
financial position and results of operations. Operating results for the six
month period ended June 30, 1999 are not necessarily indicative of the results
that may be expected for the year ended December 31, 1999.
NOTE B - INITIAL PUBLIC OFFERING
On February 10, 1999, the Company sold 1,150,000 shares of common stock
in a public offering providing net proceeds of approximately $10.8 million after
deducting underwriters discounts and offering costs. The net proceeds from the
public offering are being held in an overnight fed funds account until the Bank
obtains its charter and begins purchasing other investment securities.
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The following discussion of the Company's financial condition and
results of operations should be read in conjunction with the Company's
Consolidated Financial Statements, related notes and statistical information
included elsewhere herein.
PLAN OF OPERATIONS
The Company and the Bank are still in a developmental stage and will
remain in such stage until the Bank commences operations. During the four month
period subsequent to the date of the Company's financial statements included
herein, management of the Company and the Bank intends to complete preparations
for, and to consummate, the opening of the Bank for business. The Company
believes that it can satisfy its cash requirements during the next twelve months
without raising additional funds.
In connection with the anticipated opening of the Bank, the Company
expects to expend approximately $400,000 on improvements to the Bank's leased
office space and approximately $100,000 for various items of equipment
necessary to Bank operations. In addition, the Company expects that, by the
latter half of August 1999, it will hire approximately eleven additional
employees to conduct the Bank's operations.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Certain statements in this Quarterly Report on Form 10-QSB constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, such as statements relating to the financial
condition and prospects, lending risks, Year 2000 readiness, plans for future
business development and marketing activities, capital spending and financing
sources, capital structure, the effects of regulation and competition, and the
prospective business of both the Company and the Bank. Where used in this
Quarterly Report, the words "anticipate," "believe," "estimate," "expect,"
"intend," and similar words and expressions, as they relate to the Company or
the Bank or their respective managements, identify forward-looking statements.
Such forward-looking statements reflect the current views of the Company and are
based on information currently available to the management of the Company and
the Bank and upon current expectations, estimates, and projections about the
Company and its industry, management's beliefs with respect thereto, and certain
assumptions made by management. These forward-looking statements are not
guarantees of future performance and are subject to risks, uncertainties, and
other factors which could cause actual results to differ materially from those
expressed or implied by such forward-looking statements. Potential risks and
uncertainties include, but are not limited to: (i) significant increases in
competitive pressure in the banking and financial services industries; (ii)
changes in the interest rate environment which could reduce anticipated or
actual margins; (iii) changes in political conditions or the legislative or
regulatory environment; (iv) general economic conditions, either nationally or
regionally (especially in southwest Florida), becoming less favorable than
expected resulting in, among other things, a deterioration in credit quality;
(v) changes occurring in business conditions and inflation; (vi) changes in
technology; (vii) changes in monetary and tax policies; (viii) changes in the
securities markets; and (ix) other risks and uncertainties detailed from time to
time in the filings of the Company with the Commission.
<PAGE> 9
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits. The following exhibit is filed with this report:
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
27 Financial Data Schedule (for SEC use only)
</TABLE>
(b) Reports on Form 8-K. No report on Form 8-K was filed
during the quarter ended June 30, 1999.
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.
Dated: August 13, 1999 By: /s/ Richard E. Horne
-------------------------------------
Richard E. Horne
President and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE UNAUDITED
FINANCIAL STATEMENTS OF MARINE BANCSHARES INC DATED JUNE 30, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 26,968
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 9,760,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 0
<ALLOWANCE> 0
<TOTAL-ASSETS> 10,153,302
<DEPOSITS> 0
<SHORT-TERM> 0
<LIABILITIES-OTHER> 198,757
<LONG-TERM> 0
0
0
<COMMON> 11,500
<OTHER-SE> 9,943,045
<TOTAL-LIABILITIES-AND-EQUITY> 10,153,302
<INTEREST-LOAN> 0
<INTEREST-INVEST> 0
<INTEREST-OTHER> 177,635
<INTEREST-TOTAL> 177,635
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 10,129
<INTEREST-INCOME-NET> 167,506
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 191,934
<INCOME-PRETAX> (24,428)
<INCOME-PRE-EXTRAORDINARY> (24,428)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (24,428)
<EPS-BASIC> (0.03)
<EPS-DILUTED> (0.03)
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
