<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION REPORT FROM _____ TO _____
Commission file number 0-23619
Tarpon Coast Bancorp, Inc.
--------------------------
(Exact name of small business issuer as specified in its charter)
Florida 65-0772718
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1490 Tamiami Trail
Port Charlotte, FL 33948
------------------------
(Address of principal executive offices)
941-629-8111
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(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant, as 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.
Class Outstanding as of March 31, 2000
------ --------------------------------
Common Stock, $.01 par value 1,182,151
Transitional Small Business Disclosure Format: Yes [ ] No [X]
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TARPON COAST BANCORP, INC.
INDEX
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheet as of March 31, 2000 and December 31, 1999 1
Statement of Operations for the Three Months
Ended March 31, 2000 and 1999 2
Statement of Cash Flows for the Three Months
Ended March 31, 2000 and 1999 3
Notes to Financial Statements 4
Item 2. Management's Discussion and Analysis 5
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 7
Item 6. Exhibits and Reports on Form 8-K 7
SIGNATURES 7
EXHIBIT INDEX 7
<PAGE> 3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
TARPON COAST BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, 2000 December 31,1999
-------------- ----------------
(Unaudited)
<S> <C> <C>
ASSETS
Cash and due from banks $ 2,242,248 $ 2,224,990
Federal funds sold 4,100,000 --
------------ ------------
Total cash and cash equivalents 6,342,248 2,224,990
Securities available for sale 9,282,889 9,467,906
Loans 32,634,265 29,390,411
Less allowance for loan losses (423,486) (454,576)
------------ ------------
Net loans 32,210,779 28,935,835
Premises and equipment, net 3,482,598 3,123,866
Accrued interest & other assets 430,969 351,066
------------ ------------
Total assets $ 51,749,483 $ 44,103,663
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Non-interest bearing $ 6,163,264 $ 5,192,481
Interest bearing 30,828,248 24,292,246
------------ ------------
Total deposits 36,991,512 29,484,727
Customer Repurchase Agreements 5,596,739 5,309,717
Accrued interest & other liabilities 113,247 184,440
------------ ------------
Total liabilities 42,701,498 34,978,884
Shareholders' equity:
Common stock, par value $.01 per share,
10,000,000 shares authorized; 1,182,151 shares
issued and outstanding 11,821 11,821
Additional paid-in capital 10,940,915 10,940,915
Deficit (1,705,995) (1,638,175)
Unrealized loss on securities available for sale (198,756) (189,782)
------------ ------------
Total shareholders' equity 9,047,985 9,124,779
------------ ------------
Total liabilities and shareholders' equity $ 51,749,483 $ 44,103,663
============ ============
</TABLE>
See accompanying notes to financial statements.
1
<PAGE> 4
TARPON COAST BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended March 31,
2000 1999
----------- -----------
Interest income:
Interest and fees on loans $ 629,895 $ 190,602
Interest on securities 141,277 118,057
Interest on federal funds sold 6,567 51,832
----------- -----------
Total interest income 777,739 360,491
Interest expense:
Interest on deposits 286,229 137,927
Interest on repurchase agreements 56,458 9,509
----------- -----------
Total interest expense 342,687 147,436
----------- -----------
Net interest income 435,052 213,055
Provision for loan losses 25,000 75,000
----------- -----------
Net interest income after
provision for loan losses 410,052 138,055
Non-interest income 33,961 12,472
Non-interest expense:
Salaries and benefits 266,807 195,418
Occupancy and equipment expense 91,922 54,368
Other expense 153,104 104,542
----------- -----------
Total non-interest expense 511,833 354,328
----------- -----------
Net loss (67,820) (203,801)
----------- -----------
Other comprehensive income (loss) (8,974) (18,831)
----------- -----------
Comprehensive income (loss) $ (76,794) $ (222,632)
=========== ===========
Net loss per share $ (0.06) $ (0.17)
=========== ===========
Average shares outstanding 1,182,151 1,182,151
=========== ===========
See accompanying notes to financial statements.
2
<PAGE> 5
TARPON COAST BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended March 31,
2000 1999
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (67,820) $ (203,801)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation 52,915 23,937
Provision for loan losses 25,000 75,000
(Increase) Decrease in accrued interest
and other assets (79,903) (539,713)
Increase (Decrease) in accrued interest
and other liabilities (71,193) (11,936)
----------- -----------
Total adjustments (73,181) (452,712)
----------- -----------
Net cash used in operating activities (141,001) (656,513)
----------- -----------
Cash flows from investing activities:
Net increase in loans (3,299,944) (3,654,543)
Purchases of securities available for sale -- (1,534,457)
Maturities of securities available for sale 176,043 1,630,234
Purchases of premises and equipment (411,647) (342,928)
----------- -----------
Net cash used in investing activities (3,535,548) (3,901,694)
----------- -----------
Cash flows from financing activities:
Increase in deposits 7,506,785 6,846,283
Increase in customer repurchase agreements 287,022 492,728
----------- -----------
Net cash provided by financing activities 7,793,807 7,339,011
----------- -----------
Increase (Decrease) in cash and cash equivalents 4,117,258 2,780,804
Cash and cash equivalents, beginning of period 2,224,990 4,690,881
----------- -----------
Cash and cash equivalents, end of period $ 6,342,248 $ 7,471,685
=========== ===========
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 336,091 $ 143,859
=========== ===========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 6
TARPON COAST BANCORP, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION
Organization:
Tarpon Coast Bancorp, Inc. (the "Company") was incorporated under the
laws of the state of Florida on August 7, 1997. Effective June 1, 1998, the
Company's new wholly owned subsidiary, Tarpon Coast National Bank (the "Bank")
received federal regulatory approval to commence its banking operations.
Contemporaneously, the Company became a registered bank holding company under
the Bank Holding Company Act of 1956, as amended. Until June 1, 1998, the
Company was in the development stage and its activities were limited to the
organization of the Bank, as well as the offering of $11,500,000 in common
stock (the "Offering"). Approximately $8.2 million of the proceeds of the
Offering have been used by the Company to provide for the capitalization of the
Bank. Also effective June 1, 1998, the Bank received approval from the Federal
Deposit Insurance Corporation (the "FDIC") for deposit insurance.
Basis of Presentation:
The accompanying unaudited consolidated financial statements include
the accounts of the Company. All inter-company accounts and transactions have
been eliminated in consolidation.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and 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 consolidated financial position and results of operations. Operating
results for the three-month period ended March 31, 2000 are not necessarily
indicative of the results that may be expected for the year ended December 31,
2000.
4
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
GENERAL
The following is a discussion of the Company's financial condition and results
of operations for the period ended March 31, 2000:
FINANCIAL CONDITION
At March 31, 2000, the Company had approximately $37 million in deposits and
$5.6 million in customer repurchase agreements as compared to $29.5 million and
$5.3 million, respectively, at December 31, 1999. Stockholders equity comprised
$9 million at March 31, 2000 compared to $9.1 million at December 31, 1999.
At March 31, 2000, the Company used these funds to generate $32.2 million in
net loans ($28.9 million at December 31, 1999) and approximately $6.8 million
in unfunded loan commitments. At March 31, 2000 it also held approximately $9.3
million ($9.5 million at December 31, 1999) in investment securities. At March
31, 2000, the Company had $3.5 million ($ 3.1 million at December 31, 1999) in
premises and equipment. The Company's remaining liquidity at March 31, 2000,
less current cash reserve requirements was invested in overnight federal funds
of $4.1 million.
RESULTS OF OPERATIONS
For the three-month period ended March 31, 2000, the Company reported a net
loss of $67,820, compared to $203,801 for the comparable period in 1999.
Interest income for the three-month periods was $777,739 in 2000 and $360,491
in 1999 or a yield on average earning assets of 7.75% and 6.70%, respectively.
Net interest income was $435,052 in 2000 and $213,055 in 1999 (net interest
margins of 4.34% and 3.96%, respectively) after deducting interest expense of
$342,687 in 2000 and $147,436 in 1999 or an average rate paid on
interest-bearing funds of 4.00% and 3.74%, respectively. Rate variances between
the comparable three-month periods of 2000 and 1999 contributed approximately
$20,000 to net interest income while corresponding volume variances contributed
approximately $202,000.
As the Bank has limited historical loan loss experience, the provision for loan
losses of $25,000 for the three-month period ended March 31, 2000 has been
based principally on peer industry data of comparable commercial banks. In
1999, the provision for loan losses included an additional provision of 0.5%
for potential Year 2000 credit loss exposures.
Non-interest income was $33,961 and 12,472 for the three-month periods ended
March 31, 2000 and 1999, respectively, comprised principally of service charges
on deposit accounts. The increase is consistent with the increase in volume of
deposit activity.
5
<PAGE> 8
Non-interest expenses for the comparable three-month periods were $511,833 and
354,328, comprised principally of salaries and benefits ($266,807 in 2000 and
$195,418 in 1999) and occupancy costs ($91,922 in 2000 and $54,368 in 1999). At
March 31, 2000, the Company and the Bank had 22 employees and two banking
facilities compared to 16 employees and one banking facility a year earlier.
On June 1, 1999, the Bank opened a branch office in the City of North Port,
Sarasota County, Florida comprising approximately 1,100 square feet of rental
space at a monthly rental of $1,700. The Bank is completing constructing a
permanent North Port branch facility comprising approximately 3,300 square feet
for occupancy in April 2000.
Management anticipates that the Company will continue to experience losses from
operations until such time as the operations of the Bank achieve profitable
levels.
6
<PAGE> 9
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
During the first quarter, there were no matters submitted to a vote of
security holders.
Item 6. Exhibits and Reports on Form 8-K
1. Exhibits
27.1 Financial Data Schedule
2. Reports on Form 8-K
The Company did not file a Current Report on Form 8-K during the
quarter ended March 31, 2000.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereto duly authorized.
Date: April 21, 2000 /s/ George E. Cline, III
---------------------------
George E. Cline, III
Chief Financial Officer
Date: April 21, 2000 /s/ Lewis S. Albert
---------------------------
Lewis S. Albert
Chief Executive Officer
EXHIBIT INDEX
Exhibit
Number
27.1 Financial Data Schedule
7
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 2,242,248
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,100,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 9,282,889
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 32,634,265
<ALLOWANCE> 423,486
<TOTAL-ASSETS> 51,749,483
<DEPOSITS> 36,991,512
<SHORT-TERM> 5,596,739
<LIABILITIES-OTHER> 113,247
<LONG-TERM> 0
0
0
<COMMON> 11,821
<OTHER-SE> 9,036,164
<TOTAL-LIABILITIES-AND-EQUITY> 51,749,483
<INTEREST-LOAN> 629,895
<INTEREST-INVEST> 141,277
<INTEREST-OTHER> 6,567
<INTEREST-TOTAL> 777,739
<INTEREST-DEPOSIT> 286,229
<INTEREST-EXPENSE> 342,687
<INTEREST-INCOME-NET> 435,052
<LOAN-LOSSES> 25,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 511,833
<INCOME-PRETAX> (67,820)
<INCOME-PRE-EXTRAORDINARY> (67,820)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (67,820)
<EPS-BASIC> (0.06)
<EPS-DILUTED> (0.06)
<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>
