UNITED STATES
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 September 30, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to _______________
Commission File Number 000-24907
IBL BANCORP, INC.
---------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
LOUISIANA 72 - 1421499
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23910 RAILROAD AVE., PLAQUEMINE, LOUISIANA 70764
------------------------------------------------
(Address of principal executive offices)
Issuer's telephone number, including area code: (225) 687-6337
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 issuer was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [_]
Shares of common stock, par value $.01 per share, outstanding as of November 7,
2000: 210,870
Transitional Small Business Disclosure Format (check one): Yes [_] No [X]
<PAGE>
IBL Bancorp, Inc.
Form 10-QSB
Quarter Ended September 30, 2000
PART I - FINANCIAL INFORMATION
Interim Financial Information required by Rule 10-01 of Regulation S-X and
Item 303 of
Regulation S-B is included in this Form 10-QSB as referenced below:
Item 1 - Financial Statements
<TABLE>
<CAPTION>
Page
----
<S> <C>
Consolidated Statements Of Financial Condition At
September 30, 2000 (Unaudited) and December 31, 1999...............................3
Consolidated Statements Of Income and Comprehensive Income (Unaudited)
For the Three and Nine Months Ended September 30, 2000 and 1999...................4
Consolidated Statements Of Changes in Shareholders' Equity (Unaudited) For The
Three and Nine Months Ended September 30, 2000 and 1999............................6
Consolidated Statements Of Cash Flows (Unaudited) For the
Three and Nine Months Ended September 30, 2000 and 1999............................7
Notes to Consolidated Financial Statements.........................................8
Item 2 - Management's Discussion and Analysis or Plan
of Operations....................................................11
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings.......................................................17
Item 2 - Changes in Securities and Use of Proceeds...............................17
Item 3 - Defaults Upon Senior Securities.........................................17
Item 4 - Submission of Matters to a Vote of Security Holders.....................17
Item 5 - Other Information.......................................................17
Item 6 - Exhibits and Reports on Form 8-K........................................17
Signatures.........................................................................18
</TABLE>
IBL BANCORP, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
September 30, 2000 and December 31, 1999
<TABLE>
<CAPTION>
September 30,
2000 December 31,
(Unaudited) 1999
----------- ----------
<S> <C> <C>
ASSETS
Cash and amounts due from depository institutions........................ $ 181,290 $ 770,481
Interest-bearing deposits in other institutions.......................... 1,246,005 2,121,112
-------------------- --------------------
Total cash...................................................... 1,427,295 2,891,593
-------------------- --------------------
Time deposits ....................................................... 1,302,000 1,101,000
-------------- --------------
Securities held-to-maturity
Mortgage-backed sec. (estimated market value $2,085,896 and $2,308,395).. 2,129,702 2,371,700
Municipal (market value approximates cost)............................... 70,283 -
Mortgage-backed securities available-for-sale (amortized
cost $5,895,458 and $3,739,649)......................................... 5,904,245 3,732,565
-------------------- --------------------
Total investment securities..................................... 8,104,230 6,104,265
-------------------- --------------------
Loans receivable ....................................................... 20,693,285 18,549,659
Less allowance for loan losses........................................... 395,880 406,329
-------------------- --------------------
Loans receivable, net........................................... 20,297,405 18,143,330
-------------------- --------------------
Premises and equipment, net.............................................. 137,508 154,248
Federal Home Loan Bank stock, at cost.................................... 193,900 180,200
Accrued interest receivable.............................................. 166,701 108,581
Other assets ...................................................... 37,735 93,134
----------- -----------
Total assets........................................... $ 31,666,774 $ 28,776,351
==================== ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $ 24,425,355 $ 22,884,393
Advances from Federal Home Loan Bank..................................... 3,301,000 2,300,000
Advances by borrowers for taxes and insurance............................ 14,451 12,821
Federal income taxes payable............................................. 77,094 477
Other liabilities and deferrals.......................................... 148,858 74,622
-------------------- --------------------
Total liabilities...................................... 27,966,758 25,272,313
-------------------- --------------------
Commitments and contingencies ........................................... - -
-------------------- --------------------
Preferred stock - $.01 par, 2,000,000 shares authorized.................. - -
Common stock - $.01 par, 5,000,000 shares authorized, 210,870 shares
issued ....................................................... 2,109 2,109
Additional paid-in capital............................................... 1,740,729 1,740,201
Unearned ESOP shares..................................................... (134,952) (147,603)
Unearned RRP shares...................................................... (64,984) (44,193)
Retained earnings - substantially restricted............................. 2,151,315 1,958,199
Accumulated other comprehensive income (loss)............................ 5,799 (4,675)
-------------------- ---------------------
Total stockholders' equity............................ 3,700,016 3,504,038
-------------------- ------------
Total liabilities and stockholders' equity............. $ 31,666,774 $ 28,776,351
==================== ======================
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
IBL BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
Three and nine months ended September 30, 2000 and 1999
<TABLE>
<CAPTION>
-----Three months ended----- -----Nine months ended------
09/30/00 09/30/99 09/30/00 09/30/99
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans $ 421,085 $ 366,768 $1,219,712 $1,098,511
Mortgage-backed securities 134,964 80,766 363,277 192,107
FHLB stock and other securities 3,126 2,430 11,767 7,012
Deposits 28,721 49,873 101,538 123,423
---------- ---------- ---------- ----------
Total interest income 587,896 499,837 1,696,294 1,421,053
---------- ---------- ---------- ----------
INTEREST EXPENSE
Deposits
Interest-bearing demand deposit
accounts 36,165 24,007 92,560 65,048
Passbook savings accounts 21,544 22,478 73,397 70,415
Certificate of deposit accounts 201,576 188,599 548,307 542,555
---------- ---------- ---------- ----------
Total interest on deposits 259,285 235,084 714,264 678,018
Advances from Federal Home
Loan Bank 48,489 9,945 117,693 21,349
---------- ---------- ---------- ----------
Total interest expense 307,774 245,029 831,957 699,367
---------- ---------- ---------- ----------
Net interest income 280,122 254,808 864,337 721,686
Provision for losses on loans 4,500 1,744 4,067 7,604
---------- ---------- ---------- ----------
NET INTEREST INCOME
AFTER PROVISION FOR
LOSSES ON LOANS 275,622 253,064 860,270 714,082
---------- ---------- ---------- ----------
NON-INTEREST INCOME
Service charges on deposit accounts 20,136 20,516 57,717 59,684
Other 2,000 4,646 10,999 13,538
---------- ---------- ---------- ----------
Total non-interest income 22,136 25,162 68,716 73,222
---------- ---------- ---------- ----------
NON-INTEREST EXPENSES
Compensation and benefits 96,856 89,470 294,216 276,269
Occupancy 9,112 6,576 25,076 19,375
Furniture and equipment 7,618 11,136 20,959 24,850
Deposit insurance premium 1,215 3,170 3,636 9,468
Data processing 15,357 21,288 45,214 59,923
Legal and other professional 11,707 14,723 50,235 59,254
Advertising 4,909 4,536 14,907 11,474
Office supplies and postage 8,456 9,313 28,155 25,010
Other taxes - share tax assessment 8,550 -- 25,650 --
Other general and administrative 31,657 15,712 74,744 59,845
---------- ---------- ---------- ----------
Total non-interest expenses 195,437 175,924 582,792 545,468
---------- ---------- ---------- ----------
</TABLE>
Continued. . .
4
<PAGE>
<TABLE>
<CAPTION>
----Three months ended----- ----Nine months ended----
09/30/00 09/30/99 09/30/00 09/30/99
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INCOME BEFORE PROVISION
FOR INCOME TAXES ................. $ 102,321 $ 102,302 $ 346,194 $ 241,836
PROVISION FOR INCOME
TAXES ............................ 40,918 37,797 128,072 88,179
========= ========= ========= =========
NET INCOME ........................ $ 61,403 $ 64,505 $ 218,122 $ 153,657
========= ========= ========= =========
Basic earnings per share .......... $ .32 $ .33 $ 1.14 $ .79
========= ========= ========= =========
Diluted earnings per share ........ $ .31 $ .33 $ 1.11 $ .79
========= ========= ========= =========
COMPREHENSIVE INCOME
Net income ........................ $ 61,403 $ 64,505 $ 218,122 $ 153,657
========= ========= ========= =========
Other comprehensive income (loss)
Unrealized holding gains (losses)
on securities during the period 22,631 19,607 15,871 (2,041)
Income tax benefit (expense)
related to unrealized holding
gains (losses) ................. (7,695) (6,666) (5,397) 694
--------- --------- --------- ---------
Other comprehensive income (loss),
net of tax effects .............. 14,936 12,941 10,474 (1,347)
--------- --------- --------- ---------
Comprehensive income .............. $ 76,339 $ 77,446 $ 228,596 $ 152,310
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
IBL BANCORP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Nine months ended September 30, 2000 and 1999
<TABLE>
<CAPTION>
Retained
Earnings-
Additional Unearned Unearned Substan-
Common Paid - In ESOP RRP tially
Stock Capital Shares Shares Restricted
----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
BALANCE, DECEMBER 31, 1998 ........... $ 2,109 $ 1,740,254 $ (165,971) $ -- $ 1,806,496
----------- ----------- ----------- ----------- -----------
COMPREHENSIVE INCOME
(Unaudited)
Net income ........................... -- -- -- -- 153,657
Other comprehensive income, net of tax
Unrealized losses on securities .... -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Comprehensive income ................. -- -- -- -- 153,657
----------- ----------- ----------- ----------- -----------
ESOP shares released for allocation .. -- (369) 14,150 -- --
Dividends ............................ -- -- -- -- (23,724)
----------- ----------- ----------- ----------- -----------
BALANCE, SEPTEMBER 30, 1999
(Unaudited) ......................... $ 2,109 $ 1,739,885 $ (151,821) $ -- $ 1,936,429
=========== =========== =========== =========== ===========
BALANCE, DECEMBER 31, 1999 ........... $ 2,109 $ 1,740,201 $ (147,603) $ (44,193) $ 1,958,199
----------- ----------- ----------- ----------- -----------
COMPREHENSIVE INCOME
(Unaudited)
Net income ........................... -- -- -- -- 218,122
Other comprehensive income, net of tax
Unrealized gains on securities ..... -- -- -- -- --
Comprehensive income ................. -- -- -- -- 218,122
ESOP shares released for allocation .. -- 528 12,651 -- 1,880
Acquisition of RRP shares ............ -- -- -- (20,791) --
Dividends ............................ -- -- -- -- (26,886)
----------- ----------- ----------- ----------- -----------
BALANCE, SEPTEMBER 30, 2000
(Unaudited) .......................... $ 2,109 $ 1,740,729 $ (134,952) $ (64,984) $ 2,151,315
=========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
Accumulated
Other
Compre-
hensive Total
Income Equity
------------ -----------
<S> <C> <C>
BALANCE, DECEMBER 31, 1998 ........... $ (293) $ 3,382,595
----------- -----------
COMPREHENSIVE INCOME
(Unaudited)
Net income ........................... -- 153,657
Other comprehensive income, net of tax
Unrealized losses on securities .... (1,347) (1,347)
----------- -----------
Comprehensive income ................. (1,347) 152,310
----------- -----------
ESOP shares released for allocation .. -- 13,781
Dividends ............................ -- (23,724)
----------- -----------
BALANCE, SEPTEMBER 30, 1999
(Unaudited) ......................... $ (1,640) $ 3,524,962
=========== ===========
BALANCE, DECEMBER 31, 1999 ........... $ (4,675) $ 3,504,038
----------- -----------
COMPREHENSIVE INCOME
(Unaudited)
Net income ........................... -- 218,122
Other comprehensive income, net of tax
Unrealized gains on securities ..... 10,474 10,474
----------- -----------
Comprehensive income ................. 10,474 228,596
----------- -----------
ESOP shares released for allocation .. -- 15,059
Acquisition of RRP shares ............ -- (20,791)
Dividends ............................ -- (26,886)
----------- -----------
BALANCE, SEPTEMBER 30, 2000
(Unaudited) .......................... $ 5,799 $ 3,700,016
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
IBL BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended September 30, 2000 and 1999
<TABLE>
<CAPTION>
2000 1999
(Unaudited) (Unaudited)
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income ............................................................... $ 218,122 $ 153,657
----------- -----------
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation ........................................................... . 18,023 19,512
Provision for loan losses .............................................. 4,067 7,604
ESOP contribution ...................................................... 15,059 13,781
Provision for deferred federal income tax benefit ...................... (3,503) (2,666)
Amortization of net premium on investment and mortgage-backed securities 10,012 14,073
Net discount charged on installment loans .............................. 47,951 13,023
Net loan fees deferred ................................................. 7,144 1,911
Stock dividends from Federal Home Loan Bank ............................ (11,600) (6,900)
Net increase in interest receivable .................................... (58,120) (34,354)
Net decrease (increase) in other assets ................................ 53,505 (16,263)
Net increase (decrease) in interest payable ............................ 11,460 (9,486)
Net increase (decrease) in income taxes payable ........................ 76,617 (54,403)
Net increase in other liabilities ...................................... 74,236 32,597
----------- -----------
Total adjustments ............................................... 244,851 (21,571)
----------- -----------
Net cash provided by operating activities ................................ 462,973 132,086
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans receivable ......................................... (2,213,237) (1,118,714)
Purchases of securities available-for-sale ............................... (2,773,385) (2,440,995)
Principal payments received on mortgage-backed securities
available-for-sale ...................................................... 611,528 353,790
Purchases of securities held-to-maturity ................................. (262,871) (450,495)
Principal payments received on mortgage-backed securities
held-to-maturity ........................................................ 500,905 409,557
Purchase of municipal obligation ......................................... (70,283) --
Purchase of FHLB stock ................................................... (2,100) --
Proceeds from sale of foreclosed assets .................................. -- 10,500
Purchases of office property and equipment ............................... (1,283) (22,800)
Certificates of deposits acquired ........................................ (300,000) (606,000)
Maturity of certificates of deposit ...................................... 99,000 100,000
----------- -----------
Net cash used in investing activities .................................... (4,411,726) (3,765,157)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposit accounts ......................................... 1,529,502 3,799,601
Net increase (decrease) in advances by borrowers for taxes and insurance . 1,630 (929)
Cash dividends ........................................................... (26,886) (23,724)
Acquisition of RRP shares ................................................ (20,791) --
Advances from Federal Home Loan Bank ..................................... 1,001,000 1,150,000
----------- -----------
Net cash provided by financing activities ................................ 2,484,455 4,924,948
----------- -----------
NET INCREASE (DECREASE) IN CASH .......................................... (1,464,298) 1,291,877
Cash - beginning of period ............................................... 2,891,593 1,858,498
----------- -----------
Cash - end of period ..................................................... $ 1,427,295 $ 3,150,375
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements
7
<PAGE>
IBL BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
September 30, 2000
A: BASIS OF PRESENTATION
The accompanying consolidated financial statements for the
period ended September 30, 2000 include the accounts of IBL
Bancorp, Inc. (the "Company") and its wholly owned subsidiary,
Iberville Building and Loan Association (the "Association").
Currently, the business and management of IBL Bancorp, Inc. is
primarily the business and management of the Association. All
significant intercompany transactions and balances have been
eliminated in the consolidation.
The accompanying consolidated unaudited financial statements
were prepared in accordance with instructions for Form 10-QSB
and, therefore, do not include information or footnotes
necessary for a complete presentation of financial position,
results of operations and cash flows in conformity with
generally accepted accounting principles. However, all
adjustments (consisting only of normal recurring accruals)
which, in the opinion of management, are necessary for a fair
presentation of the consolidated financial statements have
been included. The results of operations for the nine months
ended September 30, 2000 are not necessarily indicative of the
results to be expected for the year ending December 31, 2000.
B: EMPLOYEE STOCK OWNERSHIP PLAN
The Company sponsors a leveraged employee stock ownership plan
(ESOP) that covers all employees who have at least one year of
service with the Company. The ESOP shares initially were
pledged as collateral for the ESOP debt. The debt is being
repaid based on a ten-year amortization and the shares are
being released for allocation to active employees quarterly
over the ten-year period. The shares pledged as collateral are
deducted from stockholders' equity as unearned ESOP shares in
the accompanying balance sheets.
As shares are released from collateral, the Company reports
compensation expense equal to the current market price of the
shares. Dividends on allocated ESOP shares are recorded as a
reduction of retained earnings; dividends on unallocated ESOP
shares are applied to the ESOP debt and recorded as a
reduction of unearned ESOP shares. ESOP compensation expense
was $13,663 for the nine months ended September 30, 2000 based
on the quarterly release of shares.
C: RECOGNITION AND RETENTION PLAN
On October 20, 1999, the Company's stockholders approved a
Recognition and Retention Plan (RRP) as an incentive to retain
personnel of experience and ability in key positions. The
shareholders approved a total of 8,434 shares of stock to be
acquired for the Plan, of which 7,169 shares have been
allocated for distribution to key employees and directors. As
shares are acquired for the plan, the purchase price of these
shares is recorded as unearned compensation, a contra equity
account. As the shares are distributed, the contra equity
account is reduced.
C: RECOGNITION AND RETENTION PLAN (Continued)
The allocated shares are earned by participants as plan share
awards vest over a specified period. If an employee or
non-employee director plan participant is terminated prior to
the end of the vesting period for any reason other than death,
disability, retirement or a change in control, the recipient
shall forfeit the right to any shares subject to the awards
which have not been earned. The compensation cost associated
with the plan is based on the market price of the stock as of
the date on which the plan shares are earned.
8
<PAGE>
IBL BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
September 30, 2000
A summary of the changes in restricted stock follows:
Unawarded Awarded
Shares Shares
--------- --------
Balance, January 1, 1999 .. -- --
Purchased by Plan ......... 8,434 --
Granted ................... (7,169) 7,169
Earned and issued ......... -- (2,390)
------ ------
Balance, September 30, 2000 1,265 4,779
====== ======
D: STOCK OPTION PLAN
On October 20, 1999, the Company's stockholders approved a
stock option plan for the benefit of directors, officers, and
other key employees. An amount equal to 10% of the total
number of common shares issued in the initial public offering
or 21,087 shares are reserved for issuance under the stock
option plan. The option exercise price cannot be less than the
fair value of the underlying common stock as of the date of
the option grant and the maximum option term cannot exceed ten
years.
The stock option plan also permits the granting of stock
appreciation rights (SARs). SARs entitle the holder to
receive, in the form of cash or stock, the increase in fair
value of the Company`s common stock from the date of the grant
to the date of exercise. No SARs have been issued under the
plan.
The following table summarizes the activity related to stock
options:
Exercise Available Options
Price for Grant Outstanding
----- --------- -----------
At inception ........ 21,087 --
Granted ............. $ 10.50 (17,925) 17,925
Cancelled ........... -- --
Exercised ........... -- --
------- ------
At September 30, 2000 3,162 17,925
======= =======
E: EARNINGS PER SHARE
The following table provides a reconciliation between basic
and diluted earnings per share:
<TABLE>
<CAPTION>
For the three months ended September 30, 2000
---------------------------------------------
Weighted
Average
Income Shares Per-Share
(Numerator) (Denominator) Amount
----------- ------------- ---------
<S> <C> <C> <C>
Net income .............................. $61,403
-------
Basic earnings per share
Income available to common stockholders . 61,403 190,915 $ 0.32
========
Effect of dilutive securities
RRP shares granted ...................... -- 4,778
------ -------
Diluted earnings per share
Income available to common stockholders +
assumed conversions .................... $61,403 195,693 $ 0.31
======= ======= ========
</TABLE>
9
<PAGE>
IBL BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
September 30, 2000
<TABLE>
<CAPTION>
For the nine months ended September 30, 2000
--------------------------------------------
Weighted
Average
Income Shares Per-Share
(Numerator) (Denominator) Amount
----------- ------------ ---------
<S> <C> <C> <C>
Net income .............................. $218,122
--------
Basic earnings per share
Income available to common stockholders . 218,122 190,927 $ 1.14
========
Effect of dilutive securities
RRP shares granted ...................... -- 4,778
-------- -------
Diluted earnings per share
Income available to common stockholders +
assumed conversions .................... $218,122 195,705 $ 1.11
======== ======= ========
</TABLE>
The computation of basic earnings per share includes reported
net income in the numerator and the weighted average number of
shares outstanding of 195,272 for the three months ended
September 30, 1999 and 194,853 for the nine months then ended
in the denominator.
10
<PAGE>
IBL BANCORP, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The following discussion compares the consolidated financial
condition of IBL Bancorp, Inc. and Subsidiary at September 30, 2000 to December
31, 1999 and the results of operations for the three and nine months ended
September 30, 2000 with the same periods in 1999. Currently, the business and
management of IBL Bancorp, Inc. is primarily the business and management of the
Association. This discussion should be read in conjunction with the interim
consolidated financial statements and footnotes included herein.
This quarterly report on Form 10-QSB includes statements
that may constitute forward-looking statements, usually containing the words
"believe", "estimate", "expect", "intend" or similar expressions. These
statements are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements inherently
involve risks and uncertainties that could cause actual results to differ
materially from those reflected in the forward-looking statements. Factors that
could cause future results to vary from current expectations include, but are
not limited to, the following: changes in economic conditions (both generally
and more specifically in the markets in which the Company operates); changes in
interest rates, deposit flows, loan demand, real estate values and competition;
changes in accounting principles, policies or guidelines and in government
legislation and regulation (which change from time to time and over which the
Company has no control); and other risks detailed in this quarterly report on
Form 10-QSB and the Company's other Securities and Exchange Commission filings.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which reflect management's analysis only as of the date hereof. The
Company undertakes no obligation to publicly revise these forward-looking
statements to reflect events or circumstances that arise after the date hereof.
IBL Bancorp, Inc. is the holding company for the
Association. Substantially all of the Company's assets are currently held in,
and its operations are conducted through, its sole subsidiary the Association.
The Company's business consists primarily of attracting deposits from the
general public and using such deposits to make loans for the purchase and
construction of residential properties. The Company also originates commercial
real estate loans and various types of consumer loans.
Changes in Financial Condition
The Company's total assets increased $2,890,000 or 10.0% from
$28.8 million at December 31, 1999 to $31.7 million at September 30, 2000. This
increase was primarily due to increases of $2,154,000 in net loans receivable,
$2,000,000 in investment securities, and $201,000 in time deposits. These
increases were offset by a decrease in cash and cash equivalents of $1,464,000.
The mortgage-backed securities portfolio increased by
$1,930,000 or 31.6% from $6,104,000 at December 31, 1999 to $8,034,000 at
September 30, 2000, due to purchases of $3,036,000 in the first nine months of
2000 funded by increases in deposits, advances from
Federal Home Loan Bank and the reallocation of the excess liquidity that was
built up in accordance with the Company's Year 2000 Plan.
The Company also purchased a municipal bond in the amount of
$70,000 in the first nine months of 2000. At December 31, 1999, the Company had
no municipal bonds.
The demand for mortgage loans in the Association's market area
increased during the past nine months. The net loan portfolio increased
$2,154,000 or 11.9% from $18,143,000 at December 31, 1999 to $20,297,000 at
September 30, 2000. This increase consisted mainly of single-family residential
mortgage loans and was also funded by increases in deposits and the reallocation
of Year 2000 cash.
Time deposits increased by $201,000 or 18.3% from $1,101,000
at December 31, 1999 to $1,302,000 at September 30, 2000. This increase was
primarily due to the purchase of short-term certificates of deposit.
Cash and amounts due from depository institutions decreased
by $589,000 or 76.5% from $770,000 at December 31, 1999 to $181,000 at September
30, 2000. Interest-bearing deposits in other institutions decreased by $875,000
or 41.3% from $2,121,000 at December 31, 1999 to $1,246,000 at September 30,
2000. Both of these decreases were primarily due to the reallocation of the
excess liquidity that was built up in accordance with the Company's Year 2000
Plan.
11
<PAGE>
Deposits increased by $1,541,000 or 6.7% from $22,884,000 at
December 31, 1999 to $24,425,000 at September 30, 2000. This increase was offset
by a $628,000 decrease in governmental funds on deposit at the Association.
Advances from Federal Home Loan Bank increased $1,001,000 or
43.5% from $2,300,000 at December 31, 1999 to $3,301,000 at September 30, 2000.
This increase was primarily used for the purchase of mortgage-backed securities.
Total stockholders' equity increased by $196,000 during the
past nine months. Net income of $218,000, a $13,000 decrease in unearned ESOP
shares which caused a $2,000 increase in retained earnings substantially
restricted, a $10,000 increase in unrealized gains on available-for-sale
investment securities and a $1,000 increase in additional paid-in capital
increased stockholders' equity during the period. These factors were partially
offset by the payment of three quarterly dividends totaling $27,000 and an
increase in unearned RRP shares of $21,000 during this period. Stockholders'
equity at September 30, 2000 totaled $3,700,000 or 11.7% of total assets
compared to stockholders' equity of $3,504,000 or 12.2% of total assets at
December 31, 1999.
The Association's total classified assets for regulatory
purposes at September 30, 2000 (excluding loss assets specifically reserved for)
amounted to $633,000, all of which was classified as substandard. The largest
classified asset at September 30, 2000 consisted of a $70,000 adjustable-rate
residential loan. The remaining $563,000 of substandard assets at September 30,
2000 consisted of 17 residential mortgage loans totaling $453,000 and 7 consumer
loans totaling $110,000.
Results of Operations
The profitability of the Company depends primarily on its net
interest income, which is the difference between interest and dividend income on
interest-earning assets, principally loans, mortgage-backed securities, and
investment securities, and interest expense on interest-bearing deposits and
borrowings. Net interest income is dependent upon the level of interest rates
and the extent to which such rates are changing. The Company's profitability
also is dependent, to a lesser extent, on the level of its non-interest income,
provision for loan losses, non-interest expense and income taxes. In the nine
months ended September 30, 2000 and 1999, net interest income after provision
for loan losses exceeded total non-interest expense. Total non-interest expense
consists of general, administrative and other expenses, such as compensation and
benefits, furniture and equipment expense, federal insurance premiums, and
miscellaneous other expenses.
Net income decreased by $3,000 or 4.8% in the quarter ended
September 30, 2000 and increased by $64,000 or 42.0% in the first nine months of
2000 compared to the respective 1999 periods. The decrease in the September 30,
2000 quarter was due to a $19,500 increase in non-interest expense, a $3,000
increase in provision for income tax, a $3,000 decrease in non-interest income
and a $3,000 increase in provision for loan losses. These items were partially
offset by a $25,500 increase in net interest income. The increase in net income
for the nine-month period ending September 30, 2000 was primarily due to an
increase of $146,000 in net interest income after provision for loan losses
offset by a $40,000 increase in provision for income taxes, a $37,000 increase
in non-interest expenses and a $5,000 decrease in non-interest income.
The $25,500 increase in net interest income in the third
quarter of 2000, over the same period in 1999, was primarily due to increases in
interest-earning assets funded by increased deposits and advances from the
Federal Home Loan Bank. This increase in net interest income can also be
attributed to an increase in the average interest rate spread from 3.15% in the
quarter ended September 30, 1999 to 3.20% in the third quarter of 2000. The
average yield on interest-earning assets increased from 7.03% in the quarter
ended September 30, 1999 to 7.73% in the third quarter of 2000, while the
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average rate on interest-bearing liabilities increased from 3.88% in the third
quarter of 1999 to 4.53% in the third quarter of 2000. The increased yield on
assets was primarily due to higher yields on the Association's adjustable-rate
mortgage loans and adjustable-rate mortgage-backed securities. This increase in
asset yield can also be attributed to the reallocation of the excess cash
liquidity built up for the Year 2000 into higher yielding interest-earning
assets.
The $143,000 increase in net interest income in the first nine
months of 2000 compared to the first nine months of 1999 was also primarily due
to increases in interest-earning assets funded by increased deposits and
advances from Federal Home Loan Bank. The increase in net interest income during
this period can also be attributed to an increase in the average interest rate
spread from 3.09% in the nine month period ending September 30, 1999 to 3.42% in
the nine month period ending September 30, 2000. The average yield on
interest-earning assets increased from 7.06% in the first nine months of 1999 to
7.62% in the first nine months of 2000, while the average rate on
interest-bearing liabilities increased from 3.97% to 4.20% over the same period.
This increase in asset yield can also be attributed to the reallocation of the
excess liquidity built up for the Year 2000 into higher interest-earning assets.
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Total interest income increased by $88,000 or 17.6% in the
quarter ended September 30, 2000 and increased $275,000 or 19.4% in the first
nine months of 2000 over the comparable 1999 periods due to higher balances and
higher yields. The average balance of total interest-earning assets increased
from $26.2 million in the first nine months of 1999 to $30.1 million in the
first nine months of 2000.
Total interest expense increased by $63,000 or 25.6% for the
quarter ended September 30, 2000 and $132,000 or 19.0% for the first nine months
of 2000 compared to the respective 1999 periods. The increase in the quarter
period was primarily due to an increase in interest paid on Federal Home Loan
Bank advances of $39,000 and an increase in total interest paid on deposit
accounts of $24,000. The increase in the nine-month period was primarily due to
an increase in interest paid on Federal Home Loan Bank advances of $96,000 and
an increase in total interest paid on deposit accounts of $36,000. The increase
in interest paid on deposits and advances is a result of both higher volumes and
higher average interest rates paid.
The provision for loan losses increased by $3,000 for the
quarter ended September 30, 2000 and decreased $4,000 in the first nine months
of 2000 from the comparable 1999 periods. At September 30, 2000, the
Association's total non-accruing loans amounted to $405,000. The allowance for
loan losses amounted to $396,000 at September 30, 2000, representing 1.9% of the
total loans held in portfolio and 97.8% of total non-accruing loans at such
date. The analysis of the provision for loan losses led to the conclusion that
the allowance for loan losses needed to be increased by $4,500 in the September
quarter in light of the current asset quality of the loan portfolio.
Non-interest income decreased by $3,000 or 12.0% in the
quarter ended September 30, 2000 and decreased $5,000 or 6.2% in the first nine
months of 2000 from the comparable 1999 periods. The decrease in the quarter was
primarily due to a $3,000 decrease in commissions on credit life insurance. The
decrease in the nine-month period was primarily due to a decrease in commissions
on credit life insurance of $3,000 and a decrease in service charges on deposit
accounts of $2,000.
Non-interest expenses increased by $20,000 or 11.1% in the
quarter ended September 30, 2000 and increased $37,000 or 6.8% in the first nine
months of 2000 from the comparable 1999 periods. The increase in the quarter was
primarily due to increases of $16,000 in other general and administrative,
$9,000 in other taxes, $7,000 in compensation and benefits and $3,000 in
occupancy. These increases in non-interest expenses were partially offset by
decreases of $6,000 in data processing, $4,000 in furniture and equipment,
$3,000 in legal and other professional and $2,000 in deposit insurance premium.
The increase in the nine-month period was primarily due to increases of $26,000
in other taxes, $18,000 in compensation and benefits, $15,000 in other general
and administrative, $6,000 in occupancy, $3,000 in advertising and $3,000 in
office supplies and postage. These increases in non-interest expense were offset
primarily by decreases of $15,000 in data processing, $9,000 in legal and other
professional, $6,000 in deposit insurance premium and $4,000 in furniture and
equipment.
The $26,000 increase in other taxes for the nine months ended
September 30, 2000 over the same period in 1999 was caused by the Company
beginning to accrue for a parish and city tax which is assessed on publicly held
companies.
The $18,000 increase in compensation and benefits for the nine
months ended September 30, 2000 was due primarily to increases of $10,000 in
compensation for officers and employees, $5,000 in ESOP contributions, $4,000 in
employee retirement contributions, $3,500 in compensation for directors and $500
in payroll taxes. These increases were partially offset by a $5,000 decrease in
other employee benefits.
The increase of $15,000 in other general and administrative
for the nine months ended September 30, 2000 was primarily caused by the
reclassification of $8,500 in FHLB demand deposit charges into other general and
administrative from data processing expense. The $15,000 increase was further
caused by increases of $6,000 in other operating expense, $2,000 in officers and
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employees expense account, $1,000 in dues and subscriptions and $1,000 in
franchise tax. These increases were partially offset by decreases of $2,500 in
loan expense and $1,000 in supervisory examination fees.
The increase of $6,000 in occupancy for the nine months ended
September 30, 2000 was primarily due to a $4,000 increase in office building
taxes and assessments and a $1,000 increase in both office building depreciation
and utilities.
The increase in provision for income taxes is primarily due to
an increase in pre-tax earnings.
Liquidity and Capital Resources
The Association is required under applicable federal
regulations to maintain specified levels of "liquid" investments in qualifying
types of U.S. Government, federal agency and other investments having maturities
of up to five years. Current OTS regulations require that a savings institution
maintain liquid assets of not less than 4% of its average daily balance of net
withdrawable deposit accounts and borrowings payable in one year or less. At
September 30, 2000, the Association's liquidity was 9.1% or $1.3 million in
excess of the minimum OTS requirement.
The Association is required to maintain regulatory capital
sufficient to meet tangible, core and risk-based capital ratios of 1.5%, 4.0%,
and 8.0%, respectively. At September 30, 2000, the Association's tangible and
core capital both amounted to $3.1 million or 9.9% of adjusted total assets of
$31.1 million, and the Association's risk-based capital amounted to $3.3 million
or 20.5% of adjusted risk-weighted assets of $15.9 million.
As of September 30, 2000, the Association's unaudited regulatory capital
requirements are as indicated in the following table:
(Dollars In Thousands)
TANGIBLE CORE RISK-BASED
CAPITAL CAPITAL CAPITAL
------- ------- -------
GAAP Capital $3,063 $3,063 $3,063
Unrealized loss on securities available
for sale net of taxes -- (6) (6)
Additional Capital Items:
General Valuation Allowances -- -- 200
------ ------ ------
Regulatory Capital Computed 3,063 3,057 3,257
Minimum Capital Requirement 466 1,242 1,276
------ ------ ------
Regulatory Capital Excess $2,597 $1,815 $1,981
====== ====== ======
Regulatory Capital as a
Percentage 9.86% 9.86% 20.46%
Minimum Capital Required
as a Percentage 1.50% 4.00% 8.00%
------ ------ ------
Regulatory Capital as a
Percentage in Excess
of Requirements 8.36% 5.86% 12.46%
====== ====== ======
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Based on the above capital ratios, the Association meets the
criteria for a "well capitalized" institution at September 30, 2000. The
Association's management believes that under the current regulations, the
Association will continue to meet its minimum capital requirements in the
foreseeable future. However, events beyond the control of the Association, such
as increased interest rates or a downturn in the economy of the Association's
area, could adversely affect future earnings and consequently, the ability of
the Association to continue to exceed its future minimum capital requirements.
The Year 2000
The Association did not experience any interruption in service
or computer difficulties relating to the start of Year 2000. Additional expenses
for issues related to the Year 2000 are not expected to be incurred; however,
management will continue to monitor our data processing.
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IBL Bancorp, Inc.
Form 10-QSB
Quarter Ended September 30, 2000
PART II - OTHER INORMATION
Item 1 - Legal Proceedings:
There are no matters required to be reported under this item.
Item 2 - Changes in Securities and Use of Proceeds:
There are no matters required to be reported under this item.
Item 3 - Defaults Upon Senior Securities:
There are no matters required to be reported under this item.
Item 4 -Submission of Matters to a Vote of Security Holders:
There are no matters required to be reported under this item.
Item 5 - Other Information:
There are no matters required to be reported under this item.
Item 6 - Exhibits and Reports on Form 8-K:
(a) The following exhibit is filed herewith:
EXHIBIT NO. DESCRIPTION
27.1 Financial Data Schedule
(b) Reports on Form 8-K:
No reports on Form 8-K were filed by the Registrant during the
quarter ended September 30, 2000.
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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. IBL BANCORP, INC. Registrant
Date: November 7, 2000 By: /s/ G. Lloyd Bouchereau, Jr.
----------------------------------------
G. Lloyd Bouchereau, Jr., President and
Chief Executive Officer
Date: November 7, 2000 By: /s/ Gary K.Pruitt
----------------------------------------
Gary K. Pruitt
Secretary
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