SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1998 Commission File Number:333-59039-01
FCB/NC CAPITAL TRUST I
(Exact name of registrant as specified in its charter)
Delaware 51-6507188
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification number)
3128 Smoketree Court; Raleigh, North Carolina 27604
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including Area Code: (919) 716-7000
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
requirements for the past 90 days. [X] Yes [ ] No
The registrant meets the conditions set forth in General Instruction H(1)(a) and
(b) of Form 10-Q and is therefore filing this form with the reduced disclosure
format.
<PAGE>
FCB/NC CAPITAL TRUST I
BALANCE SHEET
<TABLE>
<CAPTION>
(Dollars in thousands) September 30, March 5,
1998 1998
(Unaudited) (Unaudited)
<S> <C> <C>
ASSETS
Junior Subordinated Debentures $ 154,640 $ 154,640
Interest Receivable 1,037 -
----------------------- -----------------------
Total Assets $ 155,677 $ 154,640
======================= =======================
LIABILITIES
8.05% Capital Securities $ 150,000 $ 150,000
Interest Payable 823 -
----------------------- -----------------------
Total Liabilities $ 150,823 $ 150,000
----------------------- -----------------------
EQUITY AND NET ASSETS
Common Securities $ 4,640 $ 4,640
Net Assets 214 $ -
----------------------- -----------------------
Total liabilities, equity and net assets $ 155,677 $ 154,640
======================= =======================
The accompanying notes are an integral part of these financial statements.
</TABLE>
FCB/NC CAPITAL TRUST I
STATEMENT OF REVENUE AND EXPENSE AND
CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
(Dollars in thousands) Six Months
and
Three Months 26 days ended
September 30, September 30,
1998 1998
(Unaudited) (Unaudited)
<S> <C> <C>
Revenues:
Interest income $ 3,140 $ 7,158
----------------------- -----------------------
Total Revenues $ 3,140 $ 7,158
Expenses:
Interest expense $ 3,018 $ 6,944
----------------------- -----------------------
Total Expenses $ 3,018 $ 6,944
----------------------- -----------------------
Excess of revenues over expenses $ 122 $ 214
======================= =======================
Excess of revenues over expenses $ 122 $ 214
Net assets beginning of period $ 92 $ -
----------------------- -----------------------
Net assets September 30, 1998 $ 214 $ 214
======================= =======================
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
FCB/NC CAPITAL TRUST I
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
(Dollars in thousands) Six Months
and
26 days ended
September 30,
1998
(Unaudited)
<S> <C>
OPERATING CASH FLOWS
-----------------------
Net operating cash flows $ -
-----------------------
FINANCING CASH FLOWS
-----------------------
Net financing cash flows $ -
-----------------------
INVESTING CASH FLOWS
-----------------------
Net investing cash flows $ -
-----------------------
Net change in cash $ -
Cash: Beginning of period $ -
-----------------------
End of quarter $ -
=======================
</TABLE>
RECONCILIATION OF EXCESS OF REVENUES OVER EXPENSES
TO OPERATING CASH FLOWS
<TABLE>
<CAPTION>
(Dollars in thousands except per share data)
(Unaudited)
<S> <C>
Excess of Revenues over Expenses $ 214
Changes in: Receivables $ (1,037)
Payables $ 823
-----------------------
Operating cash flows $ -
=======================
</TABLE>
FCB/NC CAPITAL TRUST I
STATEMENT OF CHANGES IN EQUITY AND NET ASSETS
<TABLE>
<CAPTION>
(Dollars in thousands except per share data) (Unaudited)
-----------------------------------------------------
Equity Equity
and and
Net Assets Net Assets
----------------------- -----------------------
<S> <C> <C>
BALANCE March 5, 1998 $ 4,640 $ 4,640
Excess of revenues over expenses 214 214
----------------------- -----------------------
BALANCE September 30, 1998 $ 4,854 $ 4,854
======================= =======================
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
FCB/NC CAPITAL TRUST I
Notes to financial statements
(Dollars in thousands)
Note 1. Description of Trust and Management Opinion
The Trust
FCB/NC Capital Trust I (the "Trust"), was created February 27, 1998 and
funded on March 5, 1998. The Trust is a wholly owned subsidiary of First
Citizens BancShares, Inc. ("BancShares") of Raleigh, North Carolina. The Trust
is a statutory business trust created under Delaware law, the result of the
filing of a certificate of trust with the Delaware Secretary of State. The Trust
is governed by a trust agreement between BancShares, as Depositor; Bankers Trust
(Delaware), as Delaware Trustee; Bankers Trust, as Property Trustee; the
Administrators (as named herein); and the holders, from time to time of
undivided beneficial interests in the assets of the Trust. Two individuals have
been selected by the holders of the Trust's Common Securities, to act as
administrators with respect to The Trust (the "Administrators"). BancShares, as
the holder of the Common Securities, has selected two individuals who are
officers of BancShares to serve as the Administrators. The Trust exists for the
following exclusive purposes:
(i) to issue and sell the Trust Securities,
(ii) to use the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures and
(iii) to engage in only those other activities necessary,
convenient or incidental thereto (such as registering the
transfer of Trust Securities).
Accordingly, the Junior Subordinated Debentures are, and will be, the
sole assets of the Issuer Trust, and payments under the Junior Subordinated
Debentures will be the sole source of revenue of the Trust.
Management Opinion
The financial statements in this report are unaudited. In the opinion
of management, all adjustments (none of which were other than normal accruals)
necessary for fair presentation of the financial position and results of
operations for the period presented have been included.
Note 2. INCOME TAXES
In the opinion of the Trust's tax counsel, under current law and
assuming compliance with terms of the Trust Agreement, the Trust is classified
as a grantor trust and not as an association, taxable as a corporation for
federal income tax purposes. The preceding not withstanding, the Trust will file
a consolidated federal tax return with its parent company, BancShares, beginning
in 1998. It is BancShares' policy not to allocate income taxes to the Trust.
<PAGE>
NOTE 3. CAPITAL SECURITIES
Pursuant to the terms of the Trust Agreement for the Trust, the
Trustees of the Trust have issued the Capital Securities and the Common
Securities. The Capital Securities represent preferred undivided beneficial
interests in the assets of the Trust and holders thereof are entitled to a
preference in certain circumstances with respect to Distributions and amounts
payable on redemption or liquidation over the common securities, as well as
other benefits as described in the Trust Agreement.
NOTE 4. JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures were issued under the Junior
Subordinated Indenture, under which Bankers Trust Company is the Debenture
Trustee. Concurrently with the issuance of the Capital Securities, the Trust
invested the proceeds thereof, together with the consideration paid by
BancShares for the Common Securities, in Junior Subordinated Debentures (the
"Debentures") issued by BancShares. The Debentures bear interest, and have
accrued interest from the date of original issuance, at a rate of 8.05%, payable
in arrears semi-annually, beginning September 1, 1998. It is anticipated that,
until the liquidation, if any, of the Trust, each Debenture will be registered
in the name of the Trust and held by the Property Trustee in trust for the
benefit of the holders of the Trust Securities. The amount of interest payable
for any period less than a full interest period will be computed on the basis of
a 360-day year of twelve 30-day months and the actual days elapsed in a partial
month in such period. The amount of interest payable for any full interest
period will be computed by dividing the rate per annum by four. If any date on
which the interest is payable on the Debentures is not a business day, then
payment of the interest payable on such date will be made on the next succeeding
day that is a business day. Accrued interest that is not paid on the applicable
interest date will bear additional interest on the amount thereof (to the extent
permitted by law) at a rate equal to 8.05% per annum, compounded quarterly and
computed on the basis of a 360-day year of twelve 30-day months and actual days
elapsed in a partial month in such period. The amount of additional interest
payable for any interest period will be computed by dividing the rate per annum
by two. The Debentures mature March 1, 2028.
The Debentures are unsecured and rank junior and subordinate in
right of payment to all Senior Indebtedness of BancShares. The
Debentures are not subject to a sinking fund and are not eligible as
collateral for any loan made by BancShares.
Item - 2
Not Required
<PAGE>
FCB/NC CAPITAL TRUST I
MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS
(Dollars in thousands)
The excess of revenues over expenses for the period of March 5, 1998
through September 30, 1998 was $214. During this period the Trust accrued $7,158
in interest revenue and $6,944 in interest expense. On September 1, 1998, the
Trust made its first interest payment to holders of the Capital Securities.
Other than the original funding of the Trust on March 5, there was no other
financial activity.
The Trust does not own any computers or equipment and all Year 2000
(Y2K) issues are being handled by BancShares and its subsidiaries. Therefore,
there are no assessments of Y2K issues, costs or contingency plans for the
Trust.
Part II. OTHER INFORMATION
Item 1 - Legal Proceedings
Not applicable
Item 2 - Changes in Securities and Use of Proceeds
Not required
Item 3 - Defaults Upon Senior Securities
Not required
Item 4 - Submission of Matters to a Vote of Security Holders
Not required
Item 5 - Other Information
Not applicable
Item 6 - Exhibits and Reports on Form 8-K
None
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.
FCB/NC CAPITAL TRUST I
FIRST CITIZENS BANCSHARES, INC.
Dated November 12, 1998 /s/Kenneth A. Black
-----------------------------------
Kenneth A. Black
Administrator
Treasurer
Dated November 12, 1998 /s/John H. Gray
---------------
John H. Gray
Administrator
Assistant Vice President
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 0
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 154,460
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 0
<ALLOWANCE> 0
<TOTAL-ASSETS> 155,677
<DEPOSITS> 0
<SHORT-TERM> 0
<LIABILITIES-OTHER> 823
<LONG-TERM> 150,000
0
0
<COMMON> 4,640
<OTHER-SE> 214
<TOTAL-LIABILITIES-AND-EQUITY> 155,677
<INTEREST-LOAN> 0
<INTEREST-INVEST> 7,158
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 7,158
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 6,944
<INTEREST-INCOME-NET> 214
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 0
<INCOME-PRETAX> 0
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 214
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<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>
