<PAGE> 1
FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities and Exchange Act of 1934
-----------------------
Date of Report: November 1, 2000
BANK MUTUAL CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
U.S.A. 000-31207 39-2004336
---------------------------- --------- ------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number Identification No.)
4949 West Brown Deer Road, Milwaukee, WI 53223
---------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(414) 354-1500
--------------
<PAGE> 2
Item 2. Acquisition or Disposition of Assets
On November 1, 2000, Mutual Savings Bank, now a wholly-owned subsidiary
of Bank Mutual Corporation, completed its previously announced restructuring
into mutual holding company form, pursuant to a Plan of Restructuring dated as
of February 21, 2000, as amended July 31, 2000. Under the Plan of Restructuring,
among other things, Bank Mutual conducted a subscription offering of its common
stock in which 6,141,006 shares were sold to depositors of Mutual Savings and
the Bank Mutual ESOP, and 11,193,174 shares were issued to Mutual Savings
Bancorp, MHC (the "MHC"), and Mutual Savings became a wholly-owned subsidiary of
Bank Mutual. The Plan of Restructuring was adopted by the Mutual Savings
directors and approved by Mutual Savings' depositors; the Plan did not require
third party negotiations.
On the same date, Bank Mutual acquired First Northern Capital Corp.
pursuant to an Agreement and Plan of Merger dated as of February 21, 2000. Under
the First Northern merger agreement, First Northern was merged with and into
Bank Mutual. In the merger, Bank Mutual issued an aggregate of 5,007,485 shares
of Bank Mutual common stock and paid approximately $75.1 million in cash. The
cash portion of the purchase price was financed through the net proceeds of the
subscription offering and existing capital resources. The merger agreement was
negotiated at arm's length between the respective officers of Mutual Savings (on
behalf of Bank Mutual) and First Northern. None of such officers were affiliated
with the other party, its affiliates, its directors and officers and their
associates. Both parties were also assisted in the negotiations by their
investment advisors and counsel, neither of which is affiliated with the other
party. As a result of the merger, First Northern Savings Bank has become a
wholly-owned subsidiary of Bank Mutual.
Bank Mutual is accounting for the restructuring of Mutual Savings Bank
as a de-mutualization transaction, and Bank Mutual's prior periods will be
restated to reflect Mutual Savings' prior results in a manner similar to pooling
of interests accounting. Bank Mutual is accounting for the First Northern merger
using the purchase method of accounting, and First Northern's operations will
therefore only be included in Bank Mutual's results and financial statements
from the date of the acquisition.
Bank Mutual is now the holding company for Mutual Savings Bank and First
Northern Savings Bank, both of which are federally chartered savings banks. Bank
Mutual and its subsidiaries operate 69 full service offices in Wisconsin and one
in Minnesota.
2
<PAGE> 3
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired
See "Index to Financial Statements" on the following page, the
Mutual Savings financial statements at pages F-1 through F-28 of the prospectus
dated September 8, 2000, forming part of the Registration Statement on Form S-1
(No. 333-39362) of Bank Mutual (the "Prospectus") which are incorporated herein
by reference, the Mutual Savings interim financial statements at pages F-1
through F-11 of Bank Mutual's Report on Form 10-Q for the quarter ended
September 30, 2000 (the "9/30/00 10-Q"), and the First Northern financial
statements at pages FN-1 through FN-28 of the Prospectus which are incorporated
herein by reference.
(b) Pro Forma Financial Information
The pro forma financial statements of Bank Mutual reflecting the
transactions reported herein are not yet available to Bank Mutual. Not later
than 60 days after the due date of this report, Bank Mutual will file the
required financial statements.
(c) Exhibits
See the Exhibit Index, following the signatures to this Report,
which Exhibit Index is incorporated herein by reference.
3
<PAGE> 4
INDEX TO FINANCIAL STATEMENTS
The following financial statements of Mutual Savings Bank and First Northern
Capital Corp. are incorporated by reference in this report from the indicated
pages of the Prospectus:
<TABLE>
<CAPTION>
Page No.
in Prospectus
-------------
MUTUAL SAVINGS
<S> <C>
Independent Auditors' Report.................................... F-1
Consolidated Statements of Financial Condition at June 30, 2000
(unaudited) and December 31, 1999 and 1998.................... F-2
Consolidated Statements of Income for the six months ended
June 30, 2000 and 1999 (unaudited) and for each of the three
years ended December 31, 1999, 1998 and 1997................... F-3
Consolidated Statements of Changes in Equity for the six months
ended June 30, 2000 and 1999 (unaudited) and for each of the three
years ended December 31, 1999, 1998 and 1997..................... F-4
Consolidated Statements for Cash Flows for the six months ended
June 30, 2000 and 1999 (unaudited) and for each of the three years
ended December 31, 1999, 1998 and 1997........................... F-5
Notes to Consolidated Financial Statements......................... F-7
FIRST NORTHERN
Independent Auditors' Reports...................................... FN-1
Consolidated Statements of Financial Condition at December 31,
1999 and 1998 ................................................. FN-3
Consolidated Statements of Income for each of the three years
ended December 31, 1999, 1998 and 1997........................... FN-4
Consolidated Statements of Stockholders' Equity for each of the
three years ended December 31, 1999, 1998 and 1997............... FN-5
Consolidated Statements for Cash Flows for each of the three
years ended December 31, 1999, 1998 and 1997..................... FN-6
Notes to Consolidated Financial Statements......................... FN-8
</TABLE>
4
<PAGE> 5
The following unaudited interim period financial statements of Mutual
Savings Bank are incorporated by reference in this report from the indicated
pages of the 9/30/00 10-Q:
<TABLE>
<CAPTION>
Page No. in
9/30/00 10-Q
------------
<S> <C>
MUTUAL SAVINGS
Consolidated Statement of Financial Condition at
September 30, 2000........................................................ 3
Consolidated Statements of Income for the three months and the
nine months ended September 30, 2000 and 1999............................. 4
Consolidated Statement of Changes in Equity for the nine months
ended September 30, 2000.................................................. 6
Consolidated Statements for Cash Flows for the nine months ended
September 30, 2000 and 1999............................................... 7
Notes to Consolidated Financial Statements................................. 8
The following unaudited interim period financial statements of First
Northern Capital Corp. are included in the following pages of this report:
<CAPTION>
Page No.
Herein
------
<S> <C>
FIRST NORTHERN
Consolidated Statement of Financial Condition at
September 30, 2000 ...................................................... A-1
Consolidated Statements of Income for the three months and the
nine months ended September 30, 2000 and 1999............................ A-2
Consolidated Statements of Stockholders' Equity for the
nine months ended September 30, 2000 and 1999............................ A-4
Consolidated Statements for Cash Flows for the nine
months ended September 30, 2000 and 1999................................. A-5
Notes to Consolidated Financial Statements................................. A-6
</TABLE>
5
<PAGE> 6
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 hereunto duly authorized.
Date: November 15, 2000 /s/ Eugene H. Maurer
------------------------------------
Eugene H. Maurer
Senior Vice President and Secretary
6
<PAGE> 7
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
September 30, 2000 December 31, 1999
----------------- -----------------
(In Thousands)
<S> <C> <C>
Assets
Cash $ 8,311 $ 8,043
Interest-earning deposits 636 4,329
--------- ---------
CASH AND CASH EQUIVALENTS 8,947 12,372
Securities available-for-sale, at fair value
Investment securities 11,902 8,444
Mortgage-related securities 5,229 5,554
Securities held-to-maturity
Investment securities
(estimated fair value of $27,090 - 2000; $25,644 - 1999) 27,341 26,215
Mortgage-related securities
(estimated fair value of $8,570 - 2000; $9,976 - 1999) 8,674 10,048
Loans held for sale 2,025 1,085
Loans receivable 819,546 736,880
Accrued interest receivable 4,829 4,229
Foreclosed properties and repossessed assets 367 382
Office properties and equipment 7,863 7,463
Federal Home Loan Bank stock 13,250 9,250
Life insurance policies 14,324 13,548
Prepaid expense and other assets 3,633 4,153
--------- ---------
$ 927,930 $ 839,623
========= =========
Liabilities
Deposits $ 570,514 $ 566,908
Borrowings 263,399 185,899
Advance payments by borrowers for taxes and insurance 11,405 3,887
Other liabilities 6,285 6,134
--------- ---------
TOTAL LIABILITIES 851,603 762,828
Commitments and Contingencies (See Note 8)
Stockholders' Equity
Cumulative preferred stock, $1 par value; 10,000,000
shares authorized; none outstanding
Common stock, $1 par value; 30,000,000 shares authorized;
shares issued: 9,134,735 - 2000 and 1999
shares outstanding: 8,375,808 - 2000; 8,548,658 - 1999 9,135 9,135
Additional paid-in capital 8,528 8,780
Retained earnings 66,812 64,468
Accumulated other comprehensive income 668 479
Treasury stock at cost (788,927 shares - 2000; 586,077 shares - 1999 (8,816) (6,067)
--------- ---------
TOTAL STOCKHOLDERS' EQUITY 76,327 76,795
--------- ---------
$ 927,930 $ 839,623
========= =========
</TABLE>
See Notes to Unaudited Consolidated Financial Statements.
A - 1
<PAGE> 8
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Three Months Ended
September 30
2000 1999
------------ ------------
(In Thousands,
Except Per Share Amounts)
<S> <C> <C>
Interest and dividend income:
Loans $15,350 $12,580
Investment securities 825 594
Interest-earning deposits 23 18
Mortgage-related securities 229 254
------- -------
TOTAL INTEREST AND DIVIDEND INCOME 16,427 13,446
Interest expense:
Deposits 6,772 5,875
Borrowings 4,229 1,915
Advance payments by borrowers for taxes and insurance 54 53
------- -------
TOTAL INTEREST EXPENSE 11,055 7,843
------- -------
NET INTEREST INCOME 5,372 5,603
Provision for loan losses 165 102
------- -------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 5,207 5,501
Non-interest income:
Fees on serviced loans 57 48
Loan fees and service charges 76 63
Deposit account service charges 445 362
Insurance commissions 107 92
Gain on sales of loans 63 46
Gain on sale of security - -
Other 414 384
------- -------
TOTAL NON-INTEREST INCOME 1,162 995
Non-interest expense:
Compensation, payroll taxes and other employee benefits 2,120 2,066
Federal insurance premiums 30 79
Occupancy 276 265
Data processing 421 441
Furniture and equipment 129 98
Telephone and postage 108 101
Marketing 103 117
Other 612 550
------- -------
TOTAL NON-INTEREST EXPENSE 3,799 3,717
INCOME BEFORE INCOME TAXES 2,570 2,779
Income taxes 810 892
------- -------
NET INCOME $ 1,760 $ 1,887
======= =======
BASIC NET INCOME PER SHARE $ 0.21 $ 0.22
======= =======
DILUTED NET INCOME PER SHARE $ 0.21 $ 0.21
======= =======
CASH DIVIDENDS PAID PER SHARE $ 0.11 $ 0.10
======= =======
</TABLE>
See Notes to Unaudited Consolidated Financial Statements.
A - 2
<PAGE> 9
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Nine Months Ended
September 30
2000 1999
--------- --------
(In Thousands,
Except Per Share Amounts)
<S> <C> <C>
Interest and dividend income:
Loans $43,454 $36,258
Investment securities 2,234 1,698
Interest-earning deposits 63 59
Mortgage-related securities 727 649
------- -------
TOTAL INTEREST AND DIVIDEND INCOME 46,478 38,664
Interest expense:
Deposits 19,374 17,381
Borrowings 10,770 4,702
Advance payments by borrowers for taxes and insurance 97 95
------- -------
TOTAL INTEREST EXPENSE 30,241 22,178
------- -------
NET INTEREST INCOME 16,237 16,486
Provision for loan losses 495 276
------- -------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 15,742 16,210
Non-interest income:
Fees on serviced loans 162 129
Loan fees and service charges 200 180
Deposit account service charges 1,244 1,014
Insurance commissions 305 253
Gain on sale of security 10 --
Gains on sales of loans 117 354
Other 1,228 1,018
------- -------
TOTAL NON-INTEREST INCOME 3,266 2,948
Non-interest expense:
Compensation, payroll taxes and other employee benefits 6,300 5,884
Federal insurance premiums 89 239
Occupancy 884 715
Data processing 1,233 1,231
Furniture and equipment 371 298
Telephone and postage 325 322
Marketing 370 331
Other 1,921 1,853
------- -------
TOTAL NON-INTEREST EXPENSE 11,493 10,873
INCOME BEFORE INCOME TAXES 7,515 8,285
Income taxes 2,379 2,732
------- -------
NET INCOME $ 5,136 $ 5,553
======= =======
BASIC NET INCOME PER SHARE $ 0.61 $ 0.64
======= =======
DILUTED NET INCOME PER SHARE $ 0.59 $ 0.62
======= =======
CASH DIVIDENDS PAID PER SHARE $ 0.33 $ 0.30
======= =======
</TABLE>
See Notes to Unaudited Consolidated Financial Statements.
A - 3
<PAGE> 10
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Accumulated
Additional Other-
Common Paid-In Retained Treasury Comprehensive
Stock Capital Earnings Stock Income Total
----------- ----------- ------------- ----------- -------------- -----------
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
For the Nine Months Ended September 30, 2000
--------------------------------------------
Balance at January 1, 2000 $9,135 $8,780 $64,468 $(6,067) $479 $76,795
Comprehensive income:
Net income 5,136 5,136
Other comprehensive losses 189 189
-------
Total comprehensive income 5,325
Cash dividends ($.11 per share) (2,792) (2,792)
Purchase of treasury stock (3,154) (3,154)
Exercise of stock options - (253) - 405 - 153
------ ------ ------- ------- ---- -------
Balance at September 30, 2000 $9,135 $8,528 $66,812 $(8,816) $668 $76,327
====== ====== ======= ======= ==== =======
For the Nine Months Ended September 30, 1999
--------------------------------------------
Balance at January 1, 1999 $9,135 $9,126 $60,582 $(3,710) $960 $76,093
Comprehensive income:
Net income 5,553 5,553
Other comprehensive losses (363) (363)
-------
Total comprehensive income 5,190
Cash dividends ($.10 per share) (2,626) (2,626)
Purchase of treasury stock (1,676) (1,676)
Exercise of stock options - (291) - 495 - 204
------ ------- ------- ------- ---- -------
Balance at September 30, 1999 $9,135 $ 8,835 $63,509 $(4,891) $597 $77,185
====== ======= ======= ======= ==== =======
</TABLE>
See Notes to Unaudited Consolidated Financial Statements.
A - 4
<PAGE> 11
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Nine Months Ended
September 30
2000 1999
---- ----
(In Thousands)
<S> <C> <C>
Cash flows from operating activities:
Net income $ 5,136 $ 5,553
Adjustments to reconcile net income to cash provided
by operating activities:
Provision for losses on loans 495 276
Provision for depreciation and amortization 678 687
Gains on sales of loans (63) (354)
Gain on sale of security (10) --
Loans originated for sale (6,029) (18,952)
Proceeds from loan sales 5,152 21,014
Increase in interest receivable (600) (465)
Increase (decrease) in interest payable 970 (47)
Increase in other assets (498) (846)
Decrease in other liabilities (249) (745)
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 4,982 6,121
Cash flows from investing activities:
Proceeds from maturities of available-for-sale investment securities 2,750 1,000
Proceeds from maturities of held-to-maturity investment securities 2,950 8,146
Purchases of available-for-sale investment securities (6,013) (1,490)
Purchases of held-to-maturity investment securities (4,128) (9,462)
Principal payments on available-for-sale mortgage-related securities 386 13
Principal payments on held-to-maturity mortgage-related securities 2,366 3,240
Purchase of available-for-sale mortgage-related securities - (2,982)
Purchases of held-to-maturity mortgage-related securities (991) (3,453)
Proceeds from the sale of securities 121 -
Net increase in loans receivable (83,220) (77,831)
Purchases of office properties and equipment (1,078) (686)
Purchase of Federal Home Loan Bank stock (4,000) (2,500)
--------- ---------
NET CASH USED BY INVESTING ACTIVITIES (90,857) (87,005)
Cash flows from financing activities:
Net increase in deposits 3,250 16,485
Net increase (decrease) in short-term borrowings (9,201) 35,113
Proceeds from long-term borrowings 148,205 48,225
Repayments of long-term borrowings (61,504) (23,228)
Cash dividend paid (2,792) (2,626)
Purchase of treasury stock (3,154) (1,676)
Proceeds from exercise of stock options 128 204
Net increase in advance payments by borrowers for taxes and insurance 7,518 7,298
--------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES 82,450 79,795
DECREASE IN CASH AND CASH EQUIVALENTS (3,425) (1,089)
Cash and cash equivalents at beginning of period 12,372 7,211
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 8,947 $ 6,123
========= =========
Supplemental Information to the Statement of Cash Flows:
Interest on deposits $ 19,018 $ 17,105
Interest on borrowings 10,156 4,474
Income taxes 2,200 2,660
Loans transferred to foreclosed properties and repossessed assets 186 177
</TABLE>
See Notes to Unaudited Consolidated Financial Statements.
A - 5
<PAGE> 12
FIRST NORTHERN CAPITAL CORP.
AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
GENERAL
1. The consolidated financial statements include the accounts of First
Northern Capital Corp. ("First Northern" or the "Company") and its
wholly-owned subsidiary First Northern Savings Bank, S.A. and its
subsidiaries (collectively, the "Savings Bank"): Great Northern Financial
Services Corporation ("GNFSC"), First Northern Investments Incorporated
("FNII"), Keystone Financial Services, Incorporated ("Keystone") and First
Northern Financial Services, Incorporated. All significant intercompany
balances and transactions have been eliminated according to generally
accepted accounting principles. The Savings Bank's ownership of Savings
Financial Corporation ("SFC"), a 50% owned subsidiary, is accounted for by
the equity method.
2. The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information, Rule 10-01 of Regulation S-X and the instructions to
Form 10-Q. The financial statements do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial information. In the opinion of First Northern, the
accompanying Unaudited Consolidated Statements of Financial Condition,
Unaudited Consolidated Statements of Income, Unaudited Consolidated
Statement of Stockholders' Equity and Unaudited Consolidated Statements of
Cash Flows contain all adjustments, which are of a normal recurring nature,
necessary to present fairly the consolidated financial position of the
Company and subsidiaries at September 30, 2000 and December 31, 1999, the
results of their income for the three and nine months ended September 30,
2000 and 1999, the changes in stockholders' equity for the nine months
ended September 30, 2000 and 1999, and their cash flows for the nine months
ended September 30, 2000 and 1999. The accompanying Unaudited Consolidated
Financial Statements and related notes should be read in conjunction with
First Northern's 1999 Annual Report on Form 10-K. Operating results for the
three and nine months ended September 30, 2000, are not necessarily
indicative of the results that may be expected for the year ending December
31, 2000.
A - 6
<PAGE> 13
3. Securities Available-for-Sale
The amortized cost and estimated fair values of securities
available-for-sale are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
------------ ------------ ------------- -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
At September 30, 2000: $ 10,021 $ 80 $ (69) $ 10,032
U.S. government and agency securities 588 (15) 573
Asset Management Funds
Federal Home Loan Mortgage 33 1,264 - 1,297
Corporation stock -------- -------- -------- --------
10,642 1,344 (84) 11,902
-------- -------- -------- --------
Mortgage-related securities 1,872 (78) 1,794
Federal Home Loan Mortgage Corporation 1,638 (4) 1,634
Federal National Mortgage Association 1,873 (72) 1,801
Government National Mortgage Association -------- -------- -------- --------
5,383 - (154) 5,229
-------- -------- -------- --------
$ 16,025 $ 1,344 $ (238) $ 17,131
======== ======== ======== ========
At December 31, 1999: $ 6,737 $ 6 $ (86) $ 6,657
U.S. government and agency securities 563 (17) 546
Asset Management Funds
Federal Home Loan Mortgage 33 1,097 1,130
Corporation stock 111 - - 111
Northwest Equities Corporation stock -------- -------- -------- --------
7,444 1,103 (103) 8,444
-------- -------- -------- --------
Mortgage-related securities 1,938 (92) 1,846
Federal Home Loan Mortgage Corporation 1,862 1,862
Federal National Mortgage Association 1,955 - (109) 1,846
Government National Mortgage Association -------- -------- -------- --------
5,755 - (201) 5,554
-------- -------- -------- --------
$ 13,199 $ 1,103 $ (304) $ 13,998
======== ======== ======== ========
</TABLE>
At September 30, 2000, the U.S. government and agency securities
available-for-sale have the following maturities:
<TABLE>
<CAPTION>
AMORTIZED ESTIMATED
COST FAIR VALUE
----------- ----------
(IN THOUSANDS)
<S> <C> <C>
Due in one year or less
Due after one year through 5 years $10,021 $10,032
-------- --------
$10,021 $10,032
======== ========
</TABLE>
A - 7
<PAGE> 14
Expected maturities from mortgage-related securities will differ from
contractual maturities because borrowers may have the right to call or
prepay obligations with or without prepayment penalties
4. Securities Held-to-Maturity
The amortized cost and estimated fair values of mortgage-related
securities held-to-maturity are as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
------------- ------------ ----------- ------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
At September 30, 2000:
Investment Securities:
U.S. government and agency securities $ 26,341 $ 43 $ (294) $ 26,090
Corporate Bonds 1,000 - - 1,000
-------- -------- -------- --------
Total investment securities 27,341 43 (294) 27,090
-------- -------- -------- --------
Mortgage-related securities:
Federal Home Loan
Mortgage Corporation 6,064 14 (84) 5,994
Federal National
Mortgage Association 2,610 - (34) 2,576
-------- -------- -------- --------
Total mortgage-related securities 8,674 14 (118) 8,570
-------- -------- -------- --------
Total investment securities and
mortgage-related securities $ 36,015 $ 57 $ (412) $ 35,660
======== ======== ======== ========
At December 31, 1999:
Investment Securities:
U.S. government and agency securities $ 25,216 $ (571) $ 24,645
Corporate bond 999 - - 999
-------- -------- -------- --------
Total investment securities 26,215 - (571) 25,644
-------- -------- -------- --------
Mortgage-related securities
Federal Home Loan
Mortgage Corporation 6,192 $ 15 (60) 6,147
Federal National
Mortgage Association 3,856 1 (28) 3,829
-------- -------- -------- --------
Total mortgage-related securities 10,048 16 (88) 9,976
-------- -------- -------- --------
Total investment securities and
mortgage-related securities $ 36,263 $ 16 $ (659) $ 35,620
======== ======== ======== ========
</TABLE>
A - 8
<PAGE> 15
At September 30, 2000, the investment securities have the following maturities:
<TABLE>
<CAPTION>
AMORTIZED ESTIMATED
COST FAIR VALUE
-------------- --------------
<S> <C> <C>
(In Thousands)
Due in one year or less $ 6,256 $ 6,232
Due after one year through 5 years 18,804 18,619
Due after 5 years through 10 years 2,281 2,239
------- -------
$27,341 $27,090
======= =======
</TABLE>
5. Loans Receivable
The composition of loans follows:
<TABLE>
<CAPTION>
SEPTEMBER 30 DECEMBER 31
2000 1999
------------- -------------
(IN THOUSANDS)
<S> <C> <C>
First mortgage loans:
One to four family residential $495,321 $465,737
Five or more family residential 37,920 35,815
Commercial real estate 32,575 17,699
Construction-residential 36,087 29,758
Construction-commercial 6,813 6,910
Other 4,147 3,769
-------- --------
612,863 559,688
Consumer loans:
Consumer 24,354 20,153
Second mortgage 92,471 78,223
Automobile 97,159 96,356
-------- --------
213,984 194,732
Commercial loans 11,875 4,771
-------- --------
838,722 759,191
Less:
Undisbursed loan proceeds 14,350 17,852
Allowance for losses 4,422 3,910
Unearned loan fees 404 549
-------- --------
19,176 22,311
-------- --------
$819,546 $736,880
======== ========
</TABLE>
A - 9
<PAGE> 16
6. The weighted average number of shares outstanding, including common
stock equivalents, for the three months ended September 30, 2000 and
1999 were 8,571,482 and 8,875,123, respectively and for the nine
months ended September 30, 2000 and 1999 there were 8,647,374 and
8,920,362, respectively.
7. Certain amounts in the 1999 financial statements have been
reclassified to conform to the 2000 presentations.
8. Off-balance sheet financial instruments whose contract amounts
represent credit and/or interest rate risk at September 30, 2000 are
as follows:
<TABLE>
<S> <C>
Commitment to extend credit:
Fixed rate (8.50% to 8.625%) $ 721
Adjustable rate (7.625% to 10.00%) 1,288
Commitment to sell loans (8.50% to 8.625%) 1,646
Unused overdraft protection lines
of credit for checking accounts 1,364
Unused equity lines of credit 21,100
Unused commercial lines of credit 3,375
Unused commercial letters of credit 1,342
Unused credit card lines of credit 8,084
</TABLE>
9. On February 21, 2000, the Company entered into an Agreement and Plan
of Merger (the "Merger Agreement") with Mutual Savings Bank
("Mutual"), a Wisconsin-chartered mutual savings bank and a wholly
owned subsidiary of Mutual organized for the purpose of effecting the
transactions contemplated by the Merger Agreement. Mutual intends to
assign the rights and obligations of this subsidiary to Bank Mutual
Corporation ("Bank Mutual"). The Merger Agreement provides for the
acquisition of the Company by Mutual through a merger of the Company
into Bank Mutual.
Subject to the terms and conditions of the Merger Agreement, at the
time of the merger, each outstanding share of the Company's common
stock will be converted into the right to receive cash in the amount
of $15.00 or 1.5 shares of common stock of the Bank Mutual or a
combination of cash and shares of Bank Mutual.
In connection with the Merger, the Company and Mutual will engage in a
restructuring. As part of the restructuring, Mutual will form a mutual
holding company. The mutual holding company will own a majority of
Bank Mutual's common stock. The balance of the shares of Bank Mutual
will be offered for sale to Mutual's depositors and issued to First
Northern stockholders in the Merger. As a result of the restructuring,
the Savings Bank and Mutual will become wholly owned subsidiaries of
Bank Mutual
The Merger and Mutual restructuring and stock offering are subject to
approval by the stockholders of the Company (for the Merger),
depositors of Mutual (for the restructuring), and various regulatory
agencies (for all transactions).
A - 10
<PAGE> 17
Concurrent with the execution of the Merger Agreement, the parties
entered into a Stock Option Agreement by which the Company granted
Mutual an irrevocable option to purchase up to 1,708,675 shares of the
Company's stock equal to 19.9% of the number of shares of the
Company's stock outstanding on February 21, 2000, at an exercise price
of $9.0375 per share. The option would become exercisable under
certain circumstances if the Company becomes the subject of a third
party proposal for a competing transaction.
Through September 30, 2000, First Northern has incurred direct
expenditures relating to the merger of $367,200. If the merger is not
consummated, these expenditures will be expensed.
A - 11
<PAGE> 18
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 hereunto duly authorized.
Date: November 15, 2000 /s/ Eugene H. Maurer
---------------------------------------
Eugene H. Maurer
Senior Vice President and Secretary
S-1
<PAGE> 19
BANK MUTUAL CORPORATION
EXHIBIT INDEX
to
FORM 8-K CURRENT REPORT
Dated as of November 1, 2000
<TABLE>
<CAPTION>
Exhibit Incorporated by Filed
Number Description Reference To Herewith
------- ------------------------------------- ---------------------------------------- ----------
<S> <C> <C> <C>
2.1 Agreement and Plan of Merger dated as Appendix A to the Proxy
of February 21, 2000 among Mutual Statement/Prospectus contained in Bank
Savings Bank, OV Corp. (assigned to Mutual's Registration Statement on Form
Bank Mutual Corporation) and First S-4, No. 333-39838
Northern Capital Corp.
2.2 Plan of Restructuring from Mutual Exhibit 2.1 to Bank Mutual's
Savings Bank to Mutual Holding Registration Statement on Form S-1 (No.
Company of Mutual Savings Bank, as 333-39362), as amended ("Form S-1")
amended and restated
23.1 Consent of Ernst & Young LLP X
23.2 Consent of Wipfli Ullrich Bertelson X
LLP
10.1 Stock Issuance Plan of Mutual Savings Exhibit 4.2 to Form S-1
Bank, as amended and restated
99.1 Pages F-1 to F-28 and FN-1 to FN-28 X
of the Prospectus
99.2 Page 3 to 9 of the 9/30/00 10-Q X
</TABLE>
EI-1
