<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(MARK ONE)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 1996
------------------
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
---------------- ----------------
Commission file number 0-4707
------
Beverly Bancorporation, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-4090152
-------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
1357 West 103rd Street 60643
---------------------- -----
Chicago, Illinois (Zip Code)
-----------------
(Address of principal
executive offices)
Registrant's telephone number, including area code (773) 881-2373
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.
Yes No X
----- -----
As of October 31, 1996, 5,144,225 shares of the registrant's common stock were
outstanding.
<PAGE>
BEVERLY BANCORPORATION, INC.
INDEX
Page
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets at September 30, 1996 3
and December 31, 1995
Consolidated Statements of Income for the three- 4
month and nine-month periods ended September 30,
1996 and 1995
Consolidated Statements of Cash Flows for the nine- 6
month periods ended September 30, 1996 and 1995
Notes to Condensed Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 2. Changes in Securities 16
Item 4. Submission of Matters to a Vote of
Security Holders 16
Item 6. Exhibits and Reports on Form 8-K 16
SIGNATURES 17
2
<PAGE>
PART I. FINANCIAL INFORMATION - ITEM 1. FINANCIAL STATEMENTS
BEVERLY BANCORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
ASSETS
September 30, December 31,
1996 1995
---- ----
<S> <C> <C>
Cash and due from banks. . . . . . . . . . . . . . . . . . . . . $ 27,105 $ 32,635
Funds sold . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 20,075
Investment securities:
Available-for-sale, at fair value. . . . . . . . . . . . . . . 195,184 174,963
Held-to-maturity, at amortized cost (fair value
$33,069 and $32,639, respectively) . . . . . . . . . . . . . 33,317 32,644
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353,185 312,160
Less allowance for possible loan losses. . . . . . . . . . . . 3,957 3,524
----- -----
Net loans. . . . . . . . . . . . . . . . . . . . . . . . . . 349,228 308,636
Premises and equipment, net. . . . . . . . . . . . . . . . . . . 15,279 13,204
Accrued interest receivable. . . . . . . . . . . . . . . . . . . 5,354 4,826
Other real estate. . . . . . . . . . . . . . . . . . . . . . . . 1,091 858
Intangible assets, net . . . . . . . . . . . . . . . . . . . . . 1,091 1,301
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . 2,949 2,061
----- -----
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . $ 630,598 $ 591,203
--------- ---------
--------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Interest bearing . . . . . . . . . . . . . . . . . . . . . . . $474,342 $439,020
Non-interest bearing . . . . . . . . . . . . . . . . . . . . . 83,045 88,111
------ ------
Total deposits . . . . . . . . . . . . . . . . . . . . . . 557,387 527,131
Securities sold under agreements to repurchase, funds
purchased, and treasury tax deposits . . . . . . . . . . . . . 9,794 6,292
Bank notes payable . . . . . . . . . . . . . . . . . . . . . . . -- 11,000
Accrued expenses and other liabilities . . . . . . . . . . . . . 5,163 5,819
----- -----
Total liabilities. . . . . . . . . . . . . . . . . . . . . 572,344 550,242
STOCKHOLDERS' EQUITY
Preferred stock, par value $.01 per share; authorized
1,000,000 shares; no shares issued and outstanding . . . . . . -- --
Common stock, par value $.01 per share; authorized
8,000,000 shares; issued and outstanding 5,144,225
and 3,769,815, respectively. . . . . . . . . . . . . . . . . . 51 38
Additional paid-in capital . . . . . . . . . . . . . . . . . . 27,033 9,005
Retained earnings. . . . . . . . . . . . . . . . . . . . . . . 34,813 33,011
Net unrealized gains (losses) on available-for-sale
securities. . . . . . . . . . . . . . . . . . . . . . . . . . ( 1,815) 617
Note receivable - officer stockholders. . . . . . . . . . . . . ( 1,828) (1,710)
----- -----
Total stockholders' equity. . . . . . . . . . . . . . . . . . . 58,254 40,961
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY . . . . . . . . . . . . . . . . . . . . . . . . . $ 630,598 $ 591,203
--------- ---------
--------- ---------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE>
BEVERLY BANCORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ ------------------------
1996 1995 1996 1995
------------------------ ------------------------
<S> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans $7,378 $6,717 $20,909 $19,885
Interest on investment securities
Taxable 2,958 2,751 8,941 8,424
Tax-exempt 537 327 1,338 1,010
Funds sold 55 135 518 294
--------- --------- --------- ---------
Total Interest Income 10,928 9,930 31,706 29,613
Interest Expense:
Deposits 4,736 4,301 13,874 12,390
Securities sold under
agreement to repurchase,
funds purchased, and
treasury tax deposits 105 89 247 284
Note payable 126 2 495 53
--------- --------- --------- ---------
Total Interest Expense 4,967 4,392 14,616 12,727
--------- --------- --------- ---------
Net Interest Income 5,961 5,538 17,090 16,886
Provision for loan losses 40 34 115 137
--------- --------- --------- ---------
Net Interest Income after Provision
For Loan Losses 5,921 5,504 16,975 16,749
Other Income:
Income from fiduciary activities 505 473 1,503 1,427
Service charges on deposit accounts 987 1,012 3,159 3,000
Net (losses) gains on sales of investment securities 5 (4) 40 29
Mortgage origination & servicing fees 60 253 372 596
Other 410 308 1,042 664
--------- --------- --------- ---------
Total Other Income 1,967 2,042 6,116 5,716
--------- --------- --------- ---------
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ ------------------------
1996 1995 1996 1995
------------------------ ------------------------
<S> <C> <C> <C> <C>
Operating Expense:
Salaries and employee benefits 2,604 2,670 7,976 8,052
Occupancy 608 556 1,796 1,714
Equipment 406 453 1,203 1,474
Marketing and promotion 246 249 673 662
Other 1,647 1,243 4,742 4,080
--------- --------- --------- ---------
Total Operating Expenses 5,511 5,171 16,390 15,982
--------- --------- --------- ---------
Income Before Income Taxes 2,377 2,375 6,701 6,483
Income tax expense 697 773 2,014 2,030
--------- --------- --------- ---------
NET INCOME $1,680 $1,602 $4,687 $4,453
--------- --------- --------- ---------
--------- --------- --------- ---------
Net income per share $0.37 $0.32 $1.10 $0.90
--------- --------- --------- ---------
Common and common equivalent 4,601,644 4,938,607 4,261,029 4,921,235
shares --------- --------- --------- ---------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
5
<PAGE>
BEVERLY BANCORPORATION, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, 1996 and 1995 (unaudited)
(Amounts in thousands)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------
1996 1995
---- ----
Cash Flows from Operating Activities:
<S> <C> <C>
Net Income $4,687 $4,453
Adjustments to reconcile net income to net
cash provided by operating activities
Provision for credit losses 115 137
Provision for depreciation and amortization 1,209 1,233
Investment security accretion and amortization net 519 646
Deferred tax expense (benefit) (259) (103)
Amortization of intangible assets 210 235
Realized investment security gains, net (40) (28)
Gain on sale of other real estate - (25)
Increase in accrued interest receivable (528) (726)
(Decrease) increase in other assets 531 (501)
Loans held for sale 1,464 (3,957)
(Decrease) increase in accrued expense and other
liabilities (939) 387
----- -----
Net Cash Provided by Operating Activities 6,969 1,751
----- -----
Cash Flows from Investment Activities:
Investment securities available-for-sale:
Proceeds from maturities and call of securities 25,369 19,132
Proceeds from sale of securities 28,052 2,460
Purchase of securities (77,551) (12,307)
Investment securities held-to-maturity:
Proceeds from maturities and call of securities 1,557 6,490
Purchase of securities (2,710) (3,153)
Net (Increase) Decrease in loans (42,552) (20,185)
Purchases of premises and equipment (2,683) (520)
Proceeds from sale of other real estate and equipment 148 380
-------- -------
Net Cash Used by Investment Activities (70,370) (7,703)
-------- -------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------
1996 1995
---- ----
Cash Flows from Financing Activities:
<S> <C> <C>
Net increase in deposits 30,256 5,943
Net increase (decrease) in securities sold under
agreements to repurchase, funds purchased and treasury
tax deposits 3,502 (1,656)
Principal reductions on note payable (11,000) (1,800)
Cash dividends (662) (698)
Proceeds from issuance of common stock 15,818 360
Proceeds from notes receivable-officer stockholders 267 29
Issuance of notes receivable-officer stockholders (385) 29
------- -------
Net Cash Provided By Financing Activities 37,796 2,207
------- -------
Increase in Cash and Cash Equivalents (25,605) (3,745)
Cash and Cash Equivalents at Beginning of year 52,710 35,072
------- -------
Cash and Cash Equivalents at End of Period $27,105 $31,327
------- -------
Supplemental Disclosure of Cash Flow Information
Cash Paid During the Year For:
Interest 14,324 12,293
Income taxes 2,000 2,100
Non-Cash Investing and Financing Activities:
Unrealized gain (loss) on available-for-sale securities (3,909) (6,859)
Net change in loans transferred to other real estate 382 430
Refinancing of notes receivable 215 -
Common Stock Dividends 2,223 2,192
Capital lease 601 -
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
7
<PAGE>
BEVERLY BANCORPORATION, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30,1996
(UNAUDITED)
NOTE 1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the rules and regulations of the
Securities and Exchange Commission. 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 items) considered necessary for a
fair presentation have been included. Operating results for the three and nine
month periods ended September 30, 1996 are not necessarily indicative of the
results that may be expected for the year ended December 31, 1996. These
financial statements should be read in conjunction with the consolidated
financial statements and footnotes thereto included in the Company's prospectus
dated August 22, 1996.
NOTE 2. REINCORPORATION AND MERGER
Beverly Bancorporation, Inc. (the "Company") was incorporated in Delaware
on June 13, 1996 as a wholly-owned subsidiary of Beverly Bancorporation, Inc.,
an Illinois corporation ("Beverly Illinois").
On August 16, 1996, Beverly Illinois was merged with and into the Company
and the Company is the surviving corporation. Each outstanding share of common
stock of Beverly Illinois was converted into five shares of common stock of the
Company.
NOTE 3. PUBLIC OFFERING
On August 27, 1996, the Company sold 1,150,000 shares of its common stock,
including the underwriters over-allotment, in a public offering. For further
information refer to the Company's prospectus dated August 22, 1996.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis is a review of significant factors
affecting the results of operations and the financial condition of the Company
for the three and nine month periods ended September 30, 1996. This discussion
should be read in conjunction with the accompanying unaudited condensed
consolidated financial statements and the notes thereto included in this report.
OVERVIEW
Beverly Bancorporation, Inc. (the "Company") provides a full range of
banking services, including personal and corporate trust services. The strategy
of the Company is to continue to increase its core banking business and to
further develop its mortgage, trust, securities sales and insurance activities
in order to provide an array of household financial services encompassing
banking and other investment products.
The Company was incorporated in Delaware on June 13, 1996 as a wholly-owned
subsidiary of Beverly Bancorporation, Inc., an Illinois corporation ("Beverly
Illinois"). Beverly Illinois was organized in 1969 and owned all of the
outstanding capital stock of the subsidiary banks and Beverly Trust Company.
Pursuant to the reincorporation, on August 16, 1996, Beverly Illinois was merged
with and into the Company and the Company is the surviving corporation.
Subsequent to the reincorporation, the Company sold 1,150,000 shares of
common stock at $15.00 per share in a public offering in the third quarter. In
connection with the offering, the Company's common stock was listed on the
NASDAQ National Market under the symbol BEVB. A portion of the proceeds of the
offering was used to pay off the Company's $9 million debt. In September 1996,
the Company completed the merger of its four subsidiary banks into one bank
subsidiary and renamed the bank "Beverly National Bank."
The net income of the Company was $1.7 million for the three months ended
September 30, 1996, compared with net income of $1.6 million for the three
months ended September 30, 1995. Earnings per share for the third quarter of
1996 was $.37. The net income of the Company was $4.7 million for the nine
months ended September 30, 1996, compared with net income of $4.5 million for
the nine months ended September 30, 1995. Earnings per share for the nine
months ended September 30, 1996 was $1.10. The following table sets forth
certain selected additional financial data of the Company.
9
<PAGE>
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
1996 1995 1996 1995
---- ---- ---- ----
(dollars in thousands, except per share data)
Balance Sheet Data
Average assets $ 625,250 $ 572,670 $ 610,137 $564,104
Average total loans 341,329 311,728 322,068 304,742
Average deposits 558,568 511,795 547,097 506,252
Average equity 47,770 48,514 43,486 45,582
Per Share Data
Net Income $0.37 $0.32 $1.10 $0.90
Book value End of Period 11.32 10.66 11.32 10.66
Selected financial Ratios
Return on average assets 1.07% 1.12% 1.02% 1.05%
Return on average equity 14.07% 13.21% 14.37% 13.03%
Net interest margin (TE) 4.33% 4.35% 4.26% 4.54%
Net Charge offs (recoveries) to
average total loans 0.01% 0.08% -0.10% 0.15%
10
<PAGE>
RESULTS OF OPERATIONS
NET INTEREST INCOME
Net interest income equals the difference between interest income earned on
assets and the interest expense paid on liabilities. A comparison of the
Company's net interest income, on a taxable-equivalent basis, follows:
<TABLE>
<CAPTION>
For the Three Months Ended
----------------------------------------------------------------------
September 30, 1996 September 30, 1995
------------------ ------------------
Average Yield/ Average Yield/
Balance Interest Rate Balance Interest Rate
------- -------- ---- ------- -------- ----
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Funds sold $ 4,060 $ 55 5.37% $ 9,266 $ 135 5.78%
Investment securities 232,092 3,764 6.43% 206,188 3,241 6.24%
Loans 337,392 7,408 8.71% 307,975 6,753 8.70%
------- ----- ----- ------- ----- -----
Total earning assets 573,544 11,227 7.77% 523,429 10,129 7.68%
------- ------ ----- ------- ------ -----
Interest bearing deposits 470,137 4,736 4.00% 424,401 4,301 4.02%
Notes payable 7,256 126 6.89% - - -
Other interest bearing
liabilities 6,841 105 6.09% 7,136 91 5.06%
------ --- ----- ----- -- -----
Total interest bearing
liabilities $484,234 4,967 4.07% $431,537 4,392 4.04%
------- ----- ----- ------- ----- -----
Margin (T/E) $6,260 4.33% $5,737 4.35%
----- ----- ----- -----
----- ----- ----- -----
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
For the Nine Months Ended
----------------------------------------------------------------------
September 30, 1996 September 30, 1995
------------------ ------------------
Average Yield/ Average Yield/
Balance Interest Rate Balance Interest Rate
------- -------- ------- ------- -------- ----
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Funds sold $ 13,154 $ 518 5.27% $ 6,727 $ 294 5.84%
Investment securities 228,443 10,947 6.41% 208,095 9,937 6.38%
Loans 318,147 21,003 8.83% 300,831 19,998 8.89%
------- ----- ----- ------- ------ -----
Total earning assets 559,744 32,468 7.76% 515,653 30,229 7.84%
------- ------ ----- ------- ------ -----
Interest bearing deposits 460,358 13,874 4.03% 418,238 12,390 3.96%
Notes payable 9,089 495 7.28% 647 53 10.95%
Other interest bearing
liabilities 5,470 247 6.04% 5,675 284 6.69%
------- ------ ----- ------- ------ -----
Total interest bearing
liabilities $474,917 14,616 4.11% $424,560 12,727 4.01%
------- ------ ----- ------- ------ -----
Margin (T/E) $17,852 4.26% $17,502 4.54%
------- ----- ------- -----
------- ----- ------- -----
</TABLE>
For the three months ended September 30, 1996, the Company's net
interest income increased $523,000 or 9.1% to $6.3 million on a
taxable-equivalent basis from $5.7 million in the third quarter of 1995.
Interest on earning assets increased $1.1 million or 10.8% to $11.2 million
in the third quarter of 1996 from the same period in 1995 due to: the
investment of the deposit and capital growth of the Company, an increase in
the yield on investment securities, and an increase in loans outstanding
(which provide higher yields than alternative investments). The Company's
interest expense increased $575,000 or 13.1% to $5.0 million in the third
quarter of 1996 from the same period in 1995 due to growth in deposits and to
the interest expense on its note payable issued at the end of 1995.
For the nine months ended September 30, 1996, the Company's net interest
income increased $350,000 or 2.0% to $17.9 million on a taxable-equivalent basis
from $17.5 million in the same period of 1995. Interest on earning assets
increased $2.2 million or 7.4% to $32.5 million in the nine months ended
September 30, 1996 from the same period in 1995, primarily due to growth in both
loans and the investment portfolio. Total interest expense increased $1.9
million or 14.8% to $14.6 million in the nine months ended September 30, 1996
from the same period in 1995, due to a slight increase in the rate on deposits,
to growth of deposits, and to the interest cost on the note payable.
12
<PAGE>
LOAN LOSS PROVISION
The Company provided $40,000 for loan losses in the third quarter of 1996,
compared to $34,000 in the third quarter of 1995. For the nine months ended
September 30, 1996, the Company provided $115,000 for loan losses, compared to
$137,000 for the nine months ended September 30, 1995. The loan loss provisions
have remained relatively low due to the Company's asset quality, its significant
loan loss recoveries, and its relatively high concentration of generally low-
risk residential real estate loans.
OTHER INCOME
Other income declined $75,000 or 3.7% to $1.9 million in the third quarter
of 1996, compared to $2.0 million in the third quarter of 1995, primarily due to
a decrease in mortgage origination and servicing fees. This decrease resulted
from a change in the mix of mortgages originated, with 72% of originations
during the third quarter of 1996 being loans held in the Company's loan
portfolio, which do not generate current income. This decrease more than
offset an increase in other income of $102,000 in the third quarter of 1996,
primarily due to the initiation of ATM surcharges on non-customer transactions.
For the nine months ended September 30, 1996, other income increased
$400,000 or 7.0% to $6.1 million from $5.7 million in the same period in 1995.
This increase in other income was due to an increase of $107,000 in investment
security sales commissions, the initiation of ATM surcharges on non-customer
transactions and a significant recovery of interest on a charged off loan. This
increase was offset by a decline in mortgage origination and servicing fees
primarily because the loans generated for the Company's loan portfolio totaled
58% of originations.
OPERATING EXPENSE
Operating expenses increased $340,000 or 6.6% to $5.5 million for the three
months ended September 30, 1996, compared to $5.2 million in the three months
ended September 30, 1995. Salaries and Benefits declined $66,000 as a result of
outsourcing of certain operational activities, partially offset by normal
increases, the addition of several business development officers and the
additional staff at the Company's new Will-Cook Branch. Occupancy expense
increased $52,000 due to the opening of the Company's Will-Cook Branch and to
remodeling of other facilities. Other operating expenses increased $404,000 due
to the outsourcing of data processing and item processing in 1995, and to
increases in consulting and other expenses incurred in connection with the
merger of the Company's subsidiary banks.
For the nine months ended September 30, 1996, operating expenses increased
$408,000 or 2.6% to $16.4 million, compared to $16.0 million in the nine months
ended September 30, 1995. Equipment expense decreased
13
<PAGE>
$271,000, primarily due to the outsourcing of data processing and item
processing in 1995. Other operating expenses increased $662,000 despite a
decrease in FDIC insurance of $519,000. This increase is primarily due to an
increase in computer systems and service costs of $458,000 due to the
outsourcing of data processing and item processing. The Company has also
experienced increases in its consulting and legal expenses, and also incurred
increased costs in guard services.
FINANCIAL CONDITION
LOANS
The following table summarizes the Company's loan portfolio at September
30, 1996 and December 31, 1995.
September 30, December 31,
1996 1995
------------ ------------
(in thousands)
Commercial and industrial $ 62,439 $ 50,258
Residential real estate 140,016 119,153
Home equity lines of credit 28,527 31,152
Commercial real estate 80,667 74,199
Other consumer 41,536 37,398
------ ------
Total loans $353,185 $312,160
Allowance for loan losses ( 3,957) ( 3,524)
------ ------
Net loans $349,228 $308,636
-------- --------
-------- --------
The Company's loan portfolio has increased $40.6 million or 13.2% since
December 31, 1995, with $28.6 million of that growth coming in the third
quarter. Residential real estate loans increased $20.9 million since December
31,1995. These loans are exclusively ARM and balloon loans, as the Company does
not retain long-term, fixed-rate loans in its loan portfolio. Commercial loans
increased $12.2 million, and commercial real estate loans increased $6.5 million
since December 31,1995. Much of this growth has come in the third quarter, due
to the timing of closing of several significant loans.
NON-PERFORMING LOANS
The following table sets forth information on the Company's non-performing
loans and other real estate as of September 30, 1996 and December 31,1995.
14
<PAGE>
September 30, December 31,
1996 1995
------------ ------------
(dollars in thousands)
Nonaccrual loans $1,430 $1,606
Other loans 90 days past due 664 177
Other real estate 1,091 858
----- ---
Total nonperforming assets $3,185 $2,641
----- ------
Nonaccrual and other loans 90
days past due to total loans .59% .57%
Nonperforming assets to total
loans plus other real estate .90% .84%
Nonperforming assets to total
assets .51% .45%
DEPOSITS
Total deposits were $557.4 million as of September 30, 1996, an increase of
$30.3 million from December 31, 1995. This growth was primarily in certificates
of deposit due to short-term promotional certificates offered in connection with
the opening of the Will-Cook branch and with the renovation of the Oak Lawn
Branch.
NOTE PAYABLE
The Company's note payable, which was incurred in December, 1995, to fund
the purchase of 881,340 shares of common stock from the estate of the Company's
late chairman, was paid off in the third quarter of 1996 from the proceeds of
the Company's public offering.
COMMON STOCK
On August 27, 1996, the Company issued 1,150,000 shares of common stock at
$15.00 per share in a public offering. Proceeds of the offering, net of
expenses, totaled $15.4 million.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995.
This quarterly report contains forward looking statements. Forward looking
statements made by or on behalf of the Company are subject to risks and
uncertainties, including but not limited to the following: changes in interest
rates and other economic conditions could have an adverse impact on the Company;
there is no assurance as to the sufficiency of the Company's allowance for loan
losses; current and future government regulation could have an adverse impact on
the Company; and the financial services business is extremely competitive with a
number of competitors being substantially larger than the Company. Accordingly,
actual results may differ materially from those set forth in the forward looking
statements. Attention is also directed to other risk factors set forth in the
Company's prospectus dated
15
<PAGE>
August 22, 1996 filed by the Company with the Securities and Exchange
Commission.
PART II. OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES
The Company was incorporated in Delaware on June 13, 1996 as a wholly-owned
subsidiary of Beverly Bancorporation, Inc., an Illinois corporation ("Beverly
Illinois"). On August 16, 1996, Beverly Illinois was merged with and into the
Company and the Company is the surviving corporation. Each outstanding share of
common stock of Beverly Illinois was converted into five shares of common stock
of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At a special stockholders meeting held on July 24, 1996, the stockholders
of Beverly Illinois approved the merger of Beverly Illinois with and into the
Company. 574,084 shares of common stock of Beverly Illinois were voted for and
63,443 shares of common stock of Beverly Illinois were voted against the merger.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the three-month period ended
September 30, 1996.
16
<PAGE>
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.
BEVERLY BANCORPORATION, INC.
(Registrant)
Date: November 14, 1996 /s/ John D. Van Winkle
----------------------------------------
John D. Van Winkle
President, Chief Executive Officer
and Director
Date: November 14, 1996 /s/ John T. O'Neill
----------------------------------------
John T. O'Neill
Executive Vice President,
Chief Financial Officer and
Principal Accounting Officer
17
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