SECURITY AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For quarter ended March 31, 2000 Commission file number 2-71249
SOUTH BANKING COMPANY
(Exact name of registrant as specified in its charter)
Georgia 58-1418696
(State or other jurisdiction of (I.R.S. Employer Identification
Number)
incorporation or organization)
104 North Dixon Street, Alma, Georgia 31510
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (912) 632-8631
Former name, former address and former fiscal year, if changed since
last report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 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
report(s), and (2) has been subject to such filing requirement for
the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of March 31, 2000.
Common stock, $1.00 par value - 399,500 shares outstanding
SOUTH BANKING COMPANY
SOUTH BANKING COMPANY
ALMA, GEORGIA
Part I. Financial Information
Consolidated Financial Statements . . . . . . . . . . . 4 -
9
Notes to Consolidated Financial Statements . . . . . . 10 -
11
Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . 12 -
18
Part II. Other Information . . . . . . . . . . . . . . . . . .
19
SOUTH BANKING COMPANY
ALMA, GEORGIA
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
March 31, December 31,
2000 1999
ASSETS
Cash and due from banks $ 6,972,775 $ 11,695,998
Deposits in other banks -
interest bearing $ 874,000 $ 869,000
Investment securities:
Available for sale $ 18,140,737 $ 18,306,239
Held to maturity $ 747,246 $ 747,339
Georgia Bankers stock $ 547,283 $ 547,283
Federal Home Loan Bank stock $ 426,100 $ 426,100
Federal funds sold $ 7,561,000 $ 3,180,000
Loans $141,156,607 $132,282,615
Less: Unearned discount ( 225,397) ( 216,397)
Reserve for loan losses ( 2,302,889) ( 2,168,877)
$138,628,321 $129,897,341
Bank premises and equipment $ 4,271,581 $ 4,097,405
Goodwill $ 195,527 $ 208,562
Other assets $ 4,612,239 $ 3,832,154
Total Assets $182,976,809 $173,807,421
The accompanying notes are an integral part of these financial
statements.
4
SOUTH BANKING COMPANY
ALMA, GEORGIA
CONSOLIDATED BALANCE SHEETS (Con't)
(UNAUDITED)
March 31, December 31,
2000 1999
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits: Demand - non-interest
bearing $ 22,735,828 $ 21,462,802
Demand - interest bearing 24,485,929 23,089,387
Savings 10,336,624 10,520,013
Time 103,360,614 97,727,773
$160,918,995 $152,799,975
Borrowing 2,847,274 2,669,743
Accrued expenses and other
liabilities 1,939,062 1,294,354
Federal funds purchased 690,000 1,140,000
Note payable - Federal Home Loan Bank 80,000 93,333
Total Liabilities $166,475,331 $157,997,405
Stockholders' Equity
Common stock $1 par value; shares
authorized - 1,000,000, shares
issued and outstanding at
March 31, 2000 and December 31,
1999 - 399,500 and 399,500,
respectively $ 399,500 $ 399,500
Surplus 3,070,831 3,070,831
Undivided profits 13,324,501 12,520,614
Accumulated other comprehensive
income ( 293,354) ( 180,929)
Total Stockholders' Equity $ 16,501,478 $ 15,810,016
Total Liabilities and
Stockholders' Equity $182,976,809 $173,807,421
The accompanying notes are an integral part of these financial
statements.
5
SOUTH BANKING COMPANY
ALMA, GEORGIA
CONSOLIDATED STATEMENT OF INCOME AND
COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Three Months
Ended Ended
March 31, March 31,
2000 1999
Interest Income
Interest and fees on loans $ 3,768,790 $ 3,051,810
Interest on federal funds sold 107,037 155,146
Interest on deposits with other banks 10,733 17,208
Interest on investment securities:
U. S. Treasury 24,372 42,009
U. S. government agencies 217,368 169,338
Mortgage backed securities 8,349 10,801
State and political subdivisions 20,852 22,877
Dividends 21,007 49,827
Total Interest Income $ 4,178,508 $ 3,519,016
Interest Expense
Interest on deposits $ 1,701,257 $ 1,475,238
Interest on other borrowings 59,834 57,692
Total Interest Expense $ 1,761,091 $ 1,532,930
Net Interest Income $ 2,417,417 $ 1,986,086
Provision for loan losses 87,500 75,000
Net interest income after provisions
for loan losses $ 2,329,917 $ 1,911,086
Other Operating Income
Service charge on deposit accounts $ 354,223 $ 336,116
Commission on insurance 28,139 15,275
Other income 179,114 112,117
Gain (loss) sale of securities - 5
Computer income 112,345 86,585
Total Other Operating Income $ 673,821 $ 550,098
The accompanying notes are an integral part of these financial
statements.
6
SOUTH BANKING COMPANY
ALMA, GEORGIA
CONSOLIDATED STATEMENT OF INCOME AND
COMPREHENSIVE INCOME (Con't)
(UNAUDITED)
Three Months Three Months
Ended Ended
March 31, March 31,
2000 1999
Other Operating Expenses
Salaries $ 795,413 $ 742,425
Profit sharing and other personnel
expense 159,088 133,086
Occupancy expense 98,132 97,351
Furniture and fixtures expense 181,554 178,262
Payroll taxes 50,945 51,208
Data processing 44,546 83,150
Other operating expenses 466,964 379,636
Total Other Operating Expenses $ 1,796,642 $ 1,665,118
Income before income taxes $ 1,207,096 $ 796,066
Applicable income taxes 403,209 238,787
Net income $ 803,887 $ 557,279
Other comprehensive income, net of tax
Unrealized gains (losses) on
securities $( 112,425) $( 63,714)
Other comprehensive income (loss) $( 112,425) $( 63,714)
Comprehensive income $ 691,462 $ 493,565
Per share data on weighted average
outstanding shares
Weighted average outstanding shares 399,500 399,500
Net income per share $ 2.012 $ 1.395
The accompanying notes are an integral part of these financial
statements.
7
SOUTH BANKING COMPANY
ALMA, GEORGIA
STATEMENT OF CASH FLOWS
(UNAUDITED)
Three Months Three Months
Ended Ended
March 31, March 31,
2000 1999
Cash Flows From Operating Activities:
Net income $ 803,887 $ 557,279
Add expenses not requiring cash:
Provision for depreciation and
amortization 167,906 108,689
Provision for loan losses 87,500 75,000
Bond portfolio losses (gains) - -
Gain on sale of other real estate
owned - -
Increase (decrease) in taxes payable 345,770 238,787
Increase (decrease) in interest payable 118,689 16,571
Increase (decrease) in other liabilities 180,249 ( 38,770)
(Increase) decrease in interest
receivable ( 123,101) 67,662
(Increase) decrease in prepaid
expenses ( 40,894) 33,567
(Increase) decrease in other assets ( 221,127) 22,163
Recognition of unearned loan income 9,000 -
Net Cash Provided (Used) by Operating
Activities $ 1,327,879 $ 1,080,948
Cash Flows From Investing Activities:
Proceeds from maturities of investment
securities - available for sale $ 10,452 $ 3,650,418
Proceeds from maturities of investment
security - held to maturity - -
Purchase of investment securities - AFS - ( 3,150,000)
Purchase of investment securities - HTM - -
Net loans to customers ( 8,827,480) ( 3,757,174)
Purchase of premise and equipment ( 326,230) ( 222,389)
Proceeds from sale of equipment - -
Proceeds from other real estate owned - -
Purchase of FHLB stock - ( 29,900)
Net Cash Provided (Used) by Investing
Activities $( 9,143,258) $( 3,509,045)
The accompanying notes are an integral part of these financial
statements.
8
SOUTH BANKING COMPANY
ALMA, GEORGIA
STATEMENT OF CASH FLOWS (Con't)
(UNAUDITED)
Three Months Three Months
Ended Ended
March 31, March 31,
2000 1999
Cash Flows From Financing Activities:
Net increase (decrease) in demand
deposits, NOW and money market $ 2,669,568 $( 5,251,253)
Net increase (decrease) in savings
and time deposit 5,449,452 460,781
Net increase (decrease) in borrowings ( 177,531) ( 18,144)
Dividends paid - -
Redemptions of company stock - -
Federal funds purchased ( 450,000) -
Net decrease - note payable - FHLB ( 13,333) ( 13,334)
Net Cash Provided (Used) by
Financing Activities $ 7,478,156 $( 4,821,950)
Net Increase (Decrease) in Cash
and Cash Equivalents $( 337,223) $( 7,250,047)
Cash and Cash Equivalents at
Beginning of Year 15,744,998 25,309,085
Cash and Cash Equivalents at
End of Period $ 15,407,775 $ 18,059,038
The accompanying notes are an integral part of these financial
statements.
9
SOUTH BANKING COMPANY
ALMA, GEORGIA
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Basis of Presentation
The accounting and financial reporting policies of South
Banking Company and its subsidiaries conform to generally
accepted accounting principles and to general practice within
the banking industry. The consolidated statements include the
accounts of South Banking Company and its wholly owned
subsidiaries. All material intercompany accounts and
transactions have been eliminated in consolidation. The
accompanying interim financial statements are unaudited. In
management's opinion, the consolidated financial statements
reflect a fair presentation of the consolidated financial
position of South Banking Company and subsidiaries, and the
results of its operations and its cash flows for the interim
periods presented, in conformity with generally accepted
accounting principles. These interim financial statements
should be read in conjunction with the audited financial
statements and footnote disclosures in the Bank's 10K for the
fiscal year ended December 31, 1999.
Basic earnings per share have been computed by dividing
net income (the numerator) by the weighted average number of
common shares (the denominator) for the period.
In June 1997, the FASB issued SFAS No. 131, "Disclosures
about Segments of an Enterprise and Related Information."
SFAS No. 131 requires that public companies report certain
information about operating segments in complete sets of
financial statements of the company and in condensed financial
statements of interim periods issued to shareholders. It also
requires that public companies report certain information
about their products and services, the geographic areas in
which they operate, and their major customers. SFAS No. 131
applies to fiscal years beginning after December 15, 1997.
South Banking Company is a four bank holding company operating
primarily in Southeast Georgia. The primary purpose of the
company is the delivery of financial services within its
market. Each of the company's entities are part of the same
reporting segment, whose operating results are regularly
reviewed by management. Therefore, consolidated financial
statements, as presented, fairly reflect the operating results
of the financial services segment of our business.
In June 1997, FASB issued SFAS No. 130, "Reporting
Comprehensive Income" ("SFAS 130"). SFAS 130 established
standards for reporting and display of comprehensive income
and its components in the financial statements. SFAS 130
applies to fiscal years beginning after December 15, 1997.
Reclassification of financial statements for earlier periods
has been provided for comparative purposes.
10
SOUTH BANKING COMPANY
ALMA, GEORGIA
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
During 1998, the FASB issued SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities" ("SFAS
133"), which establishes accounting and reporting standards
for derivative instruments and for hedging activities. The
statement requires that all derivatives be recognized as
either assets or liabilities in the statement of financial
position and be measured at fair value. SFAS 133 is effective
for fiscal quarters of all fiscal years beginning after June
15, 1999; earlier application is permitted. The company does
not hold or issue derivative instruments as defined by SFAS
133; and accordingly, it is the opinion of management that
there will be no future impact from this recent accounting
standard.
11
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
Liquidity management involves the matching of the cash flow
requirements of customers, who may be either depositors desiring to
withdraw funds or borrowers needing assurance that sufficient funds
will be available to meet their credit needs and the ability of South
Banking Company and its subsidiaries (the "Company") to meet those
needs. The Company strives to maintain an adequate liquidity position
by managing the balances and maturities of interest-earning assets and
interest-bearing liabilities so that the balance it has in short-term
investments (Federal funds sold) at any given time will adequately
cover any reasonably anticipated immediate need for funds.
Additionally, the subsidiary banks (the "Banks") maintain
relationships with correspondent banks, which could provide funds to
them on short notice, if needed.
The liquidity and capital resources of the Company are monitored
on a periodic basis by state and federal regulatory authorities. As
determined under guidelines established by these regulatory
authorities, the Banks' liquidity ratios at March 31, 2000 were
considered satisfactory but on the lower level. At that date, the
Banks' Federal funds sold were adequate to cover any reasonably
anticipated immediate need for funds. The Company is aware of no
events or trends likely to result in a material change in liquidity.
At March 31, 2000, the Company's and the Banks' capital asset ratios
were considered well capitalized based on guidelines established by
regulatory authorities. During the three months ended March 31, 2000,
total capital increased $619,462 to $16,501,478. This increase in
capital resulted from net earnings of $803,887 and an increase of
$112,425 in unrealized losses on securities available for sale, net of
taxes.
At March 31, 2000, South Banking Company had one binding
commitment for capital expenditures. South Banking Company's
subsidiary, Pineland State Bank, had entered into an agreement to
acquire three bank branches within its market area. South Banking
will contribute an additional $2,000,000 in capital to Pineland State
Bank to facilitate the acquisition. South Banking Company has
arranged long-term financing for the additional investment.
Results of Operations
The following discussion and analysis presents the significant
changes in financial condition and the results of operations of South
Banking Company and Subsidiaries for the periods indicated. This
discussion and analysis should be read in conjunction with the
Company's 1999 Annual Report to Shareholders and Form 10-K.
12
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations (Con't)
Since the primary business activities of South Banking Company
are conducted through its Banks, this discussion focuses primarily on
the financial condition and operations of the Banks. Included in this
discussion are forward looking statements based on management's
current expectations, actual results, however, may differ. Amounts
and percentages used in this discussion have been rounded.
Earnings Summary
Net income for the first quarter of 2000 was $803,887, up
$246,608 from $557,279 in the first quarter of 1999. On a per share
basis earnings registered a similar increase from $1.40 to $2.01.
These levels of income represent annualized returns on average assets
of 1.80% and 1.37%, respectively. Return on average equity also
increased from 15.42% to 19.90%. Details concerning the Company's
results of operations are discussed in the following sections of this
report.
Net interest income for the first quarter of 2000 totaled
$2,417,417, up $431,331 from $1,986,086 in the first quarter of 1999.
Interest income is being impacted by the mix of assets, the level
of earning assets and the interest rate environment. Average earning
assets for the quarter of $160.4 million are $10.7 million in excess
of the first quarter 1999 average. These funds are primarily being
invested in the loan portfolio. The rate environment and loan volume
has caused loan income to increase $716,980 from $3,051,810 in the
first quarter of 1999 to $3,768,790 in the first quarter of 2000.
This increase reflects the volitile repricing of the Bank's
substantial portfolio of one-year adjustable rate loans; however, the
recent increase in the prime rate has begun to positively impact
interest income.
Interest expense, the other component of net interest income,
increased $228,161 when compared to the first quarter of last year
including the fact that the average balance of interest bearing
liabilities was up $13.9 million. This is the result of higher
interest rates. The overall cost of interest bearing liabilities for
the quarter of 5.04% is 16 basis points higher than in the first
quarter of 1999, reflecting several rate increases implemented in late
1999 and early 2000.
This combination of higher average balances and higher rates
produced a net interest margin of 5.37% for the quarter, up from 4.52%
in the first quarter of last year.
13
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Earnings Summary (Con't)
The provision for loan losses is a charge to earnings in the
current period to replenish the allowance for loan losses and maintain
it at the level management determines is adequate. The provision for
loan losses charged to earnings amounted to $87,500 and $75,000 during
the three months ended March 31, 2000 and 1999, respectively.
Noninterest Income
Following is a comparison of noninterest income for the three
months ended March 31, 2000 and 1999.
Three Three
Months Months
Ended Ended
March 31, March 31,
2000 1999
Service charges on deposits $ 354,223 $ 336,116
Other service charges, commissions
& fees 28,137 15,275
Other income 291,461 198,707
Total Noninterest Income $ 673,821 $ 550,098
Total noninterest income for the three months ended March 31,
2000 was $123,723 higher than during the same period in 1999. The
primary increase is related to additional computer processing income
from nonaffiliated banks and brokerage services.
During the third quarter of 1998, the Bank began offering
brokerage services, including stocks, bonds, mutual funds and
annuities, to its customers. The effect on the deposit base has been
limited as less than one quarter of the total sales have come from
Bank deposits. In the long-term, management believes this service
could actually increase deposits.
Noninterest Expense
Noninterest expense includes all items of expense other than
interest expense, the provision for loan losses, and income taxes.
Total noninterest expense for the first quarter of 2000 of $1,796,642
was $131,524, or 7.90% greater than during the first quarter of 1999.
14
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Noninterest Expense (Con't)
The majority of this increase was due to higher salary, payroll
taxes, and benefit costs, up $78,990 to $954,501. Salaries have
increased as a result of the normal growth in assets and normal salary
increases. Increases were also experienced in group insurance and
pension expense.
Other non-personnel expense had little change from prior year
except for new accruals. Management expects this trend to remain
constant during the remainder of the year.
Income Taxes
The Company's provision for income taxes, which totaled $403,209
in the first quarter of 2000 and $238,787 in the first quarter of
1999, includes both federal and state income taxes. The effective tax
rates during the two periods were 33.4% in 2000 and 30.0% in 1999.
Financial Condition
Average total assets during the first quarter of 2000 were
$178,392,115, up from $162,834,843 from the first quarter of 1999. A
detailed discussion of the Bank's financial condition, and its various
balance sheet components follows:
Loan Portfolio
The loan portfolio, which represents South's largest asset, has
increased during the first quarter by $8,873,992 to $141,156,607.
Competitive pressures from auto manufacturers and a variety of
mortgage providers continue to make loan growth at acceptable yields
and risk levels difficult for those types of loans. Management also
believes that with the recent decline in the local farming economy,
there exists little opportunity to expand and develop the agricultural
loan portfolio. In the year since March 31, 1999, the loan portfolio
has increased substantially. Commercial and real estate lending
remains the largest part of the portfolio and where the growth is
derived.
The Bank is also a party to financial instruments with off-balance
sheet risk in the normal course of business to meet the financing
needs of its customers. These financial instruments include
commitments to extend credit and letters of credit. Those instruments
involve, to varying degrees, elements of credit and interest rate risk
in excess of the amount recognized in the consolidated balance sheets.
At March 31, 2000, commitments to extend credit, including unused
lines of credit, totaled $32,238,000 while letters of credit totaled
$524,000.
15
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Loan Portfolio (Con't)
Company policy requires those loans which are past due 90 days or
more be placed on nonaccrual status unless they are both well secured
and in the process of collection. The following table provides a
summary of past due loans and nonperforming assets.
Summary of Past Due Loans and Nonperforming Assets
(in thousands)
-------March 31------
- -
2000 1999
(Unaudited)
Loans past due 90 or more days
still accruing interest $ 155 $ 183
Nonperforming assets:
Nonaccruing loans $ 843 $ 625
Other real estate owned 700 182
$ 1,543 $ 807
Management makes this determination by its analysis of overall
loan quality, changes in the mix and size of the loan portfolio,
previous loss experience, general economic conditions, information
about specific borrowers, and other factors. At March 31, 2000, the
allowance for loan losses was $2,302,889 or 1.63% of gross loans.
Given the inherent risk contained in the portfolio, including the
nonaccrual loan described above as well as commitments to extend
credit, this level is considered adequate. Management is not aware of
any trends, uncertainties or other information relating to the loan
portfolio, which it expects will materially impact future operating
results, liquidity, or capital resources.
The provision for loan losses is a charge to earnings which is
made to maintain the allowance for loan losses at a significant level.
The provision totaled $87,500 during the first quarter of 2000 and
$75,000 during the first quarter of 1999.
Securities Portfolio and Federal Funds Sold
The Bank's securities portfolio consists of available for sale
and held to maturity securities while no securities are maintained in
a trading account. At March 31, 2000, the held to maturity portfolio
totaled $747,246.
16
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Securities Portfolio and Federal Funds Sold (Con't)
Management attempts to emphasize the available for sale port-
folio due to the flexibility it allows in managing the balance sheet
structure and addressing asset/liability issues. At March 31,
2000,this
portfolio had an estimated fair value of $18,140,737, $440,031 less
than the amortized cost. Such deficit represents an unrealized loss.
This portfolio, which represents 91.3% of the total securities
portfolio, is invested primarily in U.S. Treasury and agency
obligations and tax exempt municipals. The treasury and agency
portion of the portfolio, including agency backed mortgage securities,
total $16,044,973 at quarter end or 88.4% of the available for sale
portfolio. Tax exempt municipals totaling $1,605,050 comprised 8.8%.
The remainder of the portfolio, which totals $490,714, consists of
bank holding company stock.
The Bank has typically favored investments with maturities of
five years or less which have known cash flow patterns. Such
instruments typically provide greater safety, less market value
fluctuation and more simplified asset/liability issues. However, some
callable secur-ities and mortgage backed securities may be purchased
from time to time
for their increased yield.
The Bank generally tries to minimize its involvement in the
overnight federal funds sold market, instead relying on the
continually maturing securities portfolio to provide the liquidity
needed to fund loans or meet deposit withdraw demands. Nonetheless,
at any given time, the execution of specific investing or funding
strategies or normal fluctuations in deposit and loan balances may
require the bank to sell, or buy, funds on an overnight basis. In
addition, any daily excess funds are maintained in Federal Funds until
demands on accounts are determined.
Deposits and Other Funding Sources
Total deposits at March 31, 2000 of $160,918,995 were up from
their year end total of $152,799,975. The first quarter has
traditionally been a slow growth period. First quarter deposits have
increased $8,119,020.
Noninterest bearing deposits increased $1,273,026 to $22,735,828
during the quarter. In contrast to this, interest bearing deposits
increased $6,845,994 or 5.2%, to $138,183,167 during the quarter.
Increases were experienced in all types of interest bearing deposits.
17
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Deposits and Other Funding Sources (Con't)
In addition to deposits the Bank may generate funding by the use
of borrowings.
Year 2000 Compliance
Year 2000 has passed and the Banks have not had any effect on its
computerized systems. The Banks continue to monitor, but do not
anticipate, any problems in the future. Expenditures for future
monitoring is not contemplated.
Impact of Inflation
The consolidated financial statements and related data included
in this report were prepared in accordance with generally accepted
accounting principles, which require the Company's financial position
and results of operations to be measured in terms of historical
dollars, except for the available for sale securities portfolio.
Consequently, the relative value of money generally is not considered.
Nearly all of the Company's assets and liabilities are monetary in
nature and, as a result, interest rates and competition in the market
area tend to have a more significant impact on the Company's
performance than the effect of inflation.
18
SOUTH BANKING COMPANY
ALMA, GEORGIA
PART II. OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 6. Exhibits and Reports on Form 8-K
(A) Exhibits
(27) Financial Data Schedule
The registrant has not filed any reports on Form 8-K
during the three month period ended March 31, 2000.
19
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.
SOUTH BANKING COMPANY
(Registrant)
Date: May 10, 2000 By:
Paul Bennett
President
Date: May 10, 2000 By:
Olivia Bennett
Vice President
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 6,972,775
<INT-BEARING-DEPOSITS> 874,000
<FED-FUNDS-SOLD> 7,561,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 18,140,737
<INVESTMENTS-CARRYING> 747,246
<INVESTMENTS-MARKET> 747,824
<LOANS> 141,156,607
<ALLOWANCE> 2,302,889
<TOTAL-ASSETS> 182,976,809
<DEPOSITS> 160,918,995
<SHORT-TERM> 690,000
<LIABILITIES-OTHER> 1,939,062
<LONG-TERM> 2,927,274
0
0
<COMMON> 399,500
<OTHER-SE> 16,101,978
<TOTAL-LIABILITIES-AND-EQUITY> 182,976,809
<INTEREST-LOAN> 3,768,790
<INTEREST-INVEST> 409,718
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 4,178,508
<INTEREST-DEPOSIT> 1,701,257
<INTEREST-EXPENSE> 1,761,091
<INTEREST-INCOME-NET> 2,417,417
<LOAN-LOSSES> 87,500
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,796,642
<INCOME-PRETAX> 1,207,096
<INCOME-PRE-EXTRAORDINARY> 1,207,096
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 803,887
<EPS-BASIC> 2.01
<EPS-DILUTED> 2.01
<YIELD-ACTUAL> 0
<LOANS-NON> 842,912
<LOANS-PAST> 154,664
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,168,877
<CHARGE-OFFS> 70,228
<RECOVERIES> 116,741
<ALLOWANCE-CLOSE> 2,302,889
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,302,889
</TABLE>
