<PAGE> 1
SECURITIES 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: JUNE 30, 1995
COMMISSION FILE NUMBER: 0-11108
SUMMIT BANCSHARES, INC.
STATE OF CALIFORNIA I.R.S. IDENTIFICATION
NUMBER 94-2767067
2969 BROADWAY, OAKLAND CALIFORNIA 94611
(510) 839-8800
Indicate by the 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_____X____ NO__________
The number of shares outstanding of the registrant's common stock
was:
424,259 shares of no par value common stock
issued as of June 30, 1995
<PAGE> 2
PART I - FINANCIAL INFORMATION
____ _ _________ ___________
ITEM 1 PAGE
SUMMIT BANCSHARES, INC. AND SUBSIDIARY FINANCIAL STATEMENTS
______ __________ ___ ___ __________ _________ __________
Consolidated Balance Sheets ...................... 2
Consolidated Statements of Income ................ 3-4
Consolidated Statements of Changes in
Shareholders' Equity .......................... 5
Consolidated Statement of Cash Flows ............. 6-7
Notes to Financial Statements..................... 8-9
Interest Rate Risk Reporting Schedule............. 10-12
ITEM 2
Management's Discussion and Analysis of Financial
Condition and Results of Operations ........... 13-19
PART II - OTHER INFORMATION
____ __ _____ ___________
ITEMS 1-6 .................................................. 20
<PAGE> 3
<TABLE>
<CAPTION>
SUMMIT BANCSHARES, INC. AND SUBSIDIARY
______ ___________ ___ ___ __________
CONSOLIDATED BALANCE SHEETS
____________ _______ ______
JUNE 30, 1995 AND DECEMBER 31, 1994
____ ___ ____ ___ ________ ___ ____
(Unaudited)
(Stated in Thousands)
ASSETS 6-30-95 12-31-94
______ _______ ________
<S> <C> <C>
Cash and Due from Banks $ 5,751 $ 5,746
Federal Funds Sold 8,200 3,500
______ ______
Cash and Cash Equivalents 13,951 9,246
Interest-bearing Deposits with
Other Financial Institutions 7,832 7,039
Investment Securities (Held-to- 9,912 10,325
Maturity. Market Value of
$9,977 at June 30, 1995 and
$10,219 at December 31, 1993)
Loans 45,970 47,623
Less: Allowance for
Loan Losses (1,146) (932)
______ ______
Net Loans 44,824 46,691
Premises and Equipment, net 780 849
Other Real Estate Owned 1,302 2,866
Interest Receivable and Other
Assets 1,502 1,585
______ ______
TOTAL ASSETS $80,103 $78,601
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
___________ ___ _____________ ______
Deposits:
Demand $20,812 $22,469
Savings 2,531 3,109
Interest-bearing Transaction
Accounts 27,589 28,815
Other Time 17,807 13,469
______ ______
Total Deposits 68,739 67,862
Interest Payable and Other
Liabilities 481 245
______ ______
TOTAL LIABILITIES 69,220 68,107
______ ______
SHAREHOLDERS' EQUITY:
Preferred Stock, no par value:
2,000,000 shares authorized, no
shares outstanding --- ---
Common Stock, no par value;
3,000,000 shares authorized;
427,485 shares issued and
outstanding at 12-31-94
and 424,259 at 6-30-95 3,767 3,838
Retained Earnings 7,116 6,656
______ ______
TOTAL SHAREHOLDERS' EQUITY 10,883 10,494
______ ______
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $80,103 $76,601
====== ======
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
SUMMIT BANCSHARES, INC. AND SUBSIDIARY
______ ___________ ____ ___ __________
CONSOLIDATED STATEMENTS OF INCOME FOR THE
____________ __________ __ ______ ___ ___
THREE AND SIX MONTHS ENDED JUNE 30, 1995 AND 1994
_____ ___ ___ ______ _____ ____ ___ ____ ___ ____
(unaudited)
THREE THREE SIX SIX
MONTHS MONTHS MONTHS MONTHS
ENDED ENDED ENDED ENDED
6-30-94 6-30-95 6-30-94 6-30-95
------- ------- ------- -------
Interest Income:
<S> <C> <C> <C> <C>
Interest and Fees on Loans $1,241,380 $1,370,152 $2,371,653 $2,712,915
Interest on Investment Sec. 18,927 151,868 25,165 302,730
Interest on Federal Funds Sold 30,979 95,308 35,984 145,466
Interest on Time Deposits with
Other Financial Institutions 116,300 105,591 232,274 198,533
_________ __________ _________ __________
TOTAL INTEREST INCOME 1,407,586 1,722,919 2,665,076 3,359,644
Interest Expense:
Interest on Deposits 280,529 371,432 540,209 680,804
TOTAL INTEREST EXPENSE 280,529 371,432 540,209 680,804
_________ __________ _________ __________
NET INTEREST INCOME 1,127,057 1,351,487 2,124,867 2,678,840
Provision for Possible Loan
Losses 132,000 150,000 315,000 290,000
_________ __________ _________ __________
NET INTEREST INCOME AFTER
PROVISION FOR POSSIBLE LOAN
LOSSES 995,057 1,201,487 1,809,867 2,388,840
_________ __________ _________ __________
Other Operating Income:
Service Charges on Deposit
Accts. 89,676 93,819 175,688 191,989
Other 48,922 41,749 279,545 85,178
_________ __________ _________ __________
TOTAL OTHER OPERATING INCOME 138,598 135,568 455,233 277,167
_________ __________ _________ __________
Other Operating Expenses:
Salaries and Employee Benefits 401,071 441,466 816,720 872,670
Occupancy Expense 87,507 92,345 170,426 181,081
Furniture and Equipment Expense 35,924 23,187 70,419 49,512
Other 237,754 288,395 465,797 615,321
_________ __________ _________ __________
TOTAL OTHER OPERATING EXPENSE 762,256 845,393 1,523,362 1,718,584
_________ __________ _________ __________
INCOME BEFORE INCOME TAXES 371,399 491,662 741,738 947,423
Provision for Income Taxes (153,476) (197,687) (306,611) (381,860)
_________ __________ _________ __________
NET INCOME $ 217,923 $ 293,975 $ 435,127 $ 565,563
========= ========= ========= =========
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
THREE THREE SIX SIX
MONTHS MONTHS MONTHS MONTHS
ENDED ENDED ENDED ENDED
6-30-94 6-30-95 6-30-94 6-30-95
_______ _______ _______ _______
<S> <C> <C> <C> <C>
NET INCOME APPLICABLE TO
COMMON STOCK $217,923 $293,975 $435,127 $565,563
======== ======== ======== ========
PRIMARY EARNINGS:
Weighted Average Shares
Outstanding: 430,154 454,918 430,154 455,473
PRIMARY EARNINGS PER SHARE $.51 $.65 $1.01 $1.24
======= ======= ======= =======
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
SUMMIT BANCSHARES, INC. AND SUBSIDIARY
______ ___________ ____ ___ __________
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
____________ __________ __ _______ __ _____________ ______
FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1994
___ ___ ___ ______ _____ ____ ___ ____ ___ ____
(Unaudited)
NUMBER
OF SHARES COMMON RETAINED
OUTSTANDING STOCK EARNINGS
___________ _____ ________
<S> <C> <C> <C>
BALANCE AT DECEMBER 31, 1994 427,485 $3,837,684 $6,656,072
Purchase of Common Stock (3,226) (70,246) ---
Net Income for the Six Months
Ended June 30, 1995 --- --- 565,563
Payment of $.25 Cash Dividend
for Holders of Record as of
May 12, 1995 and Payable on
June 9, 1995 --- --- (106,252)
_______ _________ _________
BALANCE AT JUNE 30, 1995 424,259 $3,767,438 $7,115,383
======= ========= =========
BALANCE AT DECEMBER 31, 1993 414,402 $3,674,959 $5,951,371
Purchase of Common Stock (1,937) (26,989) ---
Net Income for the Six Months
Ended June 30, 1994 --- --- 435,127
Payment of $.12 Cash Dividend
for Holders of Record as of
May 11, 1994 and Payable on
June 8, 1994 --- --- (49,642)
_______ _________ _________
BALANCE AT JUNE 30, 1994 412,465 $3,647,970 $6,336,856
======= ========= =========
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
SUMMIT BANCSHARES, INC. AND SUBSIDIARY
STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1995
(Unaudited)
_____________________________________________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Interest received $ 3,124,205
Fees received 535,721
Interest paid (608,976)
Cash paid to suppliers and employees (1,652,719)
Income taxes paid (506,654)
___________
Net cash provided by operating activities 891,577
___________
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in time deposits with other
financial institutions (793,000)
Maturity of investment securities 4,016,542
Purchase of investment securities (3,603,588)
Net decrease in loans made to customers 1,626,124
Recoveries on loans previously charged off 8,432
Capital expenditures (4,687)
___________
Net cash used in investing activities 1,249,823
___________
CASH FLOWS FROM FINANCING ACTIVITIES:
Net decrease in demand, MRA, NOW,
and savings accounts (3,457,152)
Net increase in time deposits 4,337,725
Decrease in other miscellaneous assets 1,859,300
Purchase of common stock (70,426)
Dividends paid (106,252)
_________
Net cash provided by financing activities 2,563,195
_________
Net increase in cash and cash equivalents 4,704,595
Cash and cash equivalents at 12-31-94 9,246,342
_________
Cash and cash equivalents at 6-30-95 $13,950,937
===========
Reconciliation of net income to net cash provided by operating activities:
Net Income $565,563
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation 73,561
Provision for possible loan losses 290,000
Increase in accrued interest receivable ( 4,427)
Increase in unearned loan fees 27,542
Increase in accrued interest payable 71,828
Increase in prepaid expenses (38,527)
Increase in accounts payable 30,831
Decrease in income tax payable (124,794)
Total adjustments 326,014
_______
Net cash provided by operating activities $891,577
========
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION>
SUMMIT BANCSHARES, INC. AND SUBSIDIARY
STATEMENT OF CASH FLOWS
FOR THE SIX MONTH ENDED JUNE 30, 1994
(Unaudited)
_____________________________________________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Interest received $ 2,414,577
Fees received 527,440
Financing revenue received under lease 8,726
Gain on sale of other real estate owned 186,963
Interest paid (540,702)
Cash paid to suppliers and employees (1,457,910)
Income taxes paid (455,000)
___________
Net cash provided by operating activities 684,094
___________
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in time deposits with other
financial institutions 5,346,000
Maturity of investment securities 693,614
Purchase of investment securities (3,152,896)
Net decrease in loans made to customers 1,054,935
Principal payments received under leases 30,897
Carrying cost of foreclosed properties (136,829)
Proceeds from sales of foreclosed properties 265,666
Recoveries on loans previously charged off 2,380
Capital expenditures (23,863)
___________
Net cash used in investing activities 4,079,904
___________
CASH FLOWS FROM FINANCING ACTIVITIES:
Net decrease in demand, MRA, NOW,
and savings accounts (2,205,296)
Net decrease in time deposits (1,343,711)
Decrease in other miscellaneous assets 33,707
Purchase of common stock (26,989)
Dividends paid (49,642)
__________
Net cash provided by financing activities (3,591,931)
__________
Net increase in cash and cash equivalents 1,172,067
Cash and cash equivalents at 12-31-93 10,387,445
__________
Cash and cash equivalents at 3-31-94 $11,559,512
===========
Reconciliation of net income to net cash provided
by operating activities:
Net Income $435,127
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation 78,754
Provision for possible loan losses 315,000
Increase in accrued interest receivable ( 7,999)
Increase in unearned loan fees 25,396
Decrease in accrued interest payable (493)
Decrease in prepaid expenses 24,311
Decrease in accounts payable (37,613)
Decrease in income tax payable (148,389)
_________
Total adjustments 248,967
________
Net cash provided by operating activities $684,094
========
</TABLE>
<PAGE> 9
NOTES TO FINANCIAL STATEMENTS
_____ __ _________ __________
1. CONSOLIDATED FINANCIAL STATEMENTS
____________ _________ ___________
In the opinion of management, the unaudited interim consolidated
financial statements contain all adjustments (consisting of only
normal recurring adjustments) necessary to present fairly the
financial position at June 30, 1995 and the results of
operations for the six months ended June 30, 1995 and 1994
and cash flows for the six months ended June 30, 1995 and
1994.
Certain information and footnote disclosures presented in the
Corporation's annual consolidated financial statements are not
included in these interim financial statements. Accordingly,
the accompanying unaudited interim consolidated financial
statements should be read in conjunction with the consolidated
financial statements and notes thereto included in the
Corporation's 1994 Annual Report to Shareholders, which is
incorporated by reference in the Company's 1994 annual report
on Form 10-K. The results of operations for the six months
ended June 30, 1995 are not necessarily indicative of the
operating results for the full year.
2. SIGNIFICANT ACCOUNTING POLICIES
___________ __________ ________
Net income per common and common equivalent share is computed
using the weighted average number of shares outstanding during
the period and the dilutive effect of stock options.
3. IMPAIRED LOANS AND TROUBLED DEBT RESTRUCTURING
________ _____ ___ ________ ____ _____________
The Bank adopted SFAS No. 114, "Accounting by Creditors for
Impairment of a Loan," and SFAS No. 118, "Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosures," as
of January 1, 1995. SFAS No 114 requires that certain impaired loans
be measured based on the present value of expected future cash flows
discounted at the loan's original effective interest rate. As a
practical expedient, impairment may be measured based on the loan's
observable market price or the fair value of the collateral if the
loan is collateral dependent. When the measure of the impaired loan
is less than the recorded investment in the loan, the impairment is
recorded through a valuation allowance.
The Bank had previously measured the allowance for credit losses
using the methods similar to those prescribed in SFAS No 114. As a
result of adopting these statements, no additional allowance for
loan losses was required as of June 30, 1995.
<PAGE> 10
As of June 30, 1995 the Bank's recorded investment in
impaired loans and the related valuation allowance
calculated under SFAS No 114 are as follows:
<TABLE>
<CAPTION>
1995
-------------------------
Recorded Valuation
Investment Allowance
---------- ----------
Impaired Loans
--------------
<S> <C> <C>
Valuation allowance
required $ 0 $0
No valuation allowance
required 464,000 0
---------- ----------
Total Impaired Loans $464,000 $0
__________ __________
</TABLE>
The valuation allowance is included in the allowance for loan losses
on the balance sheet.
The average recorded investment in impaired loans for the quarter
ending June 30, 1995 was $504,000.
Interest payments received on impaired loans are recorded as
interest income unless collection of the remaining recorded
investment is doubtful at which time payments received are recorded
as reductions of principal. The Bank did not recognize interest
income on impaired loans for the first six months of 1995.
The allowance for loan losses is maintained at a level considered
adequate to provide for estimated probable incurred losses resulting
from loans and leases. The allowance is reviewed periodically, and
as losses are incurred and the amounts become estimable, they are
charged to operations in the periods that they become known.
The activity in the allowance for loan losses was as follows:
<TABLE>
<CAPTION>
June 30,
1995 1994
_____________________
Allowance for loan losses-
<S> <C> <C>
Balance at the beginning of year $ 931,878 $728,353
Provision for credit losses 290,000 315,000
Write downs 85,397 179,410
Recoveries 9,879 2,380
Transfers and others 0 0
--------- --------
Balance at June 30 $1,146,360 $866,323
========= ========
</TABLE>
<PAGE> 11
INTEREST RATE SENSITIVITY/INTEREST RATE RISK ANALYSIS
The following table provides an interest rate sensitivity and
interest rate risk analysis for the quarter ended June 30, 1995.
The table presents each major category of interest-earning assets
and interest-bearing liabilities. In addition to illustrating the
traditional GAP analysis, the table also provides an initial review
of interest rate risk as defined in Section 305 of the Federal
Deposit Insurance Corporation Improvement Act (FDICIA), Public Law
102-242. This section requires the federal banking agencies to
revise their risk- based capital guidelines to ensure that those
standards take adequate account of (1) interest rate risk,
(2) concentration of credit risk, and (3) the risks of
nontraditional activities. The agencies must publish final regulations
implementing Section 305 and establish reasonable transition rules
to facilitate compliance with those regulations.
An underlying principle of the proposal for incorporating interest
rate risk (IRR) into risk-based capital guidelines is that a certain
amount of IRR is inherent and appropriate in commercial banking. In
addition, the proposal acknowledges that the level of IRR in banks
is difficult to measure with a high degree of confidence. Finally,
the approach takes into consideration the fact that, to date, IRR has
not been a principal threat to the financial health of commercial
banks. Accordingly, the proposal targets the identification of
insititutions with high or significant levels of risk. Institutions
identified as having IRR exposure greater than a supervisor-determined
threshold would be required to allocate additional capital to support
their higher level of measured risk.
The methodology for measuring an institution's IRR exposure applies
the principle of duration to a standard maturity GAP report in order
to approximate the net change in the economic value of the institution
arising from a change in interest rates. Institutions would slot their
assets, liabilities and off-balance-sheet positions into a maturity
ladder report based upon their remaining maturities or nearest repricing
dates. The position reported in each maturity range would then be
multiplied by an IRR weight that represents the interest rate sensitivity
of the respective positions. The IRR weights would be established by the
Banking Agencies and would be based on the modified duration of
instruments with maturities, cash flows, coupons and yields that are
assumed to be representative of the position being weighted.
Under the proposal, an institution with IRR exposure in excess
of a threshold level would be required to allocate additional capital
equal to the dollar amount of the estimated change in its economic
value that is in excess of that level. This would provide complete
coverage of any incremental exposure above the established threshold.
For example, if threshold levels of IRR exposure were set at 1.00 percent
of total assets, an institution with a measured exposure of 1.50 percent
of assets would be required to allocate a dollar amount of capital equal
to 0.50 percent of total assets.
As the following table illustrates, based on the initial review of
the proposed regulation, the Bank would not be required to increase its
capital level and is within proposed threshold levels.
<PAGE> 12
<TABLE>
<CAPTION>
INTEREST RATE RISK REPORTING SCHEDULE
REPORTING INSTITUTION: SUMMIT BANK REPORTING DATE: 06-30-95
REMAINING TIME BEFORE MATURITY OR INTEREST RATE ADJUSTMENT
($000.00
OMITTED) UP TO > 3MO > 1YR > 3YR > 7YR OVER
TOTAL 3 MO < 1YR < 3YR < 7YR < 15YR 15 YRS
I. INTEREST-BEARING ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
1. CASH AND BALANCE DUE $5,751 $5,750 $0 $0 $0 $0 $0
2. SECURITIES (INCL TRADING)
a) NON-AMORTIZING $17,744 $4,439 $9,222 $4,083 $0 $0 $0
b) DEEP DISC COUPONS $0
c) HIGH RISK MORT. SEC. $0
3. FED FUNDS SOLD & SEC $8,200 $8,200 $0 $0 $0 $0 $0
SOLD FOR RESALE $0
4. LOANS, LEASES & ACCEPT.
a) AMORTIZING $20,066 $1,959 $3,167 $8,826 $6,114 $0 $0
b) NON-AMORTIZING $26,059 $9,598 $10,101 $3,559 $2,801 $0 $0
5. TOTAL INT BEARG. ASSETS $72,069 $29,946 $22,490 $16,468 $8,915 $0 $0
6. LOAN LOSS PROVISION ($1,146)
II. ALL OTHER ASSETS $2,718
III. TOTAL ASSETS $79,392
IV. INTEREST-BEARING LIABILITIES
1. INTEREST-BEARING DEPOSITS
a) NOW ACCOUNTS $4,866 $0 $3,406 $1,460 $0 $0 $0
b) MMDA ACCOUNTS $22,746 $0 $15,922 $6,824 $0 $0 $0
c) SAVINGS $2,531 $0 $0 $1,772 $759 $0 $0
d) TIME DEPOSITS $19,367 $11,233 $7,660 $474 $0 $0 $0
2. FED FUNDS PURCH & $0 $0 $0 $0 $0 $0 $0
SEC. SOLD FOR REPUR $0 $0 $0 $0 $0 $0 $0
3. OTHER BORROWED FUNDS $0
4. TOTAL INT-BEARING LIAB. $49,510 $11,233 $26,988 $10,529 $759 $0 $0
V. NONINTEREST-BEARING LIAB.
1. DEMAND DEPOSITS $20,812 $3,122 $11,447 $6,244
2. OTHER LIABILITIES $446
VI. TOTAL LIABILITIES $70,768
VII. EQUITY CAPITAL $8,624
VIII. NET OFF-BAL SHEET POSITION
(SWAPS & FUTURES)
1. AMORTIZING $0
2. NON-AMORTIZING $0
MEMORANDA (CMO'S AND MORTGAGE DERIVATIVES)
HIGH RISK SECURITIES EVALUATED $0
HIGH RISK SEC. NOT EVALUATED $0
</TABLE>
<PAGE> 13
<TABLE>
<CAPTION>
INTEREST RATE RISK WEIGHTING CALCULATIONS
(06/30/95)
BALANCE SHEET SUMMARY REMAINING TIME BEFORE MATURITY OR INTEREST RATE ADJUSTMENT
(FROM REPORTING SCHEDULE)
UP TO > 3MO > 1YR > 3YR > 7 YRS OVER
TOTAL 3 MO < 1YR < 3YR < 7YR < 15 YRS 15 YRS
<S> <C> <C> <C> <C> <C> <C> <C>
I. TOTAL ASSETS (EXC.CASH & DUE) $74,787
2. OTHER ASSETS &
HIGH RISK SEC. EVALU $2,718
3. TOTAL INT-BEARG ASSETS. $72,069 $24,196 $22,490 $16,468 $8,915 $0 $0
4. AMORT ASSETS. $20,066 $1,959 $3,167 $8,826 $6,114 $0 $0
5. NON-AMORT ASSETS $52,003 $22,237 $19,323 $7,642 $2,801 $0 $0
6. DEEP DISC ASSETS $0 $0 $0 $0 $0 $0 $0
7. HIGH RISK SEC. NOT EVALU $0 $0 $0 $0 $0 $0 $0
8. TOTAL LIABILITIES $70,768
9. OTHER LIAB. & DDA $21,258 $3,122 $11,447 $6,244 $0 $0 $0
10. INT-BEARG LIAB. $49,510 $11,233 $26,988 $10,529 $759 $0 $0
11. NET WORTH (GAP) $4,019 $9,841 ($15,945) ($305) $8,156 $0 $0
12. OFF BAL SHEET POSITIONS
13. AMORT OBS ITEMS: $0 $0 $0 $0 $0 $0 $0
14. NON-AMORT OBS ITEMS $907 $0 $907 $0 $0 $0 $0
IRR WEIGHTS
15. AMORTIZING ASSETS: 0.08% 0.30% 0.80% 2.00% 3.20% 4.30%
16. NON-AMORTIZING ASSETS 0.12% 0.55% 1.75% 3.85% 6.60% 8.90%
17. DEEP DISCOUNT ASSETS: 0.12% 0.60% 1.90% 4.75% 10.50% 21.40%
18. LIABILITIES: 0.12% 0.55% 1.80% 4.10% 7.50% 11.40%
WEIGHTED POSITIONS
19. WEIGHTED AMORT. ASSETS $203.96 $1.57 $9.50 $70.61 $122.28 $0.00 $0.00
20. WEIGHTED NON-AMORT. ASSETS $374.53 $26.68 $106.28 $133.74 $107.84 $0.00 $0.00
21. WEIGHTED DEEP DISC. ASSETS $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
22. WEIGHTED HIGH RISK SEC $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
23. TOTAL RISK WEIGHTED ASSETS: $578.49 $28.25 $115.78 $204.34 $230.12 $0.00 $0.00
24. TOTAL RISK WEIGHTED LIABILITIES $382.57 $13.48 $148.44 $189.53 $31.13 $0.00 $0.00
25. RISK WEIGHTED OFF-BAL SHEET $2.72 $0.00 $2.72 $0.00 $0.00 $0.00 $0.00
26. HIGH RISK SEC EVALUATED $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
27. NET RISK WEIGHTED POSITION $198.64 $14.77 ($29.94) $14.82 $198.99 $0.00 $0.00
IRR MEASUREMENT
NET RISK WEIGHTED POSITION AS A PERCENT OF ASSETS = 0.27% = LEVEL OF IRR
PROPOSED REGULATION F = 1.00% = PROPOSED TARGET
</TABLE>
<PAGE> 14
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
____________ __________ ___ ________ __ _________
CONDITION AND RESULTS OF OPERATIONS
_________ ___ _______ __ __________
FOR THE SIX MONTHS ENDED JUNE 30, 1995
___ ___ ___ ______ _____ ____ ___ ____
The registrant is a bank holding company whose only operating
subsidiary is Summit Bank. The following discussion
primarily concerns the financial condition and results of
operations of the Holding Company ("Company") on a
consolidated basis including the subsidiary bank. All
adjustments made in the compilation of this information are
of a normal recurring nature.
FINANCIAL CONDITION
_________ _________
Liquidity Management
_________ __________
The consolidated loan-to-deposit ratio at June 30, 1995 was
66.9% which was a decrease from 74.5% for the same period in
1994. The average loan-to-deposit ratio for the second
quarter of 1995 was 68.8%, down from 74.7% for the same
period last year. This decrease was caused by a slight
increase of $153,000 in average total deposits in 1995 versus
1994, centered in demand and time deposits, and a $4,439,000
decrease in average outstanding loans, centered in real
estate construction and consumer lines of credit. Management
continues to seek the acquisition of quality credits. Some
of the deposit decline was directly related to customers
investing in the mutual fund market.
Net liquid assets, which consists primarily of cash, due from
banks, interest-bearing deposits with other financial
institutions, short term securities and federal funds sold
totaled $31,695,000 on June 30, 1995. This amount
represented 46.1% of total deposits in comparison to the
liquidity ratio of 36.7% as of June 30, 1994. This increase
is primarily the result of a decrease in loan demand. It is
management's belief that the current liquidity level is
appropriate given current economic conditions and is
sufficient to meet current needs.
The Company is not aware of any current recommendations by
the regulatory authorities which, if they were implemented,
would have a material effect on the Company.
<PAGE> 15
The following table sets forth book value of investments
by category and the percent of total investments at the dates
specified.
<TABLE>
<CAPTION>
Investment Comparative
______________________
6-30-94 % 12-31-94 % 6-30-95 %
_______ _ ________ _ _______ _
<S> <C> <C> <C> <C> <C> <C>
Fed Funds Sold $ 7,000 35% $ 3,500 17% $ 8,200 32%
Interest bearing
Deposits 9,818 49% 7,039 34% 7,832 30%
Securities 3,158 16% 10,325 49% 9,912 38%
_______ ____ _______ ____ _______ ____
$19,976 100% $20,864 100% $25,944 100%
======= === ======= === ======= ===
</TABLE>
Interest bearing deposits are comprised of Time Certificates
of Deposit with other banks and savings and loan institutions
with no more than $100,000 in any institution.
Securities on June 30, 1995 were comprised of $8,577,000 in
short term U.S. Gov't bills and $1,335,000 school district
tax anticipation revenue notes used to fund annual school
district budgets. Securities held on June 30, 1994 were
composed of $3,153,000 in short term U.S. Gov't bills, and a
$5,000 industrial bond.
Changes in Financial Position
_______ __ _________ ________
As of June 30, 1995, deposits increased $877,000 from year
end 1994 while at the same time loans outstanding decreased
$1,653,000. Total deposits as of June 30, 1995 were
$68,739,000, a increase of 3% from $66,913,000 as of June 30,
1994. Total loans as of June 30, 1995 were $45,970,000, a
decrease of 8% from $49,861,000 as of June 30, 1994. The
increase in the deposit categories was mentioned previously
under "Liquidity Management."
The following table sets forth the amount of deposits by each
category and the percent of total deposits at the dates
specified.
<TABLE>
<CAPTION>
Deposit Comparative
_______ ___________
6-30-94 % 12-31-94 % 6-30-95 %
_______ _ ________ _ _______ _
<S> <C> <C> <C> <C> <C> <C>
Demand $18,720 28% $22,469 33% $20,812 30%
Savings 3,319 5% 3,109 5% 2,531 4%
Interest bearing
transactions accts 30,049 45% 28,815 42% 27,589 40%
Other Time 14,825 22% 13,469 20% 17,807 26%
_______ ____ _______ ____ _______ ____
$66,913 100% $67,862 100% $68,739 100%
======= === ======= === ======= ===
</TABLE>
<PAGE> 16
The following table sets forth the amount of loans
outstanding by each category and the percent of total loans
outstanding at the dates specified.
<TABLE>
<CAPTION>
Loan Comparative
____ ___________
6-30-94 % 12-31-94 % 6-30-95 %
_______ _ ________ _ _______ _
<S> <C> <C> <C> <C> <C> <C>
Commercial $30,350 60% $30,355 63% $29,490 64%
Real estate-const. 6,832 14% 5,822 12% 5,665 12%
Real estate-other 5,418 11 4,873 10% 5,034 11%
Installment/Other 7,102 14% 6,450 14% 5,694 12%
Equip. lease 159 1% 123 1% 87 1%
_______ ____ _______ ____ _______ ____
$49,861 100% $47,623 100% $45,970 100%
======= === ======= === ======= ===
</TABLE>
Non-Performing Assets
______________ ______
The following table provides information with respect to the
subsidiary Bank's past due loans and components for non-
performing assets at the dates indicated.
<TABLE>
<CAPTION>
Non-Performing Assets
_____________________
(000.00 Omitted)
6-30-94 12-31-94 6-30-95
_______ ________ _______
<S> <C> <C> <C>
Loans 90 days or more past
due & still accruing $ 6 $ 207 $ 277
Non-accrual loans 1,933 572 464
Other real estate owned 1,440 2,866 1,302
______ ______ ______
Total non-performing assets $3,379 $3,645 $2,043
====== ====== ======
Non-performing assets to
period end loans plus
other real estate owned 6.59% 7.22% 4.32%
Allowance to non-performing
loans 45% 120% 154%
Allowance to non-performing
assets 26% 26% 56%
</TABLE>
The subsidiary Bank's policy is to recognize interest income
on an accrual basis unless the full collectibility of
principal and interest is uncertain. Loans that are delinquent
90 days as to principal or interest are placed on a
non-accrual basis, unless they are well secured and in the
process of collection, and any interest earned but uncollected
is reversed from income. Collectibility is determined by
considering the borrower's financial condition, cash flow,
quality of management, the existence of collateral or
guarantees and the state of the local economy.
<PAGE> 17
Other real estate owned is comprised of properties acquired
through foreclosure. These properties are carried at the lower
of the recorded loan balance or their estimated fair market
value based on appraisal. When the loan balance plus accrued
interest exceeds the fair value of the property, the
difference is charged to the allowance for loan losses at the
time of acquisition. Subsequent declines in value from the
recorded amount, if any, and gains or losses upon disposition
are included in noninterest expense. Operating expenses
related to other real estate owned are charged to noninterest
expense in the period incurred.
The decrease in non-performing assets from 6-30-94 to 6-30-95
is due primarily to a decrease OF $1,469,000 in non-accrual
loans. The remaining $466,000 in non-accrual status represents
loans to 3 borrowers. One borrower's loan totaling $340,000 is
secured by a single family home and no loss is anticipated.
The remaining $126,000 is composed of 2 loans of which $40,000
is anticipated to be a loss.
The amount in Other Real Estate Owned represents 3 parcels of
partially improved land. The Bank is actively marketing these
parcels and no loss is anticipated at this time.
Capital Position
_______ ________
As of June 30, 1995, Shareholders' Equity was $10,883,000.
This represents an increase of $898,000, or 9.0% over June 30,
1994. Since the inception of the repurchase program in 1989,
the Company has authorized the repurchase of $2,050,000 of its
stock. As of June 30, 1995, the Company's has repurchased a
total of 150,288 shares of Company stock constituting 28.0% of
the Company's original stock prior to the repurchase program,
at a total cost of $2,031,000, or an average price per share
of $13.51. The Company plans to continue its repurchase
program as an additional avenue for liquidity for its
shareholders. The program has not affected the Company's
liquidity or capital positions or its ability to operate as
the Company's capital growth has exceeded its asset growth. In
addition, the Company's subsidiary Bank remains more than well
capitalized under current regulations.
On March 14, 1989, the Board of Directors of the Federal
Deposit Insurance Corporation approved a Statement of Policy
on Risk-Based Capital which became effective December 31,
1990. Under this statement banks are required to meet certain
capital standards in addition to leverage standards as
previously outlined under FDIC Rules and Regulations. The Bank
does not foresee any material or significant impact to its
manner of operation in the foreseeable future. Total
qualifying capital allowable under risk-based capital
guidelines for the subsidiary bank is $9,163,000. The
following table shows the risk-based capital ratios and the
leverage ratios for 1995 as well as the minimum regulatory
requirements as of June 30, 1995:
<PAGE> 18
<TABLE>
<CAPTION>
Minimum
Capital Ratio Regulatory Requirement
<S> <C> <C>
Tier 1 Capital 14.92% 4.00%
Total Capital 15.85% 8.00%
Leverage Ratio 11.17% 3.00%
</TABLE>
The Company is not aware of any current recommendations by
the regulatory authorities which if they were implemented
would have a material effect on the Company.
RESULTS OF OPERATIONS
_______ __ __________
Net Interest Income
___ ________ ______
Total interest income including loan fees increased from
$2,371,000 for the first six months of 1994 to $2,713,000 for
the same period in 1995. This increase was due to an average
increase in the prime lending rate of approximately 2.46% over
the same period last year. Although average loans outstanding
decreased $4,439,000 from June 30, 1994 to June 30, 1995, the
yield on loans increased 2.40% over the same period last year.
Loan fees showed a decrease of $26,000 over the same period
last year primarily reflective of the decrease in good quality
loan demand. Average outstanding investments increased
$6,190,496 for the first six months of this year versus the
same period last year, primarily due to the decline in average
loans outstanding. The yield on investments showed a increase
of 2.18% primarily related to an increase in investment rates
brought about by an increase in the prime lending rate.
Interest expense increased from $540,000 as of the end of the
first six months of 1994 to $681,000 in 1995. Although the
average outstanding interest-bearing deposit accounts
decreased $715,000 during the first half of 1995 versus the
same period last year, the average cost of funds for the
period ending June 30, 1995 was .62% more than the same period
last year. As a result of these factors, net interest income
for the first six months of 1995 increased 26.1% over the same
period last year.
For the second quarter, total interest income increased from
$1,241,000 in 1994 to $1,370,000 for the same period in 1995.
The average loans for the 1995 period showed a decrease of
$4,657,000 from the same period last year. However, the
average prime rate during the second quarter was 2.12% greater
than the same period last year which caused the yield on loans
in the second quarter of 1995 to be approximately 2.12%
greater than 1994. Loan fees showed a decrease of $17,000 over
the same period last year primarily reflective of the decrease
in good quality credit demand. Following the trend in the
prime lending rate, the investment portfolio showed a increase
of 2.00% in its yield. For the second quarter of 1995 interest
expense increased to $371,000 from $281,000 as of the end of
second quarter of 1994.
<PAGE> 19
Although average outstanding interest-bearing deposit accounts
increased $186,000 during the second quarter versus the same
period last year, the average cost of funds for the second
quarter of 1995 was .73% more than the same period last year.
As a result of these factors, net interest income for the
second quarter of 1995 increased 19.9% over the same period
last year.
Other Operating Income
_____ _________ ______
Service charges on deposit accounts as of the end of the first
half of 1995 increased to $192,000 versus $175,000 for the
same period in 1994 and was centered in service charges
related to return check and overdraft charges which increased
$17,000. Other charges and fees decreased $194,000 primarily
due to a gain on sale of an OREO of $187,000 in 1994. However,
Mastercard/VISA merchant card income increased $15,000 but
collection fees declined $4,000.
Service charges on deposit accounts for the second quarter of
1995 increased $4,000 over the same period last year and was
primarily centered in return check charges and overdraft fees.
Other charges and fees decreased $7,000 primarily due to a
$5,000 decrease in letter of credit fees.
Loan Loss Provision
____ ____ _________
The increase in loan loss provision was primarily due to
offset any effects of a possible recession in California.
The allowance for loan losses is maintained at a level that
management of Company considers to be adequate for losses that
can be reasonably anticipated. The allowance is increased by
charges to operating expenses and reduced by net-charge-offs.
The level of the allowance for loan losses is based on
management's evaluation of potential losses in the loan
portfolio, as well as prevailing and anticipated economic
conditions.
Management employs a systematic methodology on a monthly basis
to determine the adequacy of the allowance for current and
future loan losses. Each loan is graded at the time of
extension or renewal by the credit administrator. Gradings are
assigned a risk factor which is calculated to assess the
adequacy of the allowance for loan losses. Further, management
considers other factors such as overall portfolio quality,
trends in the level of delinquent and classified loans,
specific problem loans, and current and anticipated economic
conditions.
The balance in the allowance for loan losses at June 30, 1995
was $1,146,000 or 2.49% of total loans compared to $866,000 or
1.74% at June 30, 1994.
<PAGE> 20
Other Operating Expenses
_____ _________ ________
Total other operating expenses increased $195,000 as of the
end of the first half of 1995 compared to the same period last
year. Total salary expense increased $56,000 and is primarily
related to an incentive program based on growth goals.
Foreclosure and OREO expense increased $73,000 and was
directly related to the maintenance of properties held in the
OREO account. Legal fees increased $24,000 and was directly
related to the collection of loans. Consulting fees increased
$33,000 and was related to the utilization of an outside firm
to assist in the acquisition of SBA loans. Occupancy expense
increased $11,000 and was due to rent increases.
For the second quarter 1995 operating expenses increased
$83,000 compared to the same period last year and was
centered in items previously mentioned above.
Provision for Income Taxes
_________ ___ ______ _____
The Company's provision for income taxes as of the end of the
first half of 1995 increased from $307,000 in 1994 to
$382,000. This increase was primarily related to the growth in
income, partially offset by tax exempt municipal bonds. For
the first half of 1995 the Company's total effective tax rate
was 40.3% compared to 41.3% in 1994.
For the second quarter 1995 the provision for income taxes
increased $44,000 compared to the second quarter of 1994. This
increase was related to the items mentioned above. The
Company's total effective tax rate was 40.2% for the second
quarter of 1995 versus 41.3% for the same period last year.
Net Income
___ ______
Net income for the first half of 1995 increased from $435,127
for the same period in 1994 to $565,563, or an increase of
30.0%. Second quarter net income increased 34.8% over the same
period last year.
<PAGE> 21
PART II - OTHER INFORMATION
____ __ _____ ___________
ITEM 1 - LEGAL PROCEEDINGS
_________________
No material developments from those which were reported in the
10-K dated March 22, 1995 for the year ended December 31, 1994.
ITEM 2 - CHANGE IN SECURITIES
____________________
None
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
_______________________________
None
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
__________ __ _______ __ _ ____ __ ________ _______
Annual Meeting minutes attached (Exhibit #1).
Meeting held April 19, 1995
ITEM 5 - OTHER INFORMATION
_____ ___________
None
ITEM 6 - REPORTS ON FORM 8-K
_______ __ ____ ___
No reports on Form 8-K have been filed by the registrant during
the second quarter of 1995 for which this report is filed.
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.
SUMMIT BANCSHARES, INC.
Registrant
DATE: August 11, 1995 By: /s/ Shirley W. Nelson
_______________ __________________________
Shirley W. Nelson
Chairman and
Chief Executive Officer
DATE: August 10, 1995 By: /s/ Kikuo Nakahara
_______________ ___________________________
Kikuo Nakahara
Chief Financial Officer
<PAGE> 22
MINUTES OF AN ANNUAL MEETING OF
THE SHAREHOLDERS OF SUMMIT BANCSHARES, INC.
APRIL 19, 1995
_______________________________________________________
A meeting of the Shareholders of Summit Bancshares, Inc. was
conducted on April 19, 1995, in the board room of Summit Bank
at 2969 Broadway, Oakland, California.
PRESENT
_______
DIRECTORS STAFF
_______________________________________
Jerrald R. Goldman, M.D. Denise Dodini
George H. Hollidge C. Michael Ziemann
Kikuo Nakahara Frances R. Darnley
Shirley W. Nelson
Thomas H. State
Barbara J. Williams
GUESTS
______
Mark Anderson, Shareholder
Warren Mooney, Shareholder
Jeffrey P. Hank, Arthur Andersen & Co.
Stephen M. Kass, Legal Counsel
Joseph W. Thatcher, First Interstate Bank
The meeting was called to order by Shirley W. Nelson, Chairman of
the Board, at 5:00 p.m. The Chairman asked George H. Hollidge,
Corporate Secretary, to present proof of the due calling of the
meeting.
Secretary Hollidge presented a copy of the printed Notice of
Annual Meeting of Shareholders dated March 22, 1995, stating the
meeting's time, place and purpose. The Secretary suggested that
the reading of the notice be dispensed unless there was a request
to do so. No request was made. He then stated if any of the
Shareholders present had an objection to the contents of the
notice or the manner in which the notice was served, such
objection should be stated or it would be deemed waived.
No objection was voiced.
<PAGE> 23
Summit Bancshares, Inc.
Annual Meeting of Shareholders
April 19, 1995
Page 2
Second, the Secretary presented a complete list certified by First
Interstate Bank, the stock transfer agent for the Company, of the
holders of the common stock of the Company as of the close of
business on February 28, 1995, the record date fixed by the Board
of Directors for Shareholders entitled to notice of and to vote at
this meeting. This list, which was kept open to the inspection of
Shareholders throughout the meeting, showed that at the close of
business on February 28, 1995, there were 425,559 common shares of
the Company issued and outstanding.
Third, the declaration of Joseph W. Thatcher, an employee of First
Interstate Bank, showing that he caused to be mailed on March 22,
1995, to each of the Shareholders of Record, a copy of the Notice
of Annual Meeting of Shareholders.
Chairman Nelson directed Secretary Hollidge to incorporate a copy
of the notice of meeting, together with the declaration of mailing
of the notice in the Minute Book of the Company as a part of the
Minutes of this meeting. The Chairman stated that the Minute Book
would be kept open to the inspection of Shareholders throughout the
meeting.
Mr. Joseph Thatcher of First Interstate Bank, who was appointed by
the Board of Directors as the Inspector of Elections for this
meeting, was introduced by the Chairman. The Inspector has duly
taken his oath of office in writing. The Chairman directed that it
be filed with the minutes of the meeting and that the Inspector
make a poll of the shares represented at the meeting in person or
by proxy.
Mr. Thatcher reported that there were represented in person or by
proxy 322,475 common shares of the Company for a total percentage
of shares of the Company present, in person or by proxy of 75.777%.
Chairman Nelson stated that based upon these numbers a quorum was
present, the meeting was declared lawful and properly convened and
competent to proceed to the transaction of the business as stated
in the notice.
Ms. Nelson described the items on the agenda for the meeting and
discussed voting procedures.
Item 1 pertains to election of Directors to serve until the 1996
Annual Meeting or until their successors and elected and qualified.
Those seven (7) nominees who receive the highest number of votes
will be those elected.
<PAGE> 24
Summit Bancshares, Inc.
Annual Meeting of Shareholders
April 19, 1995
Page 3
Item 2 involves the ratification of the selection of Arthur
Andersen LLP to audit the financial statement of the Company for
the fiscal year 1995.
Chairman Nelson explained that, in addition, the Shareholders may
consider such other business as may properly come before the Annual
Meeting and any adjournment or adjournments thereof. The meeting
will take up the agenda items in the order described. Any
Shareholder voting in person at the meeting has been provided a
ballot which may be used to vote on these items and will be given
time to mark the ballot after each item is discussed. The number of
shares which are to be voted on each matter should be marked in the
appropriate space.
The Chairman then moved to Item 1, the election of Directors. The
Board of Directors nominates the following persons to the office of
Directors of the Company to serve until the 1996 Annual Meeting of
Shareholders and until their successors are elected and qualified:
Jerrald R. Goldman, M.D.; George H. Hollidge; Thomas F. Louderback;
Kikuo Nakahara; Shirley W. Nelson; Thomas H. State and Barbara J.
Williams. The Secretary announced that there were no further
nominees, and accordingly nominations were declared closed. The
Chairman requested that the shareholders voting in person mark
their ballots and hold the same pending later matters to be voted.
Next on the agenda was Item 2, the ratification of the selection of
Arthur Andersen LLP to audit the financial statement of the Company
for the fiscal year 1995. The following resolution was proposed by
the Secretary:
"RESOLVED that the appointment of the accounting firm of Arthur
Andersen LLP as the independent auditors for the Company for the
fiscal year ending December 31, 1995, be approved and ratified."
The resolution was moved by Mr. Nakahara and seconded by Ms.
Williams. The Chairman asked if there was any discussion.
Hearing none, the discussion was closed.
The Chairman thereupon inquired whether there was any further
business to come before the meeting. Hearing none, she then asked
Mr. Thatcher to collect the ballots of any Shareholders and tally
them.
<PAGE> 25
Summit Bancshares, Inc.
Annual Meeting of Shareholders
April 19, 1995
Page 4
Mr. Ziemann gave a financial and operating overview of the Company.
Summit Bancshares, Inc. realized a 7.2% increase in income in 1994.
Per share earnings increased to $2.09 in 1994 compared to $1.97 in
1993. Return on assets was 1.3%, and return on equity was 9.43% for
the year. That compares favorably with an ROA of 1.1% and a 9.4%
ROE in the previous year. We experienced a decrease in our loan
portfolio last year which affected some of our interest income.
This year we have embarked on an aggressive business development
program, assigning specific goals not only to the three branches
but also to our individual officers. Those goals and monitoring
steps are in place and are reviewed weekly. Income is up 25% for
the first quarter of this year, and we have seen a slight increase
in assets to approximately $79 million, about 4%. First quarter
earnings were $271,000 versus $2 17,000 last year. We anticipate
good results from our business development program.
Next, the Inspector of Elections reported to the persons present.
The seven (7) highest number of votes of the common shares of the
Company for the office of Director were as follows: Jerrald R.
Goldman, M.D.; George H. Hollidge; Thomas F. Louderback; Kikuo
Nakahara; Shirley W. Nelson; Thomas H. State and Barbara J.
Williams. These individuals are hereby declared elected to serve
as Directors of the Company for the following year.
In addition, the holders of 318,205 common shares of the Company
voted to approve Item 2, the appointment of Arthur Andersen LLP as
auditors of this Company for the fiscal year ending December 31,
1995.
The Chairman announced that the Report of the Inspector of
Elections was approved and ordered appended to the minutes of this
meeting.
<PAGE> 26
Summit Bancshares, Inc.
Annual Meeting of Shareholders
April 19, 1995
Page 5
There being no other business to come before the meeting, the
Chairman asked for a motion to adjourn. Mr. Nakahara moved the
meeting be adjourned, and Mr. Hollidge seconded the motion.
Hearing no objection, the meeting was adjourned at 5:12 p.m.
Respectfully submitted:
/s/ Frances R. Darnley
_____________________________
Frances R. Darnley
Assistant Corporate Secretary
Attested: Attested:
/s/ George H. Hollidge /s/ Shirley W. Nelson
______________________ _____________________
George H. Hollidge Shirley W. Nelson
Corporate Secretary Chairman of the Board
<PAGE> 27
<TABLE>
<CAPTION>
WEIGHTED AVERAGE SHARES
Three Months Ended June 30, 1995
PRIMARY FULLY
_______ _____
<S> <C> <C> <C> <C>
A. Common Stock 425,486 425,486
427,485 12-31-94 (Bal. Fwd.)
427,485 to 01-23-95 22 days = 9,404,670
426,109 to 01-31-95 8 days = 3,408,872
425,559 to 03-06-95 34 days = 14,469,006
425,449 to 04-14-95 39 days = 16,592,511
425,009 to 06-14-94 61 days = 25,925,549
424,259 to 06-30-95 17 days = 7,212,403
181 days = 77,044,211
Average shares outstanding for period = 425,659
</TABLE>
<TABLE>
<CAPTION>
B. Stock Options
<S> <C> <C>
12-31-94 year end price $21.00
6-30-95 quarter end $22.00
12-31-94 end of quarter average $22.125 (22.75 - 21.50)
</TABLE>
Fully $22.13 end of quarter average
Primary $21.50 year end to end of quarter
(21.00_+_22.00)
_______________
2
MARKET PRICES
@ 3-31-95 21.00
@ 6-30-95 22.00
@ 9-30-95 AVERAGE $21.50
@ 12-31-95
(21.00_+22.00_+ . _+_ . )
______________________________
4.00
<TABLE>
<CAPTION>
Options - Fully 29,987
_______ _____
<S> <C> <C> <C>
MZ 1,100 X (22.13_-_12.27) = 490
_______________
22.13
FD 550 X (22.13_-_12.27) = 245
_______________
22.13
SN 8,250 X (22.13_-_10.45) = 4,354
_______________
22.13
</TABLE>
<PAGE> 28
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MZ 1,000 X (22.13_-_10.00) = 548
_______________
22.13
SN 10,000 X (22.13_-_10.00) = 5,481
_______________
22.13
SN 15,689 X (22.13_-_10.00) 8,600
_______________
22.13
SN 8,333 X (22.13_-_12.00) = 3,814
_______________
22.13
MZ 2,900 X (22.13 -_13.50) = 1,131
_______________
22.13
TW 400 X (22.13_-_12.25) = 179
_______________
22.13
SN 978 X (22.13_-_13.25) = 392
_______________
22.13
DD 2,500 X (22.13_-_13.00) = 1,031
_______________
22.13
MZ 1,045 X (22.13_-_13.00) = 431
_______________
22.13
FD 1,950 X (22.13_-_13.00) = 804
_______________
22.13
AC 400 X (22.13_-_13.00) = 165
_______________
22.13
TW 1,500 X (22.13_-_13.00) = 619
_______________
22.13
SN 4,000 X (22.13_-_17.75) = 792
_______________
22.13
MZ 2,000 X (22.13_-_17.75) = 396
_______________
22.13
DD 1,000 X (22.13_-_17.75) = 198
_______________
22.13
TW 1,000 X (22.13_-_17.75) = 198
_______________
22.13
FD 500 X (22.13_-_17.75) = 99
_______________
22.13
AC 100 X (22.13_-_17.75) = 20
_______________
22.13
</TABLE>
<PAGE> 29
<TABLE>
<CAPTION>
Options - Primary 28,954
_______ _______
<S> <C> <C> <C>
MZ 1,100 X (21.50_-_12.27) = 472
_______________
21.50
FD 550 X (21.50_-_12.27) = 236
_______________
21.50
SN 8,250 X (21.50_-_10.45) = 4,240
_______________
21.50
MZ 1,000 X (21.50_-_10.00) = 535
_______________
21.50
SN 10,000 X (21.50_-_10.00) = 5,349
_______________
21.50
SN 15,689 X (21.50_-_10.00) = 8,392
_______________
21.50
SN 8,333 X (21.50_-_12.00) = 3,682
_______________
21.50
MZ 2,900 X (21.50_-_13.50) = 1,079
_______________
21.50
TW 400 X (21.50_-_12.25) = 172
_______________
21.50
SN 978 X (21.50_-_13.25) = 375
_______________
21.50
DD 2,500 X (21.50_-_13.00) = 988
_______________
21.50
MZ 1,045 X (21.50_-_13.00) = 413
_______________
21.50
FD 1,950 X (21.50_-_13.00) = 771
_______________
21.50
AC 400 X (21.50_-_13.00) = 158
_______________
21.50
TW 1,500 X (21.50_-_13.00) = 593
_______________
21.50
SN 4,000 X (21.50_-_17.75) = 698
_______________
21.50
</TABLE>
<PAGE> 30
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MZ 2,000 X (21.50_-_17.75) = 349
_______________
21.50
DD 1,000 X (21.50_-_17.75) = 174
_______________
21.50
TW 1,000 X (21.50_-_17.75) = 174
_______________
21.50
FD 500 X (21.50_-_17.75) = 87
_______________
21.50
AC 100 X (21.50_-_17.75) = 17
_______________
21.50
TOTAL SHARES 2ND QUARTER 455,473 454,440
======= =======
TOTAL SHARES YEAR END ======= =======
NET INCOME 2ND QUARTER $293,975 $293,975
======= =======
NET INCOME YTD $565,563 $565,563
======= =======
EARNINGS PER SHARE 2ND QTR $ .65 $ .65
======= =======
EARNINGS PER SHARE YTD $1.24 $1.24
======= =======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This legend contains summary information extracted from the Form 10-Q and is
qualified in its entirety by reference to such financial statements.
<CIK> 0000353203
<NAME> SUMMIT BANCSHARES, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> JUN-30-1995
<CASH> 5,750,937
<INT-BEARING-DEPOSITS> 7,832,000
<FED-FUNDS-SOLD> 8,200,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 9,912,038
<INVESTMENTS-MARKET> 9,977,016
<LOANS> 45,969,516
<ALLOWANCE> 1,146,360
<TOTAL-ASSETS> 80,103,016
<DEPOSITS> 68,739,649
<SHORT-TERM> 0
<LIABILITIES-OTHER> 480,726
<LONG-TERM> 0
<COMMON> 3,767,258
0
0
<OTHER-SE> 7,115,383
<TOTAL-LIABILITIES-AND-EQUITY> 80,103,016
<INTEREST-LOAN> 2,712,915
<INTEREST-INVEST> 646,729
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 3,359,644
<INTEREST-DEPOSIT> 680,804
<INTEREST-EXPENSE> 680,804
<INTEREST-INCOME-NET> 2,678,840
<LOAN-LOSSES> 290,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,718,584
<INCOME-PRETAX> 947,423
<INCOME-PRE-EXTRAORDINARY> 947,423
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 565,563
<EPS-PRIMARY> 1.24
<EPS-DILUTED> 1.24
<YIELD-ACTUAL> 0<F1>
<LOANS-NON> 466
<LOANS-PAST> 277
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 403,000
<ALLOWANCE-OPEN> 931,878
<CHARGE-OFFS> 85,397
<RECOVERIES> 9,879
<ALLOWANCE-CLOSE> 290,000
<ALLOWANCE-DOMESTIC> 1,146,360
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
<FN>
<F1>Not contained in document.
</FN>
</TABLE>
