FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1995 Commission file number 2-99779
National Consumer Cooperative Bank
(Exact name of registrant as specified in its charter)
United States of America 52-1157795
(12 U.S.C. Section 3001 et seq.) (I.R.S. Employer
(State or other jurisdiction of Identification No.)
incorporation or organization)
1401 Eye Street, NW, Suite 700, Washington, D.C. 20005
(Address of principal executive offices)
Registrant's telephone number, including area code (202)336-7700
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 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________.
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Outstanding at September 30, 1995
Class C 219,077
(Common stock, $100.00 par value)
Class B 726,130
(Common stock, $100.00 par value)
Class D 3
(Common stock, $100.00 par value)
National Consumer Cooperative Bank
(doing business as National Cooperative Bank)
and Subsidiaries
INDEX
PART I FINANCIAL INFORMATION Page No.
Item 1 Consolidated balance sheets -
September 30, 1995 and December 31, 1994...................... 3
Consolidated statements of income - for the three and
and nine months ended September 30, 1995 and 1994....... 4
Consolidated statements of cash flows - for the nine
months ended Setember 30, 1995 and 1994 ............. 5
Condensed notes to the consolidated financial
statements - September 30, 1995................................... 6-8
Item 2 Management's discussion and analysis of
financial condition and results of operations - for the three
and nine months ended September 30, 1995 and 1994....... 9-18
PART II OTHER INFORMATION
Item 6 Exhibits:
Exhibit 27 - Financial Data Schedule
NATIONAL COOPERATIVE BANK
CONSOLIDATED BALANCE SHEETS
September 30, 1995 and December 31, 1994
(Unaudited)
1995 1994
Assets
Cash and cash equivalents $ 14,749,407 $ 12,546,834
Restricted cash 8,348,703 8,348,703
Investment securities
Available-for-sale 28,171,193 26,763,587
Held-to-maturity 1,632,347 3,557,000
Loans and lease financing 524,534,664 454,573,762
Loans held for sale 68,736,724 46,515,785
Less: Allowance for loan losses (13,522,795) (13,031,499)
----------- -----------
579,748,593 488,058,048
----------- -----------
Excess servicing 16,364,383 14,987,605
Premises and equipment, net 4,393,798 2,079,363
Other assets 15,264,609 10,980,103
------------ ------------
Total assets $668,673,033 $567,321,243
============ ============
Liabilities and Members' Equity
Liabilities
Deposits $ 69,513,760 $ 58,918,549
Patronage dividends payable in cash 2,533,789 3,966,724
Other liabilities 18,115,297 10,905,055
Borrowings
Short-term 110,448,810 91,031,114
Long-term 167,203,859 105,356,867
Other 1,008,178
------------ ------------
277,652,669 197,396,159
Subordinated Class A notes 183,037,928 182,927,687
----------- -----------
Total borrowings 460,690,597 380,323,846
----------- -----------
Total liabilities 550,853,443 454,114,174
----------- -----------
Members' equity
Common stock
Class B 72,612,710 67,823,071
Class C 21,907,725 24,844,625
Class D 300 300
Retained earnings
Allocated 3,096,853 4,848,218
Unallocated 20,336,243 17,112,436
Unrealized loss on investment securities
available for sale (134,241) (1,421,581)
------------ ------------
Total members' equity 117,819,590 113,207,069
Total liabilities and members' ------------ ------------
equity $668,673,033 $567,321,243
============ ============
<TABLE>
<CAPTION>
NATIONAL COOPERATIVE BANK
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Nine Months Ended Sept. 30, Three Months Ended Sept. 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Interest income
Loans and lease financing $ 34,873,510 $ 28,043,817 $ 12,237,458 $ 9,844,917
Investment securities 2,648,564 2,026,151 783,408 726,705
------------ ---------- ----------- -----------
Total interest income 37,522,074 30,069,968 13,020,866 10,571,622
------------ ---------- ----------- ------------
Interest expense
Deposits 2,521,462 1,460,594 892,966 555,550
Short-term borrowings 3,782,958 1,424,661 1,543,406 560,720
Long-term debt, other borrowings
and subordinated Class A notes 15,512,703 11,703,220 5,279,683 3,937,623
---------- ---------- ----------- ----------
Total interest expense 21,817,123 14,588,475 7,716,055 5,053,893
---------- ---------- ----------- ----------
Net interest income 15,704,951 15,481,493 5,304,811 5,517,729
Provision for loan losses 909,200 820,800 320,000 280,600
---------- ---------- ----------- -----------
Net interest income after
provision for loan losses 14,795,751 14,660,693 4,984,811 5,37,129
Non-interest income
Gain on sale of loans 2,727,497 3,421,954 427,391 222,957
Loan and deposit servicing fees 1,442,270 1,125,283 615,696 371,604
Other 2,429,968 2,381,759 821,631 920,827
---------- ---------- ----------- ---------
Total non-interest income 6,599,735 6,928,996 1,864,718 1,515,388
---------- ---------- ----------- ---------
Non-interest expenses
Compensation and employee benefits 7,129,233 7,004,789 2,331,421 2,436,479
Contractual services 3,235,569 2,347,425 1,053,013 805,013
Occupancy and equipment 2,151,240 2,078,618 729,730 708,664
Contribution to NCB
Development corporation 375,000 125,000
Other 1,844,369 1,691,784 659,730 621,453
---------- ---------- ----------- ----------
Total non-interest expenses 14,735,411 13,122,616 4,898,894 4,571,609
----------- ----------- ----------- ----------
Income before income taxes 6,600,075 8,467,073 1,950,635 2,180,908
Provision for income taxes 623,938 844,677 246,819 163,358
----------- ----------- ----------- ----------
Net income $ 6,036,137 $ 7,622,396 $ 1,703,816 $ 2,017,550
=========== ============= ============ ===========
Distribution of net income
Patronage dividends $ 5,630,642 $ 6,679,786 $ 2,072,599 $ 1,349,306
Retained earnings 405,495 942,610 (368,783) 668,244
----------- ------------ ----------- -----------
$ 6,036,137 $ 7,622,396 $ 1,703,816 $ 2,017,550
============ ============= =========== ===========
</TABLE>
NATIONAL COOPERATIVE BANK
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the nine months ended September 30, 1995 1994
------------ ------------
Cash flows from operating activities
Net income $ 6,036,137 $ 7,622,396
Adjustment to reconcile net income to net cash
provided by operating activities
Provision for loan losses 909,200 820,800
Depreciation and amortization 3,490,468 2,144,539
Gain on sale of assets (4,326,690) (1,821,940)
Loans originated for sale (172,071,002) (103,299,742)
Proceeds from sales of loans held for sale 149,720,026 111,722,791
Increase in other assets (3,881,186) (528,122)
Increase in other liabilities 7,189,409 3,884,271
(Loss)gain on hedges of loans held for sale (2,055,344) 272,172
Other 83,020 (673,016)
----------- ------------
Net cash (used in) provided by
operating activities (14,905,962) 20,144,149
------------ -----------
Cash flows from investing activities
Proceeds from maturities of investment securities
Available for sale 6,960,032 14,100,000
Held for maturity 1,775,382 3,529,304
Purchases of investment securities
Available for sale (6,931,027) (18,402,071)
Net increases in loans and lease financing(115,069,843) (850,963)
Proceeds from sale of portfolio loans 43,920,866 4,515,296
Purchases of premises and equipment (438,877) (504,374)
------------ -----------
Net cash (used in) provided
by investing activities (69,783,467) 2,387,192
Cash flows from financing activities
Net increase (decrease) in deposits 10,595,211 (8,773,938)
Net increase in short-term borrowings 19,438,529 7,491,570
Proceeds from issuance of long-term debt 61,846,992
Repayment on long-term debt (25,091,249)
Repayment on other borrowings (897,937) (576,623)
Redemption of common stock (34,661) (186,107)
Patronage dividends paid (4,056,132) (3,147,860)
------------ -------------
Net cash provided by (used in)
financing activities 86,892,002 (30,284,207)
Increase (decrease) in cash and cash equivalents 2,202,573 (7,752,866)
Cash and cash equivalents, beginning of year 12,546,834 22,938,795
---------- -----------
Cash and cash equivalents, end of period $14,749,407 $15,185,929
<PAGE>
=========== ==========
NATIONAL COOPERATIVE BANK
CONDENSED NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
September 30, 1995
(Unaudited)
The accompanying financial statements have been prepared without audit and
reflect all adjustments (consisting only of normal recurring adjustments)
which were, in the opinion of NCB, necessary to a fair statement of the results
of the interim period presented. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted. Accordingly, these consolidated financial statements should be read
in conjunction with the financial statements and the notes thereto included in
NCB's most current annual report.
1. Cash, Cash Equivalents and Investment Securities
As of September 30, 1995, NCB's portfolio of cash, cash equivalents and
investment securities had an average adjusted maturity of 1,123 days with
interest rates in those portfolios varying from 4.25% to 8.50%.
Cash and Investment Investments
Cash Available- Held-to-
Equivalents for-Sale Maturity
Cash $ 3,987,534 $ $
Federal funds 650,000
Money market securities 10,001,938
and commercial paper
Mutual funds 1,359,408
Certificates of deposit 970,373
Corporate bonds 18,095,791
Eurodollar certificates &
repurchase agreements 109,935
U.S. Treasury and
Agency obligations 8,715,994 661,974
----------- ----------- ----------
$14,749,407 $28,171,193 $1,632,347
=========== =========== ==========
At September 30, 1995, the investments in the available for sale portfolio
were recorded at aggregate fair value. Restricted cash of $8,348,703 is held
by a trustee for the benefit of certificate holders in the event of loss on
certain loans sold of $37,300,000 and $92,623,000 in 1993 and 1992,
respectively. The restricted cash will become available to NCB I, Inc., as
the principal balance of the respective loans decreases. The loans sold have
original maturities of ten to fifteen years.
2. Loans, Lease Financing and Non-performing Assets
Loans and leases outstanding by category at September 30, 1995 were:
Commercial loans $291,466,229
Lease financing 10,744,708
Real estate loans
Residential 282,388,233
Construction 550,247
Commercial 8,121,971
------------
$593,271,388
============
At September 30, 1995 and December 31, 1994 real estate loans held for
resale were $68.7 million and $46.5 million, respectively.
The loan portfolio includes loans which are not currently accruing any
interest. The total outstanding principal of these loans at September 30, 1995
and 1994 and the effect on income for the nine months ended September 30, 1995
and 1994 are shown below:
1995 1994
------------ ------------
Principal outstanding $ 932,197 $1,487,973
Gross amount of income which
would have been recorded
if still accruing $ 68,757 $ 103,903
Less interest received 20,471 15,803
---------- ----------
Interest not recorded $ 48,286 $ 88,100
=========== ==========
As of September 30, 1995, NCB had loans that are renegotiated with a reduced
interest rate or with an extension of payment of interest and principal. The
total outstanding principal of these loans at September 30, 1995 and 1994 and
the effect on income for the nine months ended September 30, 1995 and 1994 are
shown below:
1995 1994
------------ -------------
Principal outstanding $ 3,959,668 $ 2,193,729
Gross amount of income which
would have been recorded
under original terms $ 353,425 $ 217,162
Less interest received 322,275 103,264
----------- -----------
Interest not recorded $ 31,150 $ 113,898
=========== ===========
3. Allowance for Loan Losses
The following is a summary of the activity in the allowance for loan
losses during the nine months ended September 30, 1995:
Balance at January 1, 1995 $13,031,499
Provision for loan losses 909,200
Charge-offs (559,383)
Recoveries of loans previously charged off 141,479
-----------
Balance at September 30, 1995 $13,522,795
===========
The allowance for loan losses as a percentage of loans and lease
financings at September 30, 1995 was 2.3%.
4. Accounting for Mortgage Servicing Rights
NCB will adopt Statement of Financial Accounting Standards (SFAS) No. 122,
"Accounting for Mortgage Servicing Rights, " as of January 1, 1996. If NCB had
implemented SFAS No. 122 as of January 1, 1995, it would not have had a
material impact on its financial condition and results of operations.
Management does not anticipate the adoption of SFAS No. 122 to have a material
impact in the future.<PAGE>
NATIONAL COOPERATIVE BANK
MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
SUMMARY
NCB's net income for the nine months ended September 30, 1995 was $6.0
million. This was a 20.8% or $1.6 million decrease from net income for the
nine months ended September 30, 1994. The decrease resulted from a reduction
in non-interest income of $329 thousand and an increase in non-interest expense
of $1.6 million which were partially offset by an increase in net interest
income of $223 thousand. For the three month period, net income
declined to $1.7 million from $2.0 million due to a $213 thousand decrease in
net interest income, increase in non-interest expense of $327 thousand and an
increase in non-interest income of $350 thousand.
Total assets were $668.7 million at September 30, 1995, up 17.9% from
$567.3 million at December 31, 1994. Loans, lease financings and loans held
for sale led the growth with an increase amounting to $92.2 million, even after
the sale of $195.4 million of loans to investors.
NET INTEREST INCOME
Net interest income increased $223 thousand during the nine months ended
September 30,1995 compared with the same period a year ago. As shown on Table
1, the net yield decreased from 4.18% to 3.72%. This is due primarily to the
flattening of the yield curve which has caused the tightening of spreads. The
tightening of the spreads has been demonstrated by an increase of only 78 basis
points on interest-earning assets compared with the 142 basis points increase
in interest-bearing liabilities. As shown on Table 2, the increase in net
interest income has all been volume related.
For the three months ended September 30, 1995, net interest income decreased
$213 thousand from the same period in 1994. The net yield decreased from 4.48%
in 1994 to 3.60% in 1995. As mentioned above, this was due to the flattening of
the yield curve on an asset base that has increased by $97 million from
the same three month period in 1994. As shown on Table 2A, the decrease in
net interest income is due to rate changes.
For the nine months ending September 30,1995, interest income increased
$7.5 million to $37.5 million. The average rate on interest-earning assets
increased to 8.90% during the nine months ended September 30,1995 compared with
8.12% in the same period in 1994. As shown on Table 2, $4.6 million of the
increase was due to higher average outstanding balances in the real estate
and commercial portfolios while $2.9 million was mainly due to rate increases
on commercial loans.
For the three months ended September 30, 1995, interest income increased
$2.4 million to $13 million compared with the same period in 1994. The
average rate on interest-earning assets increased to 8.83% during the three
months ended September 30, 1995 compared with 8.59% in the same period in 1994.
The increase in interest income was due to a higher average loan volume and
higher average yields.
Interest expense increased $7.2 million to $21.8 million for the nine months
ended September 30, 1995 compared with the nine months ended September 30,
1994. The average rate on interest-bearing liabilities increased to 6.40% in
1995 compared with 4.98% in 1994. The increase in interest expense was due to
a combination of higher rates and increased long-term and short-term borrowing
which was necessitated by increased loan originations. The interest rate paid
on Class A Notes increased 134 basis points due to the repricing of the
$53.6 million tranch every 3 months.
For the three months ended September 30, 1995, interest expense increased
$2.7 million. The average rate on interest-bearing liabilities increased to
6.39% compared with 5.21% in the same period in 1994. As shown on Table 2A,
the increase in interest expense was rate and volume related.
NON-INTEREST INCOME
Non-interest income for the nine months ended September 30, 1995 of $6.6
million decreased 4.3% or $300 thousand from $6.9 million for the same period
last year. The decrease was due to lower gains on sales of loans which
totalled $2.7 million in the first nine months of 1995 compared with $3.4
million for the same period of 1994. Increases in servicing fee income and
excess servicing fees partially offset that negative variance.
For the three month period ended September 30, non-interest income increased
by $400 thousand from $1.5 million at September 30, 1994 to $1.9 million for
the same period in the current year. The variance was related to the timing of
real estate loan sales and increased servicing portfolio during the first nine
months of 1995.
NON-INTEREST EXPENSES
Non-interest expenses for the nine months ended September 30, 1995 increased
12.2% to $14.7 million from $13.1 million for the nine months ended
September 30, 1994. The increase was due to higher expenses for contractual
services and the contribution to NCB Development Corporation (NCBDC).
Contractual service expense was $888 thousand higher than the same period in
1994 due to higher fees paid to NCBDC for management of loan portfolios and
higher expenditures for strategic planning, process redesign and the
development of a commercial loan securitization program. Also, there was no
contribution to NCBDC in 1994.
For the three month period ended September 30,1995, non-interest expense
increased by $300 thousand to $4.9 million from $4.6 million for the same
period in 1994. The increase was primarily attributable to the timing of new
hires and additional accrual of employee and senior management incentive
bonuses.
<TABLE>
<CAPTION>
Table 1
Rate Related Assets and Liabilities
(dollars in thousands)
Nine Months Ended September 30,
ASSETS 1995 1994
Average Income/ Yields/ Average Income/ Yields/ Income/
Balance Expense Rates Balance Expense Rates
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets
Real estate loans $ 264,823 $17,972 9.05% $ 217,079 $14,664 9.01%
Commercial loans
and leases 247,687 16,901 9.10% 224,718 13,380 7.94%
-------- ------ ------- ------
Total loans and leases 512,510 34,873 9.07% 441,797 28,044 8.46%
Trading, investment sec.,
cash equivalents and other
earning assets 49,813 2,648 7.09% 52,160 2,026 5.18%
------- ----- ------- -------
Total interest-earning
assets 562,323 37,521 8.90% 493,957 30,070 8.12%
------- ------ -------- --------
Allowance for loan loss (13,111) (12,897)
Non-interest earning assets
Cash 5,022 6,204
Other assets 32,757 29,506
-------- --------
Total non-interest earning 37,779 35,710
-------- --------
Total assets $ 586,991 $ 516,770
========= =========
LIABILITIES AND MEMBERS' EQUITY
Interest-bearing liabilities
Subordinated Class A
notes $ 182,912 8,416 6.13% $ 182,970 6,579 4.79%
Notes payable 202,847 10,880 7.15% 151,663 6,549 5.76%
Deposits 68,498 2,521 4.91% 55,700 1,460 3.50%
--------- ------ -------- ------
Total interest-bearing
liabilities 454,257 21,817 6.40% 390,333 14,588 4.98%
------ ------
Other liabilities 16,952 14,492
Members' equity 115,782 111,945
--------- --------
Total liabilities and
members' equity $ 586,991 $ 516,770
========= =========
Net interest-earning assets $ 108,066 $103,624
Net interest revenues spread $15,704 2.50% $15,482 3.13%
Net yield on
interest-earning assets 3.72% 4.18%
</TABLE>
<TABLE>
<CAPTION>
Table 1A
Rate Related Assets and Liabilities
(dollars in thousands)
Three Months Ended September 30,
ASSETS 1995 1994
Average Income/ Yields/ Average Income/ Yields/
Balance Expense Rates Balance Expense Rates
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets
Real estate loans $ 278,202 $ 6,301 9.06% $ 215,625 $ 5,060 9.12%
Commercial loans
and leases 260,456 5,936 9.12% 227,090 4,784 8.43%
-------- ------ -------- ------
Total loans and leases 538,658 12,237 9.09% 442,715 9,844 8.90%
Trading, investment sec.,
cash equivalents and other
earning assets 51,255 783 6.11% 49,761 727 5.84%
-------- ------ ------- -----
Total interest-earning
assets 589,913 3,020 8.83% 492,476 10,571 8.59%
Allowance for loan loss (13,365) (13,133)
Non-interest earning assets
Cash 4,266 7,432
Other assets 36,008 27,800
------- -------
Total non-interest earning 40,274 35,232
------- -------
Total assets $ 616,822 $514,575
========= ========
LIABILITIES AND MEMBERS' EQUITY
Interest-bearing liabilities
Subordinated Class A
notes $ 182,915 2,841 6.21% $182,964 2,192 4.79%
Notes payable 228,556 3,981 6.97% 141,857 2,306 6.31%
Deposits 71,357 893 5.01% 54,608 556 3.77%
-------- ----- ------- -----
Total interest-bearing
liabilities 482,828 7,715 6.39% 379,429 5,054 5.21%
------ -----
Other liabilities 16,964 22,050
Members' equity 117,031 113,096
-------- -------
Total liabilities and
members' equity $ 616,823 $ 514,575
========= =========
Net interest-earning assets $ 107,085 $113,047
Net interest revenues spread $ 5,305 2.44% $ 5,517 3.38%
Net yield on
interest-earning assets 3.60% 4.48%
</TABLE>
Table 2
Change in Net Interest Income
(dollars in thousands)
For the nine months ended Sept. 30, 1995 Compared 1994
Increase (decrease) due to changes in:
Average Average
Volume* Yield Net**
Interest Income
Cash equivalents and
investment securities $ (95) $ 717 $ 622
Commercial loans and leases 2,575 2,017 4,592
Real estate loans 2,087 150 2,237
------- ------- ------
Total interest income 4,567 2,884 7,451
------- ------- ------
Interest Expense
Deposits 385 676 1,061
Notes payable 2,339 1,991 4,330
Subordinated Class A notes (15) 1,853 1,838
------ ----- -----
Total interest expense 2,709 4,520 7,229
------ ----- -----
Net Interest Income $ 1,858 $(1,636) $ 222
======= ======== ======
* Average monthly balances
** Changes in interest income and interest expense due to changes in rate
and volume have been allocated to "change in average volume" and
"change in average rate" in proportion to the absolute dollar
amounts in each.
<PAGE>
Table 2A
Change in Net Interest Income
(dollars in thousands)
For the three months ended Sept. 30, 1995 Compared 1994
Increase (decrease) due to changes in:
Average Average
Volume* Yield Net**
Interest Income
Cash equivalents and
investment securities $ 22 $ 34 $ 56
Commercial loans and leases 1,138 379 1,517
Real estate loans 1,025 (150) 875
------ ------ -----
Total interest income 2,185 263 2,448
------ ------ -----
Interest Expense
Deposits 132 205 337
Notes payable 1,303 372 1,675
Subordinated Class A notes (11) 660 649
------ ----- -----
Total interest expense 1,424 1,237 2,661
------ ----- -----
Net Interest Income $ 761 $ (974) $ (213)
====== ======= =======
* Average monthly balances
** Changes in interest income and interest expense due to changes in rate
and volume have been allocated to "change in average volume" and
"change in average rate" in proportion to the absolute dollar
amounts in each.
PROVISION FOR INCOME TAXES
The provision for income taxes is determined on non-member income earned
and by state and local income taxes owed by the subsidiaries of NCB. NCB's
current tax policy is to treat all income of NCB and its subsidiaries, other
than NCB Savings Bank(NCBSB), as member income. The income tax provision for
the nine months ended September 30, 1995 decreased by $221 thousand compared
with the prior year's provision of $845 thousand.
CASH EQUIVALENTS AND INVESTMENT SECURITIES
Cash, cash equivalents and investment securities increased 3.3% to $52.9
million at September 30,1995 from $51.2 million at year-end 1994. As a
percentage of earning assets, cash, cash equivalents and investment securities
decreased slightly to 8.2% at September 30, 1995 from 9.3% at December 31,
1994.
ALLOWANCE FOR LOAN LOSSES
The allowance for loan losses at September 30, 1995 increased by 3.8% to
$13.5 million from $13 million at December 31, 1994. The allowance during the
period was impacted by loans charged off, net of recoveries of loans previously
charged off, amounting to $417.9 thousand and the provision for loan losses of
$909 thousand. NCB's provision for loan losses as a percentage of average loans
and leases outstanding has remained flat at .2%.
The average allowance for loan losses as a percentage of average loans and
leases decreased from 2.9% at September 30, 1994 to 2.6% at September 30,1995.
The decrease is primarily due to the increased level of loans outstanding for
the period.
As shown in Table 3, total nonperforming assets (renegotiated and
non-accruing loans, REO and in-substance foreclosures) increased from $3.2
million at December 31, 1994 to $6.2 million at September 30, 1995. Non-
performing assets as a percentage of loans and leases outstanding were 1.1% at
September 30, 1995 compared with .6% at year-end. The allowance for loan losses
as a percentage of non performing loans decreased to 218% at September 30,1995
from 412% at December 31, 1994.
<TABLE>
<CAPTION>
<PAGE>
TABLE 3
Non-performing assets
(dollars in thousands)
Sept. 30, June 30, March. 31, Dec. 31, Sept. 30,
1995 1995 1995 1994 1994
<S> <C> <C> <C> <C> <C>
Nonaccrual loans
Commercial $ 155 $ 102 $ 0 $ 0 $ 324
Real estate-construction 0 0 0 0 0
Real estate-commercial 0 0 0 0 0
Real estate-residential 777 1,817 1,719 723 1,164
----- ------ ------ ----- ------
Total non accrual loans 932 1,919 1,719 723 1,488
Restructured loans 3,960 2,080 2,117 2,143 2,168
------ ------ ------ ----- -----
Total non-performing
loans 4,892 3,999 3,836 2,866 3,656
Real estate acquired thru
foreclosure and insubstance
foreclosure 1,314 300 300 300 170
------ ----- ------ ----- ------
Total non-performing
assets $ 6,206 $ 4,299 $ 4,136 $ 3,166 $ 3,826
======= ======= ======== ======= =======
Non-performing assets/loans
plus REO and insubstance
foreclosure 1.05% .8% .8% .6% .9%
Allowance/nonperforming
loans 218% 307% 310% 412% 363%
</TABLE>
<PAGE>
INTEREST-BEARING LIABILITIES
Interest-bearing liabilities
(dollars in thousands)
9/30/95 12/31/94 % Change
--------- -------- --------
Deposits $ 69,514 $ 58,918 18.0%
Lines of credit and other
hort-term borrowings 110,449 91,031 21.3%
Term debt 167,204 105,357 58.7%
Class A notes 183,038 182,928
Other borrowings 0 1,008 (100.0%)
-------- -------
Total $530,205 $ 439,242 20.7%
Interest-bearing liabilities increased by $91 million to $530.2 million at
September 30, 1995 from $439.2 million at December 31, 1994.
Deposits at NCBSB grew 18% in the nine months period to $69.5 million. The
growth was generated by an aggressive campaign in the local community and with
NCB's members. Average maturity of these deposits is 18.5 months.
Short-term borrowings and term debt increased 21.3% and 58.7%, respectively,
from year-end 1994 to September 30, 1995. Proceeds from the borrowings were
used mainly to fund the loan growth.
ACCOUNTING FOR MORTGAGE SERVICING RIGHTS
NCB will adopt Statement of Financial Accounting Standards (SFAS) No. 122,
"Accounting for Mortgage Servicing Rights," as of January 1, 1996. If NCB
had implemented SFAS No. 122 as of January 1, 1995, it would not have had a
material impact on its financial condition and results of operations.
Management does not anticipate the adoption of SFAS No. 122 to have a material
impact in the future.
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.
NATIONAL CONSUMER COOPERATIVE BANK
Date: --------------
---------------------------
By: /s/ Richard L. Reed
Richard L. Reed, Treasurer
& Chief Financial Officer
-----------------------------
By: /s/ Marietta J. Orcino
Vice Pres. & Manager, Tax &
Regulatory Reporting and an
authorized signature
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.
NATIONAL CONSUMER COOPERATIVE BANK
Date: ---------------------
---------------------------
By:
Richard L. Reed, Treasurer
& Chief Financial Officer
----------------------------
By:
Marietta J. Orcino, Vice Pres.
& Manager, Tax & Regulatory
Reporting and an authorized
signature
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> QTR-3
<FISCAL-YEAR-END> DEC-30-1995
<PERIOD-END> SEP-30-1995
<CASH> 3,987,534
<INT-BEARING-DEPOSITS> 10,111,873
<FED-FUNDS-SOLD> 650,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 28,171,193
<INVESTMENTS-CARRYING> 1,632,347
<INVESTMENTS-MARKET> 0
<LOANS> 593,271,388
<ALLOWANCE> 13,522,795
<TOTAL-ASSETS> 668,673,033
<DEPOSITS> 69,513,760
<SHORT-TERM> 110,448,810
<LIABILITIES-OTHER> 20,649,086
<LONG-TERM> 350,241,787
<COMMON> 94,520,735
0
0
<OTHER-SE> 134,241
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<INTEREST-LOAN> 34,873,510
<INTEREST-INVEST> 2,648,564
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<INTEREST-TOTAL> 37,522,074
<INTEREST-DEPOSIT> 2,521,462
<INTEREST-EXPENSE> 21,817,123
<INTEREST-INCOME-NET> 15,704,951
<LOAN-LOSSES> 909,200
<SECURITIES-GAINS> 73,938
<EXPENSE-OTHER> 14,735,411
<INCOME-PRETAX> 6,600,075
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,036,137
<EPS-PRIMARY> 8.54
<EPS-DILUTED> 8.54
<YIELD-ACTUAL> 3.72
<LOANS-NON> 932,197
<LOANS-PAST> 1,382,249
<LOANS-TROUBLED> 3,959,668
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 13,031,499
<CHARGE-OFFS> 559,382
<RECOVERIES> 141,478
<ALLOWANCE-CLOSE> 13,522,795
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
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</TABLE>
