<PAGE> 1
U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
----------------------------
For quarter ended March 31, 1995 Commission file number 0-10853
------------------ -------
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
(Exact name of small business issuer as specified in its charter)
----------------------------
GEORGIA 58-1458268
- ------------------------------ -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification no.)
40 NORTH MAIN STREET
P.O. BOX 878
STATESBORO, GEORGIA 30459
-------------------------------
(Address of Principal Executive
Offices, including Zip Code)
912-764-6611
-------------------------------
(Issuer's telephone number, including area code)
NOT APPLICABLE
-------------------------------
(Former name, former address
and former fiscal year, if
changed since last report)
-------------------------------
Check whether the issuer: (1) has filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports) and (2)
has been subject to such filing requirement for the past 90 days.
Yes X No
----- -----
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
COMMON STOCK, $1.00 PAR VALUE 1,663,712 SHARES AS OF MARCH 31, 1995
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<PAGE> 2
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
----------------------------
(thousands of dollars)
<S> <C> <C>
ASSETS
Cash and Due From Banks $ 8,804 $ 12,019
Interest Bearing Deposits in Other Banks 19,117 13,038
Federal Funds Sold 3,350 5,675
Investment Securities:
Available for Sale (Cost of $45,986 in 1995
and $46,866 in 1994) 45,270 45,337
Held to Maturity (Estimated Market Value
of $25,427 in 1995 and $17,317 in 1994) 24,814 17,285
Loans 163,674 162,787
Less: Unearned Interest (45) (56)
Allowance for Loan Losses (3,143) (3,005)
-------- --------
Loans, Net 160,486 159,726
-------- --------
Interest Receivable 3,189 3,185
Premises and Equipment, Net 3,307 3,113
Other Real Estate 329 307
Other Assets 2,284 2,467
-------- --------
TOTAL ASSETS $270,950 $262,152
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand $ 31,553 $ 31,509
Interest Bearing:
NOW Accounts 40,070 34,511
Money Market Deposit Accounts 32,344 35,371
Savings 10,666 10,469
Time ($100,000 and above) 52,099 51,099
Other Time 68,082 65,439
-------- --------
Total Deposits 234,814 228,398
Other Borrowed Money 5,506 4,630
Interest Payable 1,822 1,855
Other Liabilities 1,237 1,012
-------- --------
Total Liabilities 243,379 235,895
-------- --------
Shareholders' Equity (Note 3):
Common Stock, 2,661,939 Shares Issued and Outstanding 1,664 1,664
Surplus 6,266 6,266
Retained Earnings 20,112 19,336
Net Unrealized Gain/(Loss) on Investment
Securities Available for Sale (471) (1,009)
-------- --------
Shareholders' Equity 27,571 26,257
-------- --------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $270,950 $262,152
======== ========
</TABLE>
See notes to consolidated financial statements.
1
<PAGE> 3
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
1995 1994
----------------------------
(thousands of dollars)
<S> <C> <C>
INTEREST INCOME
Loans (Including fees) $ 4,284 $ 3,346
Interest Bearing Deposits 235 11
Investments:
U.S. Treasury 474 392
U.S. Government Agencies 275 247
States and Political Subdivisions 210 172
Dividend Income 49
Federal Funds Sold 35 101
---------- ----------
Total Interest Income 5,562 4,269
---------- ----------
INTEREST EXPENSE
NOW Accounts 277 206
Money Market Deposits Accounts 293 249
Savings 81 75
Time Deposits ($100,000 and above) 668 486
Other Time Deposits 883 696
Other 90 9
---------- ----------
Total Interest Expense 2,292 1,721
---------- ----------
NET INTEREST INCOME 3,270 2,548
Provision for Loan Losses 153 170
---------- ----------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 3,117 2,378
---------- ----------
NON-INTEREST INCOME
Service Charges on Deposits 358 331
Fees for Trust Services 36 34
Other 63 113
---------- ----------
Total Non-interest Income 457 478
---------- ----------
NON-INTEREST EXPENSE
Salaries 767 728
Other Personnel Expense 285 265
Occupancy Expense, Net 131 134
Equipment Expense 201 173
Other 614 596
---------- ----------
Total Other Expense 1,998 1,896
---------- ----------
INCOME BEFORE INCOME TAXES 1,576 960
Provision for Income Taxes 485 272
---------- ----------
NET INCOME $ 1,091 $ 688
========== ==========
EARNINGS PER COMMON SHARE (NOTE 3) $ .41 $ .26
========== ==========
DIVIDENDS PER COMMON SHARE (NOTE 3) $ .12 $ .09
========== ==========
AVERAGE NUMBER OF SHARES OUTSTANDING (NOTE 3) 2,661,939 2,661,939
========== ==========
</TABLE>
See notes to consolidated financial statements.
2
<PAGE> 4
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994
<TABLE>
<CAPTION>
March 31,
1995 1994
-------------------------
(thousands of dollars)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 1,091 $ 688
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Provision for Depreciation 138 126
Provision for Loan Losses 153 170
Gain on Sale of Other Real Estate (16)
Gain on Call of Securities (1)
Gain on Sale of Equipment (7)
Amortization of Premiums and Discounts on Securities 7 59
Changes in Assets and Liabilities:
(Increase)Decrease in Interest Receivable (4) 50
Increase in Other Assets (95) (492)
Decrease in Interest Payable (33) (298)
Increase in Other Liabilities 225 335
------- ------
Net Cash Provided by Operating Activities 1,474 622
------- ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net (Increase) Decrease in Interest Bearing Deposits
in Other Banks (6,079) 99
Net Decrease in Federal Funds Sold 2,325 4,725
Available-for-Sale Securities:
Proceeds from Maturity 4,364 2,056
Purchases (3,524) (9,041)
Held-to-Maturity Securities:
Proceeds from Maturity 456 704
Purchases (7,946) (250)
Net Increase in Loans (936) (3,023)
Purchases of Premises and Equipment (332) (63)
Proceeds from Sale of Equipment 7
-------- -------
Net Cash Used in Investing Activities (11,665) (4,793)
-------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Net Increase in Deposits 6,416 3,225
Net Increase in Other Borrowed Money 876 1,722
Repayment of Note Payable (100)
Dividends Paid (316) (249)
-------- -------
Net Cash Provided by Financing Activities 6,976 4,598
-------- -------
INCREASE (DECREASE) IN CASH AND DUE FROM BANKS (3,215) 427
CASH AND DUE FROM BANKS AT BEGINNING OF YEAR 12,019 8,940
-------- -------
CASH AND DUE FROM BANKS AT END OF PERIOD $ 8,804 $ 9,367
======== =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid (received) during the year for:
Interest $ 2,325 $ 2,019
Income Taxes 69 60
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:
Other Real Estate Acquired through Loan Foreclosure $ 23
Loans granted to facilitate the sale of Other Real Estate 95
Increase (Decrease) in Net Unrealized Gain (Loss) on
Investment Securities Available for Sale 539 (483)
</TABLE>
See notes to consolidated financial statements.
3
<PAGE> 5
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION
The consolidated financial statements of First Banking Company of
Southeast Georgia (the "Company") include the financial statements of
First Bulloch Bank & Trust Company and Metter Banking Company,
wholly-owned subsidiaries. Intercompany balances and transactions
have been eliminated in consolidation.
The consolidated statements contained in this report are unaudited but
reflect all adjustments, consisting only of normal recurring accruals,
which are, in the opinion of management, necessary to a fair statement
of the results for the interim period reflected. Certain information
and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to applicable rules and
regulations of the Securities and Exchange Commission. The results of
operations for the interim period reported herein are not necessarily
indicative of results to be expected for the full year.
The consolidated financial statements included herein should be read
in conjunction with the financial statements and notes thereto, and
the Independent Auditors' Report included in the Company's Annual
Report on Form 10-KSB for the fiscal year ended December 31, 1994.
2. ACCOUNTING POLICIES
Reference is made to the accounting policies of the Company described
in the notes to consolidated financial statements contained in the
Company's Annual Report on Form 10-KSB for the year ended December 31,
1994. The Company has followed those policies in preparing this
report.
3. COMMON STOCK
The par value of First Banking's common stock is $1 and 5,000,000
shares are authorized. The Banks may pay dividends to First Banking
in any year up to 50% of the previous year's net income without the
approval of the Georgia Department of Banking and Finance.
Effective May 15, 1995, the Company has declared a 5-for-3 stock split
of its common stock effected in the form of a 60 percent stock
dividend. All references to number of shares and to per share amounts
have been retroactively adjusted to reflect the split.
4. EARNINGS PER SHARE
Net Income per share of common stock is based on the weighted average
number of shares of common stock outstanding during each period, after
stating for the stock split (see Note 3).
4
<PAGE> 6
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL
CONDITION AND SUMMARY OF OPERATIONS FOR THE
THREE MONTHS ENDED MARCH 31, 1995
This discussion relates to the consolidated financial condition and
results of operations of First Banking Company of Southeast Georgia (the
"Company") and its wholly-owned subsidiaries, First Bulloch Bank & Trust
Company and Metter Banking Company (the "Banks"). Since the Company has no
subsidiaries other than the Banks and no activities other than those of the
Banks, the following narrative refers to the operations of the Banks.
FINANCIAL CONDITION
The Company functions as the sole owner of two commercial banks, and
its financial condition should be examined in terms of trends in sources and
uses of funds. The Company's primary use of funds comes from loan demand.
Loans outstanding have increased $898,000 or 0.6% since year-end. Investment
securities have increased $7,462,000, and federal funds sold have decreased by
$2,325,000 from year-end.
Total assets have increased by $8,798,000 since year-end, while total
funds (deposits plus Other Borrowed Money) have increased $7,292,000. Total
deposits have increased $6,416,000 since year-end and Other Borrowed Money has
increased $876,000. Demand deposits have increased $44,000, and savings
deposits (including NOW accounts and the liquid money market accounts) have
increased by $2,729,000. Time deposits over $100,000 have increased
approximately $1,000,000, and other time deposits have increased approximately
$2,643,000, primarily as a result of an increase in rates paid on deposits.
Effective May 15, 1995, the Company has declared a 5-for-3 stock split
of its common stock effected in the form of a 60 percent stock dividend. All
references to number of shares and to per share amounts have been retroactively
adjusted to reflect the split.
CAPITAL RESOURCES
The Company's ratio of shareholders' equity to total assets was 10.2%
at March 31, 1995 and 10.0% at December 31, 1994. This ratio of shareholders'
equity to assets is considered adequate to support the operations of the
Company.
5
<PAGE> 7
LIQUIDITY
The percentage of net loans to total funds was 68.1% at March 31, 1995
and 69.8% at December 31, 1994. At March 31, 1995 the Banks had $31,271,000 in
Cash and Due from Banks, Interest Bearing Deposits in Other Banks, and Federal
Funds Sold as compared with $30,732,000 at December 31, 1994. The liquidity of
the Company and the Banks is considered adequate to repay deposits and other
obligations, meet expected loan demand and pay dividends.
SUMMARY OF OPERATIONS
INTEREST INCOME
Total interest income increased $1,293,000 (30.3%) in the first three
months of 1995 as compared to the first three months of 1994. Interest on
loans increased $938,000 in the first three months of 1995 as compared to the
first three months of 1994, as a result of higher interest rates on loans
outstanding as well as an increase in the average loan portfolio of
$12,470,000. Interest on investments increased $148,000, primarily as a result
of higher yields within the portfolio as well as an increase of $7,680,000 in
the average carrying amount of investments.
During the first three months of 1995, interest on federal funds sold
decreased $66,000 from the first three months of 1994, while interest on
Interest-bearing Deposits in Other Banks increased $224,000. This decrease
and increase were the result of a shift in short-term investments from federal
funds sold to interest bearing deposit accounts.
INTEREST EXPENSE
During the first three months of 1995, total interest expense
increased $571,000 (33.2%) from the first three months of 1994. Interest on
deposits increased $490,000 (28.6%) in the first three months of 1995 from the
first three months of 1994. This increase is attributable to higher interest
rates paid on deposits outstanding in 1995 as compared to 1994 as well as an
increase in the average amount of interest bearing deposits. Interest on Other
Borrowed Money increased $81,000 in the first three months of 1995 from the
first three months of 1994. This increase is the result of an increase in the
average balance outstanding of Other Borrowed Money at a higher average
interest rate.
6
<PAGE> 8
PROVISIONS FOR LOAN LOSSES
Provisions for loan losses for the first three months of 1995
decreased $17,000 from the first three months of 1994. After considering the
credit worthiness of the loan portfolios, it is the opinion of the management
of the Banks that the allowance for loan losses is adequate. At March 31, 1995
the allowance for loan losses was 1.9% of outstanding loans less unearned
interest.
OTHER INCOME AND EXPENSE
Other income decreased $21,000 in the first three months of 1995 from
the first three months of 1994, primarily as a result of a decrease in income
from long-term mortgage loans originated for other banks. Other expense
increased $102,000 in the first three months of 1995 compared to the first
three months of 1994, primarily as a result of increases in certain costs of
the operations of the Banks.
7
<PAGE> 9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Neither the Registrant nor either of its subsidiaries is a party to,
nor is any of their property the subject of, any material pending legal
proceedings, other than ordinary routine proceedings incidental to the
business of banks, nor to the knowledge of management are any such
proceedings contemplated or threatened against the Registrant or its
subsidiaries.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
27 Financial Data Schedule (for SEC use only)
(b) Reports on Form 8-K: The Registrant did not file any reports
on Form 8-K during the quarter for which this report is filed.
8
<PAGE> 10
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
DATE: May 4, 1995 BY: /s/James Eli Hodges
-------------------- --------------------------------------
JAMES ELI HODGES
PRESIDENT
DATE: May 4, 1995 BY: /s/Dwayne E. Rocker
-------------------- --------------------------------------
DWAYNE E. ROCKER
SECRETARY-TREASURER
(PRINCIPAL FINANCIAL OFFICER)
9
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of First Banking Company of Southeast Georgia for the
three months ended March 31,1995 and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 8,804
<INT-BEARING-DEPOSITS> 19,117
<FED-FUNDS-SOLD> 3,350
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 45,270
<INVESTMENTS-CARRYING> 24,814
<INVESTMENTS-MARKET> 25,427
<LOANS> 163,629
<ALLOWANCE> 3,143
<TOTAL-ASSETS> 270,950
<DEPOSITS> 234,814
<SHORT-TERM> 0
<LIABILITIES-OTHER> 3,059
<LONG-TERM> 5,506
<COMMON> 1,664
0
0
<OTHER-SE> 25,907
<TOTAL-LIABILITIES-AND-EQUITY> 270,950
<INTEREST-LOAN> 4,284
<INTEREST-INVEST> 1,008
<INTEREST-OTHER> 270
<INTEREST-TOTAL> 5,562
<INTEREST-DEPOSIT> 2,202
<INTEREST-EXPENSE> 2,292
<INTEREST-INCOME-NET> 3,270
<LOAN-LOSSES> 153
<SECURITIES-GAINS> 1
<EXPENSE-OTHER> 1,998
<INCOME-PRETAX> 1,576
<INCOME-PRE-EXTRAORDINARY> 1,576
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,091
<EPS-PRIMARY> 0.41
<EPS-DILUTED> 0.41
<YIELD-ACTUAL> 5.48
<LOANS-NON> 182
<LOANS-PAST> 136
<LOANS-TROUBLED> 1,056
<LOANS-PROBLEM> 1,374
<ALLOWANCE-OPEN> 3,005
<CHARGE-OFFS> 28
<RECOVERIES> 13
<ALLOWANCE-CLOSE> 3,143
<ALLOWANCE-DOMESTIC> 3,143
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
