<PAGE>
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995, or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to .
Commission file number 03502.
First National of Nebraska, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Nebraska 47-0523079
- -------------------------------- ----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One First National Center Omaha, NE 68102
- --------------------------------------------- ----------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (402) 341-0500
----------------------------
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $5.00 par value
-----------------------------
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes ___X___ No ______.
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. __X__
As of February 15, 1996, the aggregate market value of the voting shares held by
nonaffiliates of the registrant was $637,618,800.
The number of outstanding shares of the registrant's common stock, as of March
19, 1996 was 346,767.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents have been incorporated by reference into this Form 10-K
as indicated below:
Annual report to shareholders for fiscal year ended December 31, 1995 (Parts I
and II).
Proxy statement of the registrant to be filed with the Securities and Exchange
Commission (Part III).
<PAGE>
PART I
ITEM 1. BUSINESS.
THE COMPANY
First National of Nebraska, Inc. (the "Parent Company") is a Nebraska-based
interstate multi-bank holding company. It was organized in 1968 and owns or
substantially owns all of the common stock of nine banking subsidiaries and nine
nonbanking subsidiaries.
First National of Nebraska, Inc. and subsidiaries (the "Company") was one of the
originators of the bank credit card industry and has over 40 years' experience
in this business. Through a banking subsidiary, the Company conducts a
significant consumer credit card service under license arrangements with VISA
USA and MasterCard International Inc. The Company's credit card customers are
located throughout the United States, but primarily in the Midwest.
At December 31, 1995, the Company ranked among the top 25 card issuing entities
based on the amount of managed credit card loans outstanding. The Company
originates all new credit card accounts and does not purchase existing accounts
from other originators. The Company performs all credit card servicing
activities on behalf of its subsidiary banks including data processing, payment
processing, statement rendering, marketing, customer service, credit
administration and card embossing. The Company primarily funds its credit card
loans through the core deposits of its subsidiary banks.
The Company continues to make substantial investments in data processing
technology for both its own data processing needs and to provide various data
processing services for unaffiliated parties. The services provided include
automated clearinghouse transactions, merchant credit card processing, and check
processing. The Company ranks as one of the largest merchant credit card
processors in the United States. It also was among the 15 largest automated
clearinghouse processors in the country during 1995, and is one of the largest
check processors in its market area. The Company provides data processing
services to non-affiliated banks located in nine states.
BANKING SUBSIDIARIES
First National Bank of Omaha (the "Bank") is a national banking association
founded in 1863 and substantially owns six nonbanking subsidiaries. As of
December 31, 1995, the Bank had assets in excess of $3,041,000,000 and was
ranked as the largest bank in Nebraska. The Bank is engaged in a general banking
business and offers complete banking and trust services to retail, commercial,
industrial and agricultural customers in Nebraska, Iowa, Kansas, South Dakota,
Colorado and other nearby states. The Bank offers time and demand deposits,
certificates of deposits, individual retirement accounts and other products. The
Bank also provides customers with trust services, safe deposit boxes, cash
management and investment services. The Bank makes a variety of loans such as
individual consumer loans (including home equity and automobile loans),
agricultural, real estate, and commercial loans. The Bank has branch locations
in Omaha, Beatrice, and David City, Nebraska.
2
<PAGE>
In addition to the Bank, the Parent Company owns all of the outstanding common
stock of the following banks. These banks engage in general banking business
and offer complete banking services to retail, commercial, industrial and
agricultural customers.
<TABLE>
<CAPTION>
Bank Branch Locations
- ---------------------------------------------------------------
<S> <C>
First National Bank Fort Collins, Colorado
Loveland, Colorado
First National Bank of Kansas Overland Park, Kansas
First National Bank North Platte, Nebraska
Alliance, Nebraska
Chadron, Nebraska
Gering, Nebraska
Scottsbluff, Nebraska
First National Bank and Trust Company Columbus, Nebraska
of Columbus Norfolk, Nebraska
Union Colony Bank Greeley, Colorado
Fort Collins, Colorado
Loveland, Colorado
Windsor, Colorado
Fremont National Bank & Trust Company Fremont, Nebraska
Platte Valley Bank & Trust Company Kearney, Nebraska
First National Bank South Dakota Yankton, South Dakota
</TABLE>
Refer to Note K of the Company's consolidated financial statements for details
regarding the Company's most recent acquisitions.
COMPETITION
Competitors of the Company include other commercial banks, savings and loan
associations, consumer and commercial finance companies, credit unions and other
financial services companies. The Company's credit card operation competes with
other issuers of credit cards ranging from other national issuers of bank cards
to local retailers which provide their own charge account services. The Company
believes that the level of competition will increase in the future as the
industry continues to consolidate and as nonbanking companies continue to offer
products traditionally offered by banks.
3
<PAGE>
EMPLOYEES
The Company had 3,831 full-time-equivalent employees as of December 31, 1995.
REGULATION
The Company is governed by various regulatory agencies. Bank holding companies
and their nonbanking subsidiaries are regulated by the Federal Reserve Board.
National banks are primarily regulated by the Office of the Comptroller of the
Currency (OCC). All federally-insured banks are also regulated by the FDIC. The
Parent Company's banking subsidiaries include seven national banks and two
state-chartered banks, all of which are insured by the FDIC. The state-chartered
banks are also regulated by the state banking authorities.
The Company and each of the banking subsidiaries are required to maintain
minimum capital in accordance with federal guidelines. Generally, these
guidelines are: 1) 3% to 5% for Tier I capital to total assets (as defined); 2)
4% for Tier I capital to risk-adjusted assets; and 3) 8% for Total capital (as
defined) to risk-adjusted assets. The stated capital of the Company and each of
the banking subsidiaries is subject to qualitative judgments by the regulators
about components, risk weightings, and other factors. The Company and each of
the banking subsidiaries exceeded these minimum regulatory capital requirements
at December 31, 1995.
The Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA")
imposed a significant amount of new regulation on the banking industry. A
substantial part of FDICIA's regulatory restrictions is focused on the capital
level of financial institutions and the relative risk of their assets and
liabilities. Most of the regulatory mandates of FDICIA now have been implemented
by the federal banking agencies through final regulations. These include
regulations relating to corrective regulatory action, standards of safety and
soundness and various deposit insurance reforms.
Under federal banking laws and regulations, the Parent Company's banking
subsidiaries are reviewed pursuant to a supervisory framework for prompt
corrective action. This framework consists of five categories that are defined
by different levels of capital. For the top-rated well-capitalized category, an
institution must meet capital ratios of 5.0% for Tier I capital to total assets
(as defined); 6.0% for Tier I capital to risk-adjusted assets; and 10.0% for
Total capital to risk-adjusted assets. At December 31, 1995, all of the Parent
Company's banking subsidiaries exceeded these minimum capital ratio requirements
for the top-rated well-capitalized category established by the supervisory
agencies.
At periodic intervals, the banking regulators routinely examine the financial
statements of the Parent Company and its subsidiaries as part of their legally
prescribed oversight of the banking industry. Based on these examinations, the
regulators can direct the financial statements to be adjusted in accordance with
their findings. The regulators have not proposed material adjustments to the
financial statements this year nor in prior years.
4
<PAGE>
EXECUTIVE OFFICERS AND DIRECTORS OF THE COMPANY
The following individuals are the executive officers and directors of the Parent
Company. They have served as officers and directors of the Parent Company since
it was organized in 1968. The principal occupations of such individuals during
the last five years have been as officers and directors of the Bank.
F. Phillips Giltner is chairman of the board of directors of the Bank and
chairman of the board and secretary of the Parent Company and a member of the
executive committee of the Bank and the Parent Company. Prior to June 1994, Mr.
Giltner was president of the Parent Company and vice chairman of the Bank.
Bruce R. Lauritzen is president, treasurer, member of the executive committee
and director of the Parent Company, and president, member of the executive
committee and director of the Bank. Prior to June 1994, he was treasurer and
secretary of the Parent Company and president of the Bank.
John R. Lauritzen became an officer of the Bank in 1943 and a director in 1949.
In June 1994, he became chairman emeritus of the board of directors, member of
the executive committee and director for the Parent Company and the Bank. Prior
to June 1994, he was chairman of the board of both the Bank and the Parent
Company. John R. Lauritzen is the father of Bruce R. Lauritzen.
ADDITIONAL FINANCIAL INFORMATION
The following tables show comparative financial information for the Company as
indicated in the captions.
5
<PAGE>
SCHEDULE I.A. - AVERAGE CONSOLIDATED BALANCE SHEETS
The following table presents the average consolidated balance sheets of the
Company for the years 1993 through 1995(1):
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
For the year ended December 31,
ASSETS 1995 1994 1993
- -------------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C>
Cash and due from banks (2) $ 234,563 $ 228,897 $ 199,683
Federal funds sold and other short-term
investments 177,915 134,327 97,913
Securities:
Taxable 770,064 614,132 584,890
Nontaxable 24,632 25,196 27,954
Loans net of allowance for loan losses and
unearned income 4,209,515 3,355,462 2,664,162
Premises and equipment, net 98,323 80,204 61,104
Other assets 156,385 121,215 82,665
- -------------------------------------------------------------------------------------------------------
Total assets $5,671,397 $4,559,433 $3,718,371
=======================================================================================================
- -------------------------------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
- -------------------------------------------------------------------------------------------------------
Deposits: (2)
Non-interest bearing $ 510,920 $ 475,017 $ 417,163
Interest bearing 4,263,650 3,431,635 2,763,413
- -------------------------------------------------------------------------------------------------------
Total deposits 4,774,570 3,906,652 3,180,576
- -------------------------------------------------------------------------------------------------------
Federal funds purchased and U.S. Treasury notes 67,295 62,286 51,797
Commercial paper and commercial
paper based borrowings 284,914 171,293 157,718
Other liabilities 49,375 39,796 37,971
Long-term debt and other interest-bearing
obligations 69,021 48,279 17,835
Capital notes 31,049 10,975 10,975
- -------------------------------------------------------------------------------------------------------
Total liabilities 5,276,224 4,239,281 3,456,872
- -------------------------------------------------------------------------------------------------------
Stockholders' equity:
Common stock 1,734 1,734 1,734
Additional paid-in capital 2,604 2,604 2,604
Retained earnings 390,835 315,814 257,161
- -------------------------------------------------------------------------------------------------------
Total stockholders' equity 395,173 320,152 261,499
- -------------------------------------------------------------------------------------------------------
Total liabilities and
stockholders' equity $5,671,397 $4,559,433 $3,718,371
=======================================================================================================
</TABLE>
(1) All significant intercompany balances have been eliminated in the
consolidation.
(2) The December 31 balances are higher than the average balances as shown
in this schedule due to significant growth during the year and many of the
Company's customers making large deposits at year-end.
6
<PAGE>
SCHEDULE I.B. - INTEREST RATES AND DIFFERENTIAL
The following tables present an analysis of net interest earnings for the years
1993 through 1995:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
For the year ended December 31,
ASSETS 1995 1994 1993
- ---------------------------------------------------------------------------------------------------
(Amounts in Thousands Except Percents)
<S> <C> <C> <C>
Average amount outstanding for year:
Loan and lease financing (1)(5) $4,267,290 $3,403,324 $2,706,475
Taxable securities (4) 770,064 614,132 584,890
Nontaxable securities 24,632 25,196 27,954
Federal funds sold and
other short-term investments 177,915 134,327 97,913
- ---------------------------------------------------------------------------------------------------
Total $5,239,901 $4,176,979 $3,417,232
===================================================================================================
Total interest earned during the year:
Loan and lease financing (1) (2) $ 634,157 $ 490,169 $ 412,865
Taxable securities 45,492 32,777 32,339
Nontaxable securities (3) 2,210 2,254 2,840
Federal funds sold and
other short-term investments 10,298 5,780 2,922
- ---------------------------------------------------------------------------------------------------
Total $ 692,157 $ 530,980 $ 450,966
===================================================================================================
Yield:
Loan and lease financing 14.86% 14.40% 15.25%
Taxable securities 5.91% 5.34% 5.53%
Nontaxable securities (3) 8.97% 8.95% 10.16%
Federal funds sold and
other short-term investments 5.79% 4.30% 2.98%
Total 13.21% 12.71% 13.20%
===================================================================================================
</TABLE>
(1) Non-accruing loans are included within the average loan and lease
financing amount outstanding. No interest on these non-accruing loans is
included within the "Total interest earned during the year" amount.
(2) Loan fees of approximately $83,452,000; $71,283,000; and $56,735,000
are included for 1995, 1994, and 1993, respectively.
(3) Calculated on a taxable equivalent basis with a 35% tax rate in 1995,
1994 and 1993.
(4) Includes securities held-to-maturity, securities available-for-sale,
and trading securities.
(5) Calculated net of unearned income.
7
<PAGE>
SCHEDULE I.B. - INTEREST RATES AND DIFFERENTIAL (Continued)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
For the year ended December 31,
LIABILITIES 1995 1994 1993
- -------------------------------------------------------------------------------------------------------
(Amounts in Thousands Except Percents)
<S> <C> <C> <C>
Average amount outstanding for year:
Interest bearing deposits $4,263,650 $3,431,635 $2,763,413
Federal funds purchased
and U.S. Treasury notes 67,295 62,286 51,797
Commercial paper and commercial paper
based borrowings 284,914 171,293 157,718
Long-term debt and other interest-bearing
obligations and capital notes 100,070 59,254 28,810
- -------------------------------------------------------------------------------------------------------
Total $4,715,929 $3,724,468 $3,001,738
=======================================================================================================
Total interest expensed during the year:
Interest bearing deposits $ 234,694 $ 152,746 $ 124,717
Federal funds purchased
and U.S. Treasury notes 3,642 2,333 1,523
Commercial paper and commercial paper
based borrowings 18,435 8,797 6,310
Long-term debt and other interest-bearing
obligations and capital notes 7,689 4,340 2,432
- -------------------------------------------------------------------------------------------------------
Total $ 264,460 $ 168,216 $ 134,982
=======================================================================================================
Yield:
Interest bearing deposits 5.50% 4.45% 4.51%
Federal funds purchased
and U.S. Treasury notes 5.41% 3.75% 2.94%
Commercial paper and commercial paper
based borrowings 6.47% 5.14% 4.00%
Long-term debt and other interest-bearing
obligations and capital notes 7.68% 7.32% 8.44%
Total 5.61% 4.52% 4.50%
=======================================================================================================
Net interest income (1) $ 427,697 $ 362,764 $ 315,984
Net yield on earning assets 8.16% 8.68% 9.25%
=======================================================================================================
</TABLE>
(1) Reflects the effect of interest on nontaxable securities calculated on
a taxable equivalent basis with a 35% tax rate in 1995, 1994 and 1993.
8
<PAGE>
SCHEDULE I. C. - INTEREST RATE AND VOLUME CHANGES
The following table presents the changes in interest income and interest expense
and the amounts attributable to changes in volume and changes in rates (1):
<TABLE>
<CAPTION>
Year 1995 Over 1994 Year 1994 Over 1993
------------------------------------------- -------------------------------------------
Variance Variance
Attributable to Attributable to
Amount Rate Volume Amount Rate Volume
------------ ------------ ------------ ------------ ------------ ------------
(Amounts in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Loan and lease financing $143,988 $16,036 $127,952 $77,304 $(24,119) $101,423
Taxable securities 12,715 3,767 8,948 438 (1,146) 1,584
Nontaxable securities (2) (44) 7 (51) (586) (321) (265)
Federal funds sold and other
short-term investments 4,518 2,329 2,189 2,858 1,552 1,306
Interest bearing deposits 81,948 40,479 41,469 28,029 (1,737) 29,766
Federal funds purchased and
U.S. Treasury notes 1,309 1,109 200 810 466 344
Commercial paper and commercial
paper based borrowings 9,638 2,712 6,926 2,487 1,908 579
Long-term debt and other
interest-bearing obligations and
capital notes 3,349 223 3,126 1,908 (360) 2,268
</TABLE>
(1) Changes due to rate and volume were calculated as follows:
A. The change in rate times the prior period volume.
B. The change in volume times the prior period rate.
C. The remaining variance due to a combination of rate/volume
changes. This amount was allocated proportionately to the rate
and volume changes obtained in A and B.
(2) Calculated on a taxable equivalent basis with a 35% tax rate in 1995,
1994 and 1993.
9
<PAGE>
SCHEDULE II. A. - SECURITIES PORTFOLIO
The following table indicates the amortized cost of securities of the Company
as of December 31 for the years indicated:
<TABLE>
<CAPTION>
1995 1994 1993
- ------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C>
U.S. Government obligations $ 811,338 $ 748,483 $ 586,084
Obligations of states and political
subdivisions 21,438 21,524 25,770
Collateralized mortgage obligations 1,961 3,882 9,876
Other securities 12,000 8,161 23,172
- ------------------------------------------------------------------------------------------------
Securities held-to-maturity 846,737 782,050 644,902
Trading securities -- -- 5,416
- ------------------------------------------------------------------------------------------------
Total securities $ 846,737 $ 782,050 $ 650,318
================================================================================================
</TABLE>
SCHEDULE II. B. - SECURITIES MATURITIES
The following table presents the maturity of securities held on December 31,
1995 and the weighted average yield for each range:
<TABLE>
<CAPTION>
(Amounts in Weighted
Thousands) Average Yield
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
U.S. Government obligations:
Within 1 year $ 303,238 5.92%
After 1 but within 5 years 506,455 5.95%
After 5 but within 10 years 953 7.52%
After 10 years 692 8.26%
- ------------------------------------------------------------------------------------------------
Total $ 811,338 5.94%
================================================================================================
Obligations of states and
political subdivisions (1):
Within 1 year $ 4,136 8.87%
After 1 but within 5 years 12,027 8.86%
After 5 but within 10 years 4,138 8.82%
After 10 years 1,137 8.94%
- ------------------------------------------------------------------------------------------------
Total $ 21,438 8.86%
================================================================================================
Collateralized mortgage obligations:
Within 1 year $ 48 4.12%
After 1 but within 5 years 424 4.54%
After 5 but within 10 years 407 8.24%
After 10 years 1,082 8.39%
- ------------------------------------------------------------------------------------------------
Total $ 1,961 7.42%
================================================================================================
Other securities:
Within 1 year $ 785 5.34%
After 1 but within 5 years 2,027 6.23%
After 5 but within 10 years 450 6.64%
After 10 years 8,738 6.00%
- ------------------------------------------------------------------------------------------------
Total $ 12,000 6.02%
================================================================================================
</TABLE>
(1) Taxable equivalent rates are based upon a 35% tax rate. The adjustments
made to obtain a taxable equivalent rate were (in order as the rates are shown
above), 3.10%, 3.10%, 3.09%, 3.13% and 3.10%, respectively.
10
<PAGE>
SCHEDULE III. A. - LOAN PORTFOLIO
The following table indicates the distribution of loans, net of unearned income,
of the Company as of December 31, for the years indicated:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
- -----------------------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C> <C> <C>
Individual consumer $2,895,617 $2,646,865 $2,066,266 $1,699,337 $1,443,641
Commercial and financial 565,075 486,540 393,760 325,771 266,638
Real estate-mortgage 517,375 394,920 366,204 275,565 235,165
Agriculture 268,940 246,267 225,124 186,366 167,968
Real estate-construction 131,196 105,347 71,908 56,368 49,712
Lease financing 50,447 48,976 44,521 42,506 44,643
Other 10,777 5,003 5,103 5,446 4,379
- -----------------------------------------------------------------------------------------------------------------
$4,439,427 $3,933,918 $3,172,886 $2,591,359 $2,212,146
Less:
Allowance for loan losses 67,740 55,265 49,589 41,298 35,819
- -----------------------------------------------------------------------------------------------------------------
Net Loans $4,371,687 $3,878,653 $3,123,297 $2,550,061 $2,176,327
=================================================================================================================
</TABLE>
SCHEDULE III. B. - LOAN MATURITIES
The following table presents certain consolidated loan maturities by ranges
based upon contract dates. Also included for loans maturing after one year are
the amounts which have predetermined interest rates and floating or adjustable
interest rates.
<TABLE>
<CAPTION>
Maturities as of December 31, 1995
- ----------------------------------------------------------------------------------------------------
--AFTER ONE YEAR--
After One Predetermined Adjustable
Due Within But Within After Five Interest Interest
One Year Five Years Years Rates Rates
- ----------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C> <C> <C>
Individual consumer $2,631,484 $208,777 $55,356 $195,969 $68,164
Commercial and financial 358,560 174,472 32,043 71,260 135,255
Real estate-mortgage 146,493 205,865 165,017 208,884 161,998
Agriculture 212,795 51,523 4,622 39,098 17,047
Real estate-construction 56,929 55,729 18,538 16,789 57,478
Lease financing 14,346 33,957 2,144 34,775 1,326
Other 10,087 690 -- 656 34
- ----------------------------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
SCHEDULE III. C. - RISK ELEMENTS
1.a. Non-Accrual, Past Due and Restructured Loans (1):
<TABLE>
<CAPTION>
As of December 31,
1995 1994 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------
(Amounts in Thousands)
<S> <C> <C> <C> <C> <C>
Individual consumer:
Non-accrual loans $ 135 $ 165 $ 227 $ 224 $ 286
Loans over 90 days overdue (2) 44,910 26,733 24,421 18,597 19,402
Troubled debt restructurings (3) 20 4 6 -- 471
Commercial and financial:
Non-accrual loans 3,032 789 482 3,915 369
Loans over 90 days overdue (2) 350 62 247 212 658
Troubled debt restructurings (3) 317 342 442 313 841
Real estate-mortgage:
Non-accrual loans 3,373 3,514 5,255 3,647 3,491
Loans over 90 days overdue (2) 261 508 529 415 288
Troubled debt restructurings (3) 1,190 1,520 1,821 2,004 1,493
Agriculture:
Non-accrual loans 1,821 1,040 1,467 2,635 548
Loans over 90 days overdue (2) 306 2 -- 76 140
Troubled debt restructurings (3) -- 21 200 506 802
Real estate-construction:
Non-accrual loans -- -- -- -- --
Loans over 90 days overdue (2) 416 -- -- -- --
Troubled debt restructurings (3) -- -- -- -- --
Lease financing:
Non-accrual loans 144 118 597 485 111
Loans over 90 days overdue (2) -- -- -- 1 --
Troubled debt restructurings (3) -- -- -- -- 13
Other:
Non-accrual loans 204 204 229 237 306
Loans over 90 days overdue (2) 83 -- 22 -- 25
Troubled debt restructurings (3) -- -- -- 418 --
</TABLE>
(1) Refer to provision for loan losses comment on Schedule IV (Continued).
(2) Does not include loans mentioned in non-accrual loans category.
(3) Does not include loans mentioned in non-accrual loans or loans over 90 days
overdue categories.
12
<PAGE>
SCHEDULE III. C. - RISK ELEMENTS (Continued)
<TABLE>
<CAPTION>
1.b. Interest Income Relating to Non-Accrual and Restructured Loans for the
Year Ended December 31, 1995:
(Amounts in
Thousands)
-----------
<S> <C>
Individual consumer:
Gross interest income that would have accrued $ 58
Interest income that was accrued 29
Commercial and financial:
Gross interest income that would have accrued 349
Interest income that was accrued 143
Real estate-mortgage:
Gross interest income that would have accrued 358
Interest income that was accrued 88
Agriculture:
Gross interest income that would have accrued 251
Interest income that was accrued 140
Real estate-construction:
Gross interest income that would have accrued 12
Interest income that was accrued 6
Lease financing:
Gross interest income that would have accrued 33
Interest income that was accrued --
Other:
Gross interest income that would have accrued 33
Interest income that was accrued --
</TABLE>
1.c. Policy for Placing Loans on Non-Accrual Status:
It is the Company's policy for a committee of senior loan officers to review
all loans in excess of 90 days past due for placement on non-accrual status. If
there is sufficient evidence to indicate that the borrower may be unable to meet
the obligation, the loan is placed on non-accrual status. Loans may be placed on
non-accrual status prior to reaching 90 days past due if circumstances warrant.
2. Potential Problem Loans for the Year Ended December 31, 1995 (1):
<TABLE>
<CAPTION>
(Amounts in
Thousands)
-----------
<S> <C>
Individual consumer $ 624
Commercial and financial 12,097
Real estate-mortgage 9,315
Agriculture 8,499
Real estate-construction 640
Lease financing 82
Other --
</TABLE>
(1) Potential problem loans include all loans that are classified by
management as substandard and doubtful less non-accrual, past due 90 days and
renegotiated troubled debt.
3. Foreign Outstandings: None
4. Loan Concentrations: There were no concentrations of loans exceeding 10%
of total loans which are not otherwise disclosed as a category of loans under
III.A.
13
<PAGE>
SCHEDULE III. D. - OTHER INTEREST BEARING ASSETS
There were no other interest bearing assets that would require disclosure
under Item III.C.1. or 2., if such assets were loans.
SCHEDULE IV. - SUMMARY OF LOAN LOSS EXPERIENCE
The following table summarizes activity in the allowance for loan losses of the
Company:
<TABLE>
<CAPTION>
For the year ended December 31,
1995 1994 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------
(Amounts in Thousands Except Percents)
<S> <C> <C> <C> <C> <C>
Average amount of loans
outstanding $4,267,290 $3,403,324 $2,706,475 $2,323,610 $1,960,654
Allowance for loan losses:
Balance, beginning of year 55,265 49,589 41,298 35,819 30,907
Opening balance of acquired banks 1,568 189 4,565 -- 1,145
Provision charged to operations (1) 102,767 71,698 67,083 64,467 60,745
Loans charged off:
Individual consumer 107,370 80,933 73,456 69,906 64,332
Commercial and financial 922 694 62 399 1,073
Real estate-mortgage 96 159 2,107 99 535
Agriculture 302 148 498 187 83
Real estate-construction -- -- -- -- --
Lease financing 67 41 150 216 58
Other -- 17 -- 48 540
Loans recovered:
Individual consumer 16,250 15,295 12,626 11,288 8,748
Commercial and financial 317 205 86 273 49
Real estate-mortgage 52 91 66 65 20
Agriculture 176 83 43 81 57
Real estate-construction 5 2 -- -- --
Lease financing 42 81 70 85 38
Other 55 24 25 75 731
- ---------------------------------------------------------------------------------------------------------------
Net loans charged off 91,860 66,211 63,357 58,988 56,978
- ---------------------------------------------------------------------------------------------------------------
Balance, end of year $ 67,740 $ 55,265 $ 49,589 $ 41,298 $ 35,819
===============================================================================================================
Ratio of net charge-offs to
average loans outstanding 2.15% 1.95% 2.34% 2.54% 2.91%
===============================================================================================================
</TABLE>
(1) Refer to provision for loan losses comment on Schedule IV (Continued).
14
<PAGE>
SCHEDULE IV. - SUMMARY OF LOAN LOSS EXPERIENCE (Continued)
The following table presents the loan loss allowance by loan category and the
percentage of loans in each category to loans, net of unearned income, as of
December 31 for the years indicated:
<TABLE>
<CAPTION>
(Amounts in Thousands Except Percents)
1995 1994 1993 1992 1991
------------------- --------------------- -------------------- ------------------- ------------------
Percent Percent Percent Percent Percent
of Loans of Loans of Loans of Loans of Loans
in Each in Each in Each in Each in Each
Category Category Category Category Category
to Total Loan Loss to Total Loan Loss to Total Loan Loss to Total Loan Loss to Total Loan Loss
Loans Allowance Loans Allowance Loans Allowance Loans Allowance (1) Loans Allowance (1)
--------- --------- --------- --------- --------- --------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Individual consumer 65.2% $52,453 67.3% $38,897 65.1% $35,140 65.6% $29,281 65.3% $25,396
Commercial and financial 12.7% 6,143 12.4% 8,436 12.4% 6,399 12.6% 5,327 12.1% 4,620
Real estate-mortgage 11.7% 4,444 10.0% 3,182 11.5% 4,635 10.6% 3,841 10.6% 3,331
Agriculture 6.1% 3,156 6.3% 3,074 7.1% 2,507 7.2% 2,106 7.6% 1,827
Real estate-construction 3.0% 862 2.7% 1,009 2.3% 567 2.2% 454 2.2% 394
Lease financing 1.1% 389 1.2% 331 1.4% 302 1.6% 248 2.0% 215
Other 0.2% 293 0.1% 336 0.2% 39 0.2% 41 0.2% 36
- --------------------------------------------------------------------------------------------------------------------------------
Total 100.0% $67,740 100.0% $55,265 100.0% $49,589 100.0% $41,298 100.0% $35,819
================================================================================================================================
</TABLE>
(1) Certain reclassifications were made to prior years Schedule IV Summary of
Loan Loss Experience Loan Loss Allowance numbers to conform them to the revised
allocation method used in 1995, 1994 and 1993. These reclassifications more
accurately depict the Company's procedure in determining required reserves for
loan loss for each loan category and had no effect on net income or the total
loan loss allowance.
Provision for loan losses:
The loan loss provision charged to operations is based on certain factors which,
in management's judgment, deserve current recognition in estimating possible
loan losses. Some of these factors are: the amount of the valuation reserve in
relation to the total dollar value of loans outstanding; the relation to any
loans known to be doubtful as to collection; the ratio of average net
charge-offs to average loans outstanding for the most recent years; and the loan
loss experience of comparable banks in the surrounding geographical area.
15
<PAGE>
SCHEDULE V. - DEPOSITS
The following table shows the breakdown of average deposits of the Company for
years 1993 through 1995:
<TABLE>
<CAPTION>
For the year ended December 31,
1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------
(Amounts in Thousands Except Percents)
Amount Rate Amount Rate Amount Rate
<S> <C> <C> <C> <C> <C> <C>
Average non-interest bearing
demand deposits $ 510,920 0.0% $ 475,017 0.0% $ 417,163 0.0%
Average interest bearing demand deposits 464,244 2.3% 405,228 2.0% 576,945 2.4%
Average interest bearing savings deposits 635,504 4.1% 554,127 3.0% 207,224 2.5%
Average time deposits 3,163,902 6.2% 2,472,280 5.2% 1,979,244 5.2%
Average deposits of foreign banks -- -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
Average total deposits $4,774,570 $3,906,652 $3,180,576
====================================================================================================================
</TABLE>
The following table indicates the maturity of time certificates of deposit and
other time deposits issued in amouints of $100,000 or more as of December 31,
1995.
<TABLE>
<CAPTION>
(Amounts in Thousands)
- -----------------------------------------------------------------------------------------------------------------
Time CD's Other Time
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Three months or less $ 96,999 $3,415
Over three months through six months 82,821 --
Over six months through twelve months 93,182 500
Over twelve months 140,916 --
- -----------------------------------------------------------------------------------------------------------------
Total $413,918 $3,915
=================================================================================================================
</TABLE>
16
<PAGE>
SCHEDULE VI. - RETURN ON EQUITY AND ASSETS
The following table presents the return on average assets, the return on average
equity, the dividend payout ratio and the equity to assets ratio of the Company:
<TABLE>
<CAPTION>
For the year ended December 31,
1995 1994 1993
- -------------------------------------------------------------------------------------------
(Amounts in Thousands Except Percents and Per Share Data)
<S> <C> <C> <C>
Average total assets $5,671,397 $4,559,433 $3,718,371
Average equity $ 395,173 $ 320,152 $ 261,499
Net income $ 82,241 $ 77,133 $ 70,082
Net income per share $ 237.17 $ 222.43 $ 202.10
Dividends per share $ 33.73 $ 38.07 $ 16.86
Return on average assets 1.5% 1.7% 1.9%
Return on average equity 20.8% 24.1% 26.8%
Dividend payout ratio 14.2% 17.1% 8.3%
Average equity to average assets ratio 7.0% 7.0% 7.0%
</TABLE>
SCHEDULE VII. - SHORT-TERM BORROWINGS
Transactions in short-term borrowings are summarized below:
<TABLE>
<CAPTION>
Federal Funds Purchased
and U.S. Treasury Notes (1) Commercial Paper (2)
----------------------------------- ----------------------------------
1995 1994 1993 1995 1994 1993
----------------------------------- ----------------------------------
(Amounts in Thousands Except Percents)
<S> <C> <C> <C> <C> <C> <C>
Amount outstanding at year-end $133,488 $ 99,363 $ 50,503 $289,827 $302,253 $165,332
Weighted average interest rate
at year-end 5.6% 5.0% 3.0% 5.6% 5.8% 3.2%
Maximum amount outstanding 133,488 130,081 102,388 302,828 302,253 175,938
Average amount outstanding 67,295 62,286 51,797 284,914 171,293 157,718
Weighted average interest rate
during the year 5.4% 3.7% 2.9% 6.5% 5.1% 4.0%
</TABLE>
(1) Federal funds purchased mature each day and are replaced by a new issue.
The U.S. Treasury notes are instruments payable to the U.S. Treasury upon
demand.
(2) As of December 31, 1995, all commercial paper matures within 57 days and
is collateralized by individual consumer loans.
17
<PAGE>
ITEM 2. PROPERTIES.
The Company owns a 22 story office building in Omaha, Nebraska where its primary
corporate offices are located. The Company's business is also operated at
various other facilities in the Omaha area which are either owned or leased by
the Company. The Company's banking business is operated in facilities located
in Nebraska, South Dakota, Kansas, and Colorado. Refer to Item 1., pages 2 and
3 for locations of the branches. Of the 44 branch locations, 26 are owned by
the Company and 18 are leased. The leases on the branches and office space (not
assuming renewals of exercise options) run through the year 2014.
For more explanation or detail, please see Notes D, E, and H to the consolidated
financial statements contained in the annual report to shareholders of the
Company, an exhibit to this report which is incorporated herein by reference.
ITEM 3. LEGAL PROCEEDINGS.
There are no pending legal proceedings, other than routine litigation incidental
to the Company's business, to which the Company is a party or of which any of
its properties is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of the Company's security holders during the
fourth quarter of 1995.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
Reference is made to page 26 of the annual report to shareholders of the Company
for the fiscal year ended December 31, 1995, an exhibit to this report which is
incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA.
Reference is made to page 26 of the annual report to shareholders of the Company
for the fiscal year ended December 31, 1995, an exhibit to this report which is
incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION.
Reference is made to pages 22-25 of the annual report to shareholders of the
Company for the fiscal year ended December 31, 1995, an exhibit to this report
which is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Reference is made to pages 4-21 and page 26 of the annual report to shareholders
of the Company for the fiscal year ended December 31, 1995, an exhibit to this
report which is incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE.
None.
18
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Reference is made to Item 1 of this report and to the section of the Company's
proxy statement captioned "Election of Directors" to be filed with the
Securities and Exchange Commission, which is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION.
Reference is made to the section of the Company's proxy statement captioned
"Compensation of Directors and Executive Officers" to be filed with the
Securities and Exchange Commission, which is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
Reference is made to the section of the Company's proxy statement captioned
"Security Ownership of Certain Beneficial Owners and Management" to be filed
with the Securities and Exchange Commission, which is incorporated herein by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Reference is made to the section of the Company's proxy statement captioned
"Information Concerning Certain Interests of Directors and Transactions with
Management" to be filed with the Securities and Exchange Commission, which is
incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
The following documents are filed as a part of this report and are either
attached hereto or incorporated by reference to documents previously filed with
the Securities and Exchange Commission as exhibits:
(a) (1) Financial Statements: (See Item 8 for a listing of all financial
statements).
(2) Financial Statement Schedules:
All schedules normally required by Form 10-K are omitted since they
either are not applicable or the required information is shown in the
financial statements or the notes thereto.
(3) Exhibits: See exhibit index on page 22.
(b) Report on Form 8-K for the quarter ended December 31, 1995:
On December 7, 1995, the registrant filed a Current Report on Form 8-K
reporting the issuance of $75 million of Subordinated Notes by the
Bank.
19
<PAGE>
(c) Exhibits to this Form 10-K are attached or incorporated by reference
as stated above.
(d) No financial statement schedules are filed, and as such are excluded
from the Annual Report as provided by Exchange Act Rule 14A-3(b)(i).
20
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
FIRST NATIONAL OF NEBRASKA, INC.
By /s/ Bruce R. Lauritzen
----------------------
Bruce R. Lauritzen
President and Treasurer, Principal Accounting
and Financial Officer and Director
Date: March 27, 1996
--------------
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
/s/ F. Phillips Giltner
-----------------------
F. Phillips Giltner
Chairman of the Board and Secretary
and Director
Date: March 19, 1996
--------------
/s/ Bruce R. Lauritzen
----------------------
Bruce R. Lauritzen
President and Treasurer, Principal Accounting
and Financial Officer and Director
Date: March 27, 1996
--------------
21
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
3(i) Articles of Incorporation of the
Parent Company. *
3(ii) Bylaws of the Parent Company. *
4 Fiscal and Paying Agency Agreement
entered into in connection with the
issuance of $75 million of
Subordinated Notes by
the Bank dated December 7, 1995
between the Bank as "Issuer" and the Bank
as "Fiscal and Paying Agent". *
10(a) Deferred Compensation and Consultative
Services Agreement between the Bank and
John R. Lauritzen and Amendment to Deferred
Compensation and Consultative Services
Agreement between the Bank and John R.
Lauritzen. *
10(b) Deferred Compensation and Consultative
Services Agreement between the Bank and
F. Phillips Giltner and Amendment to
Deferred Compensation and Consultative
Services Agreement between the Bank and
F. Phillips Giltner. *
10(c) First National of Nebraska Senior
Management Long Term Incentive Plan. *
10(d) Management Incentive Plan. *
10(e) Amended Split Dollar Agreement between the
Bank and John R. Lauritzen and
Elizabeth Davis Lauritzen and written
description of the amendment to the
Amended Split Dollar Agreement between the
Bank and John R. Lauritzen and
Elizabeth Davis Lauritzen. *
10(f) Amended Split Dollar Agreement between the
Bank, F. Phillips Giltner, and First
National Bank of Omaha, as Trustee of
the F. Phillips Giltner Irrevocable
Insurance Trust. *
10(g) Employment Contract between the Parent
Company and John R. Lauritzen. *
10(h) Employment Contract between the Parent
Company and F. Phillips Giltner. *
10(i) Employment Contract between the Parent
Company and Bruce R. Lauritzen. *
13 Annual report to shareholders of the
Company for the fiscal year ended
December 31, 1995 (incorporated by
reference).
21 Subsidiaries of the Corporation.
27 Financial Data Schedule.
* incorporated by reference (see Part
IV, Item 14(a)(3)).
</TABLE>
22
<PAGE>
EXHIBIT 21
SUBSIDIARIES OF FIRST NATIONAL OF NEBRASKA, INC.
STATE OR OTHER JURISDICTION OF
NAME INCORPORATION OR ORGANIZATION
<TABLE>
<CAPTION>
<S> <C> <C>
1. First National Bank of Omaha United States (pursuant to
the National Bank Act)
2. First National Credit Corporation Nebraska
3. First National Bank South Dakota United States (pursuant to
the National Bank Act)
4. MCV Acceptance Corporation Nebraska
5. Credit Card Finance Corporation Nebraska
6. Data Management Products, Inc. Nebraska
7. First National Bank and Trust Company United States (pursuant to
of Columbus the National Bank Act)
8. First National Bank (doing business as United States (pursuant to
First National Bank of Alliance- the National Bank Act)
Chadron-Gering-North Platte-Scottsbluff)
9. Collection Corporation of America Nebraska
10. Platte Valley State Bank & Trust Company Nebraska (state-chartered
bank)
11. The Fremont National Bank United States (pursuant to
and Trust Company the National Bank Act)
12. First National Services Corporation Nebraska
13. First National Bank of Kansas United States (pursuant to
the National Bank Act)
14. First National of Colorado, Inc. Delaware
15. Platte Valley Finance Company Nebraska
16. Premier Payment Processing, Inc. Nebraska
17. First Technology Solutions, Inc. Nebraska
</TABLE>
<PAGE>
EXHIBIT 21 (CONTINUED)
SUBSIDIARIES OF FIRST NATIONAL BANK OF OMAHA
STATE OR OTHER JURISDICTION OF
NAME INCORPORATION OR ORGANIZATION
<TABLE>
<CAPTION>
<S> <C> <C>
1. First Security Savings Company Nebraska
2. First of Omaha Service Corporation Nebraska
3. EFC, Inc. Nebraska
4. SPC, Inc. Nebraska
5. RPSI, Inc. Nebraska
6. FIS, Inc. Nebraska
</TABLE>
SUBSIDIARIES OF FIRST NATIONAL OF COLORADO, INC.
<TABLE>
<CAPTION>
STATE OR OTHER JURISDICTION OF
NAME INCORPORATION OR ORGANIZATION
<S> <C> <C>
1. First National Bank United States (pursuant to the
National Bank Act)
2. Union Colony Bank Colorado (state-chartered bank)
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 309,405
<INT-BEARING-DEPOSITS> 4,458,043
<FED-FUNDS-SOLD> 309,231
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 846,737
<INVESTMENTS-MARKET> 854,473
<LOANS> 4,451,120
<ALLOWANCE> 67,740
<TOTAL-ASSETS> 6,110,542
<DEPOSITS> 5,089,880
<SHORT-TERM> 0
<LIABILITIES-OTHER> 58,300
<LONG-TERM> 109,216<F1>
<COMMON> 1,734
0
0
<OTHER-SE> 428,097
<TOTAL-LIABILITIES-AND-EQUITY> 6,110,542
<INTEREST-LOAN> 634,157
<INTEREST-INVEST> 46,928
<INTEREST-OTHER> 10,298
<INTEREST-TOTAL> 691,383
<INTEREST-DEPOSIT> 234,694
<INTEREST-EXPENSE> 264,460
<INTEREST-INCOME-NET> 426,923
<LOAN-LOSSES> 102,767
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 331,495
<INCOME-PRETAX> 130,091
<INCOME-PRE-EXTRAORDINARY> 82,241
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 82,241
<EPS-PRIMARY> 237.17
<EPS-DILUTED> 237.17
<YIELD-ACTUAL> 13.21
<LOANS-NON> 8,619
<LOANS-PAST> 46,326
<LOANS-TROUBLED> 1,527
<LOANS-PROBLEM> 31,257
<ALLOWANCE-OPEN> 55,265
<CHARGE-OFFS> 108,757
<RECOVERIES> 16,897
<ALLOWANCE-CLOSE> 67,740
<ALLOWANCE-DOMESTIC> 67,740
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
<FN>
<F1> Includes 100,779 in capital notes.
</FN>
</TABLE>
