<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1995
Commission file number 0-7818
INDEPENDENT BANK CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Michigan 38-2032782
- -------------------------------- ----------------------------------
(State or jurisdiction of (I.R.S. Employer Identification
Incorporation or Organization) Number)
230 West Main Street, P.O. Box 491, Ionia, Michigan 48846
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(616) 527-9450
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
NONE
- --------------------------------------------------------------------------------
Former name, address and fiscal year, if changed since last report.
Indicate by check mark whether the registrant (1) has filed all documents
and reports required to be filed by Sections 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such 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.
Class Outstanding at May 12, 1995
- -------------------------- ------------------------------
Common stock, par value $1 2,580,443
<PAGE> 2
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Page
Number(s)
---------
<S> <C> <C>
PART I - Financial Information
Item 1. Consolidated Statements of Financial Condition
March 31, 1995 and December 31, 1994 2
Consolidated Statements of Operations
Three-month periods ended March 31, 1995 and 1994 3
Consolidated Statements of Cash Flows
Three-month periods ended March 31, 1995 and 1994 4
Consolidated Statements of Shareholders' Equity
Three-month periods ended March 31, 1995 and 1994 5
Notes to Interim Consolidated Financial Statements
Three-month periods ended March 31, 1995 and 1994 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7-12
PART II - Other Information
Item 6. Exhibits & Reports on Form 8-K 13
</TABLE>
<PAGE> 3
Part I.
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Financial Condition
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
-------------- --------------
(unaudited)
-------------- --------------
<S> <C> <C>
Assets
Cash and Cash Equivalents
Cash and due from banks $ 19,656,000 $ 22,869,000
Federal funds sold 850,000
------------ ------------
Total Cash and Cash Equivalents 19,656,000 23,719,000
------------ ------------
Interest bearing deposits 200,000 200,000
Securities available for sale 51,119,000 52,756,000
Securities held to maturity (Fair value of $81,552,000 at March 80,516,000 80,954,000
31,1995; $80,683,000 at December 31, 1994)
Real estate mortgage loans held for sale 2,170,000 5,933,000
Loans
Commercial and agricultural 102,015,000 103,984,000
Real estate mortgage 180,242,000 166,794,000
Installment 69,402,000 65,947,000
------------ ------------
Total Loans 351,659,000 336,725,000
Allowance for loan losses (5,147,000) (5,054,000)
------------ ------------
Net Loans 346,512,000 331,671,000
Property and equipment, net 9,499,000 9,493,000
Accrued income 4,037,000 4,045,000
Other assets 8,596,000 7,440,000
------------ ------------
Total Assets $522,305,000 $516,211,000
============ ============
Liabilities and Shareholders' Equity
Deposits
Non-interest bearing $ 43,257,000 $ 48,641,000
Savings and NOW 236,090,000 227,137,000
Time 135,736,000 133,693,000
------------ ------------
Total Deposits 415,083,000 409,471,000
Federal funds purchased 23,000,000 13,900,000
Other borrowings 34,751,000 47,741,000
Accrued expenses and other liabilities 7,076,000 4,788,000
------------ ------------
Total Liabilities 479,910,000 475,900,000
------------ ------------
Shareholders' Equity
Common stock, $1.00 par value-14,000,000 shares authorized;
issued and outstanding: 2,594,843 shares at March 31, 1995
and 2,589,163 shares at December 31, 1994 2,595,000 2,589,000
Capital surplus 17,051,000 16,932,000
Retained earnings 23,845,000 22,910,000
Net unrealized loss on securities available for sale, net of
related tax effect (1,096,000) (2,120,000)
------------ ------------
Total Shareholders' Equity 42,395,000 40,311,000
------------ ------------
Total Liabilities and Shareholders' Equity $522,305,000 $516,211,000
============ ============
</TABLE>
See notes to interim consolidated financial statements.
2
<PAGE> 4
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
-------------- --------------
(unaudited)
-----------------------------
<S> <C> <C>
Interest Income
Interest and fees on loans $ 8,279,000 $ 6,759,000
Securities
Taxable 1,680,000 1,625,000
Tax-exempt 438,000 432,000
Federal funds sold 12,000 185,000
Other investments 3,000 17,000
----------- -----------
Total Interest Income 10,412,000 9,018,000
----------- -----------
Interest Expense
Deposits 2,956,000 2,992,000
Other borrowings 933,000 138,000
----------- -----------
Total Interest Expense 3,889,000 3,130,000
----------- -----------
Net Interest Income 6,523,000 5,888,000
Provision for loan losses 159,000 126,000
----------- -----------
Net Interest Income After Provision for Loan Losses 6,364,000 5,762,000
----------- -----------
Non-interest Income
Service charges on deposit accounts 462,000 447,000
Net gains (losses) on asset sales
Real estate mortgage loans 4,000 150,000
Securities (68,000) 196,000
Other income 317,000 291,000
----------- -----------
Total Non-interest Income 715,000 1,084,000
----------- -----------
Non-interest Expense
Salaries and employee benefits 2,705,000 2,714,000
Occupancy, net 366,000 383,000
Furniture and fixtures 306,000 303,000
Other expenses 1,541,000 1,584,000
----------- -----------
Total Non-interest Expense 4,918,000 4,984,000
----------- -----------
Income Before Federal Income Tax 2,161,000 1,862,000
Federal income tax expense 605,000 486,000
----------- -----------
Net Income $ 1,556,000 $ 1,376,000
=========== ===========
Net Income Per Common Share $ .60 $ .52
Dividends Per Common Share
Declared $ .24 $ .20
Paid .20 .15
</TABLE>
See notes to interim consolidated financial statements.
3
<PAGE> 5
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
Three months ended
March 31,
1995 1994
-------------- --------------
(unaudited)
-----------------------------
<S> <C> <C>
Net Income $ 1,556,000 $ 1,376,000
Adjustments to Reconcile Net Income
to Net Cash from Operating Activities
Proceeds from sales of loans held for sale 7,064,000 13,378,000
Disbursements for loans held for sale (3,297,000) (13,377,000)
Provision for loan losses 159,000 126,000
Deferred loan fees (96,000) (141,000)
Depreciation, amortization of intangible assets
and premiums and accretion of discounts on
investment securities and loans 591,000 142,000
Net (gains) losses on sales of securities 68,000 (196,000)
Net gains on sales of real estate mortgage loans (4,000) (150,000)
Net gains on sales of property and equipment (20,000)
(Increase) decrease in accrued income and other assets (1,214,000) 316,000
Increase in accrued expenses and other liabilities 2,003,000 974,000
------------ ------------
Total Adjustments 5,274,000 1,052,000
------------ ------------
Net Cash from Operating Activities 6,830,000 2,428,000
------------ ------------
Cash Flow from Investing Activities
Proceeds from sales of securities available for sale 3,055,000 9,002,000
Proceeds from maturities of securities held to maturity 1,140,000 3,820,000
Principal payments received on securities available for sale 46,000 73,000
Principal payments received on securities held to maturity 1,092,000 3,160,000
Purchases of securities available for sale (15,180,000)
Purchases of securities held to maturity (1,980,000) (5,221,000)
Portfolio loans made to customers net of principle payments received (14,904,000) 2,553,000
Capital expenditures (339,000) (291,000)
Proceeds from sales of property and equipment 14,000 30,000
------------ ------------
Net Cash from Investing Activities (11,876,000) (2,054,000)
------------ ------------
Cash Flow from Financing Activities
Net increase in total deposits 5,612,000 2,032,000
Net increase (decrease) in short-term borrowings (3,890,000) 1,630,000
Retirement of debt (250,000)
Dividends paid (515,000) (357,000)
Proceeds from issuance of common stock 16,000
Repurchase of common stock (240,000)
------------ ------------
Net Cash from Financing Activities 983,000 3,055,000
------------ ------------
Net Increase (Decrease) in Cash and Cash Equivalents (4,063,000) 3,429,000
Cash and Cash Equivalents at Beginning of Period 23,719,000 37,388,000
------------ ------------
Cash and Cash Equivalents at End of Period $ 19,656,000 $ 40,817,000
============ ============
Cash paid during the period for:
Interest 3,854,000 2,494,000
Income taxes
Loans transferred to other real estate 37,000 63,000
Transfer of investment securities to available for
sale classification 19,283,000
</TABLE>
See notes to interim consolidated financial statements.
4
<PAGE> 6
INDEPENDENT BANK CORPORATION AND SUBSIDIARIES
Consolidated Statements of Shareholders' Equity
<TABLE>
<CAPTION>
Three months ended
March 31,
1995 1994
-------------- --------------
(unaudited)
-----------------------------
<S> <C> <C>
Balance at beginning of period $40,311,000 $39,049,000
Net income 1,556,000 1,376,000
Cash dividends declared (622,000) (525,000)
Issuance of common stock 366,000 347,000
Repurchase of common stock (240,000)
Net change in unrealized loss on securities
available for sale, net of related tax effect 1,024,000 (702,000)
----------- -----------
Balance at end of period $42,395,000 $39,545,000
=========== ===========
</TABLE>
See notes to interim consolidated financial statements.
5
<PAGE> 7
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. In the opinion of management of the Registrant, the accompanying unaudited
consolidated financial statements contain all the adjustments (consisting only
of normal recurring accruals) necessary to present fairly the consolidated
financial condition of the Registrant as of March 31, 1995 and December 31,
1994, and the results of operations for the three-month periods ended March 31,
1995 and 1994.
2. Management's assessment of the allowance for loan losses is based on an
evaluation of the loan portfolio, recent loss experience, current economic
conditions and other pertinent factors. Loans on non-accrual status, past due
more than 90 days, or restructured amounted to $2,823,000 at March 31, 1995,
and $2,834,000 at December 31, 1994. (See Management's Discussion and Analysis
of Financial Condition and Results of Operations).
3. The provision for income taxes represents federal income tax expense
calculated using annualized rates on taxable income generated during the
respective periods.
4. The results of operations for the three-month period ended March 31, 1995,
are not necessarily indicative of the results to be expected for the full year.
6
<PAGE> 8
MANAGEMENT'S DISCUSSION & ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATION
This section presents Management's discussion and analysis of
financial condition and results of operation for the Registrant and its bank
subsidiaries (the "Banks"). Its purpose is to provide additional information
that may be necessary to assess the consolidated financial statements contained
elsewhere in this report. This section should be read in conjunction with the
Registrant's 1994 Annual Report on Form 10-K.
FINANCIAL CONDITION
SUMMARY
During the three months ended March 31, 1995, total loans ("Portfolio
Loans") increased to $351.7 million from $336.7 million at December 31, 1994.
Real estate mortgage loans account for approximately 90% of the $15 million
increase in Portfolio Loans. Increases in Portfolio Loans were funded by an
increase in total deposits and by decreases in cash and cash equivalents as
well as securities available for sale.
The $13.5 million increase in real estate mortgage loans is largely
the result of continuing consumer demand for adjustable-rate and balloon loans
and further reflects the ability of the Banks' to increase loan production in
the absence of significant refinancing activity. (See "Asset/liability
management".) In view of two recently established loan production offices and
the addition of experienced real estate mortgage loan originators, Management
anticipates further increases in real estate mortgage loan production.
The $5.6 million increase in total deposits may be attributed to the
seasonal cash management needs of municipalities served by the Banks.
Management intends to fund anticipated declines in such municipal deposits with
non deposit funds, including advances from the Federal Home Loan Bank. (See
"Liquidity and capital resources.")
ASSET QUALITY
The Registrant maintains a senior loan committee and provides certain
commercial and retail loan services to the Banks. The Registrant also provides
loan review and compliance services. The centralization of such administrative
services provides the requisite controls required by the Registrant's
decentralized management structure and also provides certain operating
efficiencies.
Total non-performing assets declined by $320,000 during the
three-month period to $3,895,000 at March 31, 1995. The decrease principally
reflects cash payments received on restructured loans. A portion of the
decrease in other real-estate as well as corresponding increases in non-accrual
loans and loans 90 days or more past due and still accruing interest is the
result of implementing Statement of Financial Accounting Standards No. 114
"Accounting by creditors for Impairment of a Loan". As a result of the
implementation of this standard, certain loans totaling
7
<PAGE> 9
$165,000 that had been identified as in-substance foreclosed and reported as
other real estate have been reclassified to the other non-performing asset
categories.
NON-PERFORMING ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
------------ ------------
<S> <C> <C>
Non-accrual loans $2,209,000 $2,052,000
Loans 90 days or more past due and
still accruing interest 349,000 254,000
Restructured loans 265,000 528,000
------------ ------------
Total non-performing loans 2,823,000 2,834,000
Other real estate 1,072,000 1,381,000
------------ ------------
Total non-performing assets $3,895,000 $4,215,000
------------ ------------
As a percent of total loans
Total non-performing loans 0.80% 0.84%
Total non-performing assets 1.11% 1.25%
Allowance for loan losses as a percent of
non-performing loans 182% 178%
</TABLE>
Impaired loans totaled approximately $1,700,000 at March 31, 1995.
These loans included non-performing loans from the above table, other than
homogeneous residential mortgage and installment loans, and an additional
$100,000 of commercial and agricultural loans seperately identified as
impaired. The average investment in impaired loans approximated $1,850,000
for the three month period ended March 31, 1995.
Interest income on impaired loans is accrued based on the principal
amounts outstanding. The accrual of interest is discontinued when an impaired
loan becomes 90 days past due and the borrower's capacity to repay the loan and
collateral values appear insufficient. Cash receipts received on impaired
loans on non-accrual status are generally applied to the principal balance.
Interest income recognized on impaired loans for the three month period ended
March 31, 1995 approximated $15,000.
Management's assessment of the allowance for loan losses is based on
the composition of the loan portfolio, an evaluation of specific credits,
historical loss experience, the level of non-performing loans and loans that
have been identified as impaired. Certain impaired loans with a balance of
$530,000 had specific reserves, calculated in accordance with SFAS #114, of
$160,000 at March 31, 1995.
8
<PAGE> 10
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
March 31, 1995 December 31, 1994
----------------------------- -----------------------------
Percent of Percent of
Allowance Loans to Allowance Loans to
Amount Total Loans Amount Total Loans
-------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Commercial and
agricultural $1,537,000 28.8% $1,655,000 30.3%
Real estate mortgage 167,000 51.6 177,000 50.4
Installment 464,000 19.6 474,000 19.3
Unallocated 2,979,000 2,748,000
-------------- ------------ ------------ ------------
Total $5,147,000 100.0% $5,054,000 100.0%
-------------- ------------ ------------ ------------
</TABLE>
The provision for loan losses totaled $159,000 during the three months
ended March 31, 1995, compared to $126,000 during the comparable period of 1994.
During those same periods, loans charged against the allowance, net of
recoveries, amounted to $66,000 and $91,000, respectively.
ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
Three months ended
March 31,
1995 1994
---------- ----------
<S> <C> <C>
Balance at beginning of period $5,054,000 $5,053,000
Additions (deduction)
Provision charged to operating expense 159,000 126,000
Recoveries credited to allowance 117,000 125,000
Loans charged against the allowance (183,000) (216,000)
---------- ----------
Balance at end of period $5,147,000 $5,088,000
---------- ----------
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
Management views the ability to profitably deploy its capital or
otherwise maintain financial leverage as a fundamental challenge. In addition
to the Banks' loan origination efforts, the Registrant's share repurchase plan,
implemented during 1994, and its dividend policies are integral components of
Management's capital management strategies.
The Banks' ability to generate Portfolio Loans currently exceeds the
ability to profitably generate core deposits within the markets served by the
branch networks. Accordingly, future increases in Portfolio Loans will likely
require that the Banks continue to utilize non deposit funding sources,
including advances from the Federal Home Loan Bank. (See "Asset/liability
management.")
9
<PAGE> 11
CAPITAL RATIOS
<TABLE>
<CAPTION>
March 31, 1995 December 31, 1994
---------------- -----------------
<S> <C> <C>
Equity capital 8.12% 7.81%
Tangible equity capital 7.72 7.40
Primary capital 9.01 8.70
Tangible primary capital 8.62 8.30
Risk-based capital 13.54 13.03
</TABLE>
Shareholders' equity totaled $42.4 million at March 31, 1995, compared
to $40.3 million at December 31, 1994. The $2.1 million increase reflects
earnings retention and a decrease in net unrealized losses on securities
available for sale.
Notwithstanding the increase in Portfolio Loans, shareholders' equity
increased to 8.12% of total assets at March 31, 1995, compared to 7.81% at
December 31, 1994. Excluding the impact of net unrealized losses on securities
available for sale, shareholders' equity increased to 8.30% of total assets
from 8.17%.
ASSET/LIABILITY MANAGEMENT
The Bank's competitive position within many of the markets served by
the branch networks limits the ability to materially increase deposits without
adversely impacting the weighted-average cost of core deposits. Accordingly,
the Banks have implemented strategies that utilize non deposit funding sources
and employ pricing tactics that are intended to enhance the value of core
deposits.
The Banks continue to sell the majority of fixed-rate real estate loan
production to mitigate exposure to changes in interest rates. Adjustable-rate
and balloon products, however, currently comprise a substantial portion of
demand for real estate loans. Although the retention of such rate-sensitive
loans is consistent with Management's desire to maintain profitable leverage,
the reduced volume of salable fixed-rate loans has had an adverse impact on
non-interest income. (See "Non-interest income".)
The Banks continue to maintain portfolios of U.S. Treasury notes that
are included in securities available for sale. During the three months ended
March 31, 1995, the Banks sold such securities with an aggregate market value
of $3,055,000 compared to $9,002,000 during the comparable period of 1994. The
decline in sales of securities available for sale reflects Management's
assessment of reinvestment opportunities and the Banks' asset/liability
management needs.
10
<PAGE> 12
RESULTS OF OPERATIONS
SUMMARY
Net income totaled $1,556,000 during the three months ended March 31,
1995. The 13% increase from $1,376,000 during the comparable period of 1994 is
the result of a $635,000 increase in net interest income that was partially
offset by a decline in non-interest income.
Key performance ratios for the three-month periods ended March 31,
1995 and 1994, are set forth below.
KEY PERFORMANCE RATIOS
<TABLE>
<CAPTION>
Three months
ended March 31,
1995 1994
---- ----
<S> <C> <C>
Return on
Average assets 1.23% 1.16%
Average equity 15.22 14.41
Earnings per common share $.60 $.52
</TABLE>
NET INTEREST INCOME
Net interest income totaled $6,523,000 during the three months ended
March 31, 1995. The 10.8% increase from $5,888,000 during the comparable
period of 1994 principally reflects an increase in average earning assets.
Average earning assets during those same periods were equal to $481,502,000 and
$444,089,000, respectively.
An increase in Portfolio Loans and loans held for sale as a percent of
average earning assets also had a positive impact on net interest income.
During the three months ended March 31, 1995 and 1994, Portfolio Loans and
loans held for sale were equal to 72.3% and 63.3% of average earning assets,
respectively.
Net interest income was equal to 5.69% of average earning assets
during the three-month period in 1995 compared to 5.58% during the comparable
period of 1994. In addition to the increase in Portfolio Loans and loans held
for sale, the implementation of new balance sheet and deposit pricing
strategies at the Registrant's newest affiliate, Independent Bank East
Michigan, also contributed to the increase.
Net interest income as a percent of average earning assets declined,
however, from 6.06% during the three months ended December 31, 1994.
Management believes that a major portion of the 37 basis point decline is
directly attributable to the implementation of balance sheet leverage
strategies.
11
<PAGE> 13
NON-INTEREST INCOME
Non-interest income totaled $715,000 during the three months ended
March 31, 1995. The $369,000 decline from $1,084,000 during the comparable
period in 1994 is attributed to net losses on asset sales. Service charges on
deposit accounts and other income for those same periods increased by $15,000
and $26,000, respectively.
Net gains on the sale of real estate mortgage loans totaled $4,000
during the three months ended March 31, 1995, compared to net gains of $150,000
during the comparable period of 1994. The decrease partially reflects current
consumer demand for adjustable-rate and balloon real estate mortgage loans and
the corresponding decline in salable, fixed-rate real estate mortgage loans.
The Banks realized net losses of $68,000 on the sale of securities
available for sale during the three-month period in 1995, compared to net gains
of $196,000 during the comparable period of 1994. Although future sales of
securities available for sale will be dependent upon the Banks' asset/liability
management needs and available reinvestment opportunities, Management
anticipates that the Banks will realize additional losses during the remaining
periods of 1995.
NON-INTEREST EXPENSE
Total non-interest expense declined to $4,918,000 during the three
months ended March 31, 1995, from $4,984,000 in 1994. The $66,000 decrease is
principally attributed to the consolidation in 1994 as well as subsequent
staffing reductions at Independent Bank East Michigan. Such efficiencies were,
however, partially offset by increases in real estate mortgage loan origination
commissions.
NET INTEREST INCOME AND SELECTED RATIOS
<TABLE>
<CAPTION>
Three months ended
March 31, 1995 March 31, 1994
-------------- --------------
<S> <C> <C>
Average earning assets (In thousands) $481,502 $444,089
As a percent of average earning assets
Tax equivalent interest income 8.97% 8.44%
Interest expense 3.28 2.86
Tax equivalent net interest income 5.69 5.58
Average earning assets as a
percent of average assets 93.97% 91.98%
Free-funds ratio 11.59 10.87
</TABLE>
12
<PAGE> 14
Item 6. Exhibits & Reports on Form 8-K
(a) Exhibit Number & Description
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
During the quarter ended March 31, 1995, there were no
reports filed on Form 8-K
13
<PAGE> 15
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.
Date May 12, 1995 By s/William R. Kohls
---------------------------- ----------------------------------------
William R. Kohls, Principal
Financial Officer
Date May 12, 1995 By s/James J. Twarozynski
---------------------------- ----------------------------------------
James J. Twarozynski, Principal
Accounting Officer
<PAGE> 16
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION PAGE NO.
- ----------- ----------- --------
EX-27 FINANCIAL DATA SCHEDULE
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 19,656
<INT-BEARING-DEPOSITS> 200
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 51,119
<INVESTMENTS-CARRYING> 80,516
<INVESTMENTS-MARKET> 81,552
<LOANS> 351,659
<ALLOWANCE> 5,147
<TOTAL-ASSETS> 522,305
<DEPOSITS> 415,083
<SHORT-TERM> 57,751
<LIABILITIES-OTHER> 7,076
<LONG-TERM> 0
<COMMON> 2,595
0
0
<OTHER-SE> 39,800
<TOTAL-LIABILITIES-AND-EQUITY> 522,305
<INTEREST-LOAN> 8,279
<INTEREST-INVEST> 2,118
<INTEREST-OTHER> 15
<INTEREST-TOTAL> 10,412
<INTEREST-DEPOSIT> 2,956
<INTEREST-EXPENSE> 3,889
<INTEREST-INCOME-NET> 6,523
<LOAN-LOSSES> 159
<SECURITIES-GAINS> (68)
<EXPENSE-OTHER> 4,918
<INCOME-PRETAX> 2,161
<INCOME-PRE-EXTRAORDINARY> 1,556
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,556
<EPS-PRIMARY> 0.60
<EPS-DILUTED> 0.60
<YIELD-ACTUAL> 5.69
<LOANS-NON> 2,209
<LOANS-PAST> 349
<LOANS-TROUBLED> 265
<LOANS-PROBLEM> 2,259
<ALLOWANCE-OPEN> 5,054
<CHARGE-OFFS> 183
<RECOVERIES> 117
<ALLOWANCE-CLOSE> 5,147
<ALLOWANCE-DOMESTIC> 2,168
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,979
</TABLE>
