FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934.
For the period ended September 30, 1998
------------------------------------------------------------
Commission File Number: 0-5893
American Bancorporation
(Exact name of registrant as specified in its charter)
Ohio 31-0724349
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1025 Main Street, Suite 800, Wheeling, WV 26003
(Address of principal executive offices) (Zip Code)
(304) 233-5006
(Registrant's telephone number, including area code)
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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
October 2, 1998: 3,129,674 shares of Common stock without par value
Number of pages comprising
this report. . . . . . . . . 13
1
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
TABLE OF CONTENTS
Part I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Consolidated Balance Sheet................... 3
Condensed Consolidated Statement of Income............. 4
Condensed Consolidated Statement of
Cash Flows................................... 5
Condensed Consolidated Statement of
Changes in Stockholders' Equity.............. 6
Notes to the Financial Statements.......................... 6
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations................... 7
Item 3 Quantitative and Qualitative Disclosures about Market Risk. 12
Part II OTHER INFORMATION
Item 1 Legal Proceedings........................................ None
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......................... None
SIGNATURES 13
2
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
American Bancorporation and Subsidiaries
<TABLE>
CONSOLIDATED BALANCE SHEET
<S> <C> <C> <C>
September 30, December 31,
1998 1997 1997
--------------- --------------- --------------
ASSETS
Cash and due from banks......................................... $ 15,407,875 $ 11,105,723 $ 11,027,692
Interest bearing deposits in other banks.................... 274,004 - -
Federal funds sold........................................... 6,178,025 5,620,155 2,414,812
Investment securities available for sale....................... 226,533,508 153,456,761 169,175,987
Loans, net of unearned income.................................. 297,794,837 288,340,212 286,691,051
Less allowance for loan losses.............................. 3,090,281 3,392,785 3,284,338
--------------- --------------- ---------------
294,704,556 284,947,427 283,406,713
Premises and equipment - net................................. 9,758,214 10,184,488 10,070,377
Accrued interest receivable.................................. 3,198,708 3,633,538 2,713,240
Excess of cost over net assets purchased..................... 1,717,333 2,052,809 1,968,940
Other assets.................................................. 5,401,010 3,903,526 3,828,711
--------------- --------------- ---------------
TOTAL ASSETS................................................ $563,173,233 $474,904,427 $484,606,472
============ ============ ============
LIABILITIES
Deposits
Non-interest bearing........................................ $ 34,890,606 $ 34,145,567 $ 33,512,712
Interest bearing............................................ 382,499,946 309,735,355 322,221,620
------------- ------------ ------------
TOTAL DEPOSITS.......................................... 417,390,552 343,880,922 355,734,332
Short-term borrowings......................................... 88,921,787 90,092,198 87,574,152
Accrued interest payable.................................... 2,261,983 1,952,138 1,782,668
Other liabilities........................................... 5,484,053 5,222,991 4,396,674
Long-term debt............................................ 14,764 927,816 1,424,800
Guaranteed preferred beneficial interest in
subordinated debt.......................................... 12,650,000 - -
-------------------------------------------------------
TOTAL LIABILITIES.......................................... 526,723,139 442,076,065 450,912,626
STOCKHOLDERS' EQUITY
Preferred stock...................................... - - -
Common stock without par value, stated value
$2.50, authorized 6,500,000 shares, issued and
outstanding 3,129,674...................................... 7,824,185 7,824,185 7,824,185
Additional paid-in capital.................................. 10,301,982 10,301,982 10,301,982
Retained earnings........................................... 17,553,511 14,128,088 14,965,228
Accumulated other comprehensive income,
net of income tax.................................... 770,416 574,107 602,451
---------------- ---------------- ----------------
TOTAL STOCKHOLDERS' EQUITY................................. 36,450,094 32,828,362 33,693,846
-------------- -------------- --------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY............................... $563,173,233 $474,904,427 $484,606,472
============ ============ ============
</TABLE>
3
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
Quarter Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
-------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans................................................. $ 6,517,169 $ 6,335,266 $19,200,532 $18,442,153
Investment securities
Taxable interest income............................ 3,496,296 2,566,404 9,738,783 7,564,434
Non-taxable interest income....................... 89,346 21,624 135,360 68,978
-------------- -------------- --------------- ---------------
3.585,642 2,588,028 9,874,143 7,633,412
Other short-term investments....................... 259,443 83,603 589,527 264,436
------------- -------------- --------------- ---------------
Total interest income.............................. 10,362,254 9,006,897 29,664,202 26,340,001
INTEREST EXPENSE
Deposits............................................ 4,713,715 3,401,212 12,878,353 9,522,400
Borrowed funds....................................... 1,519,812 1,245,475 4,184,090 3,856,644
------------ ------------ --------------- ----------------
Total interest expense............................. 6,233,527 4,646,687 17,062,443 13,379,044
------------ ------------ --------------- ----------------
NET INTEREST INCOME............................. 4,128,727 4,360,210 12,601,759 12,960,957
PROVISION FOR LOAN LOSSES........................... 60,000 - 180,000 -
--------------------------------- --------------- ----------------
Net interest income after
provision for loan losses........................ 4,068,727 4,360,210 12,421,759 12,960,957
OTHER INCOME
Service charges on deposit accounts................. 190,551 190,571 530,453 563,817
Securities gains (losses).......................... 141,250 (44) 628,059 4,293
Net gains on sale of loans......................... 807,108 393,677 1,740,227 902,549
Insurance commissions............................. 21,483 22,882 64,913 71,879
Other income........................................ 234,910 163,108 622,544 519,476
------------- ------------- ---------------- -----------------
Total other income................................ 1,395,302 770,194 3,586,196 2,062,014
OTHER EXPENSE
Salaries and employee benefits....................... 1,675,214 1,475,122 4,864,479 4,328,362
Occupancy and equipment expense..................... 610,675 598,028 1,809,126 1,795,405
Other expenses....................................... 1,363,619 1,241,124 3,954,308 3,717,165
------------ ------------ ---------------- -----------------
Total other expense................................ 3,649,508 3,314,274 10,627,913 9,840,932
------------ ------------ ---------------- -----------------
INCOME BEFORE INCOME TAXES............................ 1,814,521 1,816,130 5,380,042 5,182,039
PROVISION FOR INCOME TAXES........................... 499,228 651,116 1,524,241 1,901,581
------------- ------------- ---------------- -----------------
NET INCOME............................................. $ 1,315,293 $ 1,165,014 $ 3,855,801 $ 3,280,458
============= ============= ================ ================
Average Shares Outstanding.......................... 3,129,674 3,129,674 3,129,674 3,129,674
BASIC EARNINGS PER SHARE ................. $ 0.42 $ 0.37 $ 1.23 $ 1.05
</TABLE>
4
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF CASH FLOWS
Nine months ended September 30,
1998 1997
------------- ----------
Operating Activities:
Net Income ......................................... $3,855,801 $3,280,458
Adjustments to reconcile net income to net cash from operating activities:
Depreciation ....................................... 640,173 615,892
Amortization of intangibles ........................ 251,607 251,607
Net amortization of premium on investment securities 545,424 218,836
Provision for loan losses .......................... 180,000 --
Net gain on sale of investment securities .......... (628,059) (4,293)
Net gain on sale of loans .......................... (1,740,227) (902,549)
Change in assets and liabilities net of effects from the purchase of branch
assets:
Net increase in accrued interest receivable ........... (485,468) (648,216)
Net increase in accrued interest payable .............. 479,315 463,139
Net (increase) decrease in other assets ............... (586,684) 1,679,464
Net increase in other liabilities ..................... 898,123 147,577
Net increase (decrease) from other operating activities (219,705) 249,017
---------- ----------
Net cash provided by operating activities ........ 3,190,300 5,350,932
Investing Activities:
Investment securities available for sale:
Proceeds from maturities and repayments 101,034,116 25,585,188
Proceeds from sales ................... 6,377,464 46,746,234
Purchases ............................. (164,376,191) (82,031,056)
Net increase in loans ...................... (9,737,616) (16,158,819)
Purchase of premises and equipment ......... (329,010) (1,069,500)
Proceeds from sale of premises and equipment 1,000 --
------------ -----------
Net cash used by investing activities .. (67,030,237) (26,927,953)
Financing Activities:
Net increase (decrease) in non-interest bearing
demand deposits....................... 1,377,894 (2,598,749)
Net decrease in interest bearing
demand and savings deposits........... (4,136,850) (9,291,309)
Net increase in time deposits............. 64,415,176 35,960,162
Net increase (decrease) in short-term borrowings 1,347,635 (14,003,845)
Principal repayment of long-term debt..... (2,410,037) (9,865)
Proceeds from issuance of long-term debt.. 12,884,091 -
Cash dividends paid....................... (1,220,572) (1,173,628)
-------------- ------------
Net cash provided by financing activities.. 72,257,337 8,882,766
-------------- ------------
Net Increase (Decrease) in Cash and Cash Equivalents 8,417,400 (12,694,255)
Cash and Cash Equivalents Beginning Balance...... $ 13,442,504 $ 29,420,133
------------- ------------
Cash and Cash Equivalents Ending Balance......... $ 21,859,904 $ 16,725,878
============= ============
5
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Nine months ended September 30, 1998 and 1997
1998 1997
--------------- ------------
Balance at January 1,................... $33,693,846 $30,422,694
Net Income............................. 3,855,801 3,280,458
Dividends declared ($.405 per share 1998,
$0.375 per share 1997)............ (1,267,518) (1,173,628)
Other comprehensive income............. 167,965 298,838
--------------- ------------
Balance at September 30,................ $36,450,094 $32,828,362
=============== ============
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The unaudited interim condensed consolidated financial statements reflect
all adjustments which, in the opinion of management, are necessary to a fair
presentation of the financial position and results of operations. All
adjustments are of a normal recurring nature. The notes to the financial
statements contained in the 1997 Annual Report to Stockholders should be read in
conjunction with these statements.
NOTE A - ADOPTION OF FINANCIAL ACCOUNTING STANDARDS
On January 1, 1998 the Company adopted Statement of Financial Accounting
Standards ("SFAS") No. 129, "Disclosure of Information about Capital Structure."
SFAS No. 129 summarizes previously issued disclosure guidance contained with
Accounting Principles Board ("APB") Opinion Nos. 10 and 15 as well as SFAS No.
47. There were no material changes to the Company's disclosures pursuant to the
adoption of SFAS No. 129.
On January 1, 1998 the Company adopted SFAS No. 130, "Reporting
Comprehensive Income". SFAS No. 130 established standards for reporting and
display of comprehensive income and its components in a full set of general
purpose financial statements. Comprehensive income is defined as "the change in
equity of a business enterprise during a period from transactions and other
events and circumstances from nonowner sources. It includes all changes in
equity during a period except those resulting from investments by owners and
distributions to owners." The comprehensive income and related cumulative equity
impact of comprehensive income items is required to be disclosed prominently as
part of the notes to the financial statements. Only the impact of unrealized
gains or losses on securities available for sale is disclosed as an additional
component of the Company's income under the requirements of SFAS No. 130.
6
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
Amounts included in comprehensive income are as follows for the quarter ended
September 30, 1998 and 1997 and the nine months ended September 30, 1998 and
1997, respectively:
Quarter ended Nine months ended
September 30, September 30,
------------------------ --------------------------
1998 1997 1998 1997
---------- ---------- ----------- -----------
Net Income .......... $ 1,315,293 $ 1,165,014 $ 3,855,801 $ 3,280,458
Other comprehensive income, net of tax
Unrealized gains on securities:
Unrealized holding gain
arising during the period 454,588 596,343 375,416 550,853
Reclassification adjustment for
gains included in
net income (38,750) (639) (207,451) (252,015)
---------- ----------- ----------- -----------
Other comprehensive income.. 415,838 595,704 167,965 298,838
---------- ----------- ----------- -----------
Comprehensive income .....$ 1,731,131 $ 1,760,718 $ 4,023,766 $ 3,579,296
=========== =========== =========== ===========
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
INTRODUCTION
The discussion and analysis, when read in conjunction with the consolidated
financial statements and accompanying notes, is designed to provide information
relevant to an assessment of financial performance and management's perception
of significant events.
The following is a discussion of significant factors influencing operating
performance and change in financial position during the interim periods
presented. The discussion should be read in connection with the 1997 Annual
Report and the financial statements appearing elsewhere herein.
SUMMARY
American Bancorporation (the "Company") recognized net income of $3,856,000
or $1.23 basic earnings per share for the nine months ended September 30, 1998,
compared to net income of $3,280,000 or $1.05 basic earnings per share for the
nine months ended September 30, 1997. Return on average assets and return on
average equity were 0.96% and 14.6%, respectively, for the nine months ended
September 30, 1998 compared to 0.94% and 14.0%, respectively, for the nine
months ended September 30, 1997.
Total assets at September 30, 1998 increased to $563,173,000, from
$474,904,000 at September 30, 1997, an increase of 18.6%. Deposits increased to
$417,391,000 at September 30, 1998, from $343,881,000 at September 30, 1997, an
increase of 21.4%. Total stockholders' equity was $36,450,000 at September 30,
1998, which represents an 11.0% increase over total stockholders' equity of
$32,828,000 at September 30, 1997.
7
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
RESULTS OF OPERATIONS
NINE MONTH COMPARISON
Net Income. Net income for the nine months ended September 30, 1997
amounted to $3,856,000, or $1.23 basic earnings per share, compared to
$3,280,000 or $1.05 basic earnings per share for the nine months ended September
30, 1997. The increase was the result of an increase in other noninterest income
which was partially offset by increases in other noninterest expense and
provision for loan losses and a decrease in net interest income.
Net Interest Income. Net interest income before provision for loan losses
for the nine months ended September 30, 1998 amounted to $12,602,000, a decrease
of $359,000 or 2.8%, compared to the nine months ended September 30, 1997. The
decrease resulted primarily from a 66 basis point decrease in the Company's
margin which was partially offset by a $72,089,000 or 16.6% increase in average
interest earning assets.
Total interest income for the nine months ended September 30, 1998 amounted
to $29,664,000, an increase of $3,324,000 or 12.6%, compared to the same period
in 1997. The increase resulted primarily from a $72,089,000 increase in the
average volume of earning assets offset by a 27 basis point decrease in the
average yield on earning assets. Average loans outstanding increased $10,893,000
or 3.9%. Average commercial loans increased $6,055,000 or 6.6%, average real
estate loans increased $2,585,000 or 1.8%, and average consumer installment
loans increased $2,253,000 or 4.7%. The average yield on loans increased from
8.80% in 1997 to 8.82% in 1998. Average investment securities and other
short-term investments outstanding increased $61,196,000 or 39.3%, while the
average yield decreased from 6.76% in 1997 to 6.43% in 1998.
Total interest expense for the nine months ended September 30, 1998
amounted to $17,062,000, an increase of $3,683,000 or 27.5% compared to the nine
months ended September 30, 1997. The increase resulted primarily from a
$67,291,000 or 17.1% increase in the average volume of interest bearing
liabilities and a 40 basis point increase in interest rates paid on such
liabilities. Average NOW, money market and savings accounts decreased
$5,165,000. Average time deposits increased $69,373,000. Average noninterest
bearing accounts increased $907,000 and represented 8.6% of average total
deposits in 1998. Average short-term borrowings decreased $5,082,000 or 5.5% and
the average rate paid on short-term borrowings increased from 5.46% in 1997 to
5.55% in 1998.
Provision for Loan Losses. The loan loss provision for the nine months
ended September 30, 1998 was $180,000. There was no loan loss provision for the
nine months ended September 30, 1997.
Other Income. Other income for the nine months ended September 30, 1998
amounted to $3,586,000, an increase of $1,524,000 or 73.9%. Net gains on sale of
loans totalled $1,740,000 for the nine months ended September 30, 1998,
including a $297,000 gain on the sale of the Company's credit card portfolio,
compared to net gains of $903,000 for the same period in 1997. The remainder of
the increase is primarily the result of increased residential mortgage loans
generated for sale to secondary markets by the Company. Net gains on sale of
investment securities totalled $628,000 in 1998 primarily the result of
liquidating a majority of the Company's SLMA preferred stock portfolio,
compared to $4,000 in 1997.
8
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
Other Expense. Total other expense for the nine months ended September 30,
1998 amounted to $10,628,000, an increase of $787,000 or 8.0%, compared to the
same period in 1997. Salaries and employee benefits increased $536,000 or 12.4%.
Occupancy and equipment expense increased $14,000 or 0.1%.
Other (miscellaneous) expenses increased $237,000 or 6.4%.
Provision for Income Taxes. The provision for income taxes for the nine
months ended September 30, 1998 was $1,524,000, compared to $1,902,000 for the
nine months ended September 30, 1997.
RESULTS OF OPERATIONS
QUARTER COMPARISON
Net Income. Net income for the quarter ended September 30, 1998 amounted to
$1,315,000, compared to net income of $1,165,000 for the quarter ended September
30, 1997. The increase was primarily the result of an increase in noninterest
income, which was partially offset by increases in other noninterest expense and
provision for loan losses and a decrease in net interest income.
Net Interest Income. Net interest income before provision for loan losses
for the quarter ended September 30, 1998 amounted to $4,129,000, a decrease of
$231,000 or 5.3%, compared to the quarter ended September 30, 1997. The decrease
resulted primarily from an 83 basis point decrease in the Company's margin which
was partially offset by an $87,307,000 or 19.8% increase in average interest
earning assets.
Total interest income for the quarter ended September 30, 1998 amounted to
$10,362,000, an increase of $1,355,000 or 15.0%, compared to the same period in
1997. The increase resulted primarily from an $87,307,000 or 19.8% increase in
the average volume of earning assets offset by a 32 basis point decrease in the
average yield on earning assets. Average loans outstanding increased $10,456,000
or 3.7%. Average commercial loans increased $7,155,000 or 7.7%, average
installment loans increased $3,255,000 or 6.8%, and average real estate loans
increased $46,000. The average yield on loans decreased from 8.91% in 1997 to
8.84% in 1998. Average investment securities and other short-term investments
outstanding increased $76,851,000 or 48.9%, while the average yield decreased
from 6.80% in 1997 to 6.57% in 1998.
Total interest expense for the quarter ended September 30, 1998 amounted
to $6,234,000, an increase of $1,587,000 or 34.1%, compared to the same period
in 1997. The increase resulted primarily from a $84,790,000 or 21.4% increase in
the average volume of interest bearing liabilities and a 50 basis point increase
in interest rates paid on such liabilities.
Provision for Loan Losses. The loan loss provision for the quarter ended
September 30, 1998 was $60,000. There was no loan loss provision for the quarter
ended September 30, 1997.
Other Income. Other income amounted to $1,395,000 for the quarter ended
September 30, 1998, compared to $770,000 for the quarter ended September 30,
1997. Net gains on sale of loans increased $413,000 or 105.0%, primarily the
result of sale of the Company's credit card portfolio. Net gain on sale of
investment securities totalled $141,000 for the quarter ended September 30,
1998.
9
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
Other Expense. Total other expense for the quarter ended September 30,
1998 amounted to $3,650,000, an increase of $335,000 or 10.1%, compared to the
same period in 1997. Salaries and employee benefits increased $200,000 or 13.6%.
Occupancy and equipment expense increased $13,000 or 2.1%.
Other (miscellaneous) expenses increased $122,000 or 9.9%.
Provision for Income Taxes. The provision for income taxes for the
quarter ended September 30, 1998 was $499,000, compared to $651,000 for the
quarter ended September 30, 1997.
ASSET QUALITY
Nonperforming loans totalled $2,862,000 or 1.0% of total loans at
September 30, 1998, compared to $2,658,000 or 0.9% at December 31, 1997.
Nonperforming loans at September 30, 1998 consisted of nonaccrual loans
totalling $1,215,000, 90 day delinquent loans of $1,165,000, and restructured
loans aggregating $482,000. Other real estate held totalled $456,000 at
September 30, 1998, compared to $236,000 at December 31, 1997.
CAPITAL RESOURCES
Stockholders' equity totalled $36,450,000 at September 30, 1998. The
Company's risk-based capital ratio was 17.4%, of which 16.1% constituted common
stockholder equity, while the risk-based capital ratio for the Company's bank
subsidiary, Wheeling National Bank, was 15.0%, with common stockholders' equity
of 13.9%. At September 30, 1998 the Company's leverage capital ratio was 8.2%,
while the leverage ratio for Wheeling National Bank was 7.1%.
YEAR 2000 COMPLIANCE
The Company is exposed to potential losses due to business interruption
or errors which could result if any of its computer systems are not modified to
ensure that dates beginning in January, 2000 are not misinterpreted by the
system as January, 1900. This is commonly referred to as the Year 2000 Problem
("Y2K"). A number of computer systems which are affected by Y2K are utilized by
the Company to operate its day-to-day business. Most of these systems use
software developed by and licensed from third party vendors, some of which have
been customized by the Company, while others have been developed internally.
Management has established a task force to identify all instances where
the Company is not currently Y2K compliant, and to ensure that those systems are
brought into compliance before the end of 1998. For software licensed from third
party vendors, software upgrades have either been received or are forthcoming
from those vendors. The Company has begun testing for Y2K compliance.
The Company has estimated that direct costs for Y2K compliance will not
be material.
Y2K problems which are inherent in the regional, national and global
banking and payments system are expected to be brought into compliance, but are
completely beyond the Company's control.
10
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
<TABLE>
<CAPTION>
Three months ended September 30, Nine months ended September 30,
1998 1997 1998 1997
<S> <C> <C> <C> <C> <C> <C> <C> <C>
--------------- ----------------- ---------------- --------------
Average Yield/ Average Yield/ Average Yield/ Average Yield/
Balance Rate Balance Rate Balance Rate Balance Rate
INTEREST EARNING ASSETS (000's) (000's) (000's) (000's)
Loans
Commercial................................ $ 99,533 9.31% $ 92,378 9.61% $ 97,185 9.23% $ 91,130 9.29%
Real estate............................... 144,038 8.22 143,992 8.14 142,936 8.28 140,351 8.07
Installment-net.......................... 51,241 8.47 47,986 8.81 50,249 8.44 47,996 8.83
----------- ---------- --------- ----------
Total loans ............................. 294,812 8.84 284,356 8.91 290,370 8.82 279,477 8.80
Investment securities
Taxable................................... 213,157 6.56 153,301 6.70 202,803 6.40 151,423 6.66
Tax-exempt............................... 10,096 3.54 1,028 8.41 4,109 4.39 1,109 8.30
----------- ----------- --------- -----------
Total investment securities.............. 223,253 6.42 154,329 6.71 206,912 6.36 152,532 6.67
Other short-term investments.............. 10,704 9.69 2,777 12.04 9,962 7.89 3,146 11.21
---------- --------- ---------- ----------
Total interest earning assets............ $528,769 7.84 $441,462 8.16 $507,244 7.80 $435,155 8.07
======== ======== ======== ========
INTEREST BEARING LIABILITIES
Deposits
NOW, Savings and MMDA..................... $117,373 2.80% $122,804 2.73% $119,689 2.71% $124,854 2.67%
Time..................................... 265,905 5.85 185,189 5.54 243,601 5.72 174,228 5.38
--------- ---------- -------- ----------
Total deposits.......................... 383,278 4.92 307,993 4.42 363,290 4.73 299,082 4.25
Short-term borrowings.................... 84,825 5.85 87,058 5.63 87,689 5.55 92,771 5.46
Long-term debt........................... 12,666 8.84 928 8.58 9,097 7.86 932 8.44
---------- ------------ -------- ----------
Total interest bearing liabilities....... $480,769 5.19 $395,979 4.69 $460,076 4.94 $392,785 4.54
======== ======== ======== ========
MARGIN ANALYSIS
(as a % of earning assets)
Interest income................... 7.84% 8.16% 7.80% 8.07%
Interest expense................... 4.72 4.21 4.49 4.10
---- ---- ---- ----
Net interest income............... 3.12% 3.95% 3.31% 3.97%
===== ==== ==== ====
<FN>
Averages stated are month end average balances. Installment loans are stated net
of unearned income. Average loans include nonaccrual loans. Yields do not
reflect tax equivalent adjustments.
</FN>
</TABLE>
11
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
September 30, 1998
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Quantitative and qualitative disclosures about market risk are
presented at December 31, 1997 in Item 7a. of the Company's Annual Report on
Form 10-K, filed with the SEC on March 31, 1998. Management believes there have
been no material changes in the Company's market risk since December 31, 1997.
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
B. Reports on Form 8-K:
Date Item Description
None
12
<PAGE>
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.
AMERICAN BANCORPORATION
(Registrant)
Date November 16, 1998 /s/ Jeremy C. McCamic
- - ---------------------- ---------------------
Jeremy C. McCamic
Chairman and
Chief Executive Officer
Date November 16, 1998 /s/ Brent E. Richmond
- - ----------------------- ---------------------
Brent E. Richmond
Chief Financial and
Accounting Officer
13
<PAGE>
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