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 June 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.
July 3, 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
June 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............................ 12
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
June 30, 1998
American Bancorporation and Subsidiaries
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET
June 30, December 31,
1998 1997 1997
<S> <C> <C> <C>
---------------- --------------- -------------
ASSETS
Cash and due from banks........................................... $ 13,568,912 $ 12,905,782 $ 11,027,692
Interest bearing deposits in other banks....................... 145,488 - -
Federal funds sold.............................................. 16,050,025 904,417 2,414,812
Investment securities available for sale.......................... 214,865,641 157,152,101 169,175,987
Loans, net of unearned income.................................... 289,814,672 280,247,511 286,691,051
Less allowance for loan losses............................... 3,179,566 3,555,330 3,284,338
--------------- --------------- ---------------
286,635,106 276,692,181 283,406,713
Premises and equipment - net.................................... 9,854,463 10,080,749 10,070,377
Accrued interest receivable..................................... 2,902,199 3,150,834 2,713,240
Excess of cost over net assets purchased....................... 1,801,202 2,136,678 1,968,940
Other assets................................................... 5,354,541 4,854,866 3,828,711
--------------- --------------- ---------------
TOTAL ASSETS.................................................. $551,177,577 $467,877,608 $484,606,472
============ ============ ============
LIABILITIES
Deposits
Non-interest bearing.......................................... $ 35,818,702 $ 33,923,814 $ 33,512,712
Interest bearing.............................................. 376,773,483 301,646,375 322,221,620
------------- ------------ ------------
TOTAL DEPOSITS............................................ 412,592,185 335,570,189 355,734,332
Short-term borrowings........................................... 84,096,093 93,166,616 87,574,152
Accrued interest payable...................................... 2,272,457 1,626,358 1,782,668
Other liabilities............................................. 4,391,546 5,124,757 4,396,674
Long-term debt.................................................. 12,668,179 930,835 1,424,800
------------- --------------- -------------
TOTAL LIABILITIES............................................ 516,020,460 436,418,755 450,912,626
STOCKHOLDERS' EQUITY
Preferred stock........................................ - - -
Common stock without par value, stated value $5,
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............................................. 16,676,372 13,354,283 14,965,228
Accumulated other comprehensive income,
net of income tax....................................... 354,578 (21,597) 602,451
---------------- ----------------- ----------------
TOTAL STOCKHOLDERS' EQUITY.................................. 35,157,117 31,458,853 33,693,846
-------------- -------------- --------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY................................. $551,177,577 $467,877,608 $484,606,472
============ ============ ============
</TABLE>
3
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
<TABLE>
<CAPTION>
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
Quarter ended June 30, Six Months ended June 30,
1998 1997 1998 1997
<S> <C> <C> <C> <C>
---------------- -------------- ---------------- -------------
INTEREST INCOME
Loans...................................................... $ 6,377,452 $ 6,131,933 $12,683,363 $12,106,887
Investment securities
Taxable interest income................................... 3,324,760 2,445,226 6,242,487 4,998,030
Non-taxable interest income............................. 23,243 23,153 46,014 47,354
-------------- -------------- --------------- ---------------
3,348,003 2,468,379 6,288,501 5,045,384
Short-term investments................................... 248,639 71,117 330,084 180,833
------------- -------------- -------------- --------------
Total interest income................................... 9,974,094 8,671,429 19,301,948 17,333,104
INTEREST EXPENSE
Deposits................................................... 4,321,546 3,179,451 8,164,638 6,121,188
Borrowed funds............................................ 1,442,842 1,194,459 2,664,278 2,611,169
------------ ------------ ------------- -------------
Total interest expense.................................. 5,764,388 4,373,910 10,828,916 8,732,357
------------ ------------ ------------ -------------
NET INTEREST INCOME.................................... 4,209,706 4,297,519 8,473,032 8,600,747
PROVISION FOR LOAN LOSSES................................. 60,000 - 120,000 -
--------------------------------- ----------------------------------
Net interest income after
provision for loan losses.............................. 4,149,706 4,297,519 8,353,032 8,600,747
OTHER INCOME
Service charges on deposit accounts....................... 172,922 185,895 339,902 373,246
Securities gains.......................................... 330,809 - 486,809 4,337
Net gains on sale of loans................................ 474,064 294,501 933,119 508,872
Insurance commissions................................... 23,282 25,617 43,430 48,997
Other income............................................. 193,403 196,407 387,634 356,368
------------- ------------- ------------- --------------
Total other income...................................... 1,194,480 702,420 2,190,894 1,291,820
OTHER EXPENSE
Salaries and employee benefits............................ 1,594,150 1,439,747 3,189,265 2,853,240
Occupancy and equipment expense........................... 617,496 610,645 1,198,451 1,197,377
Other expenses............................................ 1,374,983 1,222,144 2,590,689 2,476,041
------------ ------------ ------------- -------------
Total other expense..................................... 3,586,629 3,272,536 6,978,405 6,526,658
------------ ------------ ------------- -------------
INCOME BEFORE INCOME TAXES.................................. 1,757,557 1,727,403 3,565,521 3,365,909
PROVISION FOR INCOME TAXES................................ 470,556 641,961 1,025,013 1,250,465
------------- ------------- ------------- -------------
NET INCOME.................................................. $ 1,287,001 $ 1,085,442 $ 2,540,508 $ 2,115,444
=========== =========== ============ ============
Average Shares Outstanding............................. 3,129,674 3,129,674 3,129,674 3,129,674
BASIC EARNINGS PER SHARE........................... $ 0.41 $ 0.35 $ 0.81 $ 0.68
</TABLE>
4
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
<TABLE>
<CAPTION>
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF CASH FLOWS
Six months ended June 30,
1998 1997
<S> <C> <C>
------------- -------------
Operating Activities:
Net Income ................................................................ $ 2,540,508 $ 2,115,444
Adjustments to reconcile net income to net cash from operating activities:
Depreciation ............................................................... 418,804 389,888
Amortization of intangibles ................................................ 167,738 167,738
Net amortization of investment securities .................................. 376,701 138,400
Provision for loan losses .................................................. 120,000 -
Net loss on sale of investment securities .................................. (486,809) (4,337)
Net gain on sale of loans .................................................. (933,119) (508,872)
Change in assets and liabilities net of effects from the purchase of branch
assets:
Net increase in accrued interest receivable ................................ (188,959) (165,512)
Net increase in accrued interest payable ................................... 489,789 137,359
Net (increase) decrease in other assets .................................... (575,478) 1,165,646
Net increase in other liabilities .......................................... 169,509 297,749
Net decrease from other operating activities ............................... (184,441) (39,774)
------------- -------------
Net cash provided by operating activities ............................ 1,914,243 3,693,729
Investing Activities:
Investment securities available for sale:
Proceeds from maturities and repayments ................................ 70,163,289 6,494,608
Proceeds from sales .................................................... 5,886,214 44,062,484
Purchases .............................................................. (122,098,505) (64,864,425)
Net decrease in loans ..................................................... (2,415,275) (8,297,250)
Purchase of premises and equipment ........................................ (203,890) (739,757)
Proceeds from sale of premises and equipment .............................. 1,000 -
------------- ------------
Net cash used by investing activities ................................. (48,667,167) (23,344,340)
Financing Activities:
Net increase (decrease) in non-interest
bearing demand deposits ................................................ 2,305,990 (2,820,502)
Net increase (decrease) in interest bearing
demand and savings deposits ........................................... 201,300 (2,862,283)
Net increase in time deposits ............................................. 54,350,563 21,442,156
Net decrease in short-term borrowings ..................................... (3,478,059) (10,929,427)
Principal repayment of long-term debt ..................................... (2,406,621) (6,848)
Proceeds from issuance of long-term debt .................................. 12,884,091 -
Cash dividends paid ....................................................... (782,419) (782,419)
------------- -------------
Net cash provided by financing activities ............................ 63,074,845 4,040,677
------------- -------------
Net Increase (Decrease) in Cash and Cash Equivalents ....................... 16,321,921 (15,609,934)
Cash and Cash Equivalents Beginning Balance .................................. 13,442,504 29,420,133
------------- -------------
Cash and Cash Equivalents Ending Balance ..................................... $ 29,764,425 $ 13,810,199
============= =============
</TABLE>
5
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
Six months ended June 30, 1998 and 1997
1998 1997
------------ ------------
Balance at January 1, ..................... $ 33,693,846 $ 30,422,694
Net Income ............................... 2,540,508 2,115,444
Dividends declared ($0.265 per share 1998,
$0.25 per share 1997) ............... (829,364) (782,419)
Other comprehensive loss ................. (247,873) (296,866)
------------ ------------
Balance at June 30, ....................... $ 35,157,117 $ 31,458,853
============ ============
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
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
<TABLE>
<CAPTION>
Amounts included in comprehensive income are as follows for the quarter
ended June 30, 1998 and 1997 and the six months ended June 30, 1998 and 1997,
respectively:
Quarter ended Six months ended
June 30, June 30,
----------------------- ---------------------
1998 1997 1998 1997
----------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Net Income ..................................$ 1,287,001 $1,085,442 $2,540,508 $2,115,444
Other comprehensive income (loss), net of tax
Unrealized gains (losses) on securities:
Unrealized holding gain (loss)
arising during the period.............. (316,166) 714,164 (79,172) (45,490)
Reclassification adjustment for
gains included in net income............. (122,201) - (168,701) (251,376)
------------ ---------- ---------- -----------
Other comprehensive income (loss)............... (438,367) 714,164 (247,873) (296,866)
------------ ---------- ---------- -----------
Comprehensive income ........................$ 848,634 $1,799,606 $2,292,635 $1,818,578
============ ========== ========== ==========
</TABLE>
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 $2,541,000
or $0.81 basic earnings per share, for the six months ended June 30, 1998,
compared to net income of $2,115,000 or $0.68 basic earnings per share, for the
six months ended June 30, 1997. Return on average assets and return on average
equity were 0.97% and 14.61%, respectively, for the six months ended June 30,
1998 compared to 0.92% and 13.77%, respectively, for the six months ended June
30, 1997.
Total assets at June 30, 1998 increased to $551,178,000, from $467,878,000
at June 30, 1997, an increase of 17.8%. Deposits increased to $412,592,000 at
June 30, 1998, from $335,570,000 at June 30, 1997, an increase of 23.0%. Total
stockholders' equity was $35,157,000 at June 30, 1998, which represents an 11.8%
increase over total stockholders' equity of $31,459,000 at June 30, 1997.
7
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
RESULTS OF OPERATIONS
SIX MONTH COMPARISON
Net Income. Net income for the six months ended June 30, 1998 amounted to
$2,541,000, or $0.81 basic earnings per share, compared to net income of
$2,115,000 or $0.68 basic earnings per share, for the six months ended June 30,
1997. The increase was the result of an increase in other income which was
partially offset by increases in other expenses 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 six months ended June 30, 1998 amounted to $8,473,000, a decrease of
$128,000 or 1.5%, compared to the six months ended June 30, 1997. The decrease
resulted primarily from a 57 basis point decrease in the Company's margin which
was partially offset by a $64,481,000 or 14.9% increase in average interest
earning assets.
Total interest income for the six months ended June 30, 1998 amounted to
$19,302,000 an increase of $1,969,000 or 11.4%, compared to the six months ended
June 30, 1997. The increase resulted primarily from the increase in the average
interest earning assets which was partially offset by a 24 basis point decrease
in the average yield on earning assets. Average loans outstanding increased
$11,111,000 or 4.0% with average commercial loans increasing $5,506,000 or 6.1%,
average real estate loans increasing $3,854,000 or 2.8% and average consumer
installment loans increasing $1,751,000 or 3.6%, primarily due to increased
demand. The average yield on loans increased from 8.74% in 1997 to 8.80% in
1998. Average investment securities and other short-term investments outstanding
increased $53,370,000 or 34.4% while the average yield decreased from 6.75% in
1997 to 6.35% in 1998.
Total interest expense for the six months ended June 30, 1998 amounted to
$10,829,000, an increase of $2,097,000 or 24.0% , compared to the six months
ended June 30, 1997. The increase resulted primarily from a $58,541,000 or 15.0%
increase in the average volume of interest bearing liabilities and a 36 basis
point increase in interest rates paid on such liabilities. Average NOW, money
market and savings accounts decreased $5,032,000 or 4.0%. Average time deposits
increased $63,701,000 or 37.7%, primarily the result of increased marketing
efforts. Average noninterest bearing accounts increased $400,000 or 1.2% and
represented 8.7% of average total deposits for the six months ended June 30,
1998. Average short-term borrowings decreased $6,507,000 or 6.8% , while the
average rate paid on short-term borrowings increased from 5.38% in 1997 to 5.40%
in 1998.
Provision for Loan Losses. The loan loss provision for the six months ended
June 30, 1998 was $120,000. There was no loan loss provision for the six months
ended June 30, 1997.
Other Income. Other income for the six months ended June 30, 1998 amounted
to $2,191,000, an increase of $899,000 or 69.6%. Net gains on sale of loans
increased $424,000 or 83.4%, the result of increased residential mortgage loans
generated for sale to secondary markets by the Company's mortgage banking
operations. Net gain on sale of investment securities totalled $487,000 in 1998,
compared to $4,000 in 1997.
8
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
Other Expense. Total other expense for the six months ended June 30, 1998
amounted to $6,978,000, an increase of $452,000 or 6.9%, compared to the six
months ended June 30, 1997. Salaries and employee benefits increased $336,000 or
11.8%. Occupancy and equipment expense were virtually unchanged. Other
(miscellaneous) expenses increased $115,000 or 4.6%.
Provision for Income Taxes. The provision for income taxes for the six
months ended June 30, 1998 was $1,025,000, compared to $1,250,000 for the six
months ended June 30, 1997.
RESULTS OF OPERATIONS
QUARTER COMPARISON
Net Income. Net income for the quarter ended June 30, 1998 amounted to
$1,287,000, compared to net income of $1,085,000 for the quarter ended June 30,
1997. The increase was the result of an increase in other income which was
partially offset by increases in other expenses 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 June 30, 1998 amounted to $4,210,000, a decrease of
$88,000 or 2.0%, compared to the quarter ended June 30, 1997. The decrease
resulted primarily from a 76 basis point decrease in the Company's margin which
was partially offset by a $89,397,000 or 20.8% increase in average interest
earning assets.
Total interest income for the quarter ended June 30, 1998 amounted to
$9,974,000, an increase of $1,303,000 or 15.0% , compared to the same period in
1997. The increase resulted primarily from the increase in the average volume of
earning assets which was partially offset by a 39 basis point decrease in the
average yield on earning assets. Average loans outstanding increased $11,900,000
or 4.3%. Average commercial loans increased $6,945,000 or 7.7%, average consumer
installment loans increased $2,959,000 or 6.3% and average real estate loans
increased $1,997,000 or 1.4%. The average yield on loans decreased from 8.83% in
1997 to 8.81% in 1998. Average investment securities and other short-term
investments outstanding increased $77,497,000 or 50.8% and the average yield
decreased from 6.66% in 1997 to 6.25% in 1998.
Total interest expense for the quarter ended June 30, 1998 amounted to
$5,764,000, an increase of $1,390,000 or 31.8%, compared to the quarter ended
June 30, 1997. The increase resulted primarily from an $84,482,000 or 21.8%
increase in the average volume of interest bearing liabilities and a 37 basis
point increase in interest rates paid on such liabilities.
Provision for Loan Losses. The loan loss provision for the quarter ended
June 30, 1998 was $60,000. There was no loan loss provision for the quarter
ended June 30, 1997.
Other Income. Other income amounted to $1,194,000 for the quarter ended
June 30, 1998, compared to $702,000 for the quarter ended June 30, 1997. Net
gains on sale of loans increased $180,000 or 61.0%. Net gain on sale of
investment securities totalled $331,000 for the quarter ended June 30, 1998.
There was no gain on the sale of investment securities for the same period in
1997.
9
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
Other Expense. Total other expense for the quarter ended June 30, 1998
amounted to $3,587,000, an increase of $314,000 or 9.6%, compared to the same
period in 1997. Salaries and employee benefits increased $154,000 or 10.7%.
Occupancy and equipment expense increased $7,000 or 1.1%. Other (miscellaneous)
expenses increased $153,000 or 12.5%.
Provision for Income Taxes. The provision for income taxes for the
quarter ended June 30, 1998 was $471,000, compared to $642,000 for the quarter
ended June 30, 1997.
ASSET QUALITY
Nonperforming loans totalled $2,734,000 or 0.9% of total loans at June 30,
1998, compared to $2,658,000 or 0.9% at December 31, 1997. Nonperforming loans
at June 30, 1998 consisted of nonaccrual loans totalling $822,000, 90 day
delinquent loans of $1,366,000, and restructured loans aggregating $546,000.
Other real estate held totalled $421,000 at June 30, 1998, compared to $236,000
at December 31, 1997.
CAPITAL RESOURCES
Stockholders' equity totalled $35,157,000 at June 30, 1998. The Company's
risk-based capital ratio was 17.0%, of which 15.6% constituted Tier 1 capital,
while the risk-based capital ratio for the Company's bank subsidiary, Wheeling
National Bank, was 14.4%, with Tier 1 capital of 13.2%. At June 30, 1998 the
Company's leverage capital ratio was 8.2%, while the leverage ratio for Wheeling
National Bank was 7.2%.
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
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
1998 1997 1998 1997
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)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Loans
Commercial................................ $ 96,817 9.28% $ 89,872 9.33% $ 96,012 9.19% $ 90,506 9.12%
Real estate............................... 142,859 8.28 140,862 8.06 142,384 8.30 138,530 8.03
Installment-net.......................... 50,025 8.44 47,067 8.82 49,753 8.43 48,002 8.84
---------- ---------- ---------- ----------
Total loans ........................... 289,701 8.81 277,801 8.83 288,149 8.80 277,038 8.74
Investment securities
Taxable................................... 214,007 6.21 149,391 6.55 197,626 6.32 150,484 6.64
Tax-exempt............................... 1,143 8.13 1,119 8.28 1,116 8.25 1,149 8.25
----------- ----------- ----------- -----------
Total investment securities ........... 215,150 6.22 150,510 6.56 198,742 6.33 151,633 6.65
Other short-term investments.............. 14,974 6.64 2,117 13.43 9,591 6.88 3,330 10.86
---------- ----------- ----------- -----------
Total interest earning assets............. $519,825 7.67 $430,428 8.06 $496,482 7.78 $432,001 8.02
======== ======== ======== ========
INTEREST BEARING LIABILITIES
Deposits
NOW, Savings and MMDA..................... $121,565 2.70% $125,943 2.65% $120,847 2.67% $125,879 2.64%
Time...................................... 246,101 5.69 173,880 5.39 232,449 5.64 168,748 5.29
--------- --------- --------- ---------
Total deposits........................... 367,666 4.70 299,823 4.24 353,296 4.62 294,627 4.16
Short-term borrowings..................... 92,475 5.35 87,573 5.36 89,121 5.40 95,628 5.38
Long-term debt............................ 12,669 6.51 932 8.79 7,312 7.00 933 8.38
---------- ------------ ----------- ------------
Total interest
bearing liabilities................... $472,810 4.88 $388,328 4.51 $449,729 4.82 $391,188 4.46
======== ======== ======== ========
MARGIN ANALYSIS
(as a % of earning assets)
Interest income.................... 7.67% 8.06% 7.78% 8.02%
Interest expense.................... 4.43 4.06 4.37 4.04
---- ---- ---- ----
Net interest income................ 3.24% 4.00% 3.41% 3.98%
==== ==== ==== ====
<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
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AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 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 4. Submission of Matters to a Vote of Securities Holders
The Annual Meeting of Shareholders was held May 20, 1998. Proxies
were solicited pursuant to Regulation 14 of the 1934 Act. Shares represented in
person or by proxy totalled 1,379,493 or 44.08% of the shares then outstanding.
Shareholders approved by affirmative vote the following proposals:
1. To fix the number of positions for director at 9, with 3
vacancies that may be filled by the Board of Directors:
Vote For: 1,367,532 Against: 9,900 Abstain: 2,061
2. To elect Jack O. Cartner and Paul W. Donahie directors for
a three year term and to elect Abigail McCamic Feinknopf
director for a one year term.
Vote For Vote Withheld Abstain
Jack O. Cartner 1,371,557 7,936 0
Paul W. Donahie 1,371,573 7,920 0
Abigail M. Feinknopf 1,371,245 8,248 0
Continuing in the position of director were the following:
Term Expiring
Jay T. McCamic 1999
Jeremy C. McCamic 2000
Jolyon W. McCamic 2000
Item 6. Exhibits and Reports on Form 8-K
B. Reports on Form 8-K:
Date Item Description
None
12
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1998
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 /s/ Jeremy C. McCamic
Jeremy C. McCamic
Chairman and
Chief Executive Officer
Date /s/ Brent E. Richmond
Brent E. Richmond
Chief Financial and
Accounting Officer
13
<PAGE>
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