UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 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
incorporation or organization (I.R.S. Employer Identification No.)
- -----------------------------------------------------------------------------
1025 Main Street, Suite 800, Wheeling, WV 26003
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area code (304) 233-5006
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g)
of the Act
Common Stock, without 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 filed such reports), and (2) has been subject to the
filing requirements for the past 90 days.
Yes x No
Indicate by check mark if disclosure to 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 ]
State the aggregate market value of the voting stock held by nonaffiliates of
the Registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock as of a specified date within 60 days prior to the date of filing.
$42,803,202 at February 26, 1999
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
3,129,674 shares of Common stock, without par value, at March 31, 1999
Number of pages Exhibit Index
comprising this located at
report . . 68 Page . . 15 & 17
- 1 -
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2
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
DOCUMENTS INCORPORATED BY REFERENCE
Certain of the items listed in the table below are included in the Annual
Report to Stockholders for the year ended December 31, 1998. With the exception
of the pages listed in the index and hereby incorporated by reference, the 1998
Annual Report to Stockholders is not to be deemed filed as part of this report.
The Registrant will file a Definitive Proxy Statement with the Securities
and Exchange Commission pursuant to Regulation 14A within 120 days after the
close of fiscal year 1998. Information contained therein is hereby incorporated
by reference as indicated in the table below.
CROSS REFERENCE INDEX AND TABLE OF CONTENTS
Page Reference
Form Annual Report Proxy
10-K to Shareholders Statement
Part I
Item 1 Business.........................3 - 12 IFC -
Item 2 Properties...........................13 - -
Item 3 Legal proceedings....................14 - -
Item 4 Submission of matters to a
vote of security holders......N/A
Part II
Item 5 Market for Registrants common stock and
related security holders matters... - IFC, IBC, 30 2 - 3, 11
Item 6 Selected financial data............... - 30 -
Item 7 Management's discussion and
analysis offinancial condition
and results of operations......... - 31 - 47 -
Item 7a. Quantitative and qualitative disclosures
about market risk....................- 44 - 45 -
Item 8 Financial statements and
supplementary data..................14 3 - 29 -
Item 9 Changes and disagreements with Accountants
on accounting and financial disclosures N/A
Part III
Item 10 Directors and executive officers
of the Registrant............... - - 4 - 7
Item 11 Executive compensation...................- - 8 - 10
Item 12 Security ownership of certain beneficial
owners and management............... - - 3
Item 13 Certain relationships and
related transactions............... - - 12
Part IV
Item 14 Exhibits, financial statement schedules
and reports on Form 8K.....14 - 15 - -
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3
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Part I
Item 1. Business
General
American Bancorporation (the "Registrant" of the "Company") is a bank
holding company, headquartered in Wheeling, West Virginia which through its
subsidiaries provides commercial and mortgage banking services to customers in
central and eastern Ohio and northern West Virginia. The Company's principal
subsidiary, Wheeling National Bank ("WNB" or the "Bank"), headquartered in St.
Clairsville, Ohio, is a full-service commercial bank operating through 20
offices. As of December 31, 1998, the Company had consolidated total assets of
$611.4 million, deposits of $431.2 million and stockholders' equity of $36.4
million.
The Company, registered under the Bank Holding Company Act of 1956, as
amended, ("BHCA"), was incorporated under the laws of the State of Ohio in 1966.
WNB, a national banking association organized in 1978, was acquired by the
Company in 1988. In 1996, the Company merged its other former banking
subsidiary, Columbus National Bank, into Wheeling National Bank, under the
charter of WNB.
Through WNB, the Company provides a full range of commercial banking
services to retail customers and small to medium-sized business in its market
area. In eastern Ohio and northern West Virginia the Company focuses on local
customer needs. In the Columbus, Ohio area, the company focuses its marketing
efforts on local businesses, whose needs are not being served effectively by
larger institutions.
The banking services the Company offers its customers include checking,
savings, time and money market accounts, personal, commercial, construction and
real estate loans, individual retirement accounts, safe deposit boxes, wire
transfers and debit cards, among other standard banking products and services.
In addition to its banking activities, the Company originates and services
mortgage loans through American Mortgages, Inc. ("AMI"), a wholly-owned
subsidiary. AMI owns 51% of Premier Mortgage, Ltd., located in Columbus, Ohio, a
joint-venture with H.E.R., Inc., a major Columbus, Ohio real estate broker,
which originates residential mortgage loans.
On April 27, 1998, American Bancorporation Capital Trust I (the "Trust"), a
wholly owned subsidiary of the Company, organized as a Delaware statutory
business trust, issued 1,265,000 shares of 8.5% cumulative trust preferred
shares at $10 per share. The net proceeds after expenses was $11,886,000 which
is considered Tier I capital. Certain of these proceeds have been and will be
invested in Wheeling National Bank. The trust has no independent operations and
the issued securities contain a full and unconditional guarantee of the Company.
The Company also operates three additional subsidiaries which provide data
processing services, real estate leasing and transfer agent services for the
company, the Bank and AMI.
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4
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Lending Activities
The Company's lending activities are diversified between commercial, real
estate and consumer type loans. At December 31, 1998 the Company's total loan
portfolio amounted to $300.6 million or 49.2% of total consolidated assets. At
December 31, 1998 real estate mortgage loans totalled $138.1 million, or 45.9%
of the loan portfolio, commercial loans totalled $113.6 million, or 39.8% of the
loan portfolio, and consumer installment loans totalled $48.9 million, or 16.3%
of the loan portfolio. Total loans increased by $13.9 million or 4.8% between
December 31, 1997 and December 31, 1998, as commercial loans increased $20.3
million or 21.8% and real estate mortgage loans decreased $6.1 million or 4.3%,
while consumer installment loans decreased $0.3 million or 0.5%.
Commercial Loans. The Company makes commercial loans, primarily to small and
medium-sized businesses and to professionals, which are not concentrated in any
single industry but reflect a broad range of businesses in central and eastern
Ohio and northern West Virginia. The Company offers a variety of commercial loan
products including term loans, lines of credit, working capital loans, loans to
finance accounts receivable, inventory, equipment and real estate.
Typically, commercial loans are personally guaranteed by the borrower-owner
and are secured by accounts receivables, inventory and/or fixed assets including
real estate and equipment. The credit risk associated with commercial lending is
principally influenced by general economic conditions and the resulting impact
on the borrower's operations, mitigated by collateral values and generally a
higher risk than single family residential loans.
Real Estate Loans. Real estate loans to consumers are secured primarily by a
first lien deed of trust. These loans are traditionally one-to-four family
residential mortgages, have fixed interest rates, and generally amortize over a
20 to 30 year period with balloon payments due at the end of three to five
years. Upon the expiration of each three to five year period, the Company may,
but is not obligated to, renew the loan at the then current market rate for an
additional three to five year period. These loans are limited generally to a
loan to value ratio of 80% or less of the property value. With very few
exceptions, the Company does not originate 30 year fixed rate real estate loans.
The Company also originates home equity lines of credit which are secured by
a first or second mortgage against the borrower's residence. The maximum
loan-to-value of the Company's home equity lines of credit, inclusive of all
other secured loans against a borrower's property, is 100%. The risks associated
with real estate lending are principally influenced by real property values
which are affected by the general economic conditions in each market area.
Consumer Loans. Consumer loans made by the Company include automobile loans,
recreational vehicle loans, boat loans, home improvement loans, and personal
loans (collateralized and uncollateralized). These loans are a smaller balance,
comparable group of loans which are not concentrated in a specific market area.
Risks in this lending category include the possibility of general economic
downturn which may cause an increase in credit losses.
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5
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Investment Activity
The investment policy of the Company provides that the Company should seek
to maximize earnings consistent with prudent asset/liability management,
liquidity and risk considerations. The Investment Committee is responsible for
managing the Company's investment portfolio.
At December 31, 1998 the entire investment portfolio is classified as
available for sale. The Company's investment portfolio is comprised primarily of
U. S. Treasury securities and obligations of U. S. Agencies. The Company will
only acquire municipal securities "A" rated or better.
Market Area
The primary market area for the Company is central and eastern Ohio and
northern West Virginia and consists of Franklin, Guernsey, Belmont, Harrison and
Jefferson counties in Ohio; Brooke, Hancock, Marshall and Wetzel counties in
West Virginia. The economy in eastern Ohio and northern West Virginia is
primarily dependent on the coal, steel and chemical industries. A preponderance
of the Company's commercial loans are generated in the Columbus, Ohio (Franklin
County) metropolitan area. This area has experienced significant economic
development and growth in recent years. Columbus enjoys a stable underlying
economy and low unemployment due to the presence of the State government, the
Ohio State University, the headquarters of many Fortune 500 companies, together
with the regional and national headquarters of a number of insurance and other
financial companies.
Competition
The Company competes not only with other locally owned commercial banks,
credit unions and savings institutions, but with larger regional financial
institutions in attracting deposits and in originating loans. In competing with
regional and national institutions, the Company emphasizes its asset as a local,
neighborhood bank to its customers.
The Company competes on the basis of rates of interest charged on loans, the
rates of interest paid on funds, the availability of services and responsiveness
to the needs of its customers. The Company pays interest on deposits and charges
interest rates and fees on loans which are competitive in the general areas
served.
Employees
The Company, its affiliate bank and non-banking subsidiaries employed 221
full-time equivalent employees at December 31, 1998. None of these employees are
represented by a collective bargaining agent, and the Company believes that it
enjoys good relations with its personnel.
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6
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Regulation of the Company
The following references to laws and regulations which are applicable to
the Company and its banking subsidiaries are brief summaries thereof which do
not purport to be complete and are qualified in their entirety by reference to
such laws and regulations.
BHCA - General
The Company, as a bank holding company, is subject to regulation and
supervision by the Federal Reserve Board. Under the BHCA, a bank holding company
is required to file annually with the Federal Reserve Board a report of its
operations and, with its subsidiaries, is subject to examination by the Federal
Reserve Board.
BHCA - Activities and Other Limitations.
The BHCA generally prohibits a bank holding company from acquiring
direct or indirect ownership or control of more than 5% of the voting shares of
any bank, or increasing such ownership or control of any bank, without prior
approval of the Federal Reserve Board. As a result of recent amendments to the
BHCA the Federal Reserve Board generally may approve an application by a bank
holding company that is adequately capitalized and adequately managed to acquire
control of or to acquire all or substantially all of the assets of, a bank
located in a state other than the home state of such bank holding company,
without regard to whether such transaction is prohibited under the law of any
state, provided, however, that the Federal Reserve Board may not approve any
such application that would have the effect of permitting an out-of-state bank
holding company to acquire a bank in a host state that has not been in existence
for any minimum period of time, not, to exceed five years specified in the
statutory law of the host state.
The BHCA also generally prohibits a bank holding company, with certain
exceptions, from acquiring more than 5% of the voting shares of any company that
is not a bank and from engaging in any business other than banking or managing
or controlling banks. Under the BHCA, the Federal Reserve Board is authorized to
approve the ownership of shares by a bank holding company in any company the
activities of which the Federal Reserve Board has determined to be so closely
related to banking or to managing or controlling banks as to be a proper
incident thereto. In making such determinations, the Federal Reserve Board is
required to weigh the expected benefit to the public, such as greater
convenience, increased competition or gains in efficiency, against the possible
adverse effects, such as undue concentration of resources, decreased or unfair
competition, conflicts of interest or unsound banking practices.
Capital Requirements.
For a description of the capital adequacy guidelines adopted by the
Federal Reserve Board to assess the adequacy of capital of bank holding
companies, see "Management's Discussion and Analysis of Financial Condition and
Results of Operations -Capital" included in Item 7 hereof and Note S to the
Consolidated Financial Statements in Item I hereof.
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7
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Affiliated Institutions.
Under Federal Reserve Board policy, the Company is expected to act as a
source of financial strength to each subsidiary bank and to commit resources to
support each subsidiary bank in circumstances when it might not do so absent
such policy. The Federal Reserve Board takes the position that in implementing
this policy it may require bank holding companies to provide such support when
the holding company otherwise would not consider itself able to do so.
A bank holding company is a legal entity separate and distinct from its
subsidiary bank. Normally, the major source of a holding company's revenue is
dividends a holding company receives from its subsidiary bank. The right of a
bank holding company to participate as a stockholder in any distribution of
assets of its subsidiary bank upon its liquidation or reorganization or
otherwise is subject to the prior claims of creditors of such subsidiary bank.
The subsidiary bank is subject to claims by creditors for long-term and
short-term debt obligations, including substantial obligations for federal funds
purchased and securities sold under repurchase agreements, as well as deposit
liabilities. Under the Financial Institutions Reform, Recovery and Enforcement
Act of 1989, in the event of a loss suffered by the FDIC in connection with a
banking subsidiary of a bank holding company (whether due to a default or the
provision of FDIC assistance), other banking subsidiaries of the holding company
could be assessed for such loss.
Federal laws limit the transfer of funds by a subsidiary bank to its
holding company in the form of loans or extensions of credit, investments or
purchases of assets. Transfers of this kind are limited to 10% of a bank's
capital and surplus with respect to each affiliate and to 20% in the aggregate,
and are also subject to certain collateral requirements. These transactions, as
well as other transactions between a subsidiary bank and its holding company,
also must be on terms substantially the same as, or at least as favorable as,
those prevailing at the time for comparable transactions with non-affiliated
companies or, in the absence of comparable transactions, on terms or under
circumstances, including credit standards, that would be offered to, or would
apply to, non-affiliated companies.
Limitations of Acquisitions of Common Stock.
The federal Change in Bank Control Act prohibits a person or group of
persons from acquiring "control" of a bank holding company unless the Federal
Reserve Board has been given 60 days prior written notice of such proposed
acquisition and within that time period the Federal Reserve Board has not issued
a notice disapproving the proposed acquisition or extending for up to another 30
days the period during which such a disapproval may be issued. An acquisition
may be made prior to expiration of the disapproval period if the Federal Reserve
Board issues written notice of its intent not to disapprove the action. Under a
rebuttable presumption established by the Federal Reserve Board, the acquisition
of more than 10% of a class of voting stock of a bank holding company with a
class of securities registered under Section 12 of the Exchange Act would, under
the circumstances set forth in the presumption, constitute the acquisition of
control.
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8
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
In addition, any "company" would be required to obtain the approval of
the Federal Reserve Board under the BHCA before acquiring 25% (5% in the case of
an acquirer that is a bank holding company) or more of the outstanding Common
Stock of, or such lesser number of shares as constitute control over, the
Company.
Regulation of the Bank
General
The Bank is a national bank subject to extensive regulation and
examination by the Office of the Comptroller of the Currency (the "OCC"), The
Bank also is subject to regulation and examination by the FDIC, which insures
the deposits of the Bank to the maximum extent permitted by law, and certain
requirements established by the Federal Reserve Board. The federal laws and
regulations which are applicable to banks regulate, among other things, the
scope of their business, their investments, their reserves against deposits, the
timing of the availability of deposited funds and the nature and amount of and
collateral for loans. The laws and regulations governing the Bank generally have
been promulgated to protect depositors and not for the purpose of protecting
stockholders.
Capital Requirements.
The Bank is subject to regulatory capital requirements of the OCC which
are substantially comparable to the regulatory capital requirements of the
Federal Reserve Board applicable to bank holding companies such as the Company.
At December 31, 1998, the regulatory capital of the Bank exceeded applicable
requirements,
Prompt Corrective Action.
Section 38 of the Federal Deposit Insurance Act ("FDIA") provides the
federal banking regulators with broad power to take "prompt corrective action"
to resolve the problems of undercapitalized institutions. The extent of the
regulators' powers depends on whether the institution in question is "well
capitalized," "adequately capitalized," "undercapitalized, "significantly
undercapitalized" or "critically undercapitalized." Under regulations adopted by
the federal banking regulators, an institution shall be deemed to be (i) "well
capitalized" if it has total risk-based capital ratio of 10.0% or more, has a
Tier 1 risk-based capital ratio of 6.0% or more, has a Tier 1 leverage capital
ratio of 5.0% or more and is not subject to specified requirements to meet and
maintain a specific capital level for any capital measure; (ii) "adequately
capitalized" if it has a total risk-based capital ratio of 8.0% or more, a Tier
1 risk-based capital ratio of 4.0% or more and a Tier I leverage capital ratio
of 4.0% or more (3.0% under certain circumstances) and does not meet the
definition of "well capitalized," (iii) "undercapitalized" if it has a total
risk- based capital ratio that is less than 8.0% a Tier 1 risk-based capital
ratio that is less than 4.0% or a Tier 1 leverage capital ratio that is less
than 4.0% (3.0% under certain circumstances), (iv) "significantly
undercapitalized" if it has a total risk-based capital ratio that is less than
6.0%, a Tier 1 risk-based capital ratio that is less than 3.0%, or a Tier 1
leverage capital ratio that is less than 3.0%, and (v) "critically
undercapitalized" if it has a ratio of tangible equity to total assets that is
equal to or less than 2.0%. The regulations also provide that a federal banking
regulator may, after notice and an opportunity for a hearing, reclassify a "well
capitalized" institution as "adequately capitalized" and may require an
"adequately capitalized" institution or an
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9
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
"undercapitalized" institution to comply with supervisory actions as if it were
in the next lower Category if the institution is in an unsafe or unsound
condition or engaging in an unsafe or unsound practice. The federal banking
regulator may not, however, reclassify a "significantly undercapitalized"
institution as "critically undercapitalized."
An institution generally must file a written capital restoration plan
which meets specified requirements, as well as a performance guaranty by each
company that controls the institution, with an appropriate federal banking
regulator within 45 days of the date that the institution receives notice or is
deemed to have notice that it is "undercapitalized," "significantly
undercapitalized" or "critically undercapitalized." Immediately upon becoming
undercapitalized, an institution becomes subject to statutory provisions which,
among other things, set forth various mandatory and discretionary restrictions
on the operations of such an institution.
At December 31, 1998, the Bank had capital levels which qualified it as
a "well capitalized" institution.
FDIC Insurance Premiums.
The Bank is a member of the BIF administered by the FDIC, although
certain deposits of the Bank acquired in acquisitions are insured by the Savings
Association Insurance Fund ("SAIF) administered by the FDIC.
As an FDIC-insured institution, the Bank is required to pay deposit
insurance premiums to the FDIC. Effective January 1, 1997, the assessment
schedule for both BIF and SAIF ranges from 0 basis points (subject to a $2,000
annual minimum) to 27 basis points. In addition, both BIF-insured institutions
and SAIF-insured institutions are assessed amounts in order for a
federally-chartered Finance Corporation to make payments on it bonds.
Brokered Deposits.
The FDIA restricts the use of brokered deposits by certain depository
institutions. Under the FDIA and applicable regulations, (i) a "well capitalized
insured depository institution" may solicit and accept, renew or roll over any
brokered deposit without restriction, (ii) an "adequately capitalized insured
depository institution" may not accept, renew or roll over any brokered deposit
unless it has applied for and been granted a waiver of this prohibition by the
FDIC and (iii) an "undercapitalized insured depository institution" may not (x)
accept, renew or roll over any brokered deposit or (y) solicit deposits by
offering an effective yield that exceeds by more than 75 basis points the
prevailing effective yields on insured deposits of comparable maturity in such
institution's normal market area or in the market area in which such deposits
are being solicited. The term "undercapitalized insured depository institution"
is defined to mean any insured depository institution that fails to meet the
minimum regulatory capital requirement prescribed by its appropriate federal
banking agency. The FDIC may, on a case-by-case basis and upon application by an
adequately capitalized insured depository institution, waive the restriction on
brokered deposits upon a finding that the acceptance of brokered deposits does
not constitute, an unsafe or unsound practice with respect to such institution.
The Bank had no brokered deposits outstanding at December 31, 1998.
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10
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Community Investment and Consumer Protection Laws.
In connection with its lending activities, the Bank is subject to a
variety of federal laws designed to protect borrowers and promote lending to
various sectors of the economy and population. Included among these are the
federal Home Mortgage Disclosure Act, Real Estate Settlement Procedures Act,
Truth-in-Lending Act, Equal Credit Opportunity Act, Fair Credit Reporting Act
and Community Reinvestment Act ("CRA").
The CRA requires insured institutions to define the communities that
they serve, identify the credit needs of those communities and adopt and
implement a "Community Reinvestment Act Statement" pursuant to which they offer
credit products and take other actions that respond to the credit needs of the
community. The responsible federal banking regulator (the OCC) must conduct
regular CRA examinations of insured financial institutions and assign to them a
CRA rating of "outstanding," "satisfactory," "needs improvement" or
"unsatisfactory."
Limitations on Dividends.
The Company is a legal entity separate and distinct from its banking and
other subsidiaries. the Company's principal source of revenue consists of
dividends from its subsidiaries, including the Bank. The payment of dividends by
the Bank is subject to various regulatory requirements.
Miscellaneous.
The Bank is subject to certain restrictions on loans to the Company or
its non-bank subsidiaries, on investments in the stock or securities thereof, on
the taking of such stock or securities as collateral for loans to any borrower,
and on the issuance of a guarantee or letter of credit on behalf of the Company
or its non-bank subsidiaries. The Company's banking subsidiaries also are
subject to certain restrictions on most types of transactions with the Company
or its non-bank subsidiaries, requiring that the terms of such transactions be
substantially equivalent to terms of similar transactions with non-affiliated
firms.
Regulatory Enforcement Authority.
The enforcement powers available to federal banking regulators is
substantial and includes, among other things, the ability to assess civil money
penalties, to issue cease-and- desist or removal orders and to initiate
injunctive actions against banking organizations and institution-affiliated
parties, as defined. In general, these enforcement actions may be initiated for
violations of laws and regulations and unsafe or unsound practices. Other
actions or inactions may provide the basis for enforcement action, including
misleading or untimely reports filed with regulatory authorities.
<PAGE>
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
Selected Statistical Information
The following tables and schedules, referenced in the index
presented below, set forth certain consolidated statistical information of
American Bancorporation, required of bank holding companies pursuant to Guide 3.
Selected tables are set forth on pages 30 through 47 in the annual report to
stockholders, which pages are hereby incorporated by reference in this Form
10-K. The information contained in the tables should be read in conjunction with
the consolidated financial statements of American Bancorporation and the notes
thereto appearing elsewhere in this Form 10-K.
Page Reference
Form Annual report
10K to stockholders
I. Distribution of assets, liabilities and stockholders' equity,
interests rates and interest differential
a. Average balance sheet............................... - 31
b. Average earning assets and interest bearing
liabilities, interest earned and paid, yield and rates. - 31
c Interest variances....................................- 33-34
II. Investment portfolio
a. Carrying value of investment securities by type......- 41
b. Maturity and weighted average yield................. - 41
III. Loans
a. Types of loans.......................................- 38
b. Maturity and sensitivity to change in interest rates.- 38
c. Non-performing loans................................ - 38
IV. Summary of loans loss experience...................12 40
V. Deposits
a. Average amount.......................................- 41
b. Maturity of time certificates of deposits in
excess of $100,000......................................- 41
VI. Return on equity and assets.........................- 30
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12
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
The following table summarizes the balance of the allowance for loan
losses by the major loan categories. The table supplements that on page 40 of
the Company's Annual Report to Stockholders for the year ended December 31,
1998, incorporated by reference herein.
Allowance Percent
amount in each category
(000's omitted) to total loans
December 31, 1998
Commercial, financial and agricultural ............ $1,627 37.8%
Real estate - construction ........................ -- 0.4
Real estate - mortgage ............................ 409 45.5
Installment ....................................... 494 16.3
Leases ............................................ -- 0.0
Unallocated ....................................... 512 N/A
------ -----
$3,042 100.0%
December 31, 1997
Commercial, financial and agricultural .............. $1,550 32.2%
Real estate - construction .......................... -- 0.3
Real estate - mortgage ............................. 762 45.8
Installment ........................................ 641 21.7
Leases .............................................. -- 0.0
Unallocated ......................................... 331 N/A
------ -----
$3,284 100.0%
December 31, 1996
Commercial, financial and agricultural ............ $ 871 30.5%
Real estate - construction .......................... -- 0.7
Real estate - mortgage .......................... 515 50.3
Installment ................................. 434 18.5
Leases ................................................ -- 0.0
Unallocated ......................................... 1,744 N/A
------ -----
$3,564 100.0%
December 31, 1995
Commercial, financial and agricultural ............. $ 984 25.2%
Real estate - construction .......................... -- 0.7
Real estate - mortgage ............................ 358 51.4
Installment ......................................... 513 22.7
Leases .............................................. -- 0.0
Unallocated ........................................ 1,999 N/A
------ -----
$3,854 100.0%
December 31, 1994
Commercial, financial and agricultural ............. $1,165 22.6%
Real estate - construction .......................... -- 0.5
Real estate - mortgage ............................ 407 52.3
Installment ....................................... 913 24.6
Leases .............................................. -- 0.0
Unallocated ........................................ 1,252 N/A
------ -----
$3,737 100.0%
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13
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
ITEM 2. PROPERTIES
The Company and its non-banking subsidiaries conduct business from the
Company's administrative headquarters in Wheeling, West Virginia and the Bank
conducts business from its various office locations.
The net book value of the Company's office facilities, furniture and
equipment, including leasehold improvements and property held for future
expansion (less accumulated depreciation and amortization) at December 31, 1998
was $9.3 million. The Company does not believe that the termination of any of
its leases would have a material effect on its operations.
Listed below are the locations of the Company's executive offices and
the branch offices of the Bank that were operating as of December 31, 1998, as
well as any proposed branch office locations. All buildings are owned by the
Company unless otherwise indicated. Except as noted, the Company believes its
property is suitable and adequate for its current and proposed needs.
Approximate
Office Year Opened Sq. Feet
AMERICAN BANCORPORATION
Mull Center, Wheeling, West Virginia
Executive and non-bank subsidiary offices................. 1987 4,000 (1)
WHEELING NATIONAL BANK:
Ohio
Cambridge................................................... 1974 5,840
Cambridge - Drive-in........................................ 1989 14,000
Gahanna..................................................... 1990 3,200 (1)
Gahanna - StoneRidge Plaza................................ 1996 1,600 (1)
Reynoldsburg................................................ 1990 6,000
Flushing.................................................... 1953 5,400 (1)
St. Clairsville............................................. 1991 8,000
St. Clairsville - Ohio Valley Mall......................... 1994 3,088 (2)
Shadyside................................................... 1980 4,200
Freeport.................................................... 1988 1,500
Barnesville................................................. 1994 2,000
Columbus.................................................... 1993 1,350 (1)
Columbus (Administrative offices)........................... 1994 2,419 (1)
Steubenville................................................ 1994 1,400 (2)
West Virginia
Wheeling................................................... 1969 29,515
Wheeling - Drive-in......................................... 1991 18,583
New Martinsville............................................ 1978 2,800
Pine Grove.................................................. 1983 1,125
Wheeling Island............................................. 1984 1,280
Elm Grove................................................... 1986 2,420 (1)
Weirton..................................................... 1986 15,214
Weirton - Drive-in.......................................... 1989 4,800
Weirton Heights............................................. 1990 1,500 (1)
AMERICAN MORTGAGES, INC.
Elm Grove................................................... 1994 4,700 (1)
PREMIER MORTGAGE, LTD.
Worthington, Ohio........................................... 1996 2,250 (1)
(1) Leased.
(2) Ground leased.
<PAGE>
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
ITEM 3. LEGAL PROCEEDINGS
The Registrant and its affiliates are not involved in any material
pending legal proceedings outside the normal conduct of business (including
proceedings arising from environmental quality statutes) to which the Registrant
is a party, or of which its property is the subject, nor are any proceedings
known to be contemplated.
PART IV
ITEM 14 . EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K
A. The following documents are filed as part of this report:
1. Financial Statements
Page reference
Annual Report
to Stockholders
Independent Auditors' Report
For the years ended December 31, 1998, 1997 and 1996......................... 29
Consolidated financial statements
Consolidated balance sheet at December 31, 1998 and 1997...................... 3
Consolidated statement of income for the years ended
December 31, 1998, 1997 and 1996.................................. ........... 4
Consolidated statement of changes in stockholders' equity
for the years ended December 31, 1998, 1997 and 1996.......................... 5
Consolidated statement of cash flows for the years ended
December 31, 1998, 1997 and 1996.............................................. 6
Notes to consolidated financial statements including condensed
financial information of Registrant...................................... 7 - 28
2. Financial Statement Schedules
All schedules have been omitted since the required information is not
present in amounts sufficient to require submission or because the information
required is included in the financial statements, including the notes thereto.
<PAGE>
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
3. Exhibits Page No. in
Form 10-K
Number
3.1 Fifth Amended Articles of Incorporation (a)
3.2 Amended Code of Regulations (a)
3.3 1987 Amendment to Fifth Amended Articles of Incorporation (a)
3.4 1987 Amendment to Amended Code of Regulations (a)
3.5 1988 Amendment to Amended Code of Regulations (a)
3.6 1990 Amendment to Amended Code of Regulations (a)
4.1 Specimen Common Share Certificate as of 12/15/88 (a)
10.1 American Bancorporation Senior Management
Incentive Compensation Plan (a)
10.2 Agreement to Merge between Wheeling National Bank and
Columbus National Bank (a)
10.3 Office Purchase and Assumption Agreement by and between
Columbus National Bank and Bank One, Steubenville, NA (a)
10.4 Trust Preferred Securities Offering of American Bancorporation
Capital Trust I ("ABCT") (b)
10.5 Amended and Restated Trust Agreement of ABCT (b)
10.6 ABCT Preferred Securities Guarantee Agreement (b)
10.7 ABCT Trust Indenture (b)
10.8 American Bancorporation Agreement as to ABCT Expenses (b)
10.9 ABCT Preferred Securities Certificate (b)
13.1 1998 Annual Report to Security Holders 18-68
22.1 Subsidiaries:
The following is a list of all subsidiaries of American
Bancorporation, the jurisdiction of incorporation or
organization, and the percentage of shares owned by American
Bancorporation for each such subsidiary.
Jurisdiction Percentage
Name
Wheeling National Bank........... U.S. 100%
American Bancservices, Inc....... Ohio 100%
American Mortgages, Inc.......... Ohio 100%
American Bancleasing, Inc........ Ohio 100%
American Bancdata Corporation.... Ohio 100%
American Bancorporation
Capital Trust I.......... Delaware 100%
Premier Mortgage, Ltd...... Ohio 51% *
*Through the Company's ownership in American Mortgages, Inc.
The following footnote references are to documents incorporated by reference
herein:
(a) Incorporated by reference to the same Exhibit number in the Form
10-K for the year ended December 31, 1997.
(b) Incorporated by reference to Form S-2 Registration Nos.: 333-49659
and 333-49659-01 effective April 21, 1998. Exhibit reference is
contained on Page II-2.
B. Reports on Form 8-K:
Date Item Number Description
None
<PAGE>
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
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 hereunto duly authorized on March 31, 1999.
AMERICAN BANCORPORATION
/s/ Jeremy C. McCamic
Jeremy C. McCamic
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed by the following persons on behalf of the
Registrant and in the capacities indicated as of March 31, 1999.
/s/ Jack O. Carnter /s/ Jeremy C. McCamic
Jack O. Cartner Jeremy C. McCamic
Director Director, Chairman and
Chief Executive Officer
/s/ Paul W. Donahie /s/ Jolyon W. McCamic
Paul W. Donahie Jolyon W. McCamic
Director and President Director and Vice Chairman
/s/ Abigail M. Feinknopf /s/ John J. Malik, Jr.
Abigail M. Feinknopf John J. Malik, Jr.
Director Director
/s/ Jay T. McCamic /s/ Brent E. Richmond
Jay T. McCamic Brent E. Richmond
Director Executive Vice President and
Chief Operating Officer
/s/ Jeffrey W. McCamic /s/ Jeffrey A. Baran
Jeffrey W. McCamic Jeffrey A. Baran
Director Chief Financial Officer
<PAGE>
17
AMERICAN BANCORPORATION FORM 10-K Annual Report
December 31, 1998
EXHIBIT INDEX
Number Description SEC Page #
------------------------------------------------- ------------
3.1 Fifth Amended Articles of Incorporation........................ (a)
3.2 Amended Code of Regulations........................................(a)
3.3 1987 Amendment to Fifth Amended Articles of Incorporation..........(a)
3.4 1987 Amendment to Amended Code of Regulations .....................(a)
3.5 1988 Amendment to Amended Code of Regulations......................(a)
3.6 1990 Amendment to Amended Code of Regulations......................(a)
4.1 Specimen Common Share Certificate as of December 15, 1988..........(a)
10.1 American Bancorporation Senior Management Incentive
Compensation Plan.................................................(a)
10.2 Agreement to Merge between Wheeling National Bank and
Columbus National Bank............................................(a)
10.3 Office Purchase and Assumption Agreement by and between
Columbus National Bank and Bank One, Steubenville, NA.............(a)
10.4 Trust Preferred Securities Offering of American Bancorporation
Capital Trust I ("ABCT")..........................................(b)
10.5 Amended and Restated Trust Agreement of ABCT.......................(b)
10.6 ABCT Preferred Securities Guarantee Agreement.......... ...........(b)
10.7 ABCT Trust Indenture...............................................(b)
10.8 American Bancorporation Agreement as to ABCT Expenses..............(b)
10.9 ABCT Preferred Securities Certificate..............................(b)
13.1 1998 Annual Report to Security Holders.......................(18 - 68)
22.1 Subsidiaries:
The following is a list of all subsidiaries of American
Bancorporation, the jurisdiction of incorporation or
organization, and the percentage of shares owned by
American Bancorporation for each such subsidiary.
Jurisdiction Percentage
Name
Wheeling National Bank.....................U.S. 100%
American Bancservices, Inc............... Ohio 100%
American Mortgages, Inc.................. Ohio 100%
American Bancleasing, Inc................ Ohio 100%
American Bancdata Corporation............ Ohio 100%
American Bancorporation Capital Trust I...Delaware 100%
Premier Mortgage, Ltd.................. Ohio 51% *
*Through the Company's ownership in American Mortgages, Inc.
The following footnote references are to documents incorporated by reference
herein:
(a) Incorporated by reference to the same Exhibit number in the Form
10-K for the year ended December 31, 1997.
(b) Incorporated by reference to Form S-2 Registration Nos.:
333-49659 and 333- 49659-01 effective April 21, 1998. Exhibit
reference is contained on Page II-2.
