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, 1999
-------------------------------------------------------
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 2, 1999: 3,129,674 shares of Common stock without par value
Number of pages comprising
this report. . . . . . 13
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
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, 1999
American Bancorporation and Subsidiaries
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET
June 30, December 31,
1999 1998 1998
------------- ------------- -------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks ................................ $ 10,321,225 $ 13,568,912 $ 12,316,176
Interest bearing deposits in other banks ............... 257,794 145,488 --
Federal funds sold ..................................... 4,877,025 16,050,025 17,747,025
Investment securities available for sale ............... 306,669,719 214,865,641 263,827,239
Loans, net of unearned income .......................... 332,826,797 289,814,672 300,621,884
Less allowance for loan losses ....................... 3,068,302 3,179,566 3,042,269
------------- ------------- -------------
329,758,495 286,635,106 297,579,615
Premises and equipment - net ........................... 9,641,827 9,854,463 9,735,582
Accrued interest receivable ............................ 4,291,154 2,902,199 3,393,337
Excess of cost over net assets purchased ............... 1,494,562 1,801,202 1,633,464
Other assets ........................................... 10,658,433 5,354,541 5,173,024
------------- ------------- -------------
TOTAL ASSETS ...................................... $ 677,970,234 $ 551,177,577 $ 611,405,462
============= ============= =============
LIABILITIES
Deposits
Non-interest bearing ................................ $ 39,336,873 $ 35,818,702 $ 39,497,617
Interest bearing .................................... 393,944,304 376,773,483 391,742,578
------------- ------------- -------------
TOTAL DEPOSITS .................................. 433,281,177 412,592,185 431,240,195
Borrowed funds ........................................ 193,281,312 84,096,093 123,891,183
Accrued interest payable .............................. 2,426,190 2,272,457 2,306,854
Other liabilities ..................................... 4,217,142 4,391,546 4,858,495
Long-term debt ........................................ 4,010 18,179 11,242
Company obligated mandatorily redeemable trust
preferred securities of subsidiary trust holding solely
junior subordinated debentures of the Company ......... 12,650,000 12,650,000 12,650,000
------------- ------------- -------------
TOTAL LIABILITIES .................................. 645,859,831 516,020,460 574,957,969
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 .................................... 20,123,474 16,676,372 18,430,141
Accumulated other comprehensive income
(loss), net of income tax ........................ (6,139,238) 354,578 (108,815)
------------- ------------- -------------
TOTAL STOCKHOLDERS' EQUITY ......................... 32,110,403 35,157,117 36,447,493
------------- ------------- -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY ..................... $ 677,970,234 $ 551,177,577 $ 611,405,462
============= ============= =============
</TABLE>
3
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
American Bancorporation and Subsidiaries
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF INCOME
Quarter ended June 30, Six Months ended June 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans............................$ 6,864,668 $ 6,377,452 $13,350,683 $12,683,363
Investment securities
Taxable interest income......... 3,933,458 3,324,760 7,689,465 6,242,487
Non-taxable interest income.... 702,216 23,243 1,248,095 46,014
------------ ----------- ---------- -----------
4,635,674 3,348,003 8,937,560 6,288,501
Short-term investments.......... 115,119 248,639 238,492 330,084
------------ ---------- ----------- -----------
Total interest income........ 11,615,461 9,974,094 22,526,735 19,301,948
INTEREST EXPENSE
Deposits....................... 4,336,205 4,321,546 8,781,731 8,164,638
Borrowed funds................. 2,625,851 1,442,842 4,787,877 2,664,278
------------ ---------- ----------- ------------
Total interest expense........ 6,962,056 5,764,388 13,569,608 10,828,916
------------ ---------- ----------- ------------
NET INTEREST INCOME......... 4,653,405 4,209,706 8,957,127 8,473,032
PROVISION FOR LOAN LOSSES......... 75,000 60,000 150,000 120,000
------------ ---------- ----------- ------------
Net interest income after
provision for loan losses.... 4,578,405 4,149,706 8,807,127 8,353,032
OTHER INCOME
Service charges on
deposit accounts............. 244,179 172,922 416,444 339,902
Securities gains................ 75,155 330,809 342,967 486,809
Net gains on sale of loans...... 440,763 474,064 846,529 933,119
Insurance commissions........... 23,906 23,282 42,950 43,430
Other income.................... 173,926 193,403 308,679 387,634
---------- ---------- ---------- ----------
Total other income............ 957,929 1,194,480 1,957,569 2,190,894
OTHER EXPENSE
Salaries and employee benefits.. 1,698,839 1,594,150 3,471,633 3,189,265
Occupancy and equipment expense. 647,939 617,496 1,281,631 1,198,451
Other expenses.................. 1,453,337 1,374,983 2,689,201 2,590,689
---------- ---------- ---------- ----------
Total other expense........... 3,800,115 3,586,629 7,442,465 6,978,405
---------- ---------- ---------- ----------
INCOME BEFORE INCOME TAXES....... 1,736,219 1,757,557 3,322,231 3,565,521
PROVISION FOR INCOME TAXES....... 388,604 470,556 689,996 1,025,013
---------- ---------- ----------- ----------
NET INCOME....................... $ 1,347,615 $ 1,287,001 $ 2,632,235 $ 2,540,508
=========== =========== ============ ============
Average Shares Outstanding...... 3,129,674 3,129,674 3,129,674 3,129,674
BASIC EARNINGS PER SHARE......$ 0.43 $ 0.41 $ 0.84 $ 0.81
</TABLE>
4
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
American Bancorporation and Subsidiaries
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASH FLOWS
Six months ended June 30,
1999 1998
<S> <C> <C>
Operating Activities:
Net Income ................................................................ $ 2,632,235 $ 2,540,508
Adjustments to reconcile net income to net cash from operating activities:
Depreciation .............................................................. 436,015 418,804
Amortization of intangibles ............................................... 138,902 167,738
Net amortization of premium on investment securities ...................... 626,325 376,701
Provision for loan losses ................................................. 150,000 120,000
Net gain on sale of investment securities ................................. (342,967) (486,809)
Net gain on sale of loans ................................................. (846,529) (933,119)
Net increase in accrued interest receivable ............................... (897,817) (188,959)
Net increase in accrued interest payable .................................. 119,336 489,789
Real estate mortgage loans originated for sale ............................ (30,093,453) (32,392,348)
Proceeds from sale of real estate mortgage loans .......................... 29,920,693 31,531,550
Net increase in other assets .............................................. (1,219,901) (575,478)
Net increase (decrease) in other liabilities .............................. (641,353) 169,509
Net decrease from other operating activities .............................. (349,226) (184,441)
------------- -------------
Net cash provided (used) by operating activities .................... (367,740) 1,053,445
Investing Activities:
Investment securities available for sale:
Proceeds from maturities and repayments ............................... 51,687,759 70,163,289
Proceeds from sales ................................................... 37,727,462 5,886,214
Purchases ............................................................. (142,487,764) (122,098,505)
Change in loans, net of real estate mortgage loans originated for sale ... (31,309,591) (1,554,477)
Purchase of premises and equipment ....................................... (342,260) (203,890)
Proceeds from sale of premises and equipment ............................. -- 1,000
------------- -------------
Net cash used by investing activities ................................ (84,724,394) (47,806,369)
Financing Activities:
Net increase (decrease) in non-interest
bearing demand deposits ............................................... (160,744) 2,305,990
Net increase in interest bearing demand and savings deposits ............. 3,385,938 201,300
Net increase (decrease) in time deposits ................................. (1,184,212) 54,350,563
Net increase (decrease) in borrowed funds ................................ 69,390,129 (3,478,059)
Issuance (principal repayment) of long-term debt ......................... (7,232) 10,477,470
Cash dividends paid ...................................................... (938,902) (782,419)
------------- -------------
Net cash provided by financing activities ........................... 70,484,975 63,074,845
------------- -------------
Net Increase (Decrease) in Cash and Cash Equivalents ...................... (14,607,157) 16,321,921
Cash and Cash Equivalents Beginning Balance ................................. 30,063,201 13,442,504
------------- -------------
Cash and Cash Equivalents Ending Balance .................................... $ 15,456,044 $ 29,764,425
============= =============
</TABLE>
5
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
American Bancorporation and Subsidiaries
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
Six months ended June 30, 1999 and 1998
1999 1998
-------- ---------
Balance at January 1, .......................... $ 36,447,493 $ 33,693,846
Comprehensive results:
Net Income .................................. 2,632,235 2,540,508
Other comprehensive income (loss), net of tax (5,818,250) (79,172)
Reclassification adjustment, net of tax ..... (212,173) (168,701)
------------ ------------
Total comprehensive results ................ (3,398,188) 2,292,635
Dividends declared ($0.30 per share 1999,
$0.265 per share 1998) ................... (938,902) (829,364)
------------ ------------
Balance at June 30, ............................ $ 32,110,403 $ 35,157,117
============ ============
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 1998 Annual Report to Stockholders should be read in
conjunction with these statements.
6
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
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 1998 Annual
Report and the financial statements appearing elsewhere herein.
SUMMARY
American Bancorporation (the "Company") recognized net income of $2,632,000
or $0.84 basic earnings per share, for the six months ended June 30, 1999,
compared to net income of $2,541,000 or $0.81 basic earnings per share, for the
six months ended June 30, 1998. Return on average assets and return on average
equity were 0.80% and 14.75%, respectively, for the six months ended June 30,
1999 compared to 0.97% and 14.61%, respectively, for the six months ended June
30, 1998.
Total assets at June 30, 1999 increased to $677,970,000, from $551,178,000
at June 30, 1998, an increase of 23.0%. Deposits increased to $433,281,000 at
June 30, 1999, from $412,592,000 at June 30, 1998, an increase of 5.0%. Total
stockholders' equity was $32,110,000 at June 30, 1999, which represents an 8.7%
decrease over total stockholders' equity of $35,157,000 at June 30, 1998.
RESULTS OF OPERATIONS
SIX MONTH COMPARISON
Net Income. Net income for the six months ended June 30, 1999 amounted to
$2,632,000, or $0.84 basic earnings per share, compared to net income of
$2,541,000 or $0.81 basic earnings per share, for the six months ended June 30,
1998. The increase was the result of an increase in net interest income and a
decrease in income taxes which was partially offset by increases in other
expense and provision for loan losses and a decrease in other income.
Net Interest Income. Net interest income before provision for loan losses
for the six months ended June 30, 1999 amounted to $8,957,000, an increase of
$484,000 or 5.7%, compared to the six months ended June 30, 1998. The increase
resulted primarily from a $127,215,000 or 25.6% increase in average interest
earning assets which was partially offset by a 46 basis point decrease in the
Company's margin.
Total interest income for the six months ended June 30, 1999 amounted to
$22,527,000 an increase of $3,225,000 or 16.7%, compared to the six months ended
June 30, 1998. The increase resulted primarily from the increase in the average
interest earning assets which was partially offset by a 48 basis point decrease
in the average yield on earning assets. Average loans outstanding increased
$26,606,000 or 9.2% with average commercial loans increasing $30,428,000 or
31.7%, while average real estate loans decreased $3,667,000 or 2.6% and average
consumer installment loans decreased $155,000 or 0.3%. The average yield on
loans decreased from 8.80% in 1998 to 8.48% in 1999. Average investment
securities and other short-term investments outstanding increased $100,609,000
or 48.3% while the average yield decreased from 6.35% in 1998 to 6.10% in 1999.
7
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
Total interest expense for the six months ended June 30, 1999 amounted to
$13,570,000, an increase of $2,741,000 or 25.3% , compared to the six months
ended June 30, 1998. The increase resulted primarily from a $124,769,000 or
27.7% increase in the average volume of interest bearing liabilities which was
partially offset by a 10 basis point decrease in interest rates paid on such
liabilities. Average NOW, money market and savings accounts decreased $1,572,000
or 1.3%. Average time deposits increased $40,178,000 or 17.3%, primarily the
result of increased marketing efforts. Average noninterest bearing accounts
increased $3,550,000 or 9.5% and represented 8.7% of average total deposits for
the six months ended June 30, 1999. Average borrowed funds increased $80,818,000
or 90.7% , while the average rate paid on borrowed funds decreased from 5.40% in
1998 to 4.99% in 1999.
Provision for Loan Losses. The loan loss provision for the six months ended
June 30, 1999 was $150,000, compared to $120,000 for the same period in 1998.
Other Income. Other income for the six months ended June 30, 1999 amounted
to $1,958,000, a decrease of $233,000 or 10.6%. Net gains on sale of loans
decreased $87,000 or 10.2%. Net gain on sale of investment securities totalled
$343,000 in 1999, compared to $487,000 in 1998.
Other Expense. Total other expense for the six months ended June 30, 1999
amounted to $7,442,000, an increase of $464,000 or 6.6%, compared to the six
months ended June 30, 1998. Salaries and employee benefits increased $282,000 or
8.9%. Occupancy and equipment expense increased $83,000 or 6.9%. Other
(miscellaneous) expenses increased $99,000 or 3.8%.
Provision for Income Taxes. The provision for income taxes for the six
months ended June 30, 1999 was $690,000, compared to $1,025,000 for the six
months ended June 30, 1998. The decrease is primarily the result of additional
tax exempt income in 1999.
RESULTS OF OPERATIONS
QUARTER COMPARISON
Net Income. Net income for the quarter ended June 30, 1999 amounted to
$1,348,000, compared to net income of $1,287,000 for the quarter ended June 30,
1998. The increase was the result of an increase in net interest income and a
decrease in income taxes which was partially offset by increases in other
expense and provision for loan losses and a decrease in other income.
Net Interest Income. Net interest income before provision for loan losses
for the quarter ended June 30, 1999 amounted to $4,653,000, an increase of
$444,000 or 10.5%, compared to the quarter ended June 30, 1998. The increase
resulted primarily from a $118,785,000 or 22.9% increase in average interest
earning assets which was partially offset by a 33 basis point decrease in the
Company's margin .
Total interest income for the quarter ended June 30, 1999 amounted to
$11,615,000, an increase of $1,641,000 or 16.5% , compared to the same period in
1998. 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 $34,493,000
or 11.9%. Average commercial loans increased $34,337,000 or 35.5%, average
consumer installment loans increased $1,458,000 or 2.9% while average real
estate loans decreased $1,302,000 or 0.9%. The average yield on loans decreased
from 8.81% in 1998 to 8.47% in 1999.
8
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
Average investment securities and other short-term investments outstanding
increased $84,293,000 or 36.6% and the average yield decreased from 6.25% in
1998 to 6.04% in 1999.
Total interest expense for the quarter ended June 30, 1999 amounted to
$6,962,000, an increase of $1,198,000 or 20.8%, compared to the quarter ended
June 30, 1998. The increase resulted primarily from an $118,012,000 or 25.0%
increase in the average volume of interest bearing liabilities which was
partially offset by a 17 basis point decrease in interest rates paid on such
liabilities.
Provision for Loan Losses. The loan loss provision for the quarter ended
June 30, 1999 was $75,000, compared to $60,000 for same period in 1998.
Other Income. Other income amounted to $958,000 for the quarter ended June
30, 1999, compared to $1,194,000 for the quarter ended June 30, 1998. Net gains
on sale of loans decreased $33,000 or 7.0%. Net gain on sale of investment
securities totalled $75,000 for the quarter ended June 30, 1999 compared to
$331,000 for the same period in 1998.
Other Expense. Total other expense for the quarter ended June 30, 1999
amounted to $3,800,000, an increase of $213,000 or 6.0%, compared to the same
period in 1998. Salaries and employee benefits increased $105,000 or 6.6%.
Occupancy and equipment expense increased $30,000 or 4.9%. Other (miscellaneous)
expenses increased $78,000 or 5.7%.
Provision for Income Taxes. The provision for income taxes for the
quarter ended June 30, 1999 was $389,000, compared to $471,000 for the quarter
ended June 30, 1998. The decrease is primarily the result of additional
tax-exempt income in 1999.
ASSET QUALITY
Nonperforming loans totalled $2,568,000 or 0.8% of total loans at June 30,
1999, compared to $2,960,000 or 1.0% at December 31, 1998. Nonperforming loans
at June 30, 1999 consisted of nonaccrual loans totalling $1,151,000, 90 day
delinquent loans of $1,106,000, and restructured loans aggregating $311,000.
Other real estate held totalled $533,000 at June 30, 1999, compared to $183,000
at December 31, 1998.
CAPITAL RESOURCES
Stockholders' equity totalled $32,110,000 at June 30, 1999. The Company's
risk-based capital ratio was 15.2%, of which 14.3% constituted common
stockholder equity, while the risk-based capital ratio for the Company's bank
subsidiary, Wheeling National Bank, was 14.1%, with common stockholder equity of
13.3%. At June 30, 1999 the Company's leverage capital ratio was 7.4%, while the
leverage ratio for Wheeling National Bank was 6.9%.
9
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
YEAR 2000 COMPLIANCE
The Company may be 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 issue. A
number of computer systems which are affected by Year 2000 are utilized by the
Company to operate its day-to-day business.
Management has established a task force to develop and maintain a Year 2000
Compliance Plan. The Company's Year 2000 Compliance Plan has been prepared in
accordance with the Federal Financial Institutions Examination Council ("FFIEC")
guidelines on Year 2000 Compliance and involves the following five phases:
awareness, assessment, renovation, validation and implementation. The Company
has completed all phases of the Y2K Compliance Plan.
The Company has contacted large commercial customers and significant
suppliers to determine their capability to resolve the Year 2000 issues and
attain compliance. Risk ratings have been assigned to customers and suppliers.
Further contact will occur based on survey results.
The Company has prepared general contingency plans to address unforeseen
Year 2000 issues. Contingency plans will be continuously monitored and updated
as conditions change throughout 1999 and into the Year 2000.
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
June 30, 1999
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
1999 1998 1999 1998
Average Yield/ Average Yield/ Average Yield/ Average Yield/
Balance Rate Balance Rate Balance Rate Balance Rate
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INTEREST EARNING ASSETS (000's) (000's) (000's) (000's)
Loans
Commercial .................... $131,154 8.78% $ 96,817 9.28% $126,439 8.68% $ 96,012 9.19%
Real estate ................... 141,557 7.86 142,859 8.28 138,718 8.00 142,384 8.30
Installment-net ............... 51,483 8.28 50,025 8.44 49,599 8.33 49,753 8.43
---------- -------- ------- --------
Total loans .................. 324,194 8.47 289,701 8.81 314,756 8.48 288,149 8.80
Investment securities
Taxable ....................... 248,453 6.33 214,007 6.21 247,834 6.21 197,626 6.32
Tax-exempt .................... 57,420 4.89 1,143 8.13 52,332 5.72 1,116 8.25
---------- -------- ------- -------
Total investment securities .. 305,873 6.06 215,150 6.22 300,166 6.12 198,742 6.33
Other short-term investments ... 8,543 5.39 14,974 6.64 8,775 5.44 9,591 6.88
---------- -------- ------- ------
Total interest earning assets $638,610 7.28 $519,825 7.67 $623,697 7.30 $496,482 7.78
========== ======== ======== ========
INTEREST BEARING LIABILITIES
Deposits
NOW, Savings and MMDA ........ $120,534 2.27% $121,565 2.70% $119,275 2.26% $120,847 2.67%
Time ......................... 271,070 5.39 246,101 5.69 272,627 5.45 232,449 5.64
--------- -------- --------- --------
Total deposits .............. 391,604 4.43 367,666 4.70 391,902 4.48 353,296 4.62
Borrowed funds ................. 186,563 5.04 92,475 5.35 169,939 4.99 89,121 5.40
Long-term debt ................ 12,655 8.71 12,669 6.51 12,657 8.71 7,312 7.00
-------- -------- --------- --------
Total interest
bearing liabilities ..... $590,822 4.71 $472,810 4.88 $574,498 4.72 $449,729 4.82
======== ======== ======== ========
MARGIN ANALYSIS
(as a % of earning assets)
Interest income ................ 7.28% 7.67% 7.30% 7.78%
Interest expense ............... 4.37 4.43 4.35 4.37
----- ----- ----- ----
Net interest income ............ 2.91% 3.24% 2.95% 3.41%
===== ===== ===== ====
</TABLE>
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.
11
<PAGE>
AMERICAN BANCORPORATION FORM 10-Q Quarterly Report
June 30, 1999
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Management is responsible for monitoring and limiting the Company's
exposure to interest rate risk within established guidelines while maximizing
net interest income. During the first half of 1999, the Company's interest rate
risk position grew more liability sensitive. The change in position resulted
primarily from the purchase of fixed-rate securities funded by short-term FHLB
borrowings.
Quantitative and qualitative disclosures about market risk are
presented at December 31, 1998 in Item 7a. of the Company's Annual Report on
Form 10-K, filed with the SEC on March 31, 1999.
Part II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Securities Holders
The Annual Meeting of Shareholders was held May 19, 1999. Proxies
were solicited pursuant to Regulation 14 of the 1934 Act. Shares represented in
person or by proxy totalled 2,557,659 or 81.72% of the shares then outstanding.
Shareholders approved by affirmative vote the following proposals:
1. To fix the number of positions for director at 10, with 2
vacancies that may be filled by the Board of Directors:
Vote For: 2,535,107 Against: 21,264 Abstain: 1,288
2. To elect Abigail M. Feinknopf, Jay T. McCamic and Jeffrey
W. McCamic directors for a three year term and to elect
John J. Malik, Jr. director for a one year term.
Vote For Vote Withheld Abstain
Abigail M. Feinknopf ........ 2,516,017 41,642 0
Jay T. McCamic .............. 2,349,920 207,739 0
Jeffrey W. McCamic .......... 2,349,920 207,731 0
John J. Malik, Jr ........... 2,513,325 44,334 0
Continuing in the position of director were the following:
Term Expiring
Jeremy C. McCamic 2000
Jolyon W. McCamic 2000
Jack O. Cartner 2001
Paul W. Donahie 2001
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, 1999
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 8/16/99 /s/ Jeremy C. McCamic
Jeremy C. McCamic
Chairman and
Chief Executive Officer
Date 8/16/99 /s/ Brent E. Richmond
Brent E. Richmond
Chief Operating Officer
Date 8/16/99 /s/ Jeffrey A. Baran
Jeffrey A. Baran
Chief Financial Officer
13
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