SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO ______.
COMMISSION FILE NUMBER 0-6848
JEFFERSON BANCORP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FLORIDA 59-1284885
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
301 ARTHUR GODFREY ROAD
MIAMI BEACH, FLORIDA 33140
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(305) 534-8341
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
N/A
(FORMER NAME, FORMER ADDRESS, AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST
REPORT)
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH
FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES __X__ NO _____
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES
OF COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE.
NUMBER OF SHARES OF COMMON STOCK, $1 PAR VALUE, OUTSTANDING AS OF APRIL 30,
1995: 3,616,792
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE FOLLOWING FINANCIAL STATE-
MENTS ARE FILED AS PART OF THIS
REPORT: PAGES IN QUARTERLY REPORT
AS OF MARCH 31, 1995 TO
SECURITIES AND EXCHANGE
COMMISSION
CONSOLIDATED BALANCE SHEETS 3-4
STATEMENTS OF CONSOLIDATED INCOME 5
STATEMENT OF CONSOLIDATED STOCK-
HOLDERS' EQUITY 6
STATEMENT OF CONSOLIDATED
CASH FLOWS 7
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS 8-11
ITEM 2. MANAGEMENT'S DISCUSSION AND 12-21
ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
PART II. OTHER INFORMATION
ITEM 6(a) EXHIBITS FILED
Exhibit 27
(b) REPORTS ON FORM 8-K
NO REPORTS ON FORM 8-K HAVE BEEN
FILED DURING THE QUARTER FOR
WHICH THIS REPORT IS FILED
SIGNATURES 22
<PAGE>
PART I. FINANCIAL INFORMATION
- ----------------------
JEFFERSON BANCORP, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31, 1995 DECEMBER 31, 1994
(Unaudited) (Audited)
------------------ -----------------
<S> <C> <C>
ASSETS
- ------
CASH AND DEMAND BALANCES DUE FROM BANKS $13,932,002 $14,542,225
------------------ -----------------
INVESTMENT SECURITIES
- ---------------------
U.S. GOVERNMENT AGENCIES 1,491,555 1,491,135
OBLIGATIONS OF STATES AND POLITICAL SUBDIVISIONS (NON-TAXABLE) 119,384 124,302
OTHER SECURITIES 1,139,349 1,139,349
------------------ -----------------
TOTAL INVESTMENT SECURITIES (APPROXIMATE MARKET VALUE
1995-$2,791,000; 1994-$2,796,000) 2,750,288 2,754,786
------------------ -----------------
SECURITIES AVAILABLE FOR SALE
- -----------------------------
U.S. TREASURY SECURITIES 9,599,062 9,313,125
SECURITIES OF OTHER U.S. GOVERNMENT AGENCIES 108,823,393 102,059,332
OBLIGATIONS OF STATES AND POLITICAL SUBDIVISIONS (NON-TAXABLE) 7,720,401 7,416,948
COLLATERIZED MORTGAGE OBLIGATIONS 2,117,554 2,341,048
------------------ -----------------
TOTAL SECURITIES AVAILABLE FOR SALE (Fair value 1995-$128,260,000);
1994-$121,130,000) 128,260,410 121,130,453
------------------ -----------------
FEDERAL FUNDS SOLD AND OTHER SHORT-TERM INVESTMENTS 2,550,000 200,000
------------------ -----------------
LOANS 212,513,470 203,476,490
LESS: UNEARNED INCOME 2,427,626 2,109,361
ALLOWANCE FOR CREDIT LOSSES 3,083,999 3,151,691
------------------ -----------------
TOTAL LOANS, NET 207,001,845 198,215,438
- ------------------ ------------------ -----------------
LOANS HELD FOR SALE 534,293 830,237
------------------ -----------------
PREMISES AND EQUIPMENT, NET 5,825,148 5,920,469
------------------ -----------------
OTHER REAL ESTATE OWNED AND IN-SUBSTANCE FORECLOSED LOANS 5,608,850 5,600,219
------------------ -----------------
OTHER ASSETS 20,601,298 15,081,953
------------------ -----------------
TOTAL ASSETS $387,064,134 $364,275,780
- -------------- ================== =================
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
3
<PAGE>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY MARCH 31, 1995 DECEMBER 31, 1994
- ------------------------------------ (Unaudited) (Audited)
DEPOSITS: ------------------ -----------------
- ---------
<S> <C> <C>
DEMAND (NON-INTEREST-BEARING) $48,295,501 $49,375,688
SAVINGS 32,155,684 32,572,061
INTEREST-PAYING CHECKING 69,093,621 70,096,042
MONEY MARKET ACCOUNTS 40,982,144 40,936,942
CERTIFICATES AND PUBLIC FUNDS 124,592,925 113,888,669
------------------ -----------------
TOTAL DEPOSITS 315,119,875 306,869,402
--------------
FEDERAL FUNDS PURCHASED AND SECURITIES SOLD
UNDER AGREEMENTS TO REPURCHASE 37,492,640 25,844,770
DEFERRED GAIN ON SALE OF BUILDINGS 35,902 37,265
OTHER LIABILITIES 2,422,707 2,154,050
------------------ -----------------
TOTAL LIABILITIES 355,071,124 334,905,487
------------------ -----------------
COMMITMENTS AND CONTINGENT LIABILITIES
- --------------------------------------
STOCKHOLDERS' EQUITY:
- ---------------------
COMMON STOCK, $1.00 PAR VALUE, 10,000,000 SHARES
AUTHORIZED; ISSUED - MARCH 31, 1995 - 3,861,476 SHARES;
DECEMBER 31, 1994 - 3,853,591 SHARES 3,861,476 3,853,591
CAPITAL SURPLUS 28,159,113 28,106,726
RETAINED EARNINGS 8,679,272 8,811,612
TREASURY STOCK, AT COST - MARCH 31, 1995 - 246,859 SHARES;
DECEMBER 31, 1994 - 246,859 SHARES (2,401,204) (2,401,204)
DEFERRED COMPENSATION (738,578) (840,323)
NET UNREALIZED GAINS (LOSSES) ON SECURITIES AVAILABLE FOR SALE
(NET OF APPLICABLE INCOME TAXES) (5,567,069) (8,160,109)
------------------ -----------------
TOTAL STOCKHOLDERS' EQUITY 31,993,010 29,370,293
--------------------------- ------------------ -----------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $387,064,134 $364,275,780
------------------------------------------ ================== =================
BOOK VALUE PER COMMON SHARE EXCLUDING UNREALIZED
GAINS (LOSSES) ON SECURITIES AVAILABLE FOR SALE $10.39 $10.41
================== =================
BOOK VALUE PER COMMON SHARE $8.85 $8.14
================== =================
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
4
<PAGE>
<TABLE>
<CAPTION>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES FOR THE QUARTER ENDED
STATEMENTS OF CONSOLIDATED INCOME MARCH 31,
1995 1994
------------- -------------
<S> <C> <C>
INTEREST INCOME:
INTEREST AND FEES ON LOANS $5,038,578 $3,987,635
INVESTMENTS AND SECURITIES HELD FOR SALE:
U.S. TREASURY SECURITIES 122,845 132,264
SECURITIES OF OTHER U.S. GOVERNMENT AGENCIES 1,531,137 1,321,674
OBLIGATIONS OF STATES AND POLITICAL SUBDIVISIONS-
NON-TAXABLE 101,828 382,820
COLLATERIZED MORTGAGE OBLIGATIONS AND OTHER SECURITIES 54,070 (3,967)
FEDERAL FUNDS SOLD AND OTHER SHORT-TERM INVESTMENTS 50,248 133,142
------------- -------------
TOTAL INTEREST INCOME 6,898,706 5,953,569
------------- -------------
INTEREST EXPENSE:
SAVINGS 209,035 253,397
INTEREST-PAYING CHECKING 287,356 327,485
MONEY MARKET ACCOUNTS 237,185 250,460
CERTIFICATES AND PUBLIC FUNDS 1,584,642 626,945
SHORT-TERM BORROWINGS 354,241 148,094
------------- -------------
TOTAL INTEREST EXPENSE 2,672,459 1,606,281
------------- -------------
NET INTEREST INCOME 4,226,247 4,347,288
PROVISION FOR CREDIT LOSSES 75,000 225,000
------------- -------------
NET INTEREST INCOME AFTER PROVISION FOR
CREDIT LOSSES 4,151,247 4,122,288
------------- -------------
OTHER INCOME:
TRUST INCOME 314,078 298,437
SERVICE CHARGES, COMMISSIONS AND FEES 328,213 307,393
GAIN ON SALE OF SECURITIES AVAILABLE FOR SALE, NET - 1,288,084
OTHER OPERATING INCOME 153,025 62,806
------------- -------------
TOTAL OTHER INCOME 795,316 1,956,721
------------- -------------
OPERATING EXPENSES:
SALARIES AND EMPLOYEE BENEFITS 2,290,754 2,285,345
OCCUPANCY EXPENSE, NET 698,082 489,236
OTHER OPERATING EXPENSES 1,499,403 1,466,589
------------- -------------
TOTAL OPERATING EXPENSES 4,488,239 4,241,170
------------- -------------
INCOME BEFORE PROVISION FOR INCOME TAXES 458,324 1,837,838
PROVISION FOR INCOME TAXES (138,900) (536,900)
------------- -------------
NET INCOME $319,424 $1,300,938
============= =============
EARNINGS PER COMMON SHARE:
AVERAGE NUMBER OF SHARES OUTSTANDING 3,795,875 3,577,042
============= =============
NET INCOME PER SHARE $0.08 $0.36
============= =============
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5
<PAGE>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1995
<TABLE>
<CAPTION>
NET UNREALIZED
GAINS (LOSSES)
ON SECURITIES
COMMON CAPITAL RETAINED TREASURY DEFERRED AVAILABLE
STOCK SURPLUS EARNINGS STOCK COMPENSATION FOR SALE
------------- -------------- -------------- ------------ ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1995 $3,853,591 $28,106,726 $8,811,612 ($2,401,204) ($840,323) ($8,160,109)
NET INCOME (LOSS) - - 319,424 - - -
$.125 PER SHARE CASH DIVIDEND - - (451,764) - - -
EXERCISE OF STOCK OPTIONS
(7,885 SHARES) 7,885 52,387 - - - -
AMORTIZATION OF DEFERRED
COMPENSATION - - - - 101,745 -
CHANGE IN NET UNREALIZED
GAINS/(LOSSES) ON SECURITIES
AVAILABLE FOR SALE 2,593,041
------------- -------------- -------------- ------------ ------------ ---------------
BALANCE, MARCH 31, 1995 $3,861,476 $28,159,113 $8,679,272 ($2,401,204) ($738,578) ($5,567,068)
============= ============== ============== ============ ============ ===============
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
6
<PAGE>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31,
<TABLE>
<CAPTION>
1995 1994
----------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME $319,424 $1,300,938
ADJUSTMENTS TO RECONCILE NET INCOME TO
NET CASH PROVIDED BY OPERATING ACTIVITIES:
DEPRECIATION AND AMORTIZATION 199,787 163,328
GAIN ON SALE OF BUILDINGS (1,363) (216,510)
GAIN ON SALE OF OTHER REAL ESTATE OWNED (51,639) (43,748)
PROVISION FOR CREDIT LOSSES 75,000 225,000
PREMIUM AMORTIZATION AND DISCOUNT ACCRETION, NET 92,432 176,715
NET GAIN ON SALE OF INVESTMENT SECURITIES - (1,288,084)
AMORTIZATION OF DEFERRED COMPENSATION 101,745 90,840
SALE OF SECURITIES AVAILABLE FOR SALE - 46,400,143
PROCEEDS FROM MATURITIES AND PAYDOWNS OF
SECURITIES AVAILABLE FOR SALE 886,944 3,941,347
PURCHASE OF SECURITIES AVAILABLE FOR SALE (3,952,500) (51,925,794)
ORIGINATION OF LOANS HELD FOR SALE (5,066,943) (18,926,498)
DISPOSITION OF LOANS HELD FOR SALE 5,362,887 24,599,772
(INCREASE) DECREASE IN OTHER ASSETS (7,092,989) 1,895,741
INCREASE (DECREASE) IN OTHER LIABILITIES 268,657 (23,103)
----------- -----------
NET CASH (USED) PROVIDED BY OPERATING ACTIVITIES (8,858,558) 6,370,087
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
NET INCREASE IN LOANS (8,861,407) (6,357,076)
PURCHASES OF INVESTMENT SECURITIES - (247,126)
NET INCREASE IN FEDERAL FUNDS SOLD AND
INTEREST-EARNING DEPOSITS IN OTHER FINANCIAL INSTITUTIONS (2,350,000) (150,000)
DISPOSITION OF OTHER REAL ESTATE OWNED 43,008 293,213
ACQUISITION OF OTHER REAL ESTATE OWNED - (521,873)
PURCHASES OF PREMISES AND EQUIPMENT (90,117) (834,452)
----------- -----------
NET CASH USED BY INVESTING ACTIVITIES (11,258,516) (7,817,314)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
NET INCREASE (DECREASE) IN DEPOSITS 8,250,473 (4,631,546)
NET INCREASE IN FEDERAL FUNDS PURCHASED AND
SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE 11,647,870 9,108,319
PAYMENT OF CASH DIVIDENDS (451,764) (434,403)
PURCHASE OF TREASURY STOCK - (100,003)
PROCEEDS FROM EXERCISE OF STOCK OPTIONS 60,272 202,713
----------- -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES: 19,506,851 4,145,080
----------- -----------
NET INCREASE IN CASH AND DEMAND BALANCES
DUE FROM BANKS (610,223) 2,697,853
CASH AND DEMAND BALANCES DUE FROM BANKS AT BEGINNING OF YEAR 14,542,225 13,540,868
----------- -----------
CASH AND DEMAND BALANCES DUE FROM BANKS AT MARCH 31, $13,932,002 $16,238,721
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
INTEREST PAID $2,227,193 $1,372,000
========== ==========
INCOME TAX PAYMENTS $60,000 $55,000
========== ==========
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
7
<PAGE>
ITEM 1. JEFFERSON BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(A) SIGNIFICANT ACCOUNTING POLICIES - The accounting policies followed for
quarterly reporting purposes are the same as those disclosed in the 1994 Annual
Report to Stockholders of Jefferson Bancorp, Inc. (the "Company"). In the
opinion of management, the accompanying consolidated financial statements
reflect all adjustments (which include only normal recurring adjustments)
necessary for a fair presentation of the information provided. These statements
have been prepared by the Company without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote statements have been omitted pursuant to such rules and regulations.
Although the Company believes that the disclosures are adequate to make the
information presented not misleading, it is suggested that these financial
statements be read in conjunction with the Company's audited 1994 consolidated
financial statements and the notes thereto.
(B) RESTRICTED STOCK, STOCK OPTION AND NON-QUALIFIED OPTION PLANS
RESTRICTED STOCK PLAN - On September 1, 1989, the Company adopted a restricted
stock plan (the "Restricted Plan") whereby an aggregate of not more than 300,000
shares of common stock were made available for awards to certain key executives.
The number of shares awarded to the eligible executives are based on the
executive's salary and length of time employed by the Company. The stock issued
in connection with the Restricted Plan vests on the third anniversary of the
date of grant. Deferred compensation, a contra-equity account, is recorded for
the fair market value of any shares of common stock awarded under the Restricted
Plan and is then amortized as compensation expense over the vesting period. At
March 31, 1995, 68,654 shares were available for future awards.
STOCK OPTION PLANS - Under various stock option plans approved by the Board of
Directors, options may be granted to key employees of the Company and its
subsidiaries, including officers and directors who are also employees, to
purchase an aggregate of 585,328 shares of the common stock of the Company. At
March 15, 1995, the total number of stock options available for future grants
were 88,231 shares. Options under these plans are granted at a price of not
less than the fair market value of the shares on the date granted. No charge is
made to income with respect to stock options.
8
<PAGE>
The following table presents additional information concerning the activity in
these stock option plans:
<TABLE>
<CAPTION>
OPTION PRICE
------------
NUMBER OF AVERAGE
SHARES PER SHARE AGGREGATE
<S> <C> <C> <C>
Options outstanding:
January 1, 1992 289,006 $8.64 $2,496,805
Grants 30,000 8.38 251,400
3% stock dividend 9,570 - -
------- ---------
Options outstanding:
December 31, 1992 328,576 8.37 2,748,205
Grants 25,000 9.90 247,500
3% stock dividend 750 - -
Exercised (28,623) 8.37 (239,548)
Rescissions (30,044) 8.25 (247,800)
------- ---------
Options outstanding:
December 31, 1993 295,659 8.49 2,508,357
Grants 88,000 10.16 893,813
3% stock dividend 2,640 - -
Exercised (28,224) 7.64 (215,546)
Recision (29,802) 7.83 (233,330)
------- ---------
Options outstanding:
December 31, 1994 328,273 9.00 2,953,294
Grants 1,000 13.25 13,250
Exercised (7,885) 7.64 (60,272)
------- ---------
Options outstanding:
March 31, 1995 321,388 9.05 2,906,272
======= =========
Options exercisable at
December 31, 1994 309,348
=======
March 31, 1995 301,713
=======
</TABLE>
NON-EMPLOYEE DIRECTORS OPTION PLAN:
On June 20, 1994, with all non-employee directors abstaining and subject to
stockholder approval, the Board of Directors granted to non-employee directors
non-qualified options to purchase 27,500 (28,325 after restatement for 3% stock
dividend) shares of the common stock of the Company at a price of $10.125 per
share ($9.83 after restatement for 3% stock dividend), the fair market value of
the shares on that date. The grants were presented to the stockholders of the
Company for their consideration at the annual meeting held April 25, 1995 and
ratified by the holders of 88% of the total shares outstanding.
9
<PAGE>
<TABLE>
<CAPTION>
OPTION PRICE
------------
NUMBER OF AVERAGE
SHARES PER SHARE AGGREGATE
<S> <C> <C> <C>
Options outstanding:
January 1, 1992
Grants 110,000 $7.75 $ 852,500
3% stock dividend 3,300 - -
------- ----------
Options outstanding:
December 31, 1992 113,300 7.53 852,500
Grants 27,500 10.00 275,000
3% stock dividend 825 - -
------- ----------
Options outstanding:
December 31, 1993 141,625 7.97 1,127,500
Grants 27,500 10.13 278,438
3% stock dividend 825 -
Exercised (29,200) 7.53 (219,713)
------- ----------
Options outstanding:
December 31, 1994
and March 31, 1995 140,750 8.43 $1,186,225
======= ==========
Options exercisable at:
December 31, 1994 140,750
=======
March 31, 1995 140,750
=======
</TABLE>
(C) DEATH AND DISABILITY, SEVERANCE AND RETIREMENT PLANS
Effective May 1, 1989, the Company adopted a death and disability plan that
provides for cash payments in the event of the death or permanent disability of
directors who are not employees of the Company and certain senior officers of
the Company. The death and disability plan is substantially funded through life
insurance policies.
Also, effective May 1, 1989, the Company adopted an unfunded severance plan that
provided for cash payments to certain senior officers of the Company in the
event that their employment was voluntarily or involuntarily terminated at any
time during a one-year period following a change in control, as defined by the
Company.
Effective January 1, 1994, the Company amended the severance plan to provide for
cash payments to directors and senior officers upon a change in control, whether
or not their employment is terminated as a result thereof, or upon their
retirement. During the quarter ended March 31, 1995, the Company accrued
approximately $154,665 of benefits. It is the Company's intent that benefits
under the amended severance plan and benefits under the death and disability
plan be mutually exclusive and not duplicative.
(D) RECLASSIFICATION: Certain amounts in the prior period in the
consolidated financial statements have been reclassified for comparative
purposes.
10
<PAGE>
(E) OTHER REAL ESTATE OWNED AND IN-SUBSTANCE FORECLOSED LOANS: In-substance
foreclosed loans and property acquired by foreclosure or deed in lieu of
foreclosure are recorded at the lower of cost or estimated fair value at the
time the loan is foreclosed or deemed foreclosed in-substance. Loans foreclosed
in-substance consist of loans accounted for as foreclosed property even though
actual foreclosure has not occurred. Upon classification as other real estate
owned, the excess of the recorded investment over the fair value of the
collateral, if any, is charged to the allowance for credit losses.
Once properties are classified as other real estate owned, such properties are
carried at the lower of cost or fair value minus estimated costs to sell. Net
expenses incurred in maintaining properties, subsequent write-downs due to
changes in market values, and gains or losses upon disposition are included in
other operating expenses. Expenditures to complete or improve properties are
capitalized only if reasonably expected to be recovered; otherwise, they are
expensed as incurred.
The amounts the Company could ultimately recover from loans foreclosed in-
substance, and property acquired by foreclosure or deed in lieu of foreclosure,
could differ materially from the amounts used in arriving at the net carrying
value of the assets because of future market factors beyond the Company's
control or changes in the Company's strategy for recovering its investment.
(F) GOODWILL: In 1987, the Company acquired Broward Bancorp, a Florida bank
holding company. Broward Bancorp's sole banking subsidiary, which was known as
Broward Bank, has become a subsidiary of the Company and has been renamed
Jefferson Bank. The purchase price and costs of this acquisition exceeded the
fair market value of the net assets by approximately $1,134,000. This excess is
being amortized over a period of 20 years using the straight line method and is
included in "other assets" in the Company's consolidated balance sheets. The
accumulated amortization through March 31, 1995 totalled $ 505,000.
(G) INCOME TAXES: Deferred taxes are provided for timing differences
between income reported for financial reporting and for income tax purposes.
The Company files consolidated income tax returns.
The Company provides for deferred taxes under the liability method. Under such
method, deferred taxes are adjusted for tax rate changes as they occur.
Deferred income tax assets and liabilities are computed annually for differences
between the financial statements and tax bases of assets and liabilities that
will result in taxable or deductible amounts in the future based on enacted tax
laws and rates applicable to the periods in which the differences are expected
to affect taxable income. Valuation allowances are established when necessary
to reduce deferred tax assets to the amount expected to be realized. Income tax
expense is the tax payable or refundable for the period plus or minus the change
during the period in deferred tax assets and liabilities.
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SUMMARY
The consolidated earnings of Jefferson Bancorp, Inc. and subsidiaries
(collectively, the "Company") reflect principally the operations of the banking
subsidiaries, Jefferson Bank of Florida ("Jefferson Florida") and Jefferson Bank
("Jefferson Broward").
Earnings are comprised of net interest income and other income. Net interest
income, or the difference between total interest income from earning assets and
total interest expense from key liabilities, for any given period is determined
by the average volume of interest-earning assets (mainly loans, loans held for
sale, investment securities, securities available for sale and federal funds
sold), the average yield earned on such assets, the average volume of deposits
and borrowings on which interest is paid, the average rate of interest paid on
such deposits and borrowings and the average volume of demand deposits upon
which no interest is paid.
Other income is comprised of service charges on deposit accounts, fees and
commissions for various banking services and trust department income. Earnings
from these functions are affected chiefly by the volume of activity and the
level of fees charged. Other operating income also includes net gains
recognized from transactions involving loans and fixed assets.
12
<PAGE>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
<TABLE>
<CAPTION>
QUARTER ENDED MARCH 31, 1995 QUARTER ENDED MARCH 31, 1994
NET INTEREST INCOME, AVERAGE BALANCES
AND AVERAGE RATES AVERAGE AVERAGE AVERAGE AVERAGE
(IN THOUSANDS) BALANCE INTEREST RATE BALANCE INTEREST RATE
<S> <C> <C> <C> <C> <C> <C>
INTEREST-EARNING ASSETS:
Loans and loans held for sale:
Real estate, commercial and financial and
government guaranteed loans (1) $194,812 $4,563 9.50% $164,435 $3,521 8.68%
Installment loans, net of unearned income 9,145 220 9.64% 5,553 142 10.26%
Investment securities and securities held
for sale:
U.S. Treasury securities 10,225 123 4.87% 10,663 132 5.03%
Securities of other U.S. Government agencies 115,343 1,531 5.31% 95,569 1,322 5.53%
Obligations of states and political
subdivisions (non-taxable) (2) 8,058 153 7.58% 26,724 578 8.66%
Collateralized mortgage obligations and other
securities 3,538 54 6.12% 5,870 (4) -0.27%
Federal funds sold and other short-term
investments 3,580 50 5.69% 18,587 133 2.90%
-------- ------ -------- ------
Total interest-earning assets $344,701 6,694 7.88% $327,401 5,825 7.22%
======== ------ ======== ------
KEY LIABILITIES:
Deposits:
Savings 31,857 209 2.66% 41,481 253 2.48%
Interest-paying checking 70,579 287 1.65% 79,480 328 1.67%
Money market 41,749 237 2.30% 46,868 251 2.17%
Certificates 92,799 1,240 5.42% 78,353 618 3.20%
Public funds 25,700 344 5.43% 1,111 9 3.43%
-------- ------ -------- ------
Total deposits 262,684 2,318 3.58% 247,293 1,458 2.39%
Borrowings 35,341 354 4.06% 21,512 148 2.79%
-------- ------ -------- ------
Total interest-bearing liabilities 298,025 2,672 3.64% $268,805 1,606 2.42%
-------- ------ -------- ------
Total noninterest-bearing liabilities 47,772 51,217
-------- --------
$345,797 $320,022
======== ========
Net interest income/spread $4,022 4.24% $4,219 4.79%
====== ======
Net interest income as a percent of total
average interest-earning assets 4.73% 5.23%
<FN>
(1) Average balances include nonaccrual loans and interest income includes fees on loans of approximately $164,000, $89,000 and
$493,000 for quarters ended March 31, 1995 and 1994 and for the year ended December 31, 1994, respectively.
(2) Interest income includes the effects of taxable-equivalent adjustments, using a 34 % tax rate to adjust interest on tax-
exempt securities to taxable-equivalent basis.
</FN>
</TABLE>
13
<PAGE>
JEFFERSON BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1994
NET INTEREST INCOME, AVERAGE BALANCES
AND AVERAGE RATES AVERAGE AVERAGE
(IN THOUSANDS) BALANCE INTEREST RATE
<S> <C> <C> <C>
INTEREST-EARNING ASSETS:
Loans and loans held for sale:
Real estate, commercial and financial and
government guaranteed loans (1) $171,275 $15,700 9.17%
Installment loans, net of unearned income 6,701 664 9.91%
Investment securities and securities held
for sale:
U.S. Treasury securities 10,351 504 4.87%
Securities of other U.S. Government agencies 107,534 6,033 5.61%
Obligations of states and political
subdivisions (non-taxable) (2) 20,023 1,708 8.53%
Collateralized mortgage obligations and other
securities 4,640 172 3.70%
Federal funds sold and other short-term
investments 6,734 220 3.26%
-------- -------
Total interest-earning assets $327,258 25,001 7.64%
======== -------
KEY LIABILITIES:
Deposits:
Savings 37,417 968 2.59%
Interest-paying checking 75,126 1,257 1.67%
Money market 43,402 944 2.17%
Certificates 76,727 2,821 3.68%
Public funds 14,786 767 5.19%
-------- -------
Total deposits 247,458 6,757 2.73%
Borrowings 21,930 676 3.08%
-------- -------
Total interest-bearing liabilities $269,388 7,433 2.76%
-------- -------
Total noninterest-bearing liabilities 49,751
--------
$319,139
========
Net interest income/spread $17,568 4.88%
=======
Net interest income as a percent of total
average interest-earning assets 5.37%
<FN>
(1) Average balances include nonaccrual loans and interest income includes fees on loans of approximately $164,000, $89,000 and
$493,000 for quarters ended March 31, 1995 and 1994 and for the year ended December 31, 1994, respectively.
(2) Interest income includes the effects of taxable-equivalent adjustments, using a 34 % tax rate to adjust interest on tax-
exempt securities to taxable-equivalent basis.
</FN>
</TABLE>
14
<PAGE>
MATERIAL CHANGES IN FINANCIAL CONDITION
The average balance of the Company's consolidated interest-earning assets for
the quarter ended March 31, 1995 was $344,701,000 as compared to $327,258,000
for the year ended December 31, 1994, an increase of $17,443,000, or 5%. The
primary cause of the growth in average interest-earning assets in the first
quarter of 1995 was the increase in the Company's loans. The average balance of
such loans increased by $25,981,000, or 15%. At the same time, the average
balance of the Company's portfolio of securities of other U.S. Government
agencies increased by $7,809,000, or 7%. The increase in the Company's
portfolio of loans and securities of other U.S. Government agencies in the first
quarter of 1995 was accomplished by the growth in the average balance of
certificates of deposits, public funds, and borrowings. The average balance of
the Company's certificates of deposits for the quarter ended March 31, 1995
increased by $16,072,000, or 21%, public funds increased by $10,914,000 or 74%,
and borrowings increased by $13,411,000, or 61%. At the same time, the average
balance of saving deposits decreased by $5,560,000, or 15%, interest-paying
checking deposits decreased by $4,547,000, or 6%, money market deposits
decreased by $1,653,000, or 4%, and demand deposits decreased by $1,979,000, or
4%.
MATERIAL CHANGES IN RESULTS OF OPERATIONS
Consolidated net income for the quarter ended March 31, 1995 was $319,424
compared to net income of $1,300,938 for the comparable period in 1994. Per-
share net income for the quarter ended March 31, 1995 was $.08 compared to per-
share net income of $.36 for the comparable period in 1994. The decrease in
consolidated net income was primarily due to an absence of gains from security
transactions during the first quarter of 1995 as compared to $1,288,084 from
such transactions in the comparable period in 1994. The other contributing
factor for lower net income in the first quarter of 1995 was an increase of
$208,846, or 43%, in occupancy expense. Occupancy expense in the first quarter
of 1994 included gains of $216,509 on sale of buildings, which completed its
amortization period in 1994. Occupancy expense in the first quarter of 1995 had
no such gain.
NET INTEREST INCOME
The Company's net interest income (on a fully taxable equivalent basis,
inclusive of loan service charge income) was $4,022,000 for the first quarter of
1995, compared to $4,219,000 for the first quarter of 1994, a decrease of 5%. A
primary reason for this decline was a decrease in the net interest spread, or
the spread between the average rates earned on interest-earning assets and the
average rates paid on interest-bearing liabilities, during the first quarter of
1995.
The aggregate cost of funds increased, primarily as a result of pressure for
higher pricing for customer deposits, and shifting of lower costing deposits to
higher costing deposits. Certificates of deposit represented 35% of total
average deposits in the first quarter of 1995 as compared to 32% in the first
quarter of 1994, and the average cost of certificates of deposit was 5.42% in
the first quarter of 1995 as compared to 3.20% in the first quarter of 1994.
15
<PAGE>
PROVISION FOR CREDIT LOSSES
The provision for credit losses represents the expense which, based on
management's review and evaluation of the Company's consolidated portfolio, is
required to maintain the reserve for credit losses at an appropriate level.
Although it is impossible to predict future credit losses accurately, the
adequacy of the reserve for credit losses is determined by management through
the ongoing evaluation of various factors influencing potential loss exposure.
These factors include the collectibility of individual credits, credit loss
trends and concentrations within the loan portfolio in light of the present
economic and regulatory environment. Changes in economic factors which
influence potential loss exposure are also considered in management's evaluation
when the likelihood of such changes can be reasonably determined. In the first
quarter of 1995, the provision for credit losses amounted to $75,000 versus
$225,000 in the comparable period of 1994. This decrease was primarily in
response to management's ongoing evaluation of the loan portfolio and the
adequacy of its allowance for loan losses.
It is management's policy to charge off loans when there appears to be little
likelihood of recovery. Management considers the allowance for credit losses to
be adequate to cover estimated losses inherent in the Company's consolidated
loan portfolio.
OTHER OPERATING INCOME
Other income for the first quarter of 1995 totaled $795,316 as compared to
$1,956,720, for the first quarter of 1994. No transactions in securities
available for sale took place during the first quarter of 1995 as compared to
such transactions which resulted in net gains of $1,288,084, during the
comparable period of 1994. The portfolio of securities held for sale is managed
with the primary objective of maintaining an appropriate level of liquidity, and
to control interest rate risk.
Fee income from Trust Department operations increased by $15,641, or 5%, due
primarily to an increase in size of trust assets under management during the
first quarter of 1995 versus the first quarter of 1994. Income from service
charges, commissions and fees paid by customers increased in the first quarter
of 1995 by $20,820, or 7%, from the first quarter of 1994. This increase is
primarily caused by the increase in credit card processing fees and
miscellaneous service charges.
Other operating income increased during the first quarter of 1995 primarily due
to gain on life insurance. In the first quarter of 1995, the gain on life
insurance was $109,815 as compared to no such gain for the comparable period of
1994.
OPERATING EXPENSES
Total operating expenses for the first quarter of 1995 were $4,488,239 as
compared to $4,241,170 for the first quarter of 1994. The percentage of total
operating expenses to total income was 58% in the first quarter of 1995 as
compared to 54% in the first quarter of 1994. Personnel expenses in the first
16
<PAGE>
quarter of 1995 were $2,290,754 as compared to $2,285,345 for the first quarter
of 1994. The occupancy expenses during the first quarter of 1995 were $698,082
as compared to $489,236 for the first quarter of 1994. The increase in
occupancy expense during the first quarter of 1995, as compared to the
comparable quarter in 1994, was primarily caused by non-availability of gain on
sale of buildings which completed its amortization period in 1994. Other
operating expenses in the first quarter of 1995 were $1,499,403 as compared to
$1,466,589 in the first quarter of 1994. This increase was primarily due to an
increase in depreciation expense. In the first quarter of 1995, the
depreciation expenses were $140,963, as compared to $109,639 for the comparable
period of 1994.
ASSET/LIABILITY MANAGEMENT
The primary objective of asset and liability management is to structure the
balance sheet appropriately in order to maximize net interest income while
maintaining acceptable levels of liquidity and interest rate risk. The policies
and guidelines for managing balance sheet and off-balance sheet activities are
formulated and monitored by the Company's Asset and Liability Committee
("ALCO").
INTEREST-SENSITIVITY
Interest-sensitivity management is concerned with optimizing the effects of
interest rate changes on net interest income. Interest-sensitivity is measured
by gaps defined as the difference between interest-sensitive assets and
interest-sensitive liabilities within any specific time frame. For example, a
negative, or liability-sensitive, gap occurs when interest-sensitive liabilities
exceed interest-sensitive assets. This generally indicates that net interest
income will improve if interest rates fall. The opposite would be true in the
case of a positive or asset-sensitive gap.
Interest-sensitivity analysis is a valuable tool in assessing the potential
impact of interest rate changes on net interest income. The Company's interest-
sensitivity position is closely monitored by ALCO, which regularly examines and
evaluates the potential impact of varying scenarios of market interest rates and
balance sheet composition. Other factors, however, such as changes in balance
sheet mix and interest rate spread relationships, also play a vital role in
maximizing net interest income.
On March 31, 1995, the Company was asset sensitive (rate-sensitive assets in
excess of rate-sensitive liabilities) with respect to rate-sensitive assets and
rate-sensitive liabilities with maturities of 12 months or less, with a positive
cumulative interest rate sensitivity gap as a percentage of total interest-
sensitive earning assets of 5.35 percent. This means that the Company's
interest-sensitive assets reprice more slowly than its interest-sensitive
deposits.
17
<PAGE>
The Company's interest-sensitivity position at March 31, 1995 is presented
below.
<TABLE>
<CAPTION>
Interest Rate Sensitivity Analysis
(Dollars in thousands)
0-3 3-12 1-5 Over
March 31, 1995 Months Months Years 5 Years Total
- -------------- ------ ------ ----- ------- -----
<S> <C> <C> <C> <C> <C>
Investment securities and
securities held for sale $25,446 $30,624 $ 36,330 $38,611 $131,011
Federal funds sold and other
short-term investments 2,550 -- -- -- 2,550
Loans and loans held for sale 82,207 33,027 64,045 31,341 210,620
------- ------- -------- ------- --------
Earning assets 110,203 63,651 100,375 69,952 344,181
Deposits:
Interest-paying checking* -- -- 69,094 -- 69,094
Money market 40,982 -- -- -- 40,982
Savings* -- -- 32,156 -- 32,156
Certificates of deposit
and public funds 7,907 69,044 17,467 30,175 124,593
Federal funds purchased
and other short-term
borrowings 37,493 -- -- -- 37,493
------- ------- -------- ------- --------
Interest-bearing liabilities 86,382 69,044 118,717 30,175 304,318
------- ------- -------- ------- --------
Interest-sensitivity gap $23,821 $(5,393) $(18,342) $39,777 $ 39,863
======= ======= ======== ======= ========
Cumulative gap $23,821 $18,428 $ 86 $39,863
======= ======= ======== =======
Cumulative gap to total
earning assets (%) 6.92 5.35 .02 11.58
===== ===== ===== ======
<FN>
Loans are stated net of unearned income.
Non-earning assets and non-interest-bearing liabilities have been excluded
from analysis.
*It has been our experience that through a variety of interest rate
scenarios, interest-paying checking and savings accounts have not materially
increased or decreased as a result of interest rate changes. It is for this
reason that the Company has felt comfortable classifying its deposit accounts
as 1-5 year liabilities.
</FN>
</TABLE>
18
<PAGE>
RISK ELEMENTS
NON-ACCRUAL, PAST DUE AND RESTRUCTURED LOANS
The table below presents an analysis of consolidated risk elements of the
Company classified as follows: (a) non-accrual loans; (b) 90-day loans; (c)
troubled debt restructurings, as defined in Statement of Financial Accounting
Standards No. 15, "Accounting by Debtors and Creditors for Troubled Debt
Restructurings"; and (d) Other Real Estate Owned.
<TABLE>
<CAPTION>
03/31/95 12/31/94
-------- --------
(in thousands)
<S> <C> <C>
(a) Non-accrual loans $3,785 $4,265
(b) 90-day loans 63 1,050
(c) Troubled debt restructurings None None
(d) Other Real Estate Owned 5,609 5,600
</TABLE>
Non-accrual loans declined by $480,000 in the quarter ended March 31, 1995 due
primarily to the disposition of two loans. One loan for $229,000 was foreclosed
and transferred to OREO. One loan for $110,000 was paid.
Ninety-day loans declined $987,000 due primarily to the disposition of two
loans. One for $767,000 was paid. One for $171,000 was brought current.
<TABLE>
<CAPTION>
Potential problem loans: 03/31/95 12/31/94
-------- --------
<S> <C> <C>
$ 240 $ 403
</TABLE>
At March 31, 1995 the non-accrual loans were broken down as follows:
<TABLE>
<CAPTION>
(in thousands)
<S> <C> <C>
Residential Real Estate 981 26%
Commercial Real Estate 2,286 60%
Commercial - Unsecured 460 12%
Installment Loans 58 2%
</TABLE>
There is one major concentration within the balance of the non-accruing
portfolio: A commercial real estate loan which comprises 41% of total non-
accruing loans. The loan is fully secured with no loss expected. The loan is
classified substandard.
There are three major concentrations within the classified loans: The above
non-accrual loan, which comprises 31% of total classified loans. A second loan,
which comprises 10% of total classified loans, is secured with a combination of
collateral including real estate and marketable securities. This loan is
classified substandard due to chronic slowness caused by cash flow problems of
the borrower. However, the loan is current and accruing. A third loan
comprises 9% of total classified loans and is secured with real estate. This
loan is classified substandard due to chronic slowness caused by cash flow
problems of the borrower. The loan is 30 days past due and accruing.
At March 31, 1995 $96,033 is classified as loss and is fully reserved.
19
<PAGE>
Other real estate owned remained relatively unchanged for the quarter ended
March 31, 1995.
LIQUIDITY MANAGEMENT
In order for the Company's banking subsidiaries to satisfy the requirements of
depositors wanting to withdraw funds and to meet the credit needs of borrowers,
the banking subsidiaries must maintain certain levels of liquidity. Asset and
liability management strategy is designed to achieve the maintenance of an
adequate level of liquidity and the management of the interest-rate sensitive
structure of the balance sheet. The basic objective of interest-rate sensitive
management is the protection of net interest income from sharp fluctuations
caused by changes in the market. The management of liquidity and interest-rate
sensitivity are closely related as both are affected by maturities of assets and
the source of funds.
Liquidity and interest-rate sensitivity positions are closely monitored by an
asset and liability committee which regularly examines and evaluates the
potential impact of varying scenarios of market interest rates, balance sheet
compositions and funding source requirements.
Liquidity of the Company's banking subsidiaries is provided in part through the
cash flow generated by transactions in the ordinary course of business. Loan
repayments and maturing earning assets furnish additional cash flow sources.
Liquidity is also provided by the acquisition of new deposits, as well as by
ability to raise funds in a variety of money markets. Liquidity is also
provided by securities available for sale. As of March 31, 1995, securities
available for sale amounted to $128,260,410.
CAPITAL RESOURCES
The Company has continued to maintain a strong capital base during 1995. At
March 31, 1995, the Company's Tier 1 risk-based capital and total capital ratios
(as more fully described below) were 12.14% and 13.34%, respectively. The
Company's leverage ratio was 8.52% at March 31, 1995. These ratios were well
above the minimum capital requirements established by government agencies.
The Company and its banking subsidiaries are subject to a minimum Tier 1 capital
to risk-rated assets ratio of 4% and total capital (Tier 1 plus Tier 2) to risk-
rated asset ratio of 8%. The Federal Reserve Board has also established
additional capital adequacy guidelines referred to as the Tier 1 leverage ratio
that measures the ratio of Tier 1 capital to average assets. The most highly
rated bank holding companies will be required to maintain a Tier 1 leverage
ratio of 3%. The required ratio will be based on the Board's assessment of the
individual bank holding company's asset quality, earnings performance, interest
rate risk and liquidity. The FDIC Improvement Act of 1991 ("FDICIA") requires
the establishment of a capital-based supervisory system of prompt corrective
action of all depository institutions. The Board's regulations under FDICIA
defines "well capitalized" institutions as those whose capital ratios equal or
exceed the following minimum ratios: Tier 1 capital ratio of 6%, total risk-
based ratio of 10%, and Tier 1 leverage ratio of 5%.
20
<PAGE>
As of March 31, 1995, the Company's Tier 1 capital, total risk-based capital and
Tier 1 leverage ratios were 12.14%, 13.34% and 8.52%, respectively. These
ratios, as well as the corresponding ratios of the Company's banking
subsidiaries, are well above industry averages.
Stockholders' equity and book value per share (not including unrealized losses
on securities available for sale) as of March 31, 1995 increased to $37,560,078
and $10.39, respectively, from $37,088,133 and $10.36 per share as of March 31,
1994. These figures are net of dividends in the amounts of $451,764 and
$434,403 in 1995 and 1994, respectively. Stockholders' equity and book value
per share (including unrealized losses on available for sale securities, net of
applicable income taxes) as of March 31, 1995 were $31,993,010 and $8.85,
compared to $35,141,565 and $9.82 for the same period in 1994. Unrealized gains
and loans on securities available for sale are not included in the statement of
consolidated income until they are sold. All per-share figures for 1994 have
been retroactively adjusted to reflect the three percent stock dividend
distributed in December 1994.
As of March 31, 1995, the Company had no material commitments for capital
expenditures.
21
<PAGE>
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.
JEFFERSON BANCORP, INC.
May 12, 1995 /s/ Barton S. Goldberg
- ---------------------- ------------------------------------------
Barton S. Goldberg
Secretary-Treasurer
(Principal Financial Officer
and Director)
May 12, 1995 /s/ Syed F. Zafar
- ---------------------- ------------------------------------------
Syed F. Zafar
Senior Vice President & Comptroller
(Principal Accounting Officer)
22
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000053316
<NAME> JEFFERSON BANCORP, INC.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 13,932,002
<INT-BEARING-DEPOSITS> 266,824,374
<FED-FUNDS-SOLD> 2,550,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 128,260,410
<INVESTMENTS-CARRYING> 2,750,288
<INVESTMENTS-MARKET> 2,791,000
<LOANS> 207,001,845
<ALLOWANCE> 3,083,999
<TOTAL-ASSETS> 387,064,134
<DEPOSITS> 315,119,875
<SHORT-TERM> 37,492,640
<LIABILITIES-OTHER> 2,458,609
<LONG-TERM> 0
<COMMON> 3,861,476
0
0
<OTHER-SE> 28,131,534
<TOTAL-LIABILITIES-AND-EQUITY> 387,064,134
<INTEREST-LOAN> 5,038,578
<INTEREST-INVEST> 1,809,880
<INTEREST-OTHER> 50,248
<INTEREST-TOTAL> 6,898,706
<INTEREST-DEPOSIT> 2,318,218
<INTEREST-EXPENSE> 2,672,459
<INTEREST-INCOME-NET> 4,151,247
<LOAN-LOSSES> 75,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,488,239
<INCOME-PRETAX> 458,324
<INCOME-PRE-EXTRAORDINARY> 458,324
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 319,424
<EPS-PRIMARY> 0.08
<EPS-DILUTED> 0.08
<YIELD-ACTUAL> 7.88
<LOANS-NON> 3,785,000
<LOANS-PAST> 63,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 240,000
<ALLOWANCE-OPEN> 3,151,691
<CHARGE-OFFS> 190,133
<RECOVERIES> 47,442
<ALLOWANCE-CLOSE> 3,083,999
<ALLOWANCE-DOMESTIC> 2,432,999
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 651,000
</TABLE>
