CONFORMED 1.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1996 Commission file number 1-2940
HSBC Americas, Inc.
(Exact name of registrant as specified in its charter)
Delaware Corporation 22-1093160
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Marine Midland Center, Buffalo, N.Y. 14203
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (716) 841-2424
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, and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
All voting stock (1,001 shares of Common Stock, $5 par value) is owned by HSBC
Holdings B.V., an indirect wholly-owned subsidiary of HSBC Holdings plc.
This report includes a total of 14 pages.
2.
Part I - FINANCIAL INFORMATION
Page
Item 1 - Financial Statements
Consolidated Balance Sheet
March 31, 1996 and December 31, 1995 3
Consolidated Statements of Income
For The Three Months
Ended March 31, 1996 and 1995 4
Consolidated Statement of Changes in
Shareholders' Equity For The Three Months
Ended March 31, 1996 and 1995 5
Consolidated Statement of Cash Flows
For The Three Months Ended
March 31, 1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
Part II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K 13
Signatures 14
<TABLE>
<CAPTION>
3.
CONSOLIDATED BALANCE SHEET HSBC AMERICAS, INC.
March 31, December 31,
dollars in thousands 1996 1995*
- ------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 1,345,160 $ 1,242,335
Interest bearing deposits with banks 1,536,764 1,488,101
Federal funds sold and securities purchased
under resale agreements 762,777 518,256
Trading assets 818,882 616,531
Securities available for sale 3,370,738 2,613,830
Loans 13,398,344 13,772,339
Less - allowance for loan losses 471,820 477,502
- ------------------------------------------------------------------------------
Loans, net 12,926,524 13,294,837
Premises and equipment 178,052 180,552
Customers' acceptance liability 24,688 21,671
Accrued interest receivable 172,013 150,335
Other real estate and other owned assets 72,708 109,758
Other assets 342,766 317,137
- ------------------------------------------------------------------------------
TOTAL ASSETS $ 21,551,072 $ 20,553,343
==============================================================================
LIABILITIES
Deposits in domestic offices:
Noninterest bearing $ 3,284,517 $ 3,433,016
Interest bearing 10,744,746 10,454,352
Interest bearing deposits in foreign offices 1,663,195 1,442,484
- ------------------------------------------------------------------------------
Total deposits 15,692,458 15,329,852
Federal funds purchased and securities sold
under repurchase agreements 1,569,643 1,136,476
Other short-term borrowings 1,357,572 1,401,634
Interest, taxes and other liabilities 436,170 257,094
Acceptances outstanding 24,688 21,671
Long-term debt 709,274 709,750
- ------------------------------------------------------------------------------
TOTAL LIABILITIES 19,789,805 18,856,477
- ------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Preferred stock 98,063 98,063
Common shareholder's equity:
Common stock 5 5
Capital surplus 1,803,094 1,803,094
Accumulated deficit (149,209) (233,686)
Net unrealized gain on securities
available for sale, net of taxes 9,314 29,390
- ------------------------------------------------------------------------------
Total common shareholder's equity 1,663,204 1,598,803
- ------------------------------------------------------------------------------
Total shareholders' equity 1,761,267 1,696,866
- ------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 21,551,072 $ 20,553,343
==============================================================================
The accompanying notes are an integral part of these financial statements.
* Restated to include the accounts and results of Oleifera Investments, Ltd.
merged with the Company on January 1, 1996.
</TABLE>
<TABLE>
<CAPTION>
4.
CONSOLIDATED STATEMENT OF INCOME HSBC AMERICAS, INC.
Three months ended March 31
dollars in thousands 1996 1995 *
- -------------------------------------------------------------------------
<S> <C> <C>
Interest income:
Loans $ 309,714 $ 289,685
Securities 41,909 34,309
Trading assets 12,094 6,971
Deposits with banks 20,031 17,867
Federal funds sold and securities purchased
under resale agreements 4,827 8,337
- -------------------------------------------------------------------------
Total interest income 388,575 357,169
- -------------------------------------------------------------------------
Interest expense:
Deposits:
In domestic offices 98,779 88,599
In foreign offices 17,962 13,242
Federal funds purchased and securities
sold under repurchase agreements 13,591 6,006
Other short-term borrowings 16,635 17,228
Long-term debt 11,554 12,947
- -------------------------------------------------------------------------
Total interest expense 158,521 138,022
- -------------------------------------------------------------------------
Net interest income 230,054 219,147
Provision for loan losses 19,750 125,000
- -------------------------------------------------------------------------
Net interest income, after provision for loan
losses 210,304 94,147
- -------------------------------------------------------------------------
Other operating income:
Trust income 9,931 11,336
Service charges 20,850 19,929
Mortgage servicing income 4,471 4,510
Other fees and commissions 27,968 30,057
Trading revenues 415 1,401
Other income 16,003 9,187
- -------------------------------------------------------------------------
Total other operating income 79,638 76,420
- -------------------------------------------------------------------------
289,942 170,567
- -------------------------------------------------------------------------
Other operating expenses:
Salaries 68,158 69,031
Pension and other employee benefits 19,254 20,641
- -------------------------------------------------------------------------
Total personnel expense 87,412 89,672
Net occupancy expense 19,717 17,485
Other expenses 46,937 51,367
- -------------------------------------------------------------------------
Total other operating expenses 154,066 158,524
Provision for ORE and other owned asset losses 531 -
- -------------------------------------------------------------------------
Total operating expenses after provision for
ORE and other owned assets 154,597 158,524
- -------------------------------------------------------------------------
Income before taxes 135,345 12,043
Applicable income tax expense (benefit) 49,400 (61,870)
- -------------------------------------------------------------------------
Net income $ 85,945 $ 73,913
=========================================================================
The accompanying notes are an integral part of these financial
statements.
* Restated to include the accounts and results of Oleifera
Investments, Ltd. merged with the Company on January 1, 1996.
</TABLE>
<TABLE>
<CAPTION>
5.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY HSBC AMERICAS,INC.
---------------------------------------------------------------------------
Three months ended March 31
dollars in thousands 1996 1995*
---------------------------------------------------------------------------
<S> <C> <C>
At beginning of period $1,696,866 $1,657,448
Net income 85,945 73,913
Net change in unrealized gain on securities
available for sale, net of taxes (20,076) -
Cash dividends declared on preferred stock (1,468) (1,469)
---------------------------------------------------------------------------
At end of period $1,761,267 $1,729,892
===========================================================================
---------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
Three months ended March 31
dollars in thousands 1996 1995*
---------------------------------------------------------------------------
Cash flows from operating activities:
Net income $ 85,945 $ 73,913
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation, amortization and deferred taxes 12,179 (98,293)
Provision for loan losses 19,750 125,000
Net change in other accrual accounts 157,398 (51,457)
Net change in loans originated for sale (67,557) (37,292)
Net change in trading assets (212,565) (10,682)
Other, net (31,703) (8,736)
---------------------------------------------------------------------------
Net cash used by operating activities (36,553) (7,547)
---------------------------------------------------------------------------
Cash flows from investing activities:
Net change in interest bearing deposits with banks (48,663) 335,941
Net change in short-term investments (244,521) (499,390)
Purchases of securities (890,979) (302,033)
Sales of securities 10,757 4,933
Maturities of securities 92,621 134,801
Net change in credit card receivables (82,477) (67,832)
Net change in other short-term loans 67,071 23,928
Net originations and maturities of long-term loans 440,535 8,921
Expenditures for premises and equipment (668) (5,234)
Other, net 45,459 246,424
---------------------------------------------------------------------------
Net cash used by investing activities (610,865) (119,541)
---------------------------------------------------------------------------
Cash flows from financing activities:
Net change in deposits 362,606 530,428
Net change in short-term borrowings 389,105 (478,643)
Dividends paid (1,468) (1,469)
---------------------------------------------------------------------------
Net cash provided by financing activities 750,243 50,316
---------------------------------------------------------------------------
Net change in cash and due from banks 102,825 (76,772)
Cash and due from banks at beginning of period 1,242,335 1,051,003
---------------------------------------------------------------------------
Cash and due from banks at end of period $1,345,160 $ 974,231
===========================================================================
The accompanying notes are an integral part of these financial statements.
*Restated to include the accounts and results of Oleifera Investments, Ltd.
merged with the Company on January 1, 1996.
</TABLE>
6.
Notes to Consolidated Financial Statements
1. Basis of Presentation
The accounting and reporting policies of HSBC Americas, Inc. (the Company) and
its subsidiaries including its principal subsidiary, Marine Midland Bank,
conform to generally accepted accounting principles and to predominant
practice within the banking industry. Such policies, except as noted below,
are consistent with those applied in the presentation of the Company's annual
financial statements.
The interim financial information in this report has not been audited. In the
opinion of the Company's management, all adjustments necessary for a fair
presentation of financial position, results of operations and cash flows for
the interim periods have been made. The interim financial information should
be read in conjunction with the 1995 Annual Report on Form 10-K.
2. Pledged Financial Instruments
At March 31, 1996, securities, loans and other assets carried at
$1,976,556,000 were pledged as collateral for borrowings, to secure public and
trust deposits and for other purposes.
3. Merger with Oleifera Investments, Ltd.
The Company's results have been consolidated with Oleifera Investments, Ltd.
(OIL), which was merged with the Company on January 1, 1996 through the
contribution of OIL's outstanding stock to the Company by HSBC Holdings B.V.
Assets of OIL totaling $183 million at December 31, 1995, consisted primarily
of commercial loans and other real estate.
The merger transaction was accounted for as a transfer of assets between
companies under common control, with the assets and liabilities of OIL
combined with those of the Company at their historical carrying values. The
Company's consolidated financial statements reflect a restatement of prior
periods to include the accounts and results of operations of OIL as though the
merger transaction occurred as of the beginning of the earliest period
presented.
The results of operations previously reported by the Company and OIL for the
three month period ended March 31, 1995 and the combined amounts presented in
the accompanying consolidated statements of income are:
<TABLE>
<CAPTION>
Three months ended 3/31/95
HSBC Oleifera
Americas, Investments,
Inc. Ltd. Combined
(in millions)
<S> <C> <C> <C>
Net interest income,
after provision for loan losses $89.4 $4.7 $94.1
Net income 66.0 7.9 73.9
</TABLE>
7.
4. New Accounting Standards
Effective January 1, 1996, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 122, Accounting for Mortgage Servicing
Rights (FAS 122) prospectively. FAS 122 requires that a mortgage banking
enterprise recognize as separate assets the right to service mortgage loans
for others, whether acquired directly or in conjunction with the acquisition
of mortgage loan assets.
As originated or purchased mortgage loans are sold, securitized or where a
definitive plan exists to sell or securitize such loans, their total cost is
allocated between servicing rights and the loans, based on relative fair
values.
FAS 122 specifies that servicing rights be evaluated for impairment based on
the difference between the carrying value of such rights and their current
fair value. For purposes of measuring impairment, which is to be recorded
through use of a valuation reserve, servicing rights will be stratified based
upon interest rates and whether or not such rates are fixed or variable.
The adoption of FAS 122 did not have a material effect on the financial
position or results of operations of the Company.
8.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
HSBC Americas, Inc. (the Company) reported first quarter 1996 net income of
$85.9 million. This is the first quarter that the Company reported results
consolidated with Oleifera Investments, Ltd. (OIL), which was merged with the
Company on January 1, 1996 through the contribution of OIL's outstanding stock
to the Company. As described in Note 2 to the financial statements, "Merger
with Oleifera Investments, Ltd.", prior year data has been restated to reflect
the merger with OIL. Net income for the comparable three month period of 1995
was $73.9 million.
Net income in the first quarter of 1996 reflected improved net interest income
and lower provision for loan losses and operating expenses. The provision for
loan losses in the first quarter of 1995 primarily relates to the assets
acquired through the merger of Concord Leasing, Inc. (Concord) as a result of
management's decision to accelerate the timing of control and disposal of
Concord's exit portfolios. A one-time tax benefit was recognized for the
expected use of a portion of Concord's net operating loss carryforwards.
Net Interest Income
Net interest income for the first quarter of 1996 was $230.1 million compared
with $219.1 million for the first quarter of 1995.
Interest income of $388.6 million in the first quarter of 1996 was 8.8% higher
than the first quarter of 1995. Average earning assets of $18.8 billion in
the first quarter of 1996 were $1.4 billion higher than a year ago and the
average rate earned on earning assets was 8.34% compared with 8.35% a year
ago. The improvement in interest income is due to a number of factors,
including increases in consumer and core commercial loan volume, an increased
investment portfolio, and a reduction in commercial nonaccruing assets.
Interest expense for the first quarter of 1996 was $158.5 million,
representing a 14.9% increase over the first quarter of 1995. Average
interest bearing liabilities for the first quarter of 1996 were $15.0 billion,
compared with $13.3 billion a year ago. The average rate paid on interest
bearing liabilities was 4.24% compared with 4.22% a year ago.
The taxable equivalent net yield on average total assets for the current
year's first quarter was 4.64% compared with 4.78% in the 1995 first quarter.
The decrease in net yield resulted from increases in trading assets and
investment securities which are at rates lower than loans.
9.
Other Operating Income
Total other operating income was $79.6 million in the first quarter of 1996,
compared with $76.4 million in the 1995 first quarter. The major source of
improvement was gains realized on highly leveraged partnership interests.
Other Operating Expenses
Other operating expenses were $154.6 million in the 1996 first quarter
compared with $158.5 million for the 1995 first quarter. Both staff count and
personnel costs have declined. In addition, the Federal Deposit Insurance
Corp. (FDIC) insurance premium rate assessed on deposits decreased. This
event resulted in a $7.0 million decrease in other expense compared with the
first quarter of 1995. The premium charged is consistent with other U.S.
banks which are considered "well capitalized" by U.S. regulators.
Other operating expenses in the 1995 first quarter were favorably affected by
income of $5.7 million associated with other real estate transactions compared
with expenses of $.7 million in the 1996 first quarter.
Income Taxes
Contemplated in the merger of Concord and the Company on January 1, 1995 was
the availability of net operating loss carryforwards and other temporary
deductible differences of Concord that can be used to offset future taxable
income of the Company. At January 1, 1995, Concord had net deferred tax
assets of approximately $206 million resulting from loss carryforwards and
deductible differences, which were offset in full by a valuation allowance due
to the uncertainty of Concord realizing the tax benefits on a stand-alone
basis. As a result of the merger, management determined that a reduction in
the valuation allowance of $73.5 million relating to Concord's operating loss
carryforwards should be recognized in the first quarter of 1995 since the
realization of such carryforwards was now considered probable.
The reduction in taxes from a statutory rate of 43% to an effective rate of
36.5% in the first quarter of 1996 also relates to recognized deferred losses
of Concord. The deferred tax asset at March 31, 1996 was $99 million, net of
valuation reserve of $216 million.
10.
Asset Quality
The following table provides a summary of the loan loss allowance and
nonaccruing loans:
<TABLE>
<CAPTION>
3 Months 3 Months Year
Ended Ended Ended
3/31/96 3/31/95* 12/31/95*
(in millions)
<S>
Allowance for Loan Losses
Balance at beginning <C> <C> <C>
of period $477.5 $531.5 $ 531.5
Allowance related to
acquired companies - - .4
Provision charged to income 19.7 125.0 175.3
Net charge offs 25.4 85.2 229.7
Balance at end of period $471.8 $571.3 $ 477.5
March 31, December 31, March 31,
1996 1995* 1995*
(in millions)
Nonaccruing Loans
Balance at end of period $423.3 $468.3 $ 740.2
As a percent of loans
outstanding 3.16% 3.40% 5.69%
Nonperforming Loans and Assets **
Balance at end of period $496.0 $578.1 $1,026.9
As a percent of total assets 2.30% 2.81% 5.35%
Allowance Ratios
Allowance for loan losses
as a percent of:
Loans 3.52% 3.47% 4.39%
Nonaccruing loans 111.45 101.95 77.18
* Restated to include the accounts and results of Oleifera Investments Ltd.
merged with the Company on January 1, 1996.
** Includes nonaccruing loans, other real estate and other owned assets.
</TABLE>
Provisions for loan losses were $19.7 million in the first quarter of 1996
compared with $125.0 million in the first quarter of 1995. See page 8 for
a discussion relating to the provision recorded in the first quarter of 1995.
The Company identified impaired loans as defined by FAS 114 totaling $300.6
million at March 31, 1996, of which $90.2 million had a specific loan loss
allowance of $51.0 million. At December 31, 1995, impaired loans totaled
$347.8 million of which $116.7 million had a specific loan allowance of $61.1
million. Interest income is not recognized on loans identified as impaired.
11.
Derivative Financial Instruments
As principally an end-user of off-balance sheet financial instruments, the
Company uses various derivative financial instruments to manage its overall
interest rate risk and to reduce the risk associated with changes in the
income stream of certain on-balance sheet assets. At March 31, 1996, $20.3
billion notional value of such positions, with an estimated negative fair
value of $27.1 million were outstanding. At December 31, 1995 $16.8 billion
notional value of such positions, with an estimated negative fair value of
$10.7 million were outstanding.
The Company also maintains various derivatives in its trading portfolio to
offset risk associated with changes in market value of certain trading assets,
and to satisfy the foreign currency requirements of retail customers. These
derivatives are carried at fair value. At March 31, 1996, $.9 billion
notional value of such positions with an estimated negative fair value of $1.5
million were outstanding. At December 31, 1995 $1.0 billion of notional value
of such positions with an estimated negative fair value of $.9 million were
outstanding.
The Company's credit risk associated with off-balance sheet positions is not
considered material, since almost all derivative contracts are executed with
counterparties affiliated through common ownership.
Liquidity
The Company maintains a strong liquidity position. Short-term investments and
trading assets were $3.1 billion at March 31, 1996 compared with $2.6 billion
at December 31, 1995. Loans at March 31, 1996 were 62.2% of total assets
compared with 67.0% at December 31, 1995.
Deposits at March 31, 1996 were $15.7 billion, compared with $15.3 billion at
December 31, 1995. Deposits continue to exceed loans and were 117.1% of loans
at March 31, 1996. Short-term borrowings, including repurchase agreements,
were $2.9 billion at March 31, 1996 compared with $2.5 billion at December 31,
1995. Long-term borrowings of $.7 billion at March 31, 1996 were at the same
level as December 31, 1995.
Capital
Shareholders' equity was $1.8 billion at March 31, 1996 compared with $1.7
billion at December 31, 1995.
Under risk-based capital guidelines, the Company's capital ratios were 11.43%
at the Tier 1 level and 16.91% at the total capital level at March 31, 1996.
These ratios compare with 10.89% at the Tier 1 level and 16.39% at the total
capital level at December 31, 1995.
Under guidelines for leverage ratios, the Company's ratio of Tier 1 capital to
quarterly average total assets was 8.62% at March 31, 1996 compared with 8.36%
at December 31, 1995.
<TABLE>
<CAPTION>
12.
CONSOLIDATED AVERAGE BALANCES AND INTEREST RATES* HSBC AMERICAS,INC.
First Quarter 1996 First Quarter 1995 **
dollars in millions Balance Interest Rate Balance Interest Rate
- ------------------------------------------------------------------------------
<S>
Assets
Interest bearing deposits <C> <C> <C> <C> <C> <C>
with banks $ 1,434 $ 20.0 5.62 % $ 1,182 $ 17.9 6.13 %
Federal funds sold and securities
purchased under resale agreements 362 4.8 5.37 578 8.3 5.85
Trading assets 802 12.1 6.04 387 7.0 7.23
Securities:
U.S. Government and
federal agency obligations 2,543 36.1 5.70 2,056 31.0 6.08
Other securities 270 5.9 8.72 233 3.3 5.86
- ------------------------------------------------------------------------------
Total securities 2,813 42.0 6.00 2,289 34.3 6.09
Loans:
Domestic:
Commercial 6,418 140.2 8.79 6,563 136.8 8.46
Consumer 6,435 161.4 10.08 5,852 143.8 9.93
- ------------------------------------------------------------------------------
Total domestic 12,853 301.6 9.52 12,415 280.6 9.16
International 516 9.0 6.97 548 10.2 7.52
- ------------------------------------------------------------------------------
Total loans 13,369 310.6 9.34 12,963 290.8 9.10
- ------------------------------------------------------------------------------
Total earning assets 18,780 $ 389.5 8.34 % 17,399 $ 358.3 8.35 %
- ------------------------------------------------------------------------------
Less - allowance for loan losses (476) (543)
Cash and due from banks 1,003 912
Other assets 735 931
- ------------------------------------------------------------------------------
Total assets $ 20,042 $ 18,699
==============================================================================
Liabilities and Shareholders' Equity
Interest bearing demand
deposits $ 1,627 $ 5.5 1.35 % $ 1,571 $ 7.6 1.95 %
Consumer savings deposits 3,751 29.1 3.12 3,821 29.6 3.14
Other consumer time deposits 3,231 44.4 5.52 2,864 36.6 5.19
Commercial and public savings
and other time deposits 1,929 19.8 4.12 1,506 14.8 3.99
Deposits in foreign offices 1,364 17.9 5.30 1,259 13.2 4.27
- ------------------------------------------------------------------------------
Total time deposits 11,902 116.7 3.94 11,021 101.8 3.75
- ------------------------------------------------------------------------------
Short-term borrowings 2,421 30.2 5.02 1,534 23.2 6.14
Long-term debt 710 11.6 6.55 713 13.0 7.36
- ------------------------------------------------------------------------------
Total funds borrowed 3,131 41.8 5.37 2,247 36.2 6.53
- ------------------------------------------------------------------------------
Total interest bearing
liabilities 15,033 $ 158.5 4.24 % 13,268 $ 138.0 4.22 %
- ------------------------------------------------------------------------------
Interest rate spread 4.10 % 4.13 %
- ------------------------------------------------------------------------------
Demand deposits 2,979 3,031
Other liabilities 291 704
Total shareholders' equity 1,739 1,696
- ------------------------------------------------------------------------------
Total liabilities and
shareholders' equity $ 20,042 $ 18,699
==============================================================================
Net interest income $ 231.0 $ 220.3
Net yield on average earning assets 4.95 % 5.14 %
Net yield on average total assets 4.64 4.78
- ------------------------------------------------------------------------------
Net interest income/net yield on
average earning assets:
Domestic $ 221.0 5.23 % $ 206.4 5.39 %
International 10.0 2.26 13.9 3.04
==============================================================================
* Interest and rates are presented on a taxable equivalent basis.
** Restated to include the accounts and results of Oleifera Investments, Ltd.
merged with the Company on January 1, 1996.
</TABLE>
13.
Part II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Report on Form 8-K
None
14.
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.
HSBC Americas, Inc.
(Registrant)
Date: May 13, 1996 /s/ Gerald A. Ronning
Gerald A. Ronning
Executive Vice President & Controller
(On behalf of Registrant and
as Chief Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 1,345
<INT-BEARING-DEPOSITS> 1,537
<FED-FUNDS-SOLD> 763
<TRADING-ASSETS> 819
<INVESTMENTS-HELD-FOR-SALE> 3,371
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 13,398
<ALLOWANCE> 472
<TOTAL-ASSETS> 21,551
<DEPOSITS> 15,692
<SHORT-TERM> 2,927
<LIABILITIES-OTHER> 461
<LONG-TERM> 710
0
98
<COMMON> 0
<OTHER-SE> 1,663
<TOTAL-LIABILITIES-AND-EQUITY> 21,551
<INTEREST-LOAN> 310
<INTEREST-INVEST> 42
<INTEREST-OTHER> 37
<INTEREST-TOTAL> 389
<INTEREST-DEPOSIT> 117
<INTEREST-EXPENSE> 159
<INTEREST-INCOME-NET> 230
<LOAN-LOSSES> 20
<SECURITIES-GAINS> 4
<EXPENSE-OTHER> 156
<INCOME-PRETAX> 135
<INCOME-PRE-EXTRAORDINARY> 86
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 86
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<YIELD-ACTUAL> 4.95
<LOANS-NON> 423
<LOANS-PAST> 78
<LOANS-TROUBLED> 25
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 477
<CHARGE-OFFS> 43
<RECOVERIES> 18
<ALLOWANCE-CLOSE> 472
<ALLOWANCE-DOMESTIC> 205
<ALLOWANCE-FOREIGN> 27
<ALLOWANCE-UNALLOCATED> 240
</TABLE>
