UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996.
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 0-18127
AMERICAN BANCORP OF NEVADA
Exact name of registrant as specified in its charter)
Nevada 94-2792608
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4425 Spring Mountain Road, Las Vegas, Nevada 89102
(Address of principal executive offices) (Zip Code)
(702) 362-7222
(Registrant's telephone number, including area code)
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 June 30, 1996:
Common stock, $.05 par value 3,702,332
- -------------------------------------------------------------------------------
Class Number of Shares
<PAGE>
INDEX
PART I - FINANCIAL INFORMATION PAGE NO.
- ------------------------------ --------
Condensed Consolidated Statements of Income
Six Months and Quarters ended June 30, 1996 and 1995
Condensed Consolidated Statements of Condition
June 30, 1996 and December 31, 1995
Condensed Consolidated Statements of Cash Flows
Six Months ended June 30, 1996 and 1995
Notes to Condensed Consolidated Financial Statements
Management's Discussion and Analysis of Financial
Condition and Results of Operations
PART II - OTHER INFORMATION
Signatures
<PAGE>
PART I - FINANCIAL INFORMATION
AMERICAN BANCORP OF NEVADA AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SIX MONTHS AND QUARTERS ENDED JUNE 30, 1996 AND 1995
(Dollars in thousands except for earnings per share)
(Unaudited)
<TABLE>
For the Six Months For the Quarter
Ended June 30, Ended June 30,
1996 1995 1996 1995
------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and Fees on Loans $5,693 $5,559 $2,932 $2,941
Interest on Investment Securities 3,692 3,554 1,794 1,893
Interest on Federal Funds Sold 197 220 82 134
----------- ------------ ------------ ------------
Total Interest Income 9,582 9,333 4,808 4,968
----------- ------------ ------------ ------------
INTEREST EXPENSE
Interest on Deposits 2,157 2,446 1,069 1,358
Interest on Securities Sold Under
Agreements to Repurchase 661 406 304 238
----------- ------------ ------------ ------------
Total Interest Expense 2,818 2,852 1,373 1,596
----------- ------------ ------------ ------------
NET INTEREST INCOME 6,764 6,481 3,435 3,372
Provision for Loan Losses 150 270 150 175
----------- ------------ ------------ ------------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 6,614 6,211 3,285 3,197
TOTAL NON-INTEREST INCOME: 997 750 465 404
TOTAL NON-INTEREST EXPENSE: 4,417 4,279 2,255 2,231
----------- ------------ ------------ ------------
INCOME BEFORE TAXES 3,194 2,682 1,495 1,370
PROVISION FOR INCOME TAXES 952 731 475 358
----------- ------------ ------------ ------------
NET INCOME $2,242 $1,951 $1,020 $1,012
=========== ============ ============ ============
NET INCOME PER SHARE $ .59 $ .52 $ .27 $ .27
=========== ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
AMERICAN BANCORP OF NEVADA AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
JUNE 30, 1996 AND DECEMBER 31, 1995
(Dollars in Thousands)
<TABLE>
ASSETS June 30, 1996 December 31, 1995
- ------ ------------- -----------------
(Unaudited)
<S> <C> <C>
Cash and Due From Banks $ 35,613 $ 36,376
Federal Funds Sold 1,300 9,500
Money Market Accounts 486 3,697
--------------- ---------------
Total Cash and Cash Equivalents 37,399 49,573
Available-For-Sale Securities 120,103 120,589
Net Loans 106,144 93,244
Premises and Equipment, Net 11,356 10,510
Other Assets 4,114 2,775
--------------- ---------------
TOTAL ASSETS $ 279,116 $276,691
=============== ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $215,626 $211,524
Securities Sold Under Agreements to Repurchase 31,363 36,749
Federal Funds Purchased 3,000 0
Other Liabilities 1,048 1,529
--------------- ---------------
Total Liabilities $251,037 249,802
--------------- ---------------
STOCKHOLDERS' EQUITY
Common Stock 186 162
Surplus 28,197 20,420
Retained Earnings 629 6,156
Unrealized Gain (Loss) On Available-For-Sale Securities (822) 284
--------------- ---------------
28,190 27,022
Less Treasury Stock, at cost (111) (133)
--------------- ---------------
Total Stockholders' Equity 28,079 26,889
--------------- ---------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $279,116 $276,691
=============== ===============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
AMERICAN BANCORP OF NEVADA AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Dollars in Thousands)
(Unaudited)
<TABLE>
Six Months Ended
June 30,
1996 1995
-------------------- ---------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Interest received $ 9,992 $ 8,784
Other income 661 702
Interest paid (2,848) (2,840)
Cash paid to suppliers and employees (4,322) (3,665)
Income taxes paid (1,228) (573)
--------------- ---------------
Net cash provided by operating activities 2,255 2,408
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales and maturities of investment securities 58,596 32,947
Purchase of investment securities (59,593) (44,074)
Net increase in loans made to customers (14,005) (17,296)
Capital expenditures (1,197) (239)
--------------- ---------------
Net cash used in investing activities (16,199) (28,662)
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits 4,102 26,100
Net decrease in securities sold
under agreements to repurchase (5,386) 15,934
Net increase in federal funds purchased 3,000 0
Other 54 66
--------------- ---------------
Net cash provided by financing activities 1,770 42,100
--------------- ---------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (12,174) 15,846
CASH AND CASH EQUIVALENTS AT JANUARY 1 49,573 22,216
--------------- ---------------
CASH AND CASH EQUIVALENTS AT JUNE 30 $37,399 $38,062
=============== ===============
RECONCILIATION OF NET INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
Net income $ 2,242 $ 1,951
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization of premises and equipment 350 327
Amortization of investment security premiums and
accretion of discounts 137 (135)
Provision for loan losses 150 270
Deferred loan fees 165 (111)
Loss (Gain) on sale of investment securities (330) 20
Decrease (increase) in other assets 22 (526)
Increase (decrease) in other liabilities (481) 612
--------------- ---------------
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 2,255 $ 2,408
=============== ===============
SUPPLEMENTAL SCHEDULE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock for stock dividend $ 24 $ 0
=============== ===============
Conversion of loans to other real estate owned $ 766 $ 0
=============== ===============
Issuance of common stock for stock split $ 0 $ 40
=============== ===============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE>
AMERICAN BANCORP OF NEVADA AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(Unaudited)
NOTE A - PRINCIPLES OF CONSOLIDATION
The condensed consolidated financial statements include the parent holding
company, American Bancorp of Nevada, ("Company"), and its wholly owned
subsidiaries, American Bank of Commerce ("Bank"), AmBank Mortgage Company and
AmBank Financial Company. Material intercompany balances and transactions have
been eliminated.
NOTE B - BASIS OF PRESENTATION
In the opinion of management, all adjustments (consisting only of normal
recurring accruals) considered necessary for a fair presentation have been
reflected in the financial statements. The results of operations for the three
and six months ended June 30, 1996, are not necessarily indicative of the
results to be expected for the full year.
NOTE C - INCOME PER SHARE
Net Income per common share is based upon the weighted average number of common
and common equivalent shares outstanding, 3,828,319 and 3,747,053 for June 30,
1996 and 1995 respectively.
The weighted average number of common shares, common shares outstanding and
earnings per share are adjusted to reflect a 15% stock dividend declared on
March 18 , 1996, to stockholders of record as of April 2, 1996.
NOTE D - ACCOUNTING PRONOUNCEMENTS
Effective January 1, 1996, the Company adopted FASB Statement No. 121,
Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of. Statement No. 121 establishes accounting standards for the
impairment of long-lived assets, certain identifiable intangibles, and goodwill
related to those assets to be held used and for long-lived assets and certain
identifiable intangibles to be disposed of. There was no material effect on the
consolidated financial statements relating to this adoption.
Effective January 1, 1996, the Company adopted FASB Statement No. 123,
Accounting for Stock-Based Compensation. Statement No. 123 establishes financial
accounting and reporting standards for stock-based employee compensation plans,
such as stock options and stock purchase plans. The statement generally suggests
but does not require stock-based compensation transactions to be accounted for
based on the fair value of the consideration received or the fair value of the
equity instruments issued, whichever is more reliably measurable. Companies that
do not elect to change their accounting for stock-based compensation are
required to disclose the effect on net income and earnings per share as if the
accounting provisions of Statement No. 123 were applied. The Company has decided
not to adopt the accounting provisions of this statement.
<PAGE>
ITEM II
AMERICAN BANCORP OF NEVADA AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors which affected the Company's financial position and operating results
during the period in the accompanying condensed consolidated financial
statements.
Six Months ended June 30, 1996
Asset Growth
Total assets increased $2,425,000 or .88% during the first six months of 1996.
The primary element comprising this growth was a $12,900,000 or 13.8% increase
in net loans. Premises and fixed assets increased $846,000 or 8.05% during the
first six months as the Company continues branch development and construction on
an additional office facility. Additionally, other assets increased $1,339,000
or 48.25% when compared to December 31, 1995, primarily due to the
reclassification of certain loans to other real estate owned. These increases
were offset by a decrease in available-for-sale securities of approximately
$486,000 or .40% due primarily to market value adjustments. Cash and cash
equivalents also decreased approximately $12,174,000 or 24.56%. Asset growth was
driven primarily by an increase in federal funds purchases coupled with the
addition of earnings. Both loans and deposits continue to increase as a result
of the Bank's business developments efforts, successful operation, increased
recognition throughout the business community and the overall strength of the
Las Vegas economy.
Interest Income
Total interest income increased $249,000, or 2.67%, in the first half of 1996
when compared to the same period of 1995, and decreased $160,000 or 3.22% for
the quarter ended June 30. It is anticipated that interest income will increase
during the second part of 1996 based upon growth in the loan and securities
portfolio. Total interest income is composed of the following categories:
Interest and fees on loans: Interest and fee income increased $134,000 or 2.41%
during the first half of 1996 as compared to the same period of 1995, and
decreased $9,000 or .31 % for the quarter ended June 30. The increase in the
year-to-date earnings is attributable to a $201,000 increase in interest income
offset by a $67,000 decrease in fee income. The increase in interest income is
due primarily to an increase in average loan volume of approximately $
10,424,000 to $95,704,000. The yield on the loan portfolio decreased .80% to
10.36%. The interest differential resulting from the fluctuations in volume and
yield is approximately $581,000 and ($380,000), respectively. The quarter to
date increase is composed of a $27,000 increase in interest income and a $18,000
decrease in fee income. The increase in interest income is due primarily to an
increase in average loan volume of approximately $9,834,000 to $99,215,000. The
yield on the loan portfolio decreased 1.01% to 10.29%. The interest differential
resulting from the fluctuations in volume and yield is approximately $278,000
and ($251,000), respectively.
Interest on Investment Securities: The Bank continues to invest its excess funds
in interest bearing securities. Interest on investment securities increased
$138,000, or 3.89%, in the first half of 1996 as compared to the same period in
1995. This was the result of an increase of $7,920,000 in average volume of
investments to $127,384,000, offset with a decrease in yield from 5.95% to
5.80%. The tax-equivalent yield decreased from 6.39% to 6.14%. Comparing the
quarter ended June 30, 1996 to June 30, 1995, interest income deceased $99,000
or 5.23%. The average volume decreased $195,000 to $124,889,000 coupled with
decrease in the yield to 5.75% from 6.05%. The Bank's current investment
strategy is to maintain an investment portfolio with rather short maturities. At
this time the relative flatness of the yield curve does not warrant increased
risk or extending the overall maturity of the portfolio. Management continually
monitors these factors when evaluating investments strategies and asset
liability management.
Interest on Federal Funds Sold: Interest earned on Fed Funds Sold decreased
$23,000, or 10.45%, in the first half of 1996 as compared to the first half of
1995. This decrease was due primarily to an decrease in the average yield from
5.79% to 5.20% for Fed Funds Sold. For the quarter ended June 30, interest
decreased $52,000 or 38.81%. This decrease was due to a decrease in the average
volume of $2,807,000 or 30.63% to $6,357,000. The average yield decreased from
5.85% to 5.16%. Management's goal is to maintain a level of Federal Funds that
will enable the Bank to fund increases in loan demand and to meet depositors'
needs.
<PAGE>
Interest Expense
Total interest expense decreased $34,000, or 1.19%, during the first half of
1996 as compared to the first half of 1995. Interest on deposits decreased
$289,000, or 11.82% due to an decrease in the average balances of interest
bearing accounts by $10,769,000 to $116,431,000. The average rate paid on
deposits decreased from 3.85% in 1995 to 3.71% in 1996. Interest on securities
sold under agreements to repurchase increased $255,000 or 62.81% as the average
volume increased $16,566,000 to $35,760,000 and the average interest rate
decreased from 4.23% to 3.70%. Interest expense for the quarter ended June 30,
1996, decreased $223,000 or 13.97% when compared to the same period, 1995.
Interest on deposits decreased $289,000 or 21.28% due to a decrease in the
average interest bearing balances of $17,831,000 to $115,240,000. The average
rate paid on deposits decreased to 3.71% from 4.08%. Interest on securities sold
under agreement to repurchase increased $66,000 or 27.73% as the average volume
increased $12,123,000 to $33,643,000. The average rate decreased from 4.42% to
3.61%. Management believes that the average volume of deposits and repurchase
agreements will increase during the second half of 1996.
Interest Rate Risk
Management attempts to protect earnings from wide shifts in interest rates by
employing the following strategies:
Loans: Approximately 91% of the Bank's loan portfolio is written on an
adjustable basis that floats with the Bank's base rate. Thus, approximately
$97,861,000 reprices immediately upon a change in base.
Investments: The majority of the investment portfolio of the Bank is of a fixed
rate nature. This enables Management to provide an underlying level of income
irrespective of changes in rates. Additionally, the average life of the
portfolio is approximately 2.23 years. This strategy of maintaining short
maturities provides maximum flexibility in dealing with fluctuating interest
rates.
Deposits: Management discourages use of long term Certificates of Deposit by
consistently paying at or below market rates and not offering greater than one
year maturities. However, an attempt is currently underway to recapture some of
the jumbo short-term Certificates of Deposit market. Offering rates for
Certificates of Deposit over $100,000 and less than one year maturity are
reviewed weekly for adjustments. At June 30, 1996, approximately 45% of time
deposits had a maturity of three months or less.
The above factors, taken into consideration together with the fact that the
Bank's non-interest bearing customer deposits are approximately 46.78% of total
deposits, provides management the opportunity to maintain favorable net interest
margins under most normal interest rate scenarios.
Loans
The composition of the Company's loan portfolio is as follows:
June 30, December 31,
1996 1995
--------------- ------------------
Real Estate Loans:
Construction $ 17,425 $15,114
Residential 9,993 10,643
Commercial 40,048 34,627
--------------- ------------------
Total Real Estate Loans 67,466 60,384
Commercial, financial and industrial
loans 31,593 24,876
Commercial receivables financing 3,096 2,397
Loans to Individuals 6,060 7,340
Less unearned net loan fees (675) (510)
--------------- ------------------
Total Loans $107,540 $94,487
=============== ==================
<PAGE>
Maturities and Sensitivity of Loans to Changes in Interest Rates
The following table shows the balances of commercial, financial and industrial
loans and real estate-construction loans outstanding as of June 30, 1996 by
maturities, based on remaining scheduled repayments of principal. Also shown are
the balance of loans due after one year, classified according to sensitivity to
changes in interest rates.
MATURITY
<TABLE>
One Year or Less One Through Five Years After Five Years Total
---------------- ---------------------- ---------------- -----
<S> <C> <C> <C> <C>
Commercial, Financial
and Industrial $23,994 $6,365 $1,234 $31,593
Real estate-Construction 17,425 17,425
------------ ------------ ----------- -----------
Total $41,419 $6,365 $1,234 $49,018
============ ============ =========== ===========
</TABLE>
The maturity of certain loans may vary due to the Bank's rollover policy. The
Bank will consider extending the maturity of a loan upon receipt of current
financial information and evaluation of the loan performance, the financial
performance of the business, and overall economic conditions. Loans with
maturities so affected have been revised as appropriate in the above table.
INTEREST SENSITIVITY
The following table represents the total amount of commercial, financial and
industrial loans and real estate-construction loans due after one year which (a)
have predetermined interest rates and (b) have floating or adjustable interest
rates.
Loans Due After One Year
------------------------
Fixed or Predetermined Rate $ 180
Floating or Adjustable Rate 7,419
----------
Total $7,599
==========
Provision for Loan Losses
The provision for loan losses during the first half of 1996 was $150,000 as
compared to $270,000 during the first six months of 1995. The allowance for loan
losses stands at 1.30% of total loans at June 30, 1996 as compared to 1.32% at
December 31, 1995. Management believes the current allowance is adequate to
satisfy any unanticipated loan losses based upon the historical performance of
the loan portfolio.
Net charged off loans and leases were approximately ($3,000) and $40,000 for the
six months ended June 30, 1996 and 1995 respectively.
At June 30, 1996, no loans were accounted for on a non-accrual basis.
Additionally, no loans were contractually past due 90 days or more as to
principal or interest. No loans were accounted for as "troubled debt
restructurings" as defined in SFAS No. 15. Loans are placed on non-accrual
status when they go over 90 days delinquent, or when circumstances indicate that
timely collection of interest is doubtful. Loans over 90 days delinquent may be
left on accrual status if a repayment plan has been negotiated and it appears
likely that all interest will be paid.
<PAGE>
The Company had approximately $791,000 in other real estate owned ("REO") and
related development costs at June 30, 1996. This property was acquired through
foreclosure. The original loan was made for the purpose of construction of four
single family residences for resale. The units were approximately 90-95%
complete at the time of foreclosure. The Company has contracted to complete
construction prior to listing them for resale on the retail market. Appraisal
values are approximately $260,000 per unit representing a book-to-market ratio
of approximately 76%. Due to the favorable location of the units, and the
current strong market for homes in this price range, the Company fully expects
to recover the remaining principal balance as well as the foreclosure and
post-foreclosure expenses.
The Company has no loans at June 30, 1996, which should be classified as
impaired loans in accordance with FASB Statement No. 114 as amended by FASB
Statement No. 118.
As of June 30, 1996, there are no loans outstanding, which causes management to
have serious doubts as to the ability of the borrower to comply with the loan
repayment terms.
Management reviews portfolio concentration levels on a regular basis and
appraisal reviews are performed to support the values at which loans are carried
in the portfolio. Construction lending is generally focused on entry level and
first move-up homes. Lending for larger, speculative homes is tightly limited to
financially sound borrowers. Commercial real estate lending is generally limited
to owner-occupied properties.
Management reviews the loan loss analysis on a quarterly basis. A percentage of
the allowance is allocated to pass credits, substandard, doubtful, loss and
accounts receivable factoring. Management believes the current allowance of
$1,396,000 is adequate and there is sufficient unallocated allowance to handle
unexpected problems within the portfolio.
The table below details changes in the allowance for loan losses:
<TABLE>
Six Months Ended Six Months Ended
June 30, 1996 June 30, 1995
------------------------ ---------------------
<S> <C> <C>
Balance, beginning $1,243,000 $727,000
Provision charged to operating expense 150,000 270,000
Recoveries of amounts charged off 3,000 20,000
Less amounts charged off 0 (60,000)
---------------- ------------------
Balance, ending $1,396,000 $957,000
================ ==================
</TABLE>
<PAGE>
The schedule below shows the major categories of loan charge-offs and recoveries
for the six months ended June 30, 1996 and 1995:
<TABLE>
1996 1995
---- ----
<S> <C> <C>
Charge-Offs:
Real estate loans:
Construction $ 0 $ 0
Residential 0 0
Commercial 0 0
Commercial, financial and industrial 0 60,000
Commercial receivables financing 0 0
Loans to Individuals 0 0
---------------- ------------------
Total 0 60,000
---------------- ------------------
Less Recoveries:
Real estate loans:
Construction $ 0 $ 0
0 0
Residential 0 0
Commercial 0 4,000
Commercial, financial and industrial 3,000 16,000
Commercial receivables financing 0 0
Loans to Individuals 0 0
---------------- ------------------
Total 3,000 20,000
---------------- ------------------
Net Charge-Offs $(3,000) $40,000
================ ==================
</TABLE>
The table below details the allocation by loan type of the allowance for loan
losses at June 30, 1996:
<TABLE>
Amount Percentage
---------------- ------------------
<S> <C> <C>
Real estate loans:
Construction $ 37,000 2.65%
Residential 2,000 .14
Commercial 79,000 5.66
Commercial, financial and industrial 898,000 64.33
Commercial receivables financing 190,000 13.61
Loans to Individuals 190,000 13.61
---------------- ------------------
Total $1,396,000 100.00%
================ ==================
</TABLE>
<PAGE>
Non-Interest Income
Total non-interest income for the first six months of 1996 increased $247,000,
or 32.93%, over the same period of 1995. This increase was primarily due to
recorded gains on sale of securities.
Non-Interest Expense
Total non-interest expense increased by $138,000, or 3.23%, during the first
half of 1996 as compared to the first half of 1995. This increase is due
primarily to increased salary and employee benefit expenses due to normal salary
increases and staff additions.
Liquidity
Management of the Company strives to obtain the highest possible earnings while
maintaining a sound liquidity position. The Company's primary sources of
liquidity are its investment portfolio and federal funds sold. The Company's
investment portfolio had an average balance of approximately $127,384,000 during
the six months ended June 30, 1996 and an average life of approximately 2.23
years. Federal funds sold maintained an average balance of approximately
$7,570,000 during the six months ended June 30, 1996. The Company's liquidity
position is further enhanced by its core deposits which represent approximately
85% of total deposits at June 30, 1996. The Bank avoids the use of highly
sensitive short-term funds such as brokered deposits and believes its deposits
represent funding sources with safety with respect to both liquidity and
earnings. The Company continues to meet the cash flow requirements of customers
who are depositors desiring to withdraw funds and of borrowers requiring
assurance that sufficient funds will be available to meet their credit needs.
The measures of solid liquidity practices such as Total Deposits to Total Assets
and Loans to Deposits are monitored constantly for any adverse trends.
Historically, the Bank's loan to deposit ratio has been low when compared to
industry norms and conversely, its liquidity ratio has been high. At June 30,
1996, the net loan to deposit ratio was approximately 49.23%. The liquidity
ratio, which is comprised of cash, federal funds sold and unpledged securities
as a percent of total demand deposits stood at approximately 43.55% at June 30,
1996. Management continuously monitors outstanding loan commitments and letters
of credit for funding needs. At June 30, 1996, outstanding loan commitments and
letters of credit were approximately $48,433,000 and $1,967,000 respectively.
Cash flow from operations remains positive primarily due to favorable interest
rate yields and continued growth in the loan and investment portfolios.
Management expects this trend to continue. Cash flows from investing activities
was negative for the six months ended June 30, 1996 primarily due to an increase
in loans to customers, net purchases of investment securities and capital
expenditures. Cash flows from financing activities was positive for the six
months ended June 30, 1996, primarily due to an increase in deposits and Federal
Funds purchased which was partially offset by a decrease in Securities Sold
Under Agreements to Repurchase.
Capital Resources
On March 18, 1996, the Board of Directors declared a 15% stock dividend to be
issued on April 19, 1996 to shareholders of record on April 2, 1996. Stock
dividends have no effect on total capital. Stockholders' equity (exclusive of
the net unrealized gain/loss of securities available for sale) as a percentage
of total assets was approximately 10.35% at June 30, 1996 as compared to 9.62%
at December 31, 1995.
As of June 30, 1996 the Company completed construction on a two-story 17,000
square foot office complex located adjacent to its corporate headquarters site
at Spring Mountain Road and Arville. The building offers approximately 13,000
square feet of class "A" office space. As of June 30, 1996, the Company has
finalized lease agreements with tenants for approximately 3,200 square feet and
negotiations to rent the remainder are ongoing. The Company anticipates having
the building fully occupied by the end of the current year. Construction of this
building was funded by cash flow from operations and had no significant impact
on capital.
Construction continues on the Bank's new branch location located in the
industrial area of North Las Vegas. Management anticipates opening the new
facility during the third quarter of 1996, establishing a total of five branches
in the Las Vegas area. Construction of this facility is funded by cash flow from
operations. The impact on capital is not significant to date and is not expected
to impede operations.
At June 30, 1996, the Bank's Tier 1 Core Capital to risk weighted assets was
16.94%, Total Capital to risk weighted assets was 17.79% and the leverage ratio
was 10.12%, all above the current minimum guidelines of 4.0%, 8.0% and 4.0%,
respectively, as established and defined by regulatory authorities. The
Company's capital ratios are parallel to the Bank's.
<PAGE>
In addition, the Federal Deposit Insurance Corporation Improvement Act of 1991
(FDICIA) defined five levels of capital for financial institutions:
Well-capitalized, Adequately capitalized, Undercapitalized, Significantly
undercapitalized and Critically undercapitalized. A bank falls into one of these
levels based on its risk-based ratio and leverage ratio. At June 30, 1996, the
Bank falls in the Well-capitalized category.
PART II - OTHER INFORMATION
SIGNATURES
Pursuant to the requirement of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN BANCORP OF NEVADA
DATED: August 8, 1996 /s/ Bruce E. Hendricks
---------------------------- --------------------------------
Bruce E. Hendricks
Senior Executive Vice President,
Chief Operating Officer
DATED: August 8, 1996 /s/ Patricia L. Kirkwood
---------------------------- --------------------------------
Patricia L. Kirkwood
Executive Vice President/Cashier
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE 30,
1996 10-Q OF AMERICAN BANCORP OF NEVADA AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 35,613
<INT-BEARING-DEPOSITS> 486
<FED-FUNDS-SOLD> 1,300
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 120,103
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 107,540
<ALLOWANCE> 1,396
<TOTAL-ASSETS> 279,116
<DEPOSITS> 215,626
<SHORT-TERM> 34,363
<LIABILITIES-OTHER> 1,048
<LONG-TERM> 0
0
0
<COMMON> 186
<OTHER-SE> 27,893
<TOTAL-LIABILITIES-AND-EQUITY> 279,116
<INTEREST-LOAN> 5,693
<INTEREST-INVEST> 3,692
<INTEREST-OTHER> 197
<INTEREST-TOTAL> 9,582
<INTEREST-DEPOSIT> 2,157
<INTEREST-EXPENSE> 2,818
<INTEREST-INCOME-NET> 6,764
<LOAN-LOSSES> 150
<SECURITIES-GAINS> 330
<EXPENSE-OTHER> 4,417
<INCOME-PRETAX> 3,194
<INCOME-PRE-EXTRAORDINARY> 2,242
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,242
<EPS-PRIMARY> .59
<EPS-DILUTED> .59
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,243
<CHARGE-OFFS> 0
<RECOVERIES> 3
<ALLOWANCE-CLOSE> 1,396
<ALLOWANCE-DOMESTIC> 1,396
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
