QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
-------------
[X] Quarterly Report Pursuant to Section 13 or
15(d) of the Securities Exchange Act of
1934 For the period ended March 31, 1998
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 2-78658
INTRUST Financial Corporation
-----------------------------
(Exact name of registrant as specified in its charter)
Kansas 48-0937376
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
105 North Main Street
Box One
Wichita, Kansas 67201
--------------------- ----------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (316) 383-1111
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
At April 16, 1998, there were 2,170,729 shares of the registrant's common stock,
par value $5 per share, outstanding.
<PAGE>
Part 1. Financial Information
INTRUST Financial Corporation
Consolidated Condensed Statements of Financial Condition
(Unaudited - dollars in thousands except per share data)
March 31, December 31,
Assets 1998 1997
- --------------------------------------------------------------------------------
Cash and cash equivalents:
Cash and due from banks $ 208,741 $ 171,494
Federal funds sold and securities purchased
under agreements to resell 114,875 89,615
- --------------------------------------------------------------------------------
Total cash and cash equivalents 323,616 261,109
- --------------------------------------------------------------------------------
Investment securities:
Held-to-maturity (market value, $232,357
for 1998 and $280,715 for 1997) 230,812 270,971
Available-for-sale, at market 122,970 33,346
Equity, at cost 2,771 2,833
- --------------------------------------------------------------------------------
Total investment securities 356,553 307,150
- --------------------------------------------------------------------------------
Loans held-for-sale 20,473 16,422
Loans, net of allowance for loan losses of
$19,739 in 1998 and $17,932 in 1997 1,242,905 1,244,527
Land, buildings and equipment, net 26,281 26,529
Other assets 63,079 68,085
- --------------------------------------------------------------------------------
Total assets $2,032,907 $1,923,822
- -----------------------------------------------------===========================
Liabilities and Stockholders' Equity
- --------------------------------------------------------------------------------
Deposits $1,586,870 $1,552,766
Short-term borrowings:
Federal funds purchased and securities sold
under agreements to repurchase 204,531 183,678
Other 7,704 7,507
- --------------------------------------------------------------------------------
Total short-term borrowings 212,235 191,185
- --------------------------------------------------------------------------------
Accounts payable and accrued liabilities 13,909 13,007
Notes payable 15,000 23,000
Convertible capital notes 11,219 11,219
Guaranteed preferred beneficial interests in the
Company's subordinated debentures 57,500 0
- --------------------------------------------------------------------------------
Total liabilities 1,896,733 1,791,177
- --------------------------------------------------------------------------------
Stockholders' equity:
Common stock, $5 par value; 10,000,000 shares
authorized, 2,415,071 shares issued 12,075 12,075
Capital surplus 12,377 12,377
Retained earnings 129,173 124,877
Treasury stock, at cost (244,342 shares in
1998 and 240,277 shares in 1997) (17,429) (17,081)
Unrealized securities gains (losses) net of tax (22) 397
- --------------------------------------------------------------------------------
Total stockholders' equity 136,174 132,645
- --------------------------------------------------------------------------------
Total liabilities and stockholders' equity $2,032,907 $1,923,822
- -----------------------------------------------------===========================
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
INTRUST Financial Corporation
Consolidated Condensed Statements of Income
(Unaudited - Dollars In Thousands Except per Share Data)
Three Months
Ended March 31,
---------------
1998 1997
- --------------------------------------------------------------------------------
Interest income:
Loans $29,101 $25,677
Investment securities 4,937 4,479
Federal funds sold and securities purchased under
agreements to resell, and other 1,966 696
- --------------------------------------------------------------------------------
Total interest income 36,004 30,852
- --------------------------------------------------------------------------------
Interest expense:
Deposits 12,570 11,948
Federal funds purchased and securities sold under
agreement to repurchase 2,616 1,750
Convertible capital notes 252 252
Subordinated debentures 921 0
Other borrowings 411 461
- --------------------------------------------------------------------------------
Total interest expense 16,770 14,411
- --------------------------------------------------------------------------------
Net interest income 19,234 16,441
Provision for loan losses 3,600 1,600
- --------------------------------------------------------------------------------
Net interest income after provision for loan losses 15,634 14,841
- --------------------------------------------------------------------------------
Noninterest income:
Service charges on deposit accounts 2,434 2,369
Trust department fees 2,572 1,632
Credit card fees 2,351 3,407
Securities gains 126 0
Other service charges, fees and income 4,061 2,763
- --------------------------------------------------------------------------------
Total noninterest income 11,544 10,171
- --------------------------------------------------------------------------------
Noninterest expenses:
Salaries and employee benefits 9,199 8,368
Net occupancy and equipment expense 2,149 2,032
Advertising and promotional activities 870 1,055
Data processing expense 955 958
Supplies 597 513
Postage and dispatch 526 569
Goodwill amortization 405 404
Deposit insurance assessment 59 (29)
Other 3,894 3,897
- --------------------------------------------------------------------------------
Total noninterest expenses 18,654 17,767
- --------------------------------------------------------------------------------
Income before provision for income taxes 8,524 7,245
Provision for income taxes 3,142 2,689
- --------------------------------------------------------------------------------
Net income $ 5,382 $ 4,556
- -------------------------------------------------------------===================
Per share data:
Basic earnings per share $2.48 $2.07
- -------------------------------------------------------------===================
Diluted earnings per share $2.16 $1.83
- -------------------------------------------------------------===================
Cash Dividends $0.50 $0.35
- -------------------------------------------------------------===================
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
INTRUST Financial Corporation
Consolidated Statements of Cash Flows
(Unaudited)
(in thousands of dollars)
Three Months Ended
March 31,
------------------
1998 1997
- --------------------------------------------------------------------------------
Cash provided (absorbed) by operating activities:
Net Income $ 5,382 $ 4,556
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for loan losses 3,600 1,600
Provision for depreciation and amortization 1,740 1,685
Amortization of premium and accretion of discount
on investment securities (324) (77)
Gain on sale of investment securities (126) 0
Changes in assets and liabilities:
Loans held for sale (4,051) 4,929
Prepaid expenses and other assets 20 (450)
Income taxes 8,099 2,674
Interest receivable (1,186) (1,280)
Interest payable 2,006 2,542
Other liabilities (1,316) 3,950
Other 72 39
- --------------------------------------------------------------------------------
Net cash provided by operating activities 13,916 20,168
- --------------------------------------------------------------------------------
Cash provided (absorbed) by investing activities:
Purchase of investment securities (101,171) (20,017)
Investment securities matured or called 51,631 33,439
Proceeds from sale of investment securities 161 0
Net increase in loans (2,909) (78,777)
Purchases of land, buildings and equipment (805) (508)
Proceeds from sale of equipment 5 0
Proceeds from sale of other real estate
and repossessions 883 831
Other (2,424) (768)
- --------------------------------------------------------------------------------
Net cash absorbed by investing activities (54,629) (65,800)
- --------------------------------------------------------------------------------
Cash provided (absorbed) by financing activities:
Net increase in deposits 34,104 20,919
Net increase in short-term borrowings 21,050 11,399
Proceeds from notes payable 0 4,000
Payments on notes payable (8,000) 0
Proceeds from subordinated debentures 57,500 0
Cash dividends (1,086) (772)
Purchase of treasury stock (348) (247)
- --------------------------------------------------------------------------------
Net cash provided by financing activities 103,220 35,299
- --------------------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents 62,507 (10,333)
Cash and cash equivalents at beginning of period 261,109 185,104
- --------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 323,616 $174,771
- ---------------------------------------------------------=======================
Supplemental disclosures
Interest paid $14,764 $11,869
Income tax paid (refunded) $(4,957) $15
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
INTRUST Financial Corporation
Notes to Consolidated Financial Statements
(Unaudited)
1. PRINCIPLES OF CONSOLIDATION AND PRESENTATION
--------------------------------------------
The accompanying consolidated financial statements include the accounts of
INTRUST Financial Corporation and subsidiaries. All significant intercompany
accounts and transactions have been eliminated. In the opinion of management,
the consolidated financial statements reflect all normal recurring adjustments
necessary for a fair presentation of the financial position and results of
operations for the periods presented.
The significant accounting policies followed in the preparation of the quarterly
financial statements are the same as those disclosed in the 1997 INTRUST
Financial Corporation Annual Report on Form 10-K. Reference is made to the
"Notes to Consolidated Financial Statements" under Item 8 of the 1997 Form 10-K
for additional disclosure.
2. ALLOWANCE FOR LOAN LOSSES
-------------------------
The following is a summary of the allowance for loan losses for the three months
ended March 31, 1998 and 1997 (in thousands):
1998 1997
------- -------
Balance, January 1 $17,932 $15,536
Additions:
Provision for loan losses 3,600 1,600
------- -------
21,532 17,136
Deductions:
Loans charged off 2,199 1,351
Less recoveries on loans
previously charged off 406 359
------- -------
Net loan losses 1,793 992
------- -------
Balance, March 31 $19,739 $16,144
======= =======
Statement of Financial Accounting Standards ("SFAS") No. 114 requires that
certain impaired loans be measured based on the present value of expected future
cash flows discounted at the loan's original effective interest rate. As a
practical expedient, impairment may be measured based on the loan's observable
market price or the fair value of the collateral if the loan is collateral
dependent. When the measure of the impaired loan is less than the recorded
investment in the loan, the impairment is recorded through a valuation
allowance.
Less than 1% of the Company's total loan portfolio meet the criteria defined in
SFAS Nos. 114 and 118 for classification as an impaired loan. The Company
maintained a valuation allowance of $48,000 at March 31, 1998 related to loans
considered impaired. Interest income on this classification of loans has been
recorded by the Company in a manner consistent with its income recognition
policies on other loans. Such amount of interest income is not material to the
Company's financial statements.
3. EARNINGS PER SHARE CALCULATIONS
-------------------------------
Basic earnings per share is computed based upon the weighted average number of
shares outstanding. Diluted earnings per share includes shares issuable upon
exercise of stock options and assumes that the 9% convertible subordinated
capital notes had been converted into common stock as of the beginning of each
respective period presented with related adjustments to interest and income tax
expense. The following is a reconciliation of the numerators and denominators of
basic and diluted earnings per share:
Three Months Ended
March 31,
- --------------------------------------------------------------------------------
1998 1997
- --------------------------------------------------------------------------------
Net income for basic earnings per share $5,382 $4,556
Interest expense on convertible debt, net of taxes 164 164
Net income for diluted earnings per share $5,546 $4,720
- ------------------------------------------------------------====================
Weighted average shares for basic earnings per share 2,171,292 2,202,188
Shares issuable upon exercise of stock options 28,066 3,500
Shares issuable upon conversion of capital notes 373,967 373,967
- --------------------------------------------------------------------------------
Weighted average shares for diluted earnings per share 2,573,324 2,579,655
- ---------------------------------------------------------=======================
Pro forma disclosures of earnings per share, as if the fair value based method
of accounting as defined in SFAS No. 123 had been applied, have not been
presented since such disclosures would not result in material differences from
the intrinsic value method followed by the Company.
4. COMPREHENSIVE INCOME
--------------------
The Company has adopted SFAS No. 130 which establishes standards for reporting
and display of comprehensive income and its components (revenues, expenses,
gains and losses) in a full set of general-purpose financial statements. It
requires that an enterprise (a) classify items of other comprehensive income by
their nature in a financial statement and (b) display the accumulated balance of
other comprehensive income separately from retained earnings and capital surplus
in the equity section of a statement of financial condition.
Total comprehensive income for the periods ending March 31, 1998 and 1997 was
$4,963 and $4,546 respectively.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Unaudited consolidated net income of INTRUST Financial Corporation for the three
months ended March 31, 1998 was $5,382,000, increasing 18.1% over 1997's net
income of $4,556,000. The Company continues to experience solid growth in its
principal markets, leading to increased net interest income and noninterest
income. During the first quarter of 1998, the Company completed its offering of
$57,500,000 in trust preferred securities. This issuance, identified as
"Guaranteed preferred beneficial interests in the Company's subordinated
debentures" in the accompanying financial statements, was an important source of
capital for the Company and will serve to support the future growth of the
Company. With the sale of the national credit card portfolio in 1997, this
portfolio had no impact on the Company's operating results this year.
NET INTEREST INCOME. The Company's net interest income increased $2,793,000, or
17%, over prior year levels. Much of this increase was volume-related, as first
quarter 1998 average interest-earning assets increased 14.6% over prior year
levels. The Company also experienced an increase in the yield on its average
interest-earning assets of approximately 15 basis points. As noted in previous
filings, terms of the sale of the national credit card portfolio in 1997
resulted in a decrease in yields during that year. Continued growth in the
Company's commercial lending portfolio, along with the scheduled amortization of
one of the Company's credit card securitization transactions, have resulted in
funds being invested in somewhat higher interest-earning assets in 1998. Average
loans and leases in 1998 have increased approximately $93 million over
comparable 1997 levels, and the Company expects that the continued dislocation
in its principal markets will provide additional growth opportunities. However,
the Company continues to operate in a very competitive market, and anticipates
that it will continue to confront pressure on its interest margins throughout
the remainder of the year.
Funding costs were little-changed in the first quarter. The overall interest
rate environment during the quarter was relatively stable, but conditions remain
competitive in the Company's principal markets. The Company does not expect this
environment to change. However, significant efforts have been made by the
Company in enhancing its delivery systems and sales initiatives, and the Company
has been successful in increasing its deposit base. The Company has experienced
growth in its total number of deposit accounts, and total deposits at March 31,
1998 were 9.5% higher than they were at March 31, 1997. In addition to its
efforts to increase its deposit base, the Company continues to evaluate
alternative funding sources.
PROVISION FOR LOAN LOSSES. The provision for loan losses for the first quarter
of 1998 was $3,600,000, an increase of $2,000,000 over the same period of the
preceding year. The Company continues to build its allowance for loan losses in
recognition of the significant growth it has experienced in its loan portfolio.
Average loans in the first quarter of 1998 were 15.9% higher than they were in
1997. While net charge-offs as a percentage of average loans increased only five
basis points from 1997 levels, the Company has recorded somewhat higher
provisions for loan losses, recognizing that the dollar amount of loans
charged-off will probably increase as the loan portfolio grows.
As discussed in previous filings, the sale of the national credit card portfolio
had a significant impact on the provision for loan losses in 1997. Net
charge-offs as a percentage of average loans declined significantly in 1997,
from .39% of average loans in the first quarter of 1996 to .09% in the first
quarter of 1997. While this percentage increased to .14% in the first quarter of
1998, the Company believes its charge-off experience in 1998 will be
substantially less than that experienced while it owned the national credit card
portfolio. All segments of the loan portfolio are performing as had been
expected, and there have been no significant, unanticipated losses in the loan
portfolio in 1998. The provision for loan losses in excess of net charge-offs
recorded by the Company has resulted in an allowance for loan losses at March
31, 1998 equal to 1.56% of loans, increasing from 1.43% in 1997. While the
Company anticipates some increase in its 1998 provision for loan losses arising
from growth in loan volumes, it does not expect a significant change from 1997
levels.
Summary of Loan Loss Experience
- -------------------------------
March 31,
1998 1997
- --------------------------------------------------------------------------------
Amount of loans at period-end $1,262,644 $1,131,198
- ----------------------------------------------------============================
YTD Average loans outstanding $1,257,641 $1,084,739
- ----------------------------------------------------============================
Beginning balance of allowance for loan losses $17,932 $15,536
Loans charged-off
Commercial, Financial and Agricultural 361 167
Credit Card 1,318 727
Installment 520 457
- --------------------------------------------------------------------------------
Total loans charged off 2,199 1,351
- --------------------------------------------------------------------------------
Recoveries on charge-offs
Commercial, Financial and Agricultural 133 169
Real Estate-Mortgage 5 11
Credit Card 204 117
Installment 64 62
- --------------------------------------------------------------------------------
Total recoveries 406 359
- --------------------------------------------------------------------------------
Net loans charged off 1,793 992
Provision charged to expense 3,600 1,600
- --------------------------------------------------------------------------------
Ending balance of allowance for loan losses $19,739 $16,144
- ----------------------------------------------------============================
Net charge-offs/average loans 0.14% 0.09%
- ----------------------------------------------------============================
Allowance for loan losses/loans at period-end 1.56% 1.43%
- ----------------------------------------------------============================
The accompanying table summarizes, by type, the Company's outstanding loans,
excluding loans held-for-sale. Installment loans are principally comprised of
loans secured by automobiles.
March 31, 1998 December 31, 1997
- --------------------------------------------------------------------------------
Percent Percent
Amount of Total Amount of Total
- --------------------------------------------------------------------------------
Commercial, Financial and Agricultural $ 610,860 48.4% $ 623,707 49.4%
Real Estate-Construction 31,010 2.4 29,179 2.3
Real Estate-Mortgage 239,809 19.0 230,133 18.2
Installment, excluding credit card 270,918 21.5 259,074 20.5
Credit card 110,047 8.7 120,366 9.6
- --------------------------------------------------------------------------------
Subtotal $1,262,644 100.0% 1,262,459 100.0%
Allowance for loan losses (19,739) (17,932)
- --------------------------------------------------------------------------------
$1,242,905 $1,244,527
- -----------------------------------------=======================================
Loans considered risk elements, as presented in the following table, totaled
.45% of total loans at March 31, 1998, compared to .53% at December 31, 1997 and
.95% at March 31, 1997. At March 31, 1998, the Company's allowance for loan
losses was equal to 342% of those loans considered risk elements. Comparable
percentages at December 31, 1997 and March 31, 1997 (excluding the nonaccrual
and past due loans contained in the national credit card portfolio) were 266%
and 250%, respectively. Management will continue to actively review the activity
in its loan portfolio to ensure that the provision for loan losses and resultant
allowance for loan losses remain adequate to appropriately address the credit
risk existing in the portfolio.
March 31, December 31,
1998 1997
- --------------------------------------------------------------------------------
Loan Categories
Nonaccrual Loans $3,930 $4,618
Past Due 90 days or more 1,845 2,120
- --------------------------------------------------------------------------------
Total $5,775 $6,738
- ------------------------------------------------================================
LIQUIDITY AND CAPITAL RESOURCES. The Company considered its liquidity level
adequate at March 31, 1998. Growth in deposits and repurchase agreements has
resulted in the Company experiencing an increase in its liquidity levels. The
Company's loan/deposit ratio at March 31, 1998 was 79.6% compared to 83.6% at
March 31, 1997. The Company continues to maintain an investment portfolio with a
relatively short weighted average maturity. At March 31, 1998, the average
maturity of United States government and agency securities in the investment
portfolio was 1 year and 8 months, and the average maturity of municipal
securities was 4 years and 3 months.
The Company has thoroughly reviewed its investment security portfolio and has
determined that at March 31, 1998, it has the ability and intent to hold all
securities in the portfolio that have been classified as held-to-maturity. With
the increases the Company is experiencing in its loan portfolio, it has started
classifying purchases of United States government and agency securities as
available-for-sale. The Company believes that it has a variety of sources of
additional liquidity available. These include, but are not limited to, the
following: securities classified as available-for-sale, the regularly scheduled
maturities of those securities presently held in its investment portfolio, the
securitization of credit card receivables, the ability to securitize other
receivables, such as automobile loans, and federal funds lines available through
other financial institutions. The Company believes these sources provide
sufficient liquidity to meet depositors' needs and make available lendable funds
within its service area.
As mentioned previously, the Company completed a $57,500,000 offering of trust
preferred securities in January, 1998. These preferred securities are considered
capital for regulatory purposes but are classified as indebtedness for financial
reporting and income tax purposes. Terms of the preferred security issue provide
for a dividend rate of 8.24% and a maturity date of January 31, 2028, which may
be shortened to a date no earlier than January 31, 2003 or extended to a date no
later than January 31, 2037 if certain conditions are met.
The Company's capital position substantially exceeds regulatory capital
requirements. The Company must maintain a minimum ratio of total capital to
risk-weighted assets of 8%, of which at least 4% must qualify as Tier 1 capital.
At March 31, 1998, the Company's total capital to risk-weighted assets ratio was
13.3% and its Tier 1 capital to risk-weighted assets ratio was 8.6%.
In addition to the aforementioned regulatory requirements, each of the Company's
subsidiary banks met all capital ratios required at the individual bank level.
OTHER INCOME AND OTHER EXPENSE. First quarter noninterest income increased 13.5%
over prior year levels to $11,544,000. With the exception of credit card fees,
growth was realized in all major areas of noninterest income. The decline in
credit card fees is attributable to the amortization of one of the Company's
credit card securitization transactions in December, 1997, and the Company's
decision to cease the processing of national merchant accounts. This business
was sold in the first quarter of 1998.
Service charges on deposit accounts increased modestly (2.7%) over prior year
levels, reflecting the volume increases realized by the Company. As discussed in
previous filings, the Company has substantially increased its investments in the
wealth management area. Quarterly fee income generated by this line of business
continues to increase. First quarter, 1998 trust fee income increased 6.7% over
the fourth quarter of 1997, and was 57.6% higher than the level of income
recorded during the first quarter of 1997. Securities gains recognized during
the first quarter were the result of a contractual agreement specifying the sale
over a three year period of some stock acquired in a previous acquisition. The
Company entered into no other investment security sales in the first quarter.
Other service charges, fees and income increased 47% over 1997 levels. As noted
above, the Company, during the first quarter of 1998, elected to sell its
national merchant processing business. The Company continues to process merchant
accounts, but believes that its efforts can be more productive if focused on its
regional trade territory. The sale of this national merchant processing business
resulted in the recognition of a $1.5 million gain on the disposition of the
business. The Company also experienced a substantial increase in fees realized
from the sale of alternative investment products and from the monthly fee income
generated by the Company's previously described securitization and sale of
approximately $45 million in automobile loans.
Total noninterest expenses in the first quarter increased 5.0% over comparable
1997 amounts. Most of this increase was in the area of salaries and employee
benefits. At March 31, 1998, the Company employed 891 full-time equivalent
employees. The comparable March 31, 1997 number was 894. The Company's principal
market presently has an unemployment rate of 2.8%, and competition for personnel
is significant. In addition, after relatively moderate increases the past two
years, the Company's first quarter 1998 health care costs increased
approximately 11% over 1997 levels. These two factors were the primary reasons
for the increase in this line item.
Net occupancy and equipment costs increased $117,000, as fully-depreciated
technology equipment was replaced and enhancements were made to the Company's
traditional branch delivery system and its electronic delivery systems. The
year-over-year decrease in advertising and promotional activities is principally
an issue of timing, as total 1998 expenditures are not anticipated to be less
than 1997 amounts. Year-over-year changes in other noninterest expense
categories were relatively modest.
YEAR 2000 ISSUES. As described in previous filings, the Company is actively
engaged in efforts to assess the impact of the inability of existing data
processing hardware and software to recognize calendar dates beginning in the
year 2000. The Company outsources its principal data processing activities to
third party vendors, and all significant software applications are also
purchased from third parties. These outsourced systems include its core loan,
deposit, credit card, trust and general ledger systems. The Company believes
that its vendors are actively addressing the "Year 2000" issue. The Company's
"Year 2000" project team is actively engaged in the development, monitoring and
updating of business unit workplans. The assessment phase for the Company's
critical data processing systems has been completed. While the Company does not
expect that its "Year 200" efforts will have a material impact on its financial
position or its results of operations, it does believe that "Year 2000" efforts
will delay its ability to implement system enhancements that would provide
increased efficiencies. In addition, the failure of bank customers to adequately
prepare for "Year 2000" compatibility could have a significant adverse effect on
such customer's operations and profitability, thereby impacting that customer's
ability to repay loans in accordance with their terms. The Company has begun
contacting and surveying its customer base on their "Year 2000" efforts.
However, until sufficient information has been obtained to enable the Company to
assess the degree to which customer's operations are susceptible to potential
"Year 2000" problems, the Company will be unable to quantify the potential for
losses from loans to its commercial customers.
NEW ACCOUNTING STANDARDS. Statement of Financial Accounting Standards No. 131,
which is effective for fiscal years beginning after December 15, 1997, requires
additional disclosure information with regard to business segments. While this
Statement may impose additional disclosure requirements on the Company, the
Company does not anticipate that it will have a significant impact on operating
results or its financial condition.
Statement of Financial Accounting Standards No. 132, revises employers'
disclosures about pension and other postretirement benefit plans effective for
fiscal years beginning after December 15, 1997. It does not change the
measurement or recognition of those plans. The Company does not anticipate that
adoption of Statement No. 132 will have a material impact on its financial
statements.
<PAGE>
PART 2. OTHER INFORMATION
Item 6(b). Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit No. Description
27 Financial Data Schedule
(b) There were no reports on Form 8-K filed during the
quarter for which this report is filed.
SIGNATURES
Pursuant to the requirements 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.
INTRUST Financial Corporation
Date: May 14, 1998 By: /s/ C.Q. Chandler IV
---------------------
C. Q. Chandler IV
President
(Principal Executive Officer)
Date: May 14, 1998 By: /s/ Jay L. Smith
-----------------
Jay L. Smith
Chief Financial Officer
(Principal Accounting Officer)
<PAGE>
EXHIBIT INDEX
Number Description
- ------ -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 208,741
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 114,875
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 122,970
<INVESTMENTS-CARRYING> 233,583
<INVESTMENTS-MARKET> 358,098
<LOANS> 1,283,117
<ALLOWANCE> 19,739
<TOTAL-ASSETS> 2,032,907
<DEPOSITS> 1,586,870
<SHORT-TERM> 212,235
<LIABILITIES-OTHER> 13,909
<LONG-TERM> 83,719
0
0
<COMMON> 12,075
<OTHER-SE> 124,099
<TOTAL-LIABILITIES-AND-EQUITY> 2,032,907
<INTEREST-LOAN> 29,101
<INTEREST-INVEST> 4,937
<INTEREST-OTHER> 1,966
<INTEREST-TOTAL> 36,004
<INTEREST-DEPOSIT> 12,570
<INTEREST-EXPENSE> 16,770
<INTEREST-INCOME-NET> 19,234
<LOAN-LOSSES> 3,600
<SECURITIES-GAINS> 126
<EXPENSE-OTHER> 18,654
<INCOME-PRETAX> 8,524
<INCOME-PRE-EXTRAORDINARY> 5,382
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,382
<EPS-PRIMARY> 2.48
<EPS-DILUTED> 2.16
<YIELD-ACTUAL> 0.00
<LOANS-NON> 3,930
<LOANS-PAST> 1,845
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 17,932
<CHARGE-OFFS> 2,199
<RECOVERIES> 406
<ALLOWANCE-CLOSE> 19,739
<ALLOWANCE-DOMESTIC> 19,739
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
