SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 10 - Q
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934.
For Quarter Ended SEPTEMBER 30, 1995 Commission File Number 0-10929
GUARANTY BANCSHARES HOLDING CORPORATION
(Exact name of registrant as specified in its charter)
LOUISIANA 72-933277
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P. O. BOX 2208, MORGAN CITY, LOUISIANA 70381
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 504-384-2813
NOT APPLICABLE
(Former name, former address and former fiscal year
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No .
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, $5 par value, 206,124 shares outstanding as of
September 30, 1995.
Common Stock, no par value, 166,901 shares outstanding as of
September 30, 1995
I N D E X
PART I - Financial Information
Financial Statements
Consolidated Statement of Condition
September 30, 1995, and December 31, 1994 3
Consolidated Statement of Income -
Quarters Ended September 30, 1995 and 1994 4
Consolidated Statement of Cash Flows -
Quarters Ended September 30, 1995 and 1994 5
Consolidated Statement of Changes in
Stockholders' Equity 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Signature 15
Exhibit Index 17
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF CONDITION
September December
30, 1995 31, 1994
(in thousands)
(Unaudited)
ASSETS
Cash and due from banks $ 2,489 $ 3,436
Investment securities available for sale 5,213 7,190
Investment securities held to maturity
(Estimated market value $11,135,000 and 11,146 9,494
$9,393,000, respectively)
Federal funds sold 2,400 2,640
Loans 35,312 34,775
Less: Allowance for loan losses 497 502
Net Loans 34,815 34,273
Premises and equipment 2,117 2,176
Other real estate 66 80
Other assets 1,410 1,398
Total Assets $59,656 $60,687
====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $50,166 $51,498
Obligations under capital lease 1,654 1,723
Notes payable - Federal Home Loan Bank 1,730 1,854
Other liabilities 544 433
Total Liabilities 54,094 55,508
Commitments and contingent liabilities (Note 2) - -
Stockholders' Equity
$2.70 Cumulative Preferred stock; 145,676
shares authorized, issued and outstanding 3,497 3,497
$.50 Cumulative Preferred stock, 64,324 shares
authorized, 21,900 issued and outstanding 107 107
Class A Common stock; $5 par value; 210,000
shares authorized and outstanding 1,050 1,050
Class B Common stock; no par value; 210,000
shares authorized, 170,877 issued and
outstanding 17 17
Capital surplus 2,039 2,039
Accumulated deficit (1,127) (1,504)
Treasury Stock (28) (16)
Unrealized gain on securities
available for sale 7 (11)
Total Stockholders' Equity 5,562 5,179
Total Liabilities and Stockholders' Equity $59,656 $60,687
====== ======
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF INCOME
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
1995 1994 1995 1994
-------- -------- -------- --------
(IN THOUSANDS, EXCEPT (IN THOUSANDS, EXCEPT
PER SHARE DATA) PER SHARE DATA)
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on loans $ 866 $ 875 $ 2,588 $ 2,413
Interest on time deposits and
federal funds sold 48 19 109 59
Interest on investment securities:
Taxable income 233 190 713 520
Non-taxable income 5 2 15 3
-------- -------- -------- --------
Total Interest Income 1,152 1,086 3,425 2,995
INTEREST EXPENSE
Interest on deposits 437 363 1,261 994
Interest on capital lease 42 44 127 133
Interest on notes payable 30 34 92 60
-------- -------- -------- --------
Total Interest Expense 509 441 1,480 1,187
-------- -------- -------- --------
Net Interest Income 643 645 1,945 1,808
Provision (recovery) from reserve
for loan losses (100) (180) (100) (180)
-------- -------- -------- --------
Net interest income after provision (recovery)
from reserve for loan losses 743 825 2,045 1,988
Other operating income 79 69 271 292
Operating expenses 569 553 1,733 1,651
-------- -------- -------- --------
Income before income tax expense
and extraordinary item 253 341 583 629
Income tax expense 88 123 206 230
-------- -------- -------- --------
Net income 165 218 377 399
-------- -------- -------- --------
Dividends required for preferred stock (101) (100) (288) (302)
-------- -------- -------- --------
Net income available
for common stockholders $ 64 $ 118 $ 89 97
======== ======== ======== ========
Earnings per common share $ .17 $ .32 $ .24 $ .26
======== ======== ======== ========
Weighted average common shares outstanding 373,025 374,375 373,925 374,375
======== ======== ======== ========
</TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION
STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
NINE MONTHS ENDED
SEPTEMBER 30
1995 1994
(IN THOUSANDS)
(UNAUDITED)
Cash flows from operating activities:
Net income $ 288 $ 399
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of premium (accretion of discount
on investments) (184) (58)
Recovery from the Reserve for Loan Loss (100) (180)
Net (Gain) on sale of other real estate owned (39) (6)
Gain on sale of fixed assets (9) -
Depreciation and amortization 215 207
(Increase) decrease in accrued interest receivable (59) (10)
Increase (decrease) in accrued interest payable 11 28
Increase (decrease) in accounts payable
and other liabilities 99 (324)
Net cash provided by operating activities 222 56
Cash flows from investing activities:
(Increase)decrease in federal funds sold 240 150
Proceeds from maturities or investment securities 13,182 9,536
Purchase of investment securities (12,673) (8,803)
Maturity of interest bearing deposits - 417
Net (increase) decrease in loans (542) (3,746)
Proceeds from sale of other real estate owned 167 40
Proceeds from sale of premises and equipment 32 26
Purchase of premises and equipment (178) (58)
(Increase)decrease in other assets 128 128
Net cash provided (used) by investing activities 356 (2,310)
Cash flows from financing activities:
Net increase (decrease) in demand deposits
NOW, savings, and certificates of deposit (1,332) 1,488
Increase (decrease) of notes payable (124) 1,333
Repayments of capital lease obligation (69) (57)
Net cash provided used in financing activities (1,525) 2,764
Net increase (decrease) in cash and due from banks (947) 510
Cash and due from banks, beginning of year 3,436 1,108
Cash and due from banks, end of quarter $2,489 $1,618
====== ======
Supplemental cash flow information:
Interest paid $1,472 $1,618
====== ======
Income taxes paid $ 2 $ 4
====== ======
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
Unrealized
Acquisition Gain(Loss)
of on Securities
Balance at Treasury Available Balance at
Jan.1,1995 Net Income Stock For Sale Sep.30,1995
$2.70
Preferred
Stock $ 3,497 - - - 3,497
$.50
Preferred
Stock $ 107 - - - 107
Class A
Common
Stock $ 1,050 - - - 1,050
Class B
Common
Stock $ 17 - - - 17
Capital
Surplus $ 2,039 - - - 2,039
Accumulated
Deficit $(1,504) 377 - - (1,127)
Treasury
Stock $ (16) - (12) - (28)
Unrealized
Gain (Loss)
on Securities
available
for sale $ (11) - - 18 7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The information furnished reflects all adjustments which are,
in the opinion of management, necessary for a fair statement of
results for the nine (9) months ended September 30, 1995 and 1994.
All adjustments are considered to be of a recurring nature.
Results for the interim period may not necessarily be indicative
of results for the entire year.
NOTE 1:
On January 13, 1983, pursuant to a Reorganization and Merger
Agreement, Guaranty Bank & Trust Company of Morgan City (the Bank)
was merged into a subsidiary of Guaranty Bancshares Holding
Corporation (Bancshares) with the effect that the Bank became a
wholly owned subsidiary of Bancshares.
Bancshares has outstanding $2.70 Cumulative Preferred Stock
and Class B, No Par Value Common Stock which were issued in 1988
in exchange for subordinated debentures issued in 1983 when the
company was formed. Bancshares also has outstanding Class A, $5.00
Par Value, Common Stock which were also issued when the company was
formed. The $.50 Cumulative Preferred Stock is subordinate to the
$2.70 Preferred Stock and were issued for cash in 1989 and 1990.
The Class B common stock does not differ from the Class A
common stock except that Class A common stock has a par value of
$5 per share and Class B Common stock has no par value.
NOTE 2: Contingent Liabilities
As of September 30, 1995, there were $938,958 of letters of
credit outstanding which are not reflected in the consolidated
financial statements. Management does not expect any loss as a
result of these transactions.
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Summary
For the nine months ended September 30, 1995, Bancshares
earned $377,000, compared with earnings of $399,000 for the
comparable period in 1994. The primary reason for the decrease in
earnings was a $137,000 increase in net interest income and $80,000
less in recoveries from the Reserve for Loan Losses. Operating
expenses increased $82,000, primarily from opening a new branch
banking facility.
Changes in financial position at September 30, 1995, from
December 31, 1994 were as follows:
NET NET
INCREASES DECREASES
Investments $ - $ 325,000
Federal Funds sold - 240,000
Gross Loans 537,000 -
Deposits - 1,332,000
Notes Payable - 124,000
Total Assets - 1,031,000
Net credit income is the most significant component of
financial operations and is affected by interacting forces,
including changes in investment market interest rates and changes
in volume and mix of interest earning assets and interest bearing
deposits. For the first nine months of 1995, net interest income
as a percent of net average earning assets of $53,640,000 was 4.83
percent, up from 4.80 in 1994. The increase is attributable
primarily to a higher ratio of interest earning assets to interest
bearing liabilities.
Net Operating Results
The following analysis should be read in conjunction with the
accompanying financial statements.
Interest income increased a net of $137,000. Of this amount,
loans increased $175,000. Interest on federal funds sold increased
$50,000. Interest on investments increased $205,000. Interest on
deposits increased $267,000 wile interest on the capital lease
decreased $6,000. Interest on the notes payable increased $32,000.
The increase in loan income is attributable to an increase in
average loan volume. Average yields on loans were 9.9 percent in
1995 and 9.6 percent in 1994. Average loans outstanding increased
from $33,613,000 in 1994 to $35,263,000. The increase in income
from federal funds sold is the net result of a $604,000 increase
in average funds invested and a 1.66 percent increase in average
yields. Average securities investments increased $1,111,000 while
average yields increased 1.3 percent from 1994 levels.
Interest expense increased $293,000 from 1994 levels. Average
interest bearing deposits increased $2,705,000, while average rates
paid increased 0.6 percent from 3.3 percent in 1994 to 3.9 percent
in 1995.
Investment Securities
Investment securities increased from $16,180,000 as of
September 30, 1994 to $16,359,000 at September 30, 1995. There were
no securities sales during the first nine months of 1995.
An analysis of investment securities follows (in thousands).
Amortized Unrealized Market
Cost Gain Loss Value
September 30, 1995
Held to Maturity
U. S. Treasury Securities $ 4,973 $ 7 $ - $ 4,980
Obligations of U.S.
Agencies and Corporations 5,789 7 34 5,762
Obligations of states and
political subdivisions 362 9 - 371
Other Investments 22 - - 22
Total $11,146 $ 23 $ 34 $11,135
======= ==== ===== =======
Available for Sale
Obligations of U.S.
Agencies and Corporations $ 4,715 $ 11 $ - $ 4,726
Other investments 487 - - 487
Total $ 5,202 $ 11 $ - $ 5,213
======= ==== ==== =======
December 31, 1994
Held to Maturity
U. S. Treasury Securities $ 3,156 $ - $ 28 $ 3,128
Obligations of U.S.
Agencies and Corporations 5,943 5 67 5,881
Obligations of states and
political subdivisions 366 - 11 355
Other Investments 29 - - 29
Total $ 9,494 $ 5 $106 $ 9,393
======= ===== ==== =======
Available for Sale
U.S. Treasury Securities $ 1,500 $ - $ 1 $ 1,499
Obligations of U.S.
Agencies and Corporations 5,234 11 26 5,219
Other investments 472 - - 472
Total $ 7,206 $ 11 $ 27 $ 7,190
======= ====== ==== =======
September 30, 1994
Held to Maturity
U. S. Treasury Securities $ 3,636 $ - $ - $ 3,625
Obligations of U.S.
Agencies and Corporations 4,982 5 20 4,967
Obligations of states and
political subdivisions 369 - - 369
Other Investments 31 - - 31
Total $ 9,018 $ 5 $ 31 $ 8,992
======= ====== ==== =======
Available for Sale
U.S. Treasury Securities $ 1,500 $ - $ 7 $ 1,493
Obligations of U.S.
Agencies and Corporations 5,240 11 50 5,201
Other investments 468 - - 468
Total $ 7,208 $ 11 $ 57 $ 7,162
======= ====== ==== =======
A comparison of the amortized cost and market values of the invest
portfolio by maturity periods at September 30, 1995 follows (in
thousands):
Amortized Market
Cost Value
Within one year $ 14,983 $14,964
One to five years 169 172
Five to ten years 358 368
After ten years 838 844
Total $ 16,348 $16,348
========= =======
Maturities of mortgage backed securities are classified by
contractual (stated) maturity dates. Expected maturities will
differ from contractual maturities because borrowers have the right
to call or prepay obligations.
Investment securities with a carrying value of approximately
$6,978,000, $5,994,000, and $6,150,000 at September 30, 1995
December 31, 1994 and September 30, 1994 respectively, were pledged
to secure public deposits as required by law.
Deposits
A summary of the deposits as of September 30, 1995, December
31, and September 30, 1994 is as follows:
Sep.30 Dec. 31 Sep.30
1995 1994 1994
(in thousands)
Demand Deposits $ 8,614 $ 8,289 $ 8,339
NOW Accounts 4,775 4,883 4,371
Money Market
Investment Accts. 5,556 4,664 4,162
Savings Deposits 6,874 7,603 8,041
Other Time Deposits 18,247 17,872 15,891
Certificates of Dep.
of $100,000 or
more 6,100 8,187 7,737
$50,166 $51,498 $48,541
======= ======= =======
Non-interest bearing demand deposits at September 30, 1995
increased $275,000 from September 30, 1994. As interest rates paid
on money market investment accounts remained low, depositors
transferred funds to higher yielding certificates of deposits which
had become more competitive with non-bank related institutions.
Certificates of deposits of $100,000 or more to commercial entities
decreased $789,000. During this period, public fund deposits in
certificates of deposit of $100,000 or more decreased $848,000 as
these municipalities used accumulated funds on capital projects.
The Bank has insignificant foreign and no brokered deposits.
Short Term Borrowings
The Bank had no short term borrowings in 1995 or 1994.
Allowance for Loan Losses and Non-Performing Loans and Other Real
Estate
The allowance for loan losses was 1.41 percent of loans
outstanding at September 30, 1995, compared with 1.44 percent at
December 31, 1994 and 1.40 percent at September 30, 1994. The Bank
recorded recoveries from the Reserve for Loan Losses of $100,000
and $180,000 during the third quarters of 1995 and 1994,
respectively.
1995 1994
Balance at January 1, $502,000 $621,000
(Recovery) Provision for loan losses (100,000) (180,000)
Recoveries credited to the allowance 109,000 61,000
511,000 502,000
Losses charged to the allowance 14,000 4,000
Balance at September 30 $497,000 $498,000
======== ========
Indicative of improving conditions in the local economy, the
following schedule shows non-performing loans on non-accrual status
and repossessed and foreclosed real estate.
Sep.30 Dec. 31 Sep. 30
1995 1994 1994
Non-accrual loans $ -0- $ 30,000 $ -0-
Foreclosed real estate 66,000 80,000 -0-
Foreclosed Property 3,000 -0- -0-
Management believes the Bank has adequate reserves to provide
for possible future loan losses.
Other Income
Other operating income aggregated to $271,000 for the first
nine months of 1995 compared with $292,000 in 1994. There was no
securities trading account activity in 1995 or 1994.
Nine Months Ending
September 30
1995 1994
Service charges on deposit accounts $154,000 $178,000
Other service charges and fees 42,000 42,000
Other operating income 75,000 72,000
Total $271,000 $292,000
======== ========
Operating Expenses
Other operating expenses totaled $1,733,000 for the first nine
months of 1995, compared with $1,651,000 for 1994, an $82,000
increase.
Personnel expenses totaled $780,000 for the period, compared
with $723,000 in 1994. In 1995, expenses related to other real
estate and repossessed property, net of rental income on these
properties, totaled $8,000. These expenses, represented taxes,
maintenance and insurance. FDIC and other insurance expenses were
favorably affected by a reduction of FDIC assessments.
A summary of other operating expenses is as follows:
Nine Months 1995
Ending Over
Sep. 30, (Under)
1995 1994 1994
(In Thousands)
Salaries and benefits $ 780 $ 723 $ 57
Expenses related to other real
estate and repossessed
properties, net of rental
income on these properties 8 2 6
Net occupancy expenses 322 319 3
Equipment and computer expenses 157 144 13
Professional fees and services 91 101 (10)
FDIC and other insurance 77 106 (29)
Other 298 256 42
$ 1,733 $1,651 $ 82
====== ===== =====
Income Taxes
Income taxes were accrued at the U. S. federal tax rate. At
September 30, 1995. Bancshares has net operating loss carryforwards
of approximately $643,000 and $435,000 for income tax and financial
statement purposes, respectively.
Liquidity
The term "liquidity" generally refers to the ability of a
company to generate adequate amount of cash to meet its needs. For
a bank, "liquidity" represents its ability to meet timely the
demand for funds used to honor checks, to pay maturing time
deposits, to fund increases in loan demand and to satisfy other
commitments. Unless it borrows funds, a bank's source of funds are
generally its core deposits and its retained earnings.
At September 30, 1995 and 1994, the Bank's gross loans-to-
deposits ratios were 70.4 percent and 73.3 percent, respectively.
Loans decreased $386,000 from 1994 levels. Significant to the
loan-to-deposit ratio computation, deposits increased $1,625,000
as of September 30, 1995 from 1994. The Bank has no brokered
deposits.
Capital Resources
At September 30, 1995, stockholders' equity amounted to
$5,562,000 compared with $5,148,000 at September 30, 1994 and
$5,179,000 at December 31, 1994.
Bancshares has paid only one $2.70 and one 67.5 cents dividend
on its $2.70 preferred stock and has not declared or paid dividends
on its $.50 preferred stock since their issuance. As a result
accumulated and unpaid dividends are as follows:
$2.70 Preferred Stock, Dividends accumulated
from January 13, 1990 through September 30, 1995 $2,335,000
$.50 Preferred Stock, dividends accumulated
from January 13, 1990 through September 30, 1995 66,000
$2,401,000
=========
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.
/s/Lee A. Ringeman
Lee A. Ringeman
Executive Vice President
Chief Financial Officer
DATE: October 31, 1995
Exhibit No. 11 Computation of Earnings Per Common Share
NINE MONTHS ENDED
SEPT.30, 1995
Net income available
for common shareholders $ 89,000
Average common shares outstanding 373,925
Income per common share $ 0.24
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000706731
<NAME> GUARANTY BANCSHARES HOLDING CORP.
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<S> <C> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1995 DEC-31-1995
<PERIOD-START> JAN-01-1995 JAN-01-1995 JAN-01-1995
<PERIOD-END> MAR-31-1995 JUN-30-1995 SEP-30-1995
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<INVESTMENTS-HELD-FOR-SALE> 5677 5227 5213
<INVESTMENTS-CARRYING> 10932 11172 11146
<INVESTMENTS-MARKET> 10848 11145 11135
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1067 1067 1067
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<INTEREST-TOTAL> 1127 2273 3425
<INTEREST-DEPOSIT> 415 824 1261
<INTEREST-EXPENSE> 489 971 1480
<INTEREST-INCOME-NET> 638 1302 1945
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<EXPENSE-OTHER> 566 1164 1733
<INCOME-PRETAX> 178 330 583
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