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 JUNE 30, 1995 Commission File Number 0-10929
GUARANTY BANCSHARES HOLDING CORPORATION
(Exact name of registrant as specified in its charter)
LOUISIANA 72-0933277
(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, 206,799 shares outstanding as of June 30, 1995
Common Stock, no par value, 167,576 shares outstanding as of June 30, 1995
I N D E X
PART I - Financial Information
Financial Statements
Consolidated Statement of Condition
June 30, 1995, and December 31, 1994 3
Consolidated Statement of Income -
Quarters Ended June 30, 1995 and 1994 4
Consolidated Statement of Cash Flows -
Quarters Ended June 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
June 30 December
1995 31, 1994
------- --------
(in thousands)
(Unaudited)
ASSETS
Cash and due from banks $ 2,168 $ 3,436
Investment securities available for sale 5,227 7,190
Investment securities held to maturity
(Estimated market value $11,145,000 and 11,172 9,494
$9,393,000, respectively)
Federal funds sold 2,250 2,640
Loans 35,698 34,775
Less: Allowance for loan losses 506 502
------- ------
Net Loans 35,192 34,273
Premises and equipment 2,177 2,176
Other real estate - 80
Other assets 1,507 1,398
------- -------
Total Assets $59,693 $60,687
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $50,338 $51,498
Obligations under capital lease 1,675 1,723
Notes payable 1,777 1,854
Other liabilities 504 433
------- -------
Total Liabilities 54,294 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 (1,292) (1,504)
Treasury Stock (16) (16)
Unrealized loss on securities
available for sale (3) (11)
------- -------
Total Stockholders' Equity 5,399 5,179
------- -------
Total Liabilities and Stockholders' Equity $59,693 $60,687
======= =======
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENT OF INCOME
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 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 $ 881 $ 790 $ 1,722 $ 1,538
Interest on time deposits and
federal funds sold 26 23 61 40
Interest on investment securities:
Taxable income 234 168 480 330
Non-taxable income 5 - 10 1
-------- -------- -------- --------
Total Interest Income 1,146 981 2,273 1,909
INTEREST EXPENSE
Interest on deposits 409 326 824 631
Interest on capital lease 42 44 85 89
Interest on notes payable 31 18 62 26
-------- -------- -------- --------
Total Interest Expense 482 388 971 746
-------- -------- -------- --------
Net Interest Income 664 593 1,302 1,163
Provision (recovery) from reserve
for loan losses 0 0 0 0
-------- -------- -------- --------
Net interest income after provision (recovery)
from reserve for loan losses 664 593 1,302 1,163
Other operating income 86 101 192 223
Operating expenses 598 547 1,164 1,098
-------- -------- -------- --------
Income before income tax expense
and extraordinary item 152 147 330 288
Income tax expense 55 60 118 107
-------- -------- -------- --------
Net income 97 87 212 181
-------- -------- -------- --------
Dividends required for preferred stock (101) (101) (202) (202)
-------- -------- -------- --------
Net income (loss) available
for common stockholders $ (4) $ (14) $ 10 $ (21)
======== ======== ======== ========
Earnings (loss) per common share (.01) $ (.04) $ .03 $ (0.06)
======== ======== ======== ========
Weighted average common shares outstanding 374,375 374,375 374,375 374,375
======== ======== ======== ========
</TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION
STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
SIX ENDED
JUNE 30
1995 1994
------ ------
(IN THOUSANDS)
(UNAUDITED)
Cash flows from operating activities:
Net income $ 212 $ 181
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of premium (accretion of discount
on investments) (121) (16)
Net (Gain) on sale of other real estate owned (39) (6)
Gain on sale of fixed assets (7) (8)
Depreciation and amortization 141 138
(Increase) decrease in accrued interest receivable (34) (21)
Increase (decrease) in accrued interest payable 30 42
Increase (decrease) in accounts payable
and other liabilities 41 (399)
------- -------
Net cash provided by operating activities 223 (89)
Cash flows from investing activities:
(Increase)decrease in federal funds sold 390 450
Proceeds from maturities or investment securities 8,109 7,366
Purchase of investment securities (7,703) (5,981)
Maturity of interest bearing deposits - 20
Net increase (decrease) in loans (897) (3,725)
Proceeds from sale of other real estate owned 119 40
Proceeds from sale of premises and equipment 7 26
Purchase of premises and equipment (157) (57)
Increase in other assets (74) 37
------ ------
Net cash provided (used) by investing activities (206) (1,824)
Cash flows from financing activities:
Net increase (decrease) in demand deposits
NOW, savings, and certificates of deposit (1,160) 1,034
Increase (decrease) of notes payable (77) 1,377
Repayments of capital lease obligation (48) (38)
------- ------
Net cash provided used in financing activities (1,285) 2,373
Net increase (decrease) in cash and due from banks (1,268) 460
Cash and due from banks, beginning of year 3,436 1,108
------- ------
Cash and due from banks, end of quarter $2,168 $1,568
====== ======
Supplemental cash flow information:
Interest paid $ 941 $ 707
====== ======
Income taxes paid $ 2 $ 3
====== ======
GUARANTY BANCSHARES HOLDING CORPROATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
Unrealized
Gain(Loss)
on Securities
Balance at Available Balance at
Jan.1, 1995 Net Income For Sale June 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) 212 - (1,292)
Treasury
Stock $ (16) - - (16)
Unrealized
loss on
Securities
available
for sale $ (11) - 8 (3)
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 six (6) months ended June 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.
During 1992 the Bank acquired, through foreclosure, 3,301 shares
of $2.70 preferred stock, 3301 shares of Class A, $5.00 par value common
stock and 3,301 shares of Class B, no par value common stock. The
preferred shares were cancelled and reverted to authorized but unissued
$.50 preferred stock. The common shares are held as treasury stock at
their stated values of $5.00 and $.10, respectively. (See Capital
Resources)
NOTE 2: Contingent Liabilities
As of June 30, 1995, there were $924,850 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 six months ended June 30, 1995, Bancshares earned $212,000,
compared with earnings of $181,000 for the comparable period in 1994.
The primary reason for the increase in earnings was a $139,000 increase
in net interest income. The subsidiary bank did not make a provision for
loan losses in either period.
Changes in financial position at June 30, 1995, from December 31,
1994 were net reductions in investment securities and federal funds sold
and increases in loans. Deposits decreased $1,160,000. Investments and
funds sold declined $285,000 and $390,000, respectively. Loans increased
$923,000. Notes payable to the Federal Home Loan Bank of Dallas
decreased $77,000 through amortization. These funds are used to match
maturities and amortization on loans.
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
six months of 1995, net interest income as a percent of net average
earning assets of $53,856,000 was 4.83 percent, up from 4.66 percent for
the first six months of 1994. The increase is attributable to an
increase in higher yielding loans.
Net Operating Results
---------------------
The following analysis should be read in conjunction with the
accompanying financial statements.
Net interest income increased a net of $139,000. Of this amount,
increases were: (a) on investments - $159,000, and (b) on federal funds
sold - $19,000. Interest on loans increased $184,000. Interest on
deposits increased $193,000.
The increase in loan income is attributable to a $2,515,000
increase in average loans outstanding, and 0.4 percent increase in
average yields to 9.8 percent. The increase in investment income was
the result of a $1,364,000 increase in average securities investments
and a 1.5 percent increase in average yields.
Interest expense increased $139,000 from 1994 levels. Average
interest bearing deposits increased $3,178,000, while average rates paid
increased 0.7 percent to 3.9 percent. During 1994 the subsidiary bank
borrowed an additional $1,400,000 from the Federal Home Loan Bank of
Dallas to fund a commercial real estate loan which has a comparable
scheduled amortization and maturity.
Investment Securities
---------------------
Investment securities increased from $15,503,000 as of June 30,
1994 to $16,399,000 at June 30, 1995. This is primarily attributable
to purchases of U.S. Treasury and U.S. Government Agency securities and
by amortization on mortgage backed securities. There were no securities
sales during the first six months of 1995.
An analysis of investment securities follows (in thousands).
Amortized Unrealized Market
Cost Gain Loss Value
---------- ---- ---- -----
June 30, 1995
-------------
Held to Maturity
U. S. Treasury Securities $ 4,949 $ 1 $ 5 $ 4,945
Obligations of U.S.
Agencies and Corporations 5,837 9 43 5,803
Obligations of states and
political subdivisions 362 6 - 368
Other Investments 24 - - 24
------- ---- ----- -------
Total $11,172 $ 16 $ 48 $11,140
======= ==== ===== =======
Available for Sale
Obligations of U.S.
Agencies and Corporations $ 4,749 $ 10 $ 14 $ 4,745
Other investments 482 - - 482
------- ---- ---- -------
Total $ 5,231 $ 10 $ 14 $ 5,227
======= ==== ==== =======
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
======= ====== ==== =======
June 30, 1994
-------------
Held to Maturity
U. S. Treasury Securities $ 2,939 $ - $ - $ 2,939
Obligations of U.S.
Agencies and Corporations 5,326 19 22 5,323
Obligations of states and
political subdivisions 4 - - 4
Other Investments 33 - - 33
------- ------ ---- -------
Total $ 8,302 $ 19 $ 22 $ 8,299
======= ====== ==== =======
Available for Sale
U.S. Treasury Securities $ 1,500 $ 1 $ 8 $ 1,493
Obligations of U.S.
Agencies and Corporations 5,277 13 48 5,242
Other investments 466 - - 466
------- ------ ---- -------
Total $ 7,243 $ 14 $ 56 $ 7,201
======= ====== ==== =======
An analysis of the market value of the investment portfolio by maturity
periods at June 30, 1995 follows (in thousands):
Amortized Market
Cost Value
--------- -------
Within one year $ 9,933 $ 9,922
One to five years 4,724 4,694
Five to ten years 392 398
After ten years 1,354 1,353
--------- -------
Total $ 16,403 $16,367
========= =======
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
$7,179,000, $5,994,000, and $5,399,000 at June 30, 1995, December 31,
1994 and June 30, 1994, respectively, were pledged to secure public
deposits as required by law.
Deposits
--------
A summary of the deposits as of June 30, 1995, December 31, and
June 30, 1994 is as follows:
June 30 December 31 June 30
1995 1994 1994
-------- ----------- ------------
(in thousands)
Demand Deposits $ 7,779 $ 8,289 $ 7,305
NOW Accounts 4,687 4,883 4,300
Money Market
Investment Accts. 4,839 4,664 4,328
Savings Deposits 7,083 7,603 7,899
Other Time Deposits 19,193 17,872 16,430
Certificates of Dep.
of $100,000 or
more 6,757 8,187 7,825
------- ------- -------
$50,338 $51,498 $48,087
======= ======= =======
Non-interest bearing demand deposits at June 30, 1995
increased $474,000 from June 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 $673,000. During
this period, public fund deposits in certificates of deposit of $100,000
or more decreased $395,000 as these muncipalities 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 1.42 percent of loans outstanding
at June 30, 1995, compared with 1.44 percent at December 31, 1994 and
1.93 percent at June 30, 1994. The Bank did not make a provision to the
reserve for loan losses during the first six months of 1995 or 1994.
1995 1994
-------- --------
Balance at January 1, $502,000 $621,000
(Recovery) Provision for loan losses - -
Recoveries credited to the allowance 17,000 15,000
-------- --------
519,000 636,000
Losses charged to the allowance 13,000 4,000
-------- --------
Balance at June 30 $506,000 $632,000
======== ========
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.
June 30 December 31 June 30
1995 1994 1994
-------- ------------ ---------
Non-accrual loans $ 95,000 $ 30,000 $ -0-
Foreclosed real estate -0- 80,000 -0-
Management believes the Bank has adequate reserves to provide for
possible future loan losses.
Other Income
------------
Other operating income aggregated to $192,000 for the first six
months of 1995 compared with $223,000 in 1994. There was no securities
trading account activity in 1995 or 1994.
Six Months Ending
June 30
1995 1994
-------- --------
Service charges on deposit accounts $101,000 $125,000
Other service charges and fees 29,000 21,000
Other operating income 62,000 77,000
-------- --------
Total $192,000 $223,000
======== ========
Operating Expenses
------------------
Other operating expenses totaled $1,164,000 for the first six
months of 1995, compared with $1,098,000 for 1994, a $66,000 increase,
primarily due to openning a new branch..
Personnel expenses totaled $512,000 for the period, compared with
$482,000 in 1994. In 1995, expenses related to other real estate and
repossessed property, net of rental income on these properties, totaled
$7,000. These expenses, representing taxes, maintenance and insurance,
were partially offset by rental income on these properties of
approximately $1,000.
A summary of other operating expenses is as follows:
Six Months 1995
Ending Over
June 30, (Under)
1995 1994 1994
------------ -------
(In Thousands)
Salaries and benefits $ 512 $ 482 $ 30
Expenses related to other real
estate and repossessed
properties, net of rental
income on these properties 7 2 5
Net occupancy expenses 214 209 5
Equipment and computer expenses 105 94 11
Professional fees and services 60 68 (8)
FDIC and other insurance 72 71 1
Other 194 172 22
------- ------ ------
$ 1,164 $1,098 $ 66
====== ===== =====
Income Taxes
------------
Income taxes were accrued at the U. S. federal tax rate. At June
30, 1995. Bancshares has net operating loss carryforwards of
approximately $731,000 and $523,000 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 June 30, 1995 and 1994, the Bank's gross loans-to-deposits
ratios were 70.9 percent and 74.1 percent, respectively. Loans increased
$74,000 from 1994 levels. Significant to the loan-to-deposit ratio
computation, deposits increased $2,251,000 as of June 30, 1995 from
1994. The Bank has no brokered deposits.
As a bank holding company, the ability of Bancshares to pay its
obligations is wholly dependent upon the receipt of dividends and tax
benefits from the Bank.
Capital Resources
-----------------
At June 30, 1995, stockholders' equity amounted to $5,399,000
compared with $4,933,000 at June 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 July 13, 1995 $2,262,000
$.50 Preferred Stock, dividends accumulated
from January 13, 1990 through July 13, 1995 69,000
----------
$2,331,000
=========
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: August 3, 1995
---------------
PART II
Item 6: Exhibits and Reports on Form 8-K
a. Exhibit No. 11. Computation of Earnings Per Common
Share
b. Exhibit No. 27. Financial Data Schedule
c. The Registrant has not filed any Reports on Form
8-K during the second quarter of 1995.
Exhibit No. 11 Computation of Earnings Per Common Share
SIX MONTHS ENDED
JUNE 30, 1995
-----------------
Net income available
for common shareholders $ 10,000
Average common shares outstanding 374,275
Income per common share $ 0.03
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000706731
<NAME> GUARANTY BANCSHARES HOLDING CORPORATION
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 2168
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 2250
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 5227
<INVESTMENTS-CARRYING> 11172
<INVESTMENTS-MARKET> 11145
<LOANS> 35698
<ALLOWANCE> 506
<TOTAL-ASSETS> 59693
<DEPOSITS> 50338
<SHORT-TERM> 0
<LIABILITIES-OTHER> 504
<LONG-TERM> 3452
<COMMON> 1067
0
3604
<OTHER-SE> 728
<TOTAL-LIABILITIES-AND-EQUITY> 59693
<INTEREST-LOAN> 1722
<INTEREST-INVEST> 480
<INTEREST-OTHER> 71
<INTEREST-TOTAL> 2273
<INTEREST-DEPOSIT> 824
<INTEREST-EXPENSE> 971
<INTEREST-INCOME-NET> 1302
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1164
<INCOME-PRETAX> 330
<INCOME-PRE-EXTRAORDINARY> 330
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 212
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
<YIELD-ACTUAL> 4.83
<LOANS-NON> 95
<LOANS-PAST> 9
<LOANS-TROUBLED> 95
<LOANS-PROBLEM> 95
<ALLOWANCE-OPEN> 502
<CHARGE-OFFS> 13
<RECOVERIES> 17
<ALLOWANCE-CLOSE> 506
<ALLOWANCE-DOMESTIC> 506
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
