<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934.
For Quarter Ended MARCH 31, 1997 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 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, 206,524 shares outstanding as of
March 31, 1997, Common Stock, no par value, 166,901 shares
outstanding as of March 31, 1997.
<PAGE>
I N D E X
Part I - Financial Information
Financial Statements
Consolidated Statement of Condition
March 31, 1997, and December 31, 1996 3
Consolidated Statement of Income -
Quarters Ended March 31, 1997 and 1996 4
Consolidated Statement of Cash Flows -
Quarters Ended March 31, 1997 and 1996 5
Consolidated Statement of Changes in
Stockholders' Equity 6
Notes to Consolidated and Financial Statements 7
Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Signature 15
Exhibit Index 17
<PAGE>
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATION STATEMENT OF CONDITION
<CAPTION>
March 31 December 31,
1997 1996
(in thousands)
(Unaudited)
<S> <C> <C>
ASSETS
Cash and due from banks $ 2,559 $ 2,626
Investment securities available for sale 4,611 4,648
(Estimated market value $13,176,000
and $12,832,000, respectively) 13,181 12,818
Federal funds sold 4,700 5,350
Loans 38,148 38,142
Less: Allowance for loan losses 512 506
_______ _______
Net Loans 37,636 37,636
Premises and equipment 1,911 1,969
Other assets 1,549 1,383
_______ _______
Total Assets $66,147 $66,430
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $56,749 $56,793
Obligation under capital lease 1,521 1,546
Notes payable 1,428 1,480
Other liabilities 738 1,045
_______ _______
Total Liabilities 60,436 60,864
_______ _______
Commitments and contingent liabilities (Note 2) - -
Stockholders' Equity
$2.70 Cumulative Preferred stock; 145,001
shares authorized, issued and outstanding 3,481 3,481
$.50 Cumulative Preferred stock, 64,999 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, 170,887 issued and
Outstanding 17 17
Capital surplus 2,039 2,039
Accumulated deficit ( 973) ( 1,131)
Treasury Stock ( 14) ( 14)
Unrealized gain on securities
available for sale 4 17
_______ _______
Total Stockholders' Equity 5,711 5,566
_______ _______
Total Liabilities and Stockholders' Equity $66,147 $66,430
======= =======
</TABLE>
<PAGE>
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
<CAPTION>
THREE MONTHS ENDED
MARCH 31
1997 1996
(In thousands, except
per share data)
(Unaudited)
<S> <C> <C>
INTEREST INCOME
Interest and fees on loans $ 910 $ 816
Interest on federal
funds sold 52 93
Interest on investment securities:
Taxable income 253 207
Non-Taxable income 9 10
________ ________
Total Interest Income 1,224 1,126
INTEREST EXPENSE
Interest on deposits 442 408
Interest on capital lease 38 41
Interest on notes payable 24 28
________ ________
Total Interest Expense 504 477
________ ________
Net Interest Income 720 649
Provision for loan losses 0 0
________ ________
Net Interest Income after Provision
for loan losses 720 649
Other operating income 70 79
Operating expenses 551 565
________ ________
Income before income tax expense 239 163
Income tax expense 81 58
________ ________
Net income 158 105
Dividends required for preferred stock (101) (101)
________ ________
Net income available for common
stockholders $ 57 $ 4
======== ========
Earnings per common share $ .15 $ .01
======== ========
Weighted average common shares
outstanding 373,425 373,025
======== =======
</TABLE>
<PAGE>
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
<CAPTION>
QUARTER ENDED
MARCH 31
1997 1996
(In thousands)
(Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income $ 158 $ 105
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of premium (accretion of discount
on investments), net (103) (52)
Depreciation and amortization 59 71
(Increase) decrease in accrued interest receivable (70) 27
Increase (decrease) in accrued interest payable (52) 42
Increase (decrease) in accounts payable
and other liabilities 137 13
________ ________
Net cash provided by operating activities 129 206
Cash flows from investing activities:
Decrease (increase) in federal funds sold 650 (3,025)
Proceeds from maturities of investment securities 5,060 8,589
Purchase of investment securities (5,305) (8,536)
Net increase (decrease) in loans - 322
Proceeds from sale of other real estate owned - 1
Purchase of premises and equipment (1) (24)
Increase in other assets (87) (69)
________ ________
Net cash provided (used) by investing activities 317 (2,742)
Cash flows from financing activities:
Net increase (decrease) in demand deposits
NOW, savings, and certificates of deposit (44) 1,662
Repayment of notes payable (52) (49)
Repayment of capital lease obligation (25) (15)
Cash dividends (392) 0
________ ________
Net cash provided used in financing activities (513) 1,598
________ ________
Net increase (decrease) in cash and due from banks (67) (938)
Cash and due from banks, beginning of year 2,626 3,230
Cash and due from banks, end of quarter $ 2,559 $ 2,292
======== ========
Supplement cash flow information:
Interest paid $ 556 $ 435
======== ========
Income taxes paid $ 27 $ 91
======== ========
</TABLE>
<PAGE>
<TABLE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
<CAPTION>
Unrealized
Gain (Loss)
On Securities
Balance at Available Balance at
Jan. 1, 1997 Net Income For Sale Mar. 31, 1997
<S> <C> <C> <C> <C>
$2.70
Preferred
Stock $ 3,481 - - 3,481
$.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 $ (1,131) 158 - (973)
Treasury
Stock $ (14) - - (14)
Unrealized
loss on
Securities
available
for sale $ 17 - (13) 4
</TABLE>
<PAGE>
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 three (3) months ended March 31, 1997 and
1996. All adjustments are considered to be of 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 March 31, 1997, there were $657,108 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.
<PAGE>
GUARANTY BANCSHARES HOLDING CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Summary
For the three months ended March 31, 1997, Bancshares earned
$158,000, compared with earnings of $105,000 for the comparable
period in 1996. The primary reason for the increase in earnings
was a $98,000 increase in interest income. The subsidiary bank
did not make a provision for loan losses in either period.
Other than the decrease in other liabilities, there were no
significant changes in financial position at March 31, 1997 from
December 31, 1996. This decrease represented the payment of
$391,502 in dividends on Bancshares' $2.70 cumulative preferred
stock. This dividend was declared in December 1996.
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 three months of 1997, net interest
income as a percent of average earning assets of $60,721,000 was
4.7 percent, the same as the first quarter of 1996.
Net Operating Results
The following analysis should be read in conjunction with
the accompanying financial statements.
Interest income increased a net of $98,000. Of this amount,
income on investment securities increased $45,000. Interest on
loans increased $94,000, while income on funds sold decreased
$41,000.
The increase in loan income is attributable to a $4,082,000
increase in average loans outstanding and 0.1 percent decrease in
the average yields to 9.4 percent. The increase in investment
income was the result of a $3,972,000 increase in average
securities investments and was offset by a 0.3 percent decrease
in average yields, following the overall change in interest
rates.
Interest expense increased $27,000 from 1996 levels.
Average interest bearing deposits increased $4,856,000, while
average rates paid decreased 0.1 percent from 1996 levels to 3.7
percent. Funds borrowed are from the Federal Home Loan Bank of
Dallas and were used to fund commercial real estate loans which
have a comparable scheduled amortization and maturity.
Investment Securities
Investment securities increased from $16,181,000 as of March
31, 1996 to $17,792,000 at March 31, 1997. There were no
securities sales during the first quarter of 1997 or 1996.
<TABLE>
An analysis of investment securities follows (in thousands).
<CAPTION>
Amortized Unrealized Market
Cost Gain Loss Value
<S> <C> <C> <C> <C>
March 31, 1997
Held to Maturity
U.S. Treasury Securities $ 2,244 $ - $ - $ 2,244
Obligations of U.S.
Agencies and Corporations 10,295 3 17 10,281
Obligations of states and
political subdivisions 636 9 - 645
Other Investments 6 - - 6
________ ____ ____ ________
Total $ 13,181 $ 12 $ 17 $ 13,176
======== ==== ==== ========
Available for Sale
Obligations of U.S.
Agencies and Corporations $ 4,087 $ 11 $ 6 $ 4,092
Other investments 519 - - 519
________ ____ ____ ________
Total $ 4,606 $ 11 $ 6 $ 4,611
======== ==== ==== ========
December 31, 1996
Held to Maturity
U.S. Treasury Securities $ 250 $ 1 $ - $ 251
Obligations of U.S.
Agencies and Corporations 11,898 8 8 11,898
Obligations of states and
political subdivisions 661 13 - 674
Other Investments 9 - - 9
________ ____ ____ ________
Total $ 12,818 $ 22 $ 8 $ 12,832
======== ==== ==== ========
Available for Sale
Obligations of U.S.
Agencies and Corporations $ 4,109 $ 30 $ 5 $ 4,134
Other investments 514 - - 514
________ ____ _____ ________
Total $ 4,623 $ 30 $ 5 $ 4,648
======== ==== ===== ========
March 31, 1996
Held to Maturity
U.S. Treasury Securities $ 1,000 $ - $ - $ 1,000
Obligations of U.S.
Agencies and Corporations 9,315 1 1 9,315
Obligations of states and
political subdivisions 666 13 1 678
Other investments 17 - - 17
________ ____ ____ ________
Total $ 10,998 $ 14 $ 2 $ 11,010
======== ==== ==== ========
Available for Sale
Obligations of U.S.
Agencies and Corporations $ 4,674 $ 17 $ 6 $ 4,685
Other investments 498 - - 498
________ ____ ____ ________
Total $ 5,172 $ 17 $ 6 $ 5,183
======== ==== ==== ========
</TABLE>
An analysis of the market value of the investment portfolio by
maturity periods or repricing frequency at March 31, 1997 follows
(in thousands):
Amortized Market
Cost Value
Within one year $12,562 $12,555
One to five years 3,736 3,739
Five to ten years 293 297
After ten years 1,196 1,196
_______ _______
Total $17,787 $17,787
======= =======
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
$9,034,000, $9,047,000, and $8,128,000 at March 31, 1997,
December 31, 1996 and March 31, 1996, respectively, were pledged
to secure public deposits as required by law.
Deposits
A summary of the deposits as of March 31, 1997, December 31,
and March 31, 1996 is as follows:
March 31 December 31 March 31
1997 1996 1996
(In thousands)
Demand Deposits $ 9,593 $ 8,826 $ 9,783
NOW Accounts 6,892 7,539 5,764
Money Market
Investment Accts. 10,240 8,461 7,367
Savings Deposits 6,728 6,675 6,945
Other Time Deposits 16,796 18,886 16,820
Certificates of Dep.
of $100,000 or
more 6,500 6,406 5,753
$56,749 $56,793 $52,432
Non-interest bearing demand deposits at March 31, 1997
decreased $190,000, from March 31, 1996. In late March 1997, a
public fund body deposited the proceeds of a bond issue causing a
short term increase in money market investment accounts. These
funds were withdrawn early in April 1997. As interest paid on
money market investment accounts and certificates of deposits
stabilized, the Bank again began competing for deposits to fund
increasing loan demand. Certificates of deposits of $100,000 or
more to commercial entities increased $1,173,000. During this
period, public fund deposits in certificates of deposit of
$100,000 or more decreased $426,000.
The Bank has insignificant foreign and no brokered deposits.
Short Term Borrowings
The Bank had no short term borrowings in 1997 or 1996.
Allowance for Loan Losses and Non-Performing Loans and Other Real
Estate
The allowance for loan losses was 1.34 percent of loans
outstanding at March 31, 1997, compared with 1.33 percent at
December 31, 1996 and 1.48 percent at March 31, 1996. The Bank
did not make a provision to the reserve for loan losses during
the first quarters of 1997 or 1996.
1997 1996
Balance at January 1, $506,000 $504,000
Recoveries credited to the allowance 6,000 3,000
________ ________
512,000 507,000
Losses charged to the allowance - 2,000
________ ________
Balance at March 31 $512,000 $505,000
======== ========
The following schedule shows non-performing loans on non-
accrual status and repossessed and foreclosed real estate. The
loans on non-accrual status at March 31, 1997 and December 31,
1996 are to the same borrower.
March 31 December 31 March 31
1997 1996 1996
Non-accrual loans $145,000 $145,000 $72,000
Foreclosed real estate - - 64,000
Management believes the Bank has adequate reserves to
provide for possible future loan losses.
Other Income
Other operating income aggregated to $70,000 for the first
three months of 1997 compared with $79,000 in 1996. There was no
trading account activity in 1997 or 1996.
Quarter Ending
March 31
1997 1996
Service charges on deposit accounts $42,000 $49,000
Other service charges and fees 18,000 20,000
Other operating income 10,000 10,000
Net securities gains and (losses) - -
_______ _______
Total $70,000 $79,000
======= =======
Operating Expenses
Other operating expenses totaled $551,000 for the first
three months of 1997, compared with $565,000 for 1996, a $14,000
decrease.
Personnel expenses totaled $277,000 for the period, compared
with $265,000 in 1996. In 1996, expenses related to other real
estate and repossessed property, net of rental income on these
properties, totaled $1,000. Expenses represent taxes and
maintenance on these properties.
A summary of other operating expenses is as follows:
Three Months 1997
Ending Over
March 31, (Under)
1997 1996 1996
(In Thousands)
Salaries and benefits $277 $265 $ 12
Expenses related to other real
estate and repossessed
properties, net of rental
income on these properties - 1 (1)
Net occupancy expenses 101 108 (7)
Equipment and computer expenses 36 49 (13)
Professional fees and services 35 38 (3)
FDIC and other insurance 10 10 -
Other 92 94 (2)
____ ____ _____
Total $551 $565 $(14)
==== ==== =====
Income Taxes
Income taxes were accrued at the U.S. federal tax rate.
Liquidity
The term "liquidity" generally refers to the ability of a
company to generate adequate 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 March 31, 1997 and 1996, the Bank's gross loans-to-
deposits ratios were 67.2 percent and 65.3 percent, respectively.
Loans increased $3,923,000 from 1996 levels. Significant to the
loan-to-deposit ratio computation, deposits increased $4,317,000
as of March 31, 1997 from 1996. 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 March 31, 1997, stockholders' equity amounted to
$5,711,000 compared with $5,767,000 at March 31, 1996 and
$5,566,000 at December 31, 1996.
Selected capital adequacy measures for Bancshares and Guaranty
Bank are as follows
as of March 31, 1997:
Risk-based capital
GUARANTY GUARANTY
BANCSHARES BANK
Tier 1 10.00% 9.90%
Total Capital 10.89% 10.80%
Leverage ratio 10.01% 8.56%
Bancshares paid a $2.70 dividend on its $2.70 cumulative
preferred stock on January 24, 1997. No dividends have been
declared or paid on its $.50 cumulative preferred stock since
their issuance. As a result, accumulated and unpaid dividends
are as follows:
$2.70 Preferred stock, dividends
accumulated from January 13, 1991
through April 13, 1997 $2,544,768
$.50 Preferred stock, dividends
accumulated from January 13, 1990
through April 13, 1997 82,162
----------
$2,626.930
Bancshares' primary source of income is dividends from the Bank.
/s/ Lee A. Ringeman
Lee A. Ringeman
Executive Vice President
Chief Financial Officer
DATE: May 13, 1997
<PAGE>
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
first quarter of 1997.
Exhibit No. 11 Computation of Earnings Per Common Share
THREE MONTHS ENDED
MARCH 31, 1997
Net income available
for common shareholders $ 57,000
Average common shares outstanding 373,425
Income per common share $ 0.15
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 2559
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4700
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 4611
<INVESTMENTS-CARRYING> 13,181
<INVESTMENTS-MARKET> 13,176
<LOANS> 38,148
<ALLOWANCE> 512
<TOTAL-ASSETS> 66,147
<DEPOSITS> 56,749
<SHORT-TERM> 0
<LIABILITIES-OTHER> 738
<LONG-TERM> 2949
0
3588
<COMMON> 1067
<OTHER-SE> 1056
<TOTAL-LIABILITIES-AND-EQUITY> 66,147
<INTEREST-LOAN> 910
<INTEREST-INVEST> 262
<INTEREST-OTHER> 52
<INTEREST-TOTAL> 1224
<INTEREST-DEPOSIT> 442
<INTEREST-EXPENSE> 504
<INTEREST-INCOME-NET> 720
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 551
<INCOME-PRETAX> 239
<INCOME-PRE-EXTRAORDINARY> 239
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 158
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
<YIELD-ACTUAL> 4.7
<LOANS-NON> 145
<LOANS-PAST> 151
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 145
<ALLOWANCE-OPEN> 506
<CHARGE-OFFS> 0
<RECOVERIES> 6
<ALLOWANCE-CLOSE> 512
<ALLOWANCE-DOMESTIC> 512
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
