<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED JUNE 30, 2000
COMMISSION FILE NO. 2-80070
_________________
CASS COMMERCIAL CORPORATION
INCORPORATED UNDER THE LAWS OF MISSOURI
I.R.S. EMPLOYER IDENTIFICATION NO. 43-1265338
13001 HOLLENBERG DRIVE, BRIDGETON, MISSOURI 63044
TELEPHONE: (314) 506-5500
_________________
Indicate by check mark whether the registrant 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, and has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
The number of shares outstanding of registrant's only class of stock as
of July 31, 2000: Common stock, par value $.50 per share - 3,437,137 shares
outstanding.
------------------------------------------------------------------------------
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933.
------------------------------------------------------------------------------
<PAGE> 2
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CASS COMMERCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in Thousands except Per Share Data)
<CAPTION>
JUNE 30 DECEMBER 31
2000 1999
<S> <C> <C>
ASSETS
Cash and due from banks $ 23,373 $ 18,497
Federal funds sold and other short-term investments 60,900 105,720
-------- --------
Cash and cash equivalents 84,273 124,217
-------- --------
Investment in debt and equity securities:
Held-to-maturity, fair value of $15,931
and $25,381 at June 30, 2000
and December 31, 1999, respectively 16,287 25,554
Available-for-sale, at fair value 69,681 57,442
-------- --------
Total investment in debt and equity securities 85,968 82,996
-------- --------
Loans 328,250 278,343
Less: Allowance for loan losses 4,480 4,282
-------- --------
Loans, net 323,770 274,061
-------- --------
Premises and equipment, net 9,483 9,181
Accrued interest receivable 2,907 2,764
Other assets 7,467 7,626
-------- --------
Total assets $513,868 $500,845
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
------------
Deposits:
Noninterest-bearing $ 75,228 $ 91,672
Interest-bearing 96,279 97,064
-------- --------
Total deposits 171,507 188,736
Accounts and drafts payable 283,175 249,894
Short-term borrowings -- 208
Other liabilities 5,239 5,444
-------- --------
Total liabilities 459,921 444,282
-------- --------
Shareholders' Equity:
---------------------
Preferred stock, par value $.50 per share; 2,000,000
shares authorized and no shares issued -- --
Common stock, par value $.50 per share;
20,000,000 shares authorized and
4,000,000 shares issued 2,000 2,000
Surplus 5,065 5,087
Retained earnings 56,967 54,814
Accumulated other comprehensive loss (496) (417)
Common shares in treasury, at cost (508,863 shares at
June 30, 2000 and 277,149 shares at December 31, 1999) (9,453) (4,770)
Unamortized stock bonus awards (136) (151)
-------- --------
Total shareholders' equity 53,947 56,563
-------- --------
Total liabilities and shareholders' equity $513,868 $500,845
======== ========
See accompanying notes to consolidated financial statements.
</TABLE>
-2-
<PAGE> 3
<TABLE>
CASS COMMERCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in Thousands except Per Share Data)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
----------------------- -----------------------
2000 1999 2000 1999
<S> <C> <C> <C> <C>
INTEREST INCOME:
Interest and fees on loans $ 6,830 $ 4,940 $ 12,987 $ 9,272
Interest and dividends on debt and equity securities:
Taxable 1,385 1,163 2,756 2,340
Exempt from federal income taxes 15 16 30 32
Interest on federal funds sold and
other short-term investments 714 1,379 1,576 3,034
---------- ---------- ---------- ----------
Total interest income 8,944 7,498 17,349 14,678
---------- ---------- ---------- ----------
INTEREST EXPENSE:
Interest on deposits 1,071 1,076 2,025 2,115
Interest on short-term borrowings 5 2 7 4
---------- ---------- ---------- ----------
Total interest expense 1,076 1,078 2,032 2,119
---------- ---------- ---------- ----------
Net interest income 7,868 6,420 15,317 12,559
Provision for loan losses 150 -- 250 --
---------- ---------- ---------- ----------
Net interest income after provision
for loan losses 7,718 6,420 15,067 12,559
---------- ---------- ---------- ----------
NONINTEREST INCOME:
Freight and utility payment and processing revenue 4,849 5,079 10,185 10,256
Bank service fees 374 274 708 504
Other 38 -- 123 102
---------- ---------- ---------- ----------
Total noninterest income 5,261 5,353 11,016 10,862
---------- ---------- ---------- ----------
NONINTEREST EXPENSE:
Salaries and employee benefits 6,957 6,355 14,007 12,623
Occupancy expense 443 434 877 858
Equipment expense 767 660 1,519 1,307
Other 2,173 2,002 4,116 3,955
---------- ---------- ---------- ----------
Total noninterest expense 10,340 9,451 20,519 18,743
---------- ---------- ---------- ----------
Income before income tax expense 2,639 2,322 5,564 4,678
Income tax expense 919 835 1,988 1,672
---------- ---------- ---------- ----------
Net income $ 1,720 $ 1,487 $ 3,576 $ 3,006
========== ========== ========== ==========
Earnings per share:
Basic $.49 $.39 $1.00 $.78
Diluted $.48 $.39 $ .99 $.77
Weighted average shares outstanding:
Basic 3,501,084 3,794,706 3,572,344 3,831,868
Effect of stock options and awards 46,932 59,461 46,441 57,657
Diluted 3,548,016 3,854,167 3,618,785 3,889,525
See accompanying notes to consolidated financial statements.
</TABLE>
-3-
<PAGE> 4
<TABLE>
CASS COMMERCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in Thousands)
<CAPTION>
SIX MONTHS ENDED
JUNE 30
----------------------
2000 1999
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 3,576 $ 3,006
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 1,311 1,157
Provision for loan losses 250 --
Amortization of stock bonus awards 39 42
Decrease (increase) in accrued interest receivable (143) 216
Increase (decrease) in deferred income (765) 525
Increase (decrease) in income tax liability (157) 610
Other operating activities, net 884 940
-------- ---------
Net cash provided by operating activities 4,995 6,496
-------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of debt and equity securities:
Held-to-maturity 11,167 15,198
Available-for-sale 4,498 1,096
Purchase of debt and equity securities available-for-sale (18,889) (17,986)
Net increase in loans (49,959) (52,539)
Purchases of premises and equipment, net (1,438) (941)
-------- ---------
Net cash used in investing activities (54,621) (55,172)
-------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in noninterest-bearing demand deposits (16,444) 29
Net increase (decrease) in interest-bearing demand and savings deposits (491) 4,150
Net increase (decrease) in time deposits (294) 3
Net increase (decrease) in accounts and drafts payable 33,281 (55,292)
Net decrease in short-term borrowings (208) (96)
Cash proceeds from exercise of stock options 47 81
Cash dividends paid (1,423) (1,456)
Purchase of common shares for treasury (4,786) (2,952)
-------- ---------
Net cash provided by (used in) financing activities 9,682 (55,533)
-------- ---------
Net decrease in cash and cash equivalents (39,944) (104,209)
Cash and cash equivalents at beginning of period 124,217 179,385
-------- ---------
Cash and cash equivalents at end of period $ 84,273 $ 75,176
======== =========
Supplemental information:
Cash paid for interest $ 2,035 $ 2,129
Cash paid for income taxes 2,662 1,865
See accompanying notes to consolidated financial statements.
</TABLE>
-4-
<PAGE> 5
CASS COMMERCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to
Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the period ended June 30, 2000 are not necessarily indicative of
the results that may be expected for the year ending December 31, 2000. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1999.
Note 2 - Impact of New Accounting Pronouncements
In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 133, Accounting for
Derivative Instruments and Hedging Activities (SFAS 133) which establishes
standards for derivative instruments, including certain derivative
instruments embedded in other contracts, and for hedging activities. It
requires an entity to recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those
instruments at fair value. In June 1999, the FASB issued Statement of
Financial Accounting Standards No. 137, Accounting for Derivative Instruments
and Hedging Activities - Deferral of the Effective Date of FASB No. 133,
which defers the effective date of SFAS 133 from fiscal years beginning after
June 15, 1999 to fiscal years beginning after June 15, 2000. Earlier
application of SFAS 133, as amended, is encouraged but should not be applied
retroactively to financial statements of prior periods. In June 2000, the
FASB issued Statement of Financial Accounting Financial Standards No. 138,
Accounting for Certain Derivative Instruments and Certain Hedging Activities,
which addresses certain issues causing implementation difficulties. The
Company will adopt SFAS 133, as amended, on January 1, 2001. Since the
Company does not participate in any derivative or hedging activities, SFAS
133, as amended, has no impact on the Company's consolidated financial
position and results of operations.
Note 3 - Loans by Type
<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS) JUNE 30, 2000 DECEMBER 31, 1999
-------------------------------------------------------------------------------
<S> <C> <C>
Commercial and industrial $118,665 $106,444
Real estate:
Mortgage 114,556 86,171
Mortgage - Churches & Related 56,279 43,311
Construction 11,438 6,987
Construction - Churches & Related 15,762 22,646
Industrial revenue bonds 7,113 7,265
Installment 1,907 1,541
Other 2,530 3,978
-------------------------------------------------------------------------------
Total loans $328,250 $278,343
-------------------------------------------------------------------------------
</TABLE>
Note 4 - Stock Repurchase Program
On December 21, 1999 the Board of Directors authorized a stock repurchase
program that would allow the repurchase of up to 200,000 shares of its common
stock through December 31, 2000. On March 21, 2000 the Board of Directors
authorized a 100,000 increase in the number of shares that can be purchased
under the program. As of June 30, 2000, 243,510 shares had been repurchased
under the program. Repurchases can be made in the open market or through
negotiated transactions from time to time depending on market conditions.
The repurchased stock will be held as treasury stock to be used for general
corporate purposes.
-5-
<PAGE> 6
Note 5 - Comprehensive Income
For the three and six month periods ended June 30, 2000 and 1999,
unrealized gains and losses on debt and equity securities available-for-sale
is the Company's only other comprehensive income component. Comprehensive
income for the periods ended June 30, 2000 and 1999 is summarized as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
------------------ ----------------
(IN THOUSANDS) 2000 1999 2000 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Income $1,720 $1,487 $3,576 $3,006
Other comprehensive income:
Net unrealized gain (loss) on debt and equity
securities available-for-sale, net of tax 73 (315) (79) (470)
--------------------------------------------------------------------------------------------------
Total comprehensive income $1,793 $1,172 $3,497 $2,536
--------------------------------------------------------------------------------------------------
</TABLE>
Note 6 - Industry Segment Information
The services provided by the Company are classified into two industry
segments: Banking Services and Information Services. Total net revenue is
comprised of total interest income and total noninterest income, less
provision for loan losses. There have been no material changes in assets,
changes in the basis of segmentation or changes in the basis of measurement
of segment profits from the amounts disclosed in the Company's Annual Report
on Form 10-K for the year ended December 31, 1999.
Summarized information about the Company's operations in each industry
segment for the three and six month periods ended June 30, 2000 and 1999, is
as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
------------------ ----------------
(IN THOUSANDS) 2000 1999 2000 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total Net Revenue:
Information Services $ 9,691 $ 8,860 $19,526 $17,767
Banking Services 4,486 4,058 8,970 7,914
Eliminations (122) (67) (381) (141)
--------------------------------------------------------------------------------------------------
Total $14,055 $12,851 $28,115 $25,540
--------------------------------------------------------------------------------------------------
Income (Loss) Before Income Tax:
Information Services $ 1,385 $ 1,154 $ 2,954 $ 2,431
Banking Services 1,291 1,220 2,683 2,320
Corporate Items (37) (52) (73) (73)
--------------------------------------------------------------------------------------------------
Total $ 2,639 $ 2,322 $ 5,564 $ 4,678
--------------------------------------------------------------------------------------------------
Income Tax Expense (Benefit):
Information Services $ 451 $ 405 $ 1,014 $ 843
Banking Services 481 448 999 854
Corporate Items (13) (18) (25) (25)
--------------------------------------------------------------------------------------------------
Total $ 919 $ 835 $ 1,988 $ 1,672
--------------------------------------------------------------------------------------------------
Net Income (Loss):
Information Services $ 934 $ 749 $ 1,940 $ 1,588
Banking Services 810 772 1,684 1,466
Corporate Items (24) (34) (48) (48)
--------------------------------------------------------------------------------------------------
Total $ 1,720 $ 1,487 $ 3,576 $ 3,006
--------------------------------------------------------------------------------------------------
</TABLE>
-6-
<PAGE> 7
Note 7 - Reclassifications
Certain amounts in the 1999 consolidated financial statements have been
reclassified to conform with the 2000 presentation. Such reclassifications
have no effect on previously reported net income.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Cass Commercial Corporation (the "Company") operates in two primary
business segments through two wholly owned subsidiaries, Cass Commercial Bank
("Cass Bank"), a commercial bank, and Cass Information Systems, Inc. ("CIS"),
a payment processing company. Cass Bank provides specialized banking
services to privately held businesses located primarily in the St. Louis,
Missouri metropolitan area and church and church-related entities located in
the St. Louis metropolitan area and selected cities throughout the United
States. CIS is a payment processing and information services company, whose
operations include the processing and payment of freight and utility charges,
preparation of transportation management reports, auditing of freight
charges, rating of freight shipments and other payment related activities for
customers located throughout the United States.
The following paragraphs more fully discuss the results of operations and
changes in financial condition for the three-month period ended June 30, 2000
(the "Second Quarter of 2000") compared to the three-month period ended June
30, 1999 (the "Second Quarter of 1999") and the six-month period ended June
30, 2000 ("First Half of 2000") compared to the six-month period ended June
30, 1999 ("First Half of 1999"). Most information is provided on a
consolidated basis for the Company, Cass Bank and CIS, with expanded
disclosures for the specific effects CIS's operations have on particular
account captions.
The following discussion and analysis should be read in conjunction with
the consolidated financial statements and related notes and with the
statistical information and financial data appearing in this report as well
as the Company's 1999 Annual Report on Form 10-K. Results of operations for
the First Half of 2000 are not necessarily indicative of the results to be
attained for any other period.
RESULTS OF OPERATIONS
NET INCOME
The Company had net income of $1,720,000 for the Second Quarter of 2000,
a $233,000 or 15.7% increase compared to net income of $1,487,000 for the
Second Quarter of 1999. The Company had net income of $3,576,000 for the
First Half of 2000, a $570,000 or 19.0% increase compared to net income of
$3,006,000 for the First Half of 1999. Diluted earnings per share was $.48
for the Second Quarter of 2000, a 23.1% increase compared to $.39 for the
Second Quarter of 1999. Diluted earnings per share was $.99 for the First
Half of 2000, a 28.6% increase compared to $.77 for the First Half of 1999.
The increase in net income was primarily a result of strong loan demand, an
increase in earning assets and a general increase in the level of interest
rates. Return on average assets for the Second Quarter of 2000 was 1.39%
compared to 1.23% for the Second Quarter of 1999. Return on average assets
for the First Half of 2000 was 1.44% compared to 1.26% for the First Half of
1999. Return on average equity for the Second Quarter of 2000 was 12.81%
compared to 10.50% for the Second Quarter of 1999. Return on average equity
for the First Half of 2000 was 13.08% compared to 10.52% for the First Half
of 1999.
NET INTEREST INCOME
Second Quarter of 2000 compared to Second Quarter of 1999:
The Company's tax-equivalent net interest income increased 22.8% or
$1,477,000 from $6,469,000 in the Second Quarter of 1999 to $7,946,000 in the
Second Quarter of 2000. Average earning assets increased 2.9% or $13,094,000
from $447,251,000 in the Second Quarter of 1999 to $460,345,000 in the Second
Quarter of 2000. The tax-equivalent net interest margin increased from 5.80%
in the Second Quarter of 1999 to 6.94% in the Second Quarter of 2000. The
average tax-equivalent yield on earning assets increased from 6.77% in the
Second Quarter of 1999 to 7.88% in the Second Quarter of 2000. The average
rate paid on interest-bearing liabilities increased from 3.81% in the Second
Quarter of 1999 to 4.60% in the Second Quarter of 2000.
-7-
<PAGE> 8
The average balance of loans increased $72,662,000 from $250,887,000 to
$323,549,000, investment in debt and equity securities increased $11,025,000
from $79,134,000 to $90,159,000, and federal funds sold and other short-term
investments decreased $70,593,000 from $117,230,000 to $46,637,000 from the
Second Quarter of 1999 to the Second Quarter of 2000. The average balance of
noninterest bearing demand deposit accounts increased $6,805,000 from
$73,699,000 to $80,504,000, accounts and drafts payable increased $28,450,000
from $234,706,000 to $263,156,000, and interest bearing liabilities decreased
$19,419,000 from $113,549,000 to $94,130,000 from the Second Quarter of 1999
to the Second Quarter of 2000.
The increases experienced during the Second Quarter of 2000 in
noninterest bearing demand deposits were attributable to the addition of new
business at the Bank. The increase in accounts and drafts payable was
attributable mainly to an increase in the dollar value and number of items
processed at CIS. The decrease in interest bearing deposits relates to the
shift of balances by several large depositors into non-deposit investment
products. The increase in accounts and drafts payable combined with the
decrease in federal funds sold and other short term investments were
primarily used to fund the increased investment in loans and debt and equity
securities.
The increases experienced during the Second Quarter of 2000 in net
interest margin and net interest income were caused primarily by increases in
the level of earning assets, the shift in earning assets to higher yielding
loans and investments and a rise in the general level of interest rates. The
Company is positively affected by increases in the level of interest rates
due to the fact that its rate sensitive assets significantly exceed its rate
sensitive liabilities. Conversely, the Company is adversely affected by
decreases in the level of interest rates. This is primarily due to the
noninterest-bearing liabilities generated by CIS in the form of accounts and
drafts payable. Please refer to the table on page 9.
First Half of 2000 compared to the First Half of 1999:
The Company's tax-equivalent net interest income increased 21.9% or
$2,777,000 from $12,657,000 in the First Half of 1999 to $15,434,000 in the
First Half of 2000. Average earning assets increased 2.8% or $12,409,000
from $445,933,000 in the First Half of 1999 to $458,342,000 in the First Half
of 2000. The tax-equivalent net interest margin increased from 5.72% in the
First Half of 1999 to 6.77% in the First Half of 2000. The average
tax-equivalent yield on earning assets increased from 6.68% in the First Half
of 1999 to 7.66% in the First Half of 2000. The average rate paid on
interest-bearing liabilities increased from 3.83% in the First Half of 1999
to 4.24% in the First Half of 2000.
The average balance of loans increased $76,652,000 from $237,548,000 to
$314,200,000, investment in debt and equity securities increased $10,609,000
from $79,458,000 to $90,067,000, and federal funds sold and other short-term
investments decreased $74,852,000 from $128,927,000 to $54,075,000 from the
First Half of 1999 to the First Half of 2000. The average balance of
noninterest bearing demand deposit accounts increased $8,912,000 from
$72,767,000 to $81,679,000, accounts and drafts payable increased $24,436,000
from $234,488,000 to $258,924,000, and interest bearing liabilities decreased
$15,309,000 from $111,635,000 to $96,326,000 from the First Half of 1999 to
the First Half of 2000.
The increases experienced during the First Half of 2000 were attributable
to the same factors as those in the second quarter. The increase in
noninterest bearing demand deposits were due to the addition of new business
at the Bank. The increase in accounts and drafts payable was attributable
mainly to an increase in the dollar value and number of items processed at
CIS. The decrease in interest bearing deposits also related to the shift of
balances by several large depositors into non-deposit investment products.
The increase in accounts and drafts payable combined with the decrease in
federal funds sold and other short term investments were used to fund the
increased investment in loans and debt and equity securities.
The increases experienced during the First Half of 2000 in net interest
margin and net interest income were also caused primarily by increases in the
level of earning assets, a shift in earning assets to higher yielding loans
and investments and a rise in the general level of interest rates. The
Company is positively affected by increases in the level of interest rates
due to the fact that its rate sensitive assets significantly exceed its rate
sensitive liabilities. Conversely, the Company is adversely affected by
decreases in the level of interest rates. This is primarily due to the
noninterest-bearing liabilities generated by CIS in the form of accounts and
drafts payable. Please refer to the table on page 10.
-8-
<PAGE> 9
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY; INTEREST RATE
AND INTEREST DIFFERENTIAL
The following table shows the condensed average balance sheets for each
of the periods reported, the interest income and expense on each category of
interest-earning assets and interest-bearing liabilities, and the average
yield on such categories of interest-earning assets and the average rates
paid on such categories of interest-bearing liabilities for each of the
periods reported.
<TABLE>
<CAPTION>
SECOND QUARTER 2000 SECOND QUARTER 1999
----------------------------- -----------------------------
INTEREST INTEREST
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/
(DOLLARS IN THOUSANDS) BALANCE EXPENSE RATE BALANCE EXPENSE RATE
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS <F1>
Earning assets:
Loans <F2><F3>:
Taxable $316,393 $6,730 8.56% $244,999 $4,848 7.94%
Tax-exempt <F4> 7,156 168 9.44 5,888 133 9.06
Debt and equity securities <F5>:
Taxable 88,977 1,386 6.27 77,881 1,166 6.01
Tax-exempt <F4> 1,182 24 8.17 1,253 21 6.72
Federal funds sold and other
short-term investments 46,637 714 6.16 117,230 1,379 4.72
------------------------------------------------------------------------------------------------------------------------
Total earning assets 460,345 9,022 7.88 447,251 7,547 6.77
Nonearning assets:
Cash and due from banks 22,494 22,765
Premises and equipment, net 9,580 9,175
Other assets 9,977 9,529
Allowance for loan losses (4,420) (4,463)
------------------------------------------------------------------------------------------------------------------------
Total assets $497,976 $484,257
------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY <F1>
Interest-bearing liabilities:
Interest-bearing demand
deposits $ 42,367 $ 440 4.18% $ 41,925 $ 346 3.31%
Savings deposits 45,290 556 4.94 63,460 635 4.01
Time deposits of
$100,000 or more 2,424 32 5.31 4,319 46 4.27
Other time deposits 3,853 43 4.49 3,574 49 5.50
------------------------------------------------------------------------------------------------------------------------
Total interest-bearing deposits 93,934 1,071 4.59 113,278 1,076 3.81
Short-term borrowings 196 5 10.26 271 2 2.96
------------------------------------------------------------------------------------------------------------------------
Total interest-bearing
liabilities 94,130 1,076 4.60 113,549 1,078 3.81
Noninterest-bearing liabilities:
Demand deposits 80,504 73,699
Accounts and drafts payable 263,156 234,706
Other liabilities 6,187 5,502
------------------------------------------------------------------------------------------------------------------------
Total liabilities 443,977 427,456
Shareholders' equity 53,999 56,801
Total liabilities and
shareholders' equity $497,976 $484,257
------------------------------------------------------------------------------------------------------------------------
Net interest income $7,946 $6,469
Interest spread 3.28% 2.96%
Net interest margin 6.94% 5.80%
------------------------------------------------------------------------------------------------------------------------
<FN>
<F1> Balances shown are daily averages.
-9-
<PAGE> 10
<F2> For purposes of these computations, nonaccrual loans are included in the
average loan amounts outstanding. Interest on nonaccrual loans is
recorded when received as discussed further in Note 1 to the Company's
1999 Consolidated Financial Statements, incorporated by reference
herein.
<F3> Interest income on loans includes net loan fees of $67,000 and $80,000
for the Second Quarter of 2000 and 1999, respectively.
<F4> Interest income is presented on a tax-equivalent basis assuming a tax
rate of 34%. The tax-equivalent adjustment was approximately $78,000
and $49,000 for the Second Quarter of 2000 and 1999, respectively.
<F5> For purposes of these computations, yields on investment securities are
computed as interest income divided by the average amortized cost of the
investments.
<CAPTION>
FIRST HALF OF 2000 FIRST HALF OF 1999
----------------------------- -----------------------------
INTEREST INTEREST
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/
(DOLLARS IN THOUSANDS) BALANCE EXPENSE RATE BALANCE EXPENSE RATE
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS <F1>
Earning assets:
Loans <F2><F3>:
Taxable $307,010 $12,788 8.38% $231,640 $ 9,113 7.93%
Tax-exempt <F4> 7,190 301 8.42 5,908 241 8.23
Debt and equity securities <F5>:
Taxable 88,862 2,757 6.24 78,197 2,340 6.03
Tax-exempt <F4> 1,205 44 7.34 1,261 48 7.68
Federal funds sold and other
short-term investments 54,075 1,576 5.86 128,927 3,034 4.75
----------------------------------------------------------------------------------------------------------------------
Total earning assets 458,342 17,466 7.66 445,933 14,776 6.68
Nonearning assets:
Cash and due from banks 24,695 21,795
Premises and equipment, net 9,510 9,196
Other assets 9,746 9,653
Allowance for loan losses (4,372) (4,448)
----------------------------------------------------------------------------------------------------------------------
Total assets $497,921 $482,129
----------------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY <F1>
Interest-bearing liabilities:
Interest-bearing demand
deposits $ 42,927 $ 823 3.86% $ 39,687 $ 654 3.32%
Savings deposits 46,838 1,052 4.52 63,720 1,268 4.01
Time deposits of
$100,000 or more 2,522 64 5.10 3,609 93 5.20
Other time deposits 3,841 86 4.50 4,341 100 4.65
----------------------------------------------------------------------------------------------------------------------
Total interest-bearing deposits 96,128 2,025 4.24 111,357 2,115 3.83
Short-term borrowings 198 7 7.11 278 4 2.90
----------------------------------------------------------------------------------------------------------------------
Total interest-bearing
liabilities 96,326 2,032 4.24 111,635 2,119 3.83
Noninterest-bearing liabilities:
Demand deposits 81,679 72,767
Accounts and drafts payable 258,924 234,488
Other liabilities 6,032 5,637
----------------------------------------------------------------------------------------------------------------------
Total liabilities 442,961 424,527
Shareholders' equity 54,960 57,602
Total liabilities and
shareholders' equity $497,921 $482,129
----------------------------------------------------------------------------------------------------------------------
Net interest income $15,434 $12,657
Interest spread 3.42% 2.85%
Net interest margin 6.77% 5.72%
----------------------------------------------------------------------------------------------------------------------
-10-
<PAGE> 11
<FN>
<F1> Balances shown are daily averages.
<F2> For purposes of these computations, nonaccrual loans are included in
the average loan amounts outstanding. Interest on nonaccrual loans is
recorded when received as discussed further in Note 1 to the Company's
1999 Consolidated Financial Statements, incorporated by reference
herein.
<F3> Interest income on loans includes net loan fees of $79,000 and $87,000
for the First Half of 2000 and 1999, respectively.
<F4> Interest income is presented on a tax-equivalent basis assuming a tax
rate of 34%. The tax-equivalent adjustment was approximately $117,000
and $98,000 for the First Half of 2000 and 1999, respectively.
<F5> For purposes of these computations, yields on investment securities are
computed as interest income divided by the average amortized cost of the
investments.
</TABLE>
ANALYSIS OF NET INTEREST INCOME CHANGES
The following table presents the changes in interest income and expense
between periods due to changes in volume and interest rates. That portion of
the change in interest attributable to the combined rate/volume variance has
been allocated to rate and volume changes in proportion to the absolute
dollar amounts of the change in each.
<TABLE>
<CAPTION>
SECOND QUARTER
2000 OVER 1999
--------------------------------
(DOLLARS IN THOUSANDS) VOLUME<F1> RATE<F1> TOTAL
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Increase (decrease) in interest income:
Loans <F2><F3>:
Taxable $ 1,485 $397 $1,882
Tax-exempt <F4> 29 6 35
Debt and equity securities:
Taxable 169 51 220
Tax-exempt <F4> (1) 4 3
Federal funds sold and other
short-term investments (1,000) 335 (665)
--------------------------------------------------------------------------------------------------
Total interest income 682 793 1,475
--------------------------------------------------------------------------------------------------
Interest expense on:
Interest-bearing demand deposits 4 90 94
Savings deposits (206) 127 (79)
Time deposits of $100,000 or more (23) 9 (14)
Other time deposits 4 (10) (6)
Short-term borrowings (1) 4 3
--------------------------------------------------------------------------------------------------
Total interest expense (222) 220 (2)
--------------------------------------------------------------------------------------------------
Net interest income $ 904 $573 $1,477
--------------------------------------------------------------------------------------------------
<FN>
<F1> The change in interest due to both volume and rate has been allocated
proportionately.
<F2> Average balances include nonaccrual loans.
<F3> Interest income includes net loan fees.
<F4> Interest income is presented on a tax-equivalent basis assuming a tax
rate of 34% for the First Quarter of 2000 and 1999.
<CAPTION>
FIRST HALF
2000 OVER 1999
--------------------------------
(DOLLARS IN THOUSANDS) VOLUME<F1> RATE<F1> TOTAL
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Increase (decrease) in interest income:
Loans <F2><F3>:
Taxable $ 3,137 $ 538 $ 3,675
Tax-exempt <F4> 54 6 60
Debt and equity securities:
Taxable 334 83 417
Tax-exempt <F4> (2) (2) (4)
Federal funds sold and other
short-term investments (2,059) 601 (1,458)
--------------------------------------------------------------------------------------------------
Total interest income 1,464 1,226 2,690
--------------------------------------------------------------------------------------------------
-11-
<PAGE> 12
Interest expense on:
Interest-bearing demand deposits 57 112 169
Savings deposits (364) 148 (216)
Time deposits of $100,000 or more (27) (2) (29)
Other time deposits (11) (3) (14)
Short-term borrowings (1) 4 3
--------------------------------------------------------------------------------------------------
Total interest expense (346) 259 (87)
--------------------------------------------------------------------------------------------------
Net interest income $ 1,810 $ 967 $2,777
--------------------------------------------------------------------------------------------------
<FN>
<F1> The change in interest due to both volume and rate has been allocated
proportionately.
<F2> Average balances include nonaccrual loans.
<F3> Interest income includes net loan fees.
<F4> Interest income is presented on a tax-equivalent basis assuming a tax
rate of 34% for the First Quarter of 2000 and 1999.
</TABLE>
ALLOWANCE AND PROVISION FOR LOAN LOSSES
A significant determinant of the Company's operating results is the
provision for loan losses and the level of loans charged off. There was a
$150,000 provision made for loan losses during the Second Quarter of 2000
compared to no provision during the Second Quarter of 1999. There was a
$250,000 provision made during the First Half of 2000 compared to no
provision made during the First Half of 1999. Net loan losses for the Second
Quarter of 2000 were $79,000 compared to a $33,000 net recovery for the
Second Quarter of 1999. Net loan losses for the First Half of 2000 were
$52,000 compared to a $43,000 net recovery for the First Half of 1999. The
increase in the provision made during 2000 relates to probable losses in the
expanding loan portfolio.
The allowance for loan losses at June 30, 2000 was $4,480,000 and at
December 31, 1999 was $4,282,000. The allowance for loan losses at June 30,
2000 represented 1.36% of total loans outstanding compared to 1.54% at December
31, 1999. Nonperforming loans were $989,000 or .31% of average loans at June
30, 2000 compared to $407,000 or .16% of average loans at December 31, 1999.
At June 30, 2000, impaired loans totaled $994,000 which includes $989,000
of nonaccrual loans. The allowance for loan losses on impaired loans was
$249,000 at June 30, 2000. The average balance of impaired loans during the
First Half of 2000 and the First Half of 1999 was $597,000 and $634,000,
respectively.
Factors which influence management's determination of the adequacy of the
allowance for loan losses, among other things, include: evaluation of each
nonperforming and/or classified loan to determine the estimated loss exposure
under existing circumstances known to management; evaluation of all potential
problem loans identified in light of loss exposure based upon existing
circumstances known to management; analysis of the loan portfolio with regard
to future loss exposure on loans to specific customers and/or industries;
current economic conditions; and, an overall review of the loan portfolio in
light of past loan loss experience. In management's judgment, the allowance
for loan losses is considered adequate to absorb probable losses in the loan
portfolio.
SUMMARY OF ASSET QUALITY
The following table presents information as of and for the three and six
month periods ended June 30, 2000 and 1999 pertaining to the Company's
provision for loan losses and analysis of the allowance for loan losses.
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
----------------------------------------------
(DOLLARS IN THOUSANDS) 2000 1999 2000 1999
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Allowance at beginning of period $ 4,409 $ 4,438 $ 4,282 $ 4,428
Provision charged to expense 150 -- 250 --
Loans charged off 82 58 82 58
Recoveries on loans previously charged off 3 91 30 101
-----------------------------------------------------------------------------------------------------
Net loans charged-off (recovered) 79 (33) 52 (43)
Allowance at end of period $ 4,480 $ 4,471 $ 4,480 $ 4,471
-----------------------------------------------------------------------------------------------------
-12-
<PAGE> 13
Loans outstanding:
Average $323,549 $250,887 $314,200 $237,548
June 30 328,250 277,470 328,250 277,470
Ratio of allowance for loan losses to
loans outstanding:
Average 1.38% 1.78% 1.43% 1.88%
June 30 1.36 1.61 1.36 1.61
Nonperforming loans:
Nonaccrual loans $ 989 $ 378 $ 989 $ 378
Loans past due 90 days or more -- 143 -- 143
-----------------------------------------------------------------------------------------------------
Total $ 989 $ 521 $ 989 $ 521
-----------------------------------------------------------------------------------------------------
Nonperforming loans as a percent of average loans .31% .21% .31% .22%
-----------------------------------------------------------------------------------------------------
</TABLE>
NONINTEREST INCOME
Noninterest income is principally derived from service fees generated by
CIS. Total noninterest income for the Second Quarter of 2000 was $5,261,000,
a $92,000 or 1.72% decrease compared to the Second Quarter of 1999. Total
noninterest income for the First Half of 2000 was $11,016,000, a $154,000 or
1.4% increase compared to the First Half of 1999. CIS payment and processing
revenue for the Second Quarter of 2000 was $4,849,000, a $230,000 or 4.5%
decrease compared to the Second Quarter of 1999. CIS payment and processing
revenue for the First Half of 2000 was $10,185,000, a $71,000 or .7% decrease
compared to the First Half of 1999. Several factors caused this decrease.
First, although both the number and dollar value of invoices processed
increased for the Second Quarter and the First Half of 2000 compared to the
corresponding periods of 1999, there were a number of non-recurring fees
received in 1999. Second, there was continued anticipated decreases relating
to some freight payment services that were part of a prior acquisition.
Finally, freight rating services revenue also decreased due to a change in
the strategic direction from selling rating software to a new Internet-based
delivery system of carrier rates to the shipping community that is being
developed and will offer an expanded level of features and capabilities.
Bank service fees for the Second Quarter of 2000 were $374,000, a
$100,000 or 36.5% increase compared to the Second Quarter of 1999. During
the First Half of 2000 these fees were $708,000, a $204,000 or 40.5% increase
compared to the First Half of 1999. These increases were attributable to
increases in the number of customer relationships developed by the Bank.
NONINTEREST EXPENSE
Total noninterest expense for the Second Quarter of 2000 was $10,340,000,
a $889,000 or 9.4% increase compared to the Second Quarter of 1999. Total
noninterest expense for the First Half of 2000 was $20,519,000, a $1,776,000
or 9.5% increase compared to the First Half of 1999.
Salaries and benefits expense for the Second Quarter of 2000 was
$6,957,000, a $602,000 or 9.5% increase compared to the Second Quarter of
1999. Salaries and benefits expense for the First Half of 2000 was
$14,007,000, a $1,384,000 or 11.0% increase compared to the First Half of
1999. These increases in expense were caused by annual pay increases and
expenses related to an increased staff at CIS to support expanded operations.
Occupancy expense for the Second Quarter of 2000 was $443,000, a $9,000
or 2.1% increase compared to the Second Quarter of 1999. Occupancy expense
for the First Half of 2000 was $877,000, a $19,000 or 2.2% increase compared
to the First Half of 1999. These increases were caused by increases in
rental expense.
Equipment expense for the Second Quarter of 2000 was $767,000, an
increase of $107,000 or 16.2% compared to the Second Quarter of 1999.
Equipment expense for the First Half of 2000 was $1,519,000, an increase of
$212,000 or 16.2% compared to the First Half of 1999. These increases were
due primarily to increased investments in information technology.
Other noninterest expense for the Second Quarter of 2000 was $2,173,000,
an increase of $171,000 or 8.5% compared to the Second Quarter of 1999.
Other noninterest expense for the First Half of 2000 was $4,116,000, an
increase of $161,000 or 4.1% compared to the First Half of 1999. These
increases were due primarily to increases in consulting fees, other outside
service fees and postage and delivery expense.
-13-
<PAGE> 14
FINANCIAL CONDITION
Total assets at June 30, 2000 were $513,868,000, an increase of
$13,023,000 or 2.6% from December 31, 1999. Loans, net of the allowance for
loan losses, at June 30, 2000 were $323,770,000, an increase of $49,709,000
or 18.1% from December 31, 1999. Total investments in debt and equity
securities at June 30, 2000 were $85,968,000, a $2,972,000 or 3.6% increase
from December 31, 1999. Federal Funds sold and other short-term investments
at June 30, 2000 were $60,900,000 a $44,820,000 or 42.4% decrease from
December 31, 1999.
Total deposits at June 30, 2000 were $171,507,000, a $17,229,000 or 9.1%
decrease from December 31, 1999. Accounts and drafts payable were
$283,175,000, a $33,281,000 or 13.3% increase from December 31, 1999. Total
shareholders' equity at June 30, 2000 was $53,947,000, a $2,616,000 or 4.6%
decrease from December 31, 1999.
The increase in loans is related to the successful expansion of the
church and church-related ministries unit and increases in loans to privately
held businesses from Cass Bank's ongoing marketing efforts. The decrease in
federal funds sold and other short-term investments relates primarily to this
increase in loans and also to the purchase of investment securities. The
ending balances of accounts and drafts payable will fluctuate from period end
to period end due to the payment processing cycle, which results in lower
balances on days when checks clear and higher balances on days when checks
are issued. For this reason, average balances are a more meaningful measure
of accounts and drafts payable. The decrease in total shareholders' equity
resulted from the purchase of treasury shares for $4,786,000 (237,510
shares); dividends paid of $1,423,000 ($.40 per share); decrease in other
comprehensive income of $79,000 offset by net income of $3,576,000; cash
received from the exercise of stock options of $47,000, a tax benefit of
$10,000 on stock options exercised and the amortization of the stock bonus
plan of $39,000.
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents, which consist of cash and due from banks,
federal funds sold, and money market funds, were $84,273,000 or 16.4% of
total assets at June 30, 2000. These funds represent the Company's and its
subsidiaries' primary source of liquidity to meet future expected and
unexpected loan demand, depositor withdrawals or reductions in accounts and
drafts payable.
Secondary sources of liquidity include the investment portfolio and
borrowing lines. Total investment in debt and equity securities represented
approximately $85,968,000 or 17% of total assets at June 30, 2000. Of this
total, 49% were U.S. treasury securities, 50% were U.S. government agencies,
and 1% were other securities. Of the total portfolio, 31% matures in one
year, 60% matures in one to five years, and 9% matures in five or more years.
Of the total portfolio, 81% is designated available-for-sale and 19% is
designated held-to-maturity. The investment portfolio provides secondary
liquidity through regularly scheduled maturities, the ability to sell
securities out of the available-for-sale portfolio, and the ability to use
these securities in conjunction with its reverse repurchase lines of credit.
Cass Bank has unsecured lines at correspondent banks to purchase federal
funds up to a maximum of $19,820,000. Additionally, Cass Bank has a line of
credit at an unaffiliated financial institution in the maximum amount of
$50,000,000 collateralized by securities sold under repurchase agreements.
The deposits of the Company's banking subsidiary have historically been
stable, consisting of a sizable volume of core deposits related to customers
that utilize many other commercial products of the bank. The accounts and
drafts payable generated by CIS has also historically been a stable source of
funds.
The Company faces market risk to the extent that its net interest income
and fair market value of equity are affected by changes in market interest
rates. For information regarding the market risk of the Company's financial
instruments, see Item 3. "QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK".
Risk-based capital guidelines require the Company to meet a minimum total
capital ratio of 8.0% of which at least 4.0% must consist of Tier 1 capital.
Tier 1 capital generally consists of (a) common shareholders' equity
(excluding the unrealized market value adjustments on the available-for-sale
securities), (b) qualifying perpetual preferred stock and related surplus
subject to certain limitations specified by the FDIC, (c) minority interests
in the equity accounts of consolidated subsidiaries less (d) goodwill, (e)
mortgage servicing rights within certain limits,
-14-
<PAGE> 15
and (f) any other intangible assets and investments in subsidiaries that the
FDIC determines should be deducted from Tier 1 capital. The FDIC also
requires a minimum leverage ratio of 3.0%, defined as the ratio of Tier 1
capital less purchased mortgage servicing rights to total assets, for banking
organizations deemed the strongest and most highly rated by banking
regulators. A higher minimum leverage ratio is required of less highly rated
banking organizations. Total capital, a measure of capital adequacy,
includes Tier 1 capital, allowance for loan losses, and debt considered
equity for regulatory capital purposes.
The Company and the Bank continue to significantly exceed all regulatory
capital requirements, as evidenced by the following capital amounts and
ratios at June 30, 2000 and December 31, 1999:
<TABLE>
<CAPTION>
JUNE 30, 2000 AMOUNT RATIO
--------------------------------------------------------------------------------------
<S> <C> <C>
Total capital (to risk-weighted assets)
Cass Commercial Corporation $58,561,000 15.50%
Cass Commercial Bank 28,378,000 16.67
Tier I capital (to risk-weighted assets)
Cass Commercial Corporation $54,081,000 14.32%
Cass Commercial Bank 26,247,000 15.42
Tier I capital (to average assets)
Cass Commercial Corporation $54,081,000 10.87%
Cass Commercial Bank 26,247,000 12.17
--------------------------------------------------------------------------------------
<CAPTION>
DECEMBER 31, 1999 AMOUNT RATIO
--------------------------------------------------------------------------------------
<S> <C> <C>
Total capital (to risk-weighted assets)
Cass Commercial Corporation $60,736,000 18.23%
Cass Commercial Bank 28,014,000 16.39
Tier I capital (to risk-weighted assets)
Cass Commercial Corporation $56,570,000 16.98%
Cass Commercial Bank 25,873,000 15.14
Tier I capital (to average assets)
Cass Commercial Corporation $56,570,000 11.53%
Cass Commercial Bank 25,873,000 11.54
--------------------------------------------------------------------------------------
</TABLE>
-15-
<PAGE> 16
INFLATION
Inflation can impact the financial position and results of the operations
of financial institutions because financial institutions hold monetary assets
and monetary liabilities. Monetary assets and liabilities are those which
can be converted into a fixed number of dollars, and include cash,
investments, loans and deposits. The Company's consolidated balance sheets,
as is typical of financial institutions, reflect a net positive monetary
position (monetary assets exceeding monetary liabilities). During periods of
inflation, the holding of a net positive monetary position will result in an
overall decline in the purchasing power of a financial institution.
FORWARD-LOOKING STATEMENTS - FACTORS THAT MAY AFFECT FUTURE RESULTS
Statements in Management's Discussion and Analysis of Financial Condition
and Results of Operations and the other sections of this Report that are not
statements of historical fact are "forward-looking statements". Such
statements are subject to important risks and uncertainties which could cause
the Company's actual results to differ materially from those expressed in any
such forward-looking statements made herein. The aforesaid uncertainties
include, but are not limited to: burdens imposed by federal and state
regulators, credit risk related to borrowers' ability to repay loans,
concentration of loans in the St. Louis Metropolitan area which subjects the
Company to risks associated with changes in the local economy, risks
associated with fluctuations in interest rates, competition from other banks
and other financial institutions, some of which are not as heavily regulated
as the Company and, particularly in the case of CIS, risks associated with
breakdowns in data processing systems and competition from other providers of
similar services.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As described in the Company's Annual Report on Form 10-K for the year
ended December 31, 1999, the Company manages its interest rate risk through
measurement techniques that include gap analysis and a simulation model. As
part of the risk management process, asset/liability management policies are
established and monitored by management. The policy objective is to limit the
change in annualized net interest income to 15% from an immediate and
sustained parallel change in interest rates of 200 basis points. Based on the
Company's most recent evaluation, management does not believe the Company's
risk position at June 30, 2000 has changed materially from that at December
31, 1999.
-16-
<PAGE> 17
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS IN SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the annual meeting of the shareholders of Cass Commercial
Corporation held on April 17, 2000, the following proposals were
voted on and approved:
The following is a summary of votes cast. No broker non-votes were
received.
<TABLE>
<CAPTION>
Withheld
Authority/
For Against Abstentions
--------- ---------- -----------
<S> <C> <C> <C>
1. Proposal to elect four Directors for a term
of three years ending 2003;
Robert J. Bodine 2,380,804 20,630 1,241,449
Thomas J. Fucoloro 2,372,304 29,130 1,241,449
Harry J. Krieg 2,373,652 27,782 1,241,449
Howard A. Kuehner 2,372,304 29,130 1,241,449
2. Proposal to ratify the selection of KPMG LLP
as independent accountants for 2000. 2,394,443 1,133 1,247,307
</TABLE>
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) None
(b) Cass Commercial Corporation did not file any reports on Form
8-K during the three-month period ended June 30, 2000.
-17-
<PAGE> 18
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.
CASS COMMERCIAL CORPORATION
DATE: August 7, 2000 By /s/ Lawrence A. Collett
----------------------------------
Lawrence A. Collett
Chairman and Chief Executive Officer
DATE: August 7, 2000 By /s/ Eric H. Brunngraber
-------------------------------------
Eric H. Brunngraber
Vice President-Secretary
(Chief Financial and Accounting Officer)
-18-
