SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Issuer Tender Offer Statement
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
One American Corp.
(Name of Issuer)
One American Corp.
(Name of Person(s) Filing Statement)
Common
(Title of Class of Securities)
6823 1E1 07
(CUSIP Number of Class Securities)
Philip K. Smith, Gerrish & McCreary, P.C.
700 Colonial Road, Suite 200,
Memphis, TN 38117, (901) 767-0900
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
July 21, 1998
(Date Tender Offer First Published, Sent or Given to Security Holders)
Calculation of Filing Fee
Transaction: Stock Repurchase Plan Amount of filing Fee: $900.00
Valuation: $4,500,000 Calculation: 1/50 of 1%
Check box if any part of the fee is offset as provided by rule 0.11(a)2
and identify the filing with which the offsetting fee was previously
paid. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
Amount Previously Paid:
Form or Registration No.:
Filing Party:
<PAGE>
ISSUER TENDER OFFER STATEMENT
Item 1. Security and Issuer.
a. The name of the Issuer and its principal executive office
is One American Corp., 2785 Louisiana Highway 20 West,
Vacherie, Louisiana 70090.
b. Shares of One American Corp. Common Stock are being sought
and as of June 30, 1998, there were 2,696,090 shares of
One American Corp. Common Stock outstanding. One American
Corp. is seeking the acquisition of up to 180,000 shares at
$25.00 per share. Securities are being sought for purchase
by One American Corp. from all existing stockholders of One
American Corp. and officers, directors and affiliates of
One American Corp. will have the right to participate in
the transaction to the same extent as all other stockholders
of the Issuer. At this time, it is unknown whether
securities will be acquired from any such officer, director
or affiliate.
c. The securities being sought are not listed on any security
exchange and there currently is no established trading market
for such securities. Due to the lack of an active trading
market, One American Corp. does not have the available
information to furnish the high and low sales price or the
range of high and low bid quotations for its stock. Based
upon limited inquiries by management, it is believed that
the stock of the company traded at the following amounts
during the past two years:
Period Amount*
Second quarter 1998 $25.00
First quarter 1998 $18.50
Fourth quarter 1997 $16.00
Third quarter 1997 $16.00
Second quarter 1997 $16.00
First quarter 1997 $15.50
Fourth quarter 1996 $15.50
Third quarter 1996 $15.50
* Restated to reflect recent stock split.
d. Not applicable.
Item 2. Source and Amount of Funds or Other Consideration.
a. The total amount of funds to be utilized for the purchase of
the maximum amount of 180,000 shares is $4,500,000. The
source of funds for the purchase of securities will be excess
bank capital that will be declared as a dividend from First
American Bank to One American Corp. or existing cash balances
of One American Corp.
<PAGE>
b. No part of any of the funds to be used for the purchase of
securities is expected to be borrowed.
Item 3. Purpose of the Tender Offer and Plans or Proposals of the Issuer
or Affiliate.
The purpose of the tender offer is to effect a stock repurchase
program for the Issuer in order to provide stockholders of the One
American Corp. with some liquidity for their shares, since no
established trading market exists for the securities. The tender
offer will also have the effect of allowing First American Bank to
effectively deploy some of its excess capital. Securities that are
repurchased will be deemed to be canceled and will no longer be
outstanding for any purpose.
a.-j. Not applicable.
Item 4. Interest in Securities of the Issuer.
None.
Item 5. Contracts, Arrangements, Understandings or Relationships with
Respect to the Issuer's Securities.
None.
Item 6. Persons Retained, Employed or to be Compensated.
The law firm of Gerrish & McCreary, P.C., Memphis, Tennessee has
been retained solely to assist in the preparation of legal
documents with respect to this transaction and neither it, nor
any other party, has been retained to make solicitations or
recommendations in connection with the tender offer.
Item 7. Financial Information.
a. The audited financial statements of One American Corp. in its
1997 Form 10-K are incorporated herein by reference and are
included as Exhibit 7(a)(1) hereto. The unaudited financial
statements of One American Corp. in its 1998 first quarter
Form 10-Q are incorporated herein by reference and are included
as Exhibit 7(a)(2) hereto. Information from Items 7(a)(3) and
7(a)(4) are included in Exhibits 7(a)(1) and 7(a)(2).
b. Pro forma financial statements disclosing the effect of the
tender offer are included as Exhibits 7(b)(1) and 7(b)(2) and
are incorporated herein by reference. Information from Item
7(b)(3) is included in Exhibits 7(b)(1) and 7(b)(2). On
April 22, 1998, the organization reduced the par value of its
common shares from $5.00 to $2.50 per share to effect a
2 - for - 1 stock split that was issued on May 8, 1998. The
earnings per common share for the years ended December 31, 1997
and 1996 and for the three months ended March 31, 1998 have
not been retroactively adjusted.
<PAGE>
Item 8. Additional Information.
a. Not applicable.
b. Any dividends declared by the subsidiary bank to One American
Corp. to fund stock repurchases will require the prior approval
of the Louisiana Office of Financial Institutions. First
American Bank has received such approval to dividend as much
as $4,500,000 to One American Corp. for purposes of stock
repurchases.
c. Not applicable.
d. Not applicable.
e. Not applicable.
Item 9. Material to be Furnished as Exhibits.
a. The tender offer materials sent to security holders on behalf
of One American Corp. are included as Exhibit 9(a).
b. Not applicable.
c. Not applicable.
d. Not applicable.
e. Not applicable.
f. Not applicable.
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and
correct.
SIGNATURES
ONE AMERICAN CORP.
/s/ Frank J Bourgeois
Date July 21, 1998 Signature
Name: Frank J Bourgeois
Title: President and CEO
<PAGE>
Exhibit 7(a)(1)
Report of Independent Auditor
January 16, 1998
To the Shareholders
and Board of Directors of
One American Corp. and Subsidiaries
Vacherie, Louisiana
We have audited the accompanying Consolidated Balance Sheets
of One American Corp. and Subsidiaries as of December 31, 1997
and 1996, and the related Consolidated Statements of Income,
Changes in Stockholders' Equity, and Cash Flows for each of the
three years in the period ended December 31, 1997. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of One American Corp. and Subsidiaries as of December 31, 1997
and 1996, and the results of their operations, changes in their
stockholders' equity and their cash flows for each of the three
years in the period ended December 31, 1997, in conformity with
generally accepted accounting principles.
Respectfully submitted,
/s/ Hannis T Bourgeois, L.L.P.
Hannis T. Bourgeois, L. L. P.
Baton Rouge, Louisiana
<PAGE>
<TABLE>
<CAPTION>
Consolidated Balance Sheets
One American Corp. and Subsidiaries
December 31, 1997 and 1996
In thousands 1997 1996
Assets
<S> <C> <C>
Cash and Due From Banks $10,219 $11,176
Interest Bearing Deposits in Other Banks 2,896 2,770
Federal Funds Sold and Securities
Purchased Under Resale Agreements 12,150 13,325
Securities
Available for Sale (Amortized Cost of $114,212
and $111,797, respectively) 114,877 111,894
Total Securities 114,877 111,894
Loans 149,165 135,859
Less: Allowance for Loan Losses (2,190) (3,083)
Loans, Net 146,975 132,776
Bank Premises and Equipment 10,837 9,645
Other Real Estate 78 68
Accrued Interest Receivable 2,176 2,031
Other Assets 2,186 2,426
Total Assets $302,394 $286,111
Liabilities
Deposits:
Noninterest Bearing 52,015 45,907
Interest Bearing 211,642 204,797
Total Deposits 263,657 250,704
Accrued Interest Payable 777 693
Other Liabilities 1,705 1,179
Total Liabilities 266,139 252,576
Stockholders' Equity
Common Stock-$5.00 par value;
Authorized-10,000,000 shares;
Issued-1,500,000 shares 7,500 7,500
Surplus 5,000 5,000
Retained Earnings 23,943 21,596
Unrealized Gain (Loss) on Securities Available for Sale, Net 439 64
Treasury Stock - 148,450 and 148,385 shares at cost (627) (625)
Total Stockholders' Equity 36,255 33,535
Total Liabilities and Stockholders' Equity $302,394 $286,111
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Income
One American Corp. and Subsidiaries
for the years ended December 31, 1997, 1996, and 1995
In thousands, except per share data 1997 1996 1995
Interest Income
<S> <C> <C> <C>
Interest and Fees on Loans $13,437 $11,701 $9,948
Interest on Securities:
Taxable Interest 5,948 6,884 7,040
Nontaxable Interest 576 559 636
Total Interest on Securities 6,524 7,443 7,676
Other Interest Income 796 573 581
Total Interest Income 20,757 19,717 18,205
Interest Expense on Deposits 7,712 7,244 6,511
Net Interest Income 13,045 12,473 11,694
Provision for Loan Losses 1,025 90 -
Net Interest Income After
Provision for Loan Losses 12,020 12,383 11,694
Other Income
Service Charges on Deposit Accounts 2,092 2,135 1,849
Gain on Securities 190 285 442
Gain on Purchased Assets 607 812 1,147
Other Operating Income 851 746 1,026
Total Other Income 3,740 3,978 4,464
Income Before Other Expenses 15,760 16,361 16,158
Other Expenses
Salaries and Employee Benefits 4,749 4,435 4,224
Net Occupancy Expense 1,236 1,184 1,150
Net ORE and Repossession Expense (180) (13) (159)
Other Operating Expenses 3,868 3,424 3,286
Total Other Expenses 9,673 9,030 8,501
Income Before Income Taxes 6,087 7,331 7,657
Applicable Income Taxes 2,050 2,281 2,410
Net Income $4,037 $5,050 $5,247
Net Income Per Share $2.99 $3.74 $3.88
Cash Dividends Per Share $1.25 $1.05 $0.65
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Changes in Stockholders' Equity
One American Corp. and Subsidiaries
for the years ended December 31, 1997, 1996, and 1995
In thousands 1997 1996 1995
Common Stock
<S> <C> <C> <C>
Balance - Beginning and End of Year $7,500 $7,500 $7,500
Surplus
Balance - Beginning and End of Year $5,000 $5,000 $5,000
Retained Earnings
Balance - Beginning of Year $21,596 $17,966 $13,597
Net Income 4,037 5,050 5,247
Cash Dividends (1,690) (1,420) (878)
Balance - End of Year $23,943 $21,596 $17,966
Unrealized Gain (Loss) on Securities Available for Sale, Net
Balance - Beginning of Year $64 $371 ($1,482)
Net Change in Unrealized Gain (Loss) 375 (307) 1,853
Balance - End of Year $439 $64 $371
Treasury Stock
Balance - Beginning of Year ($625) ($625) ($625)
Treasury Stock Purchased ( 65 shares ) (2) - -
Balance - End of Year ($627) ($625) ($625)
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Cash Flows
One American Corp. and Subsidiaries
for the years ended December 31, 1997, 1996, and 1995
In thousands 1997 1996 1995
Cash Flows From Operating Activities
<S> <C> <C> <C>
Net Income $4,037 $5,050 $5,247
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Gain on Purchased Assets (606) (811) (1,147)
Provision for Depreciation 762 679 686
Provision for Loan Losses 1,025 90 -
Net Amortization (Accretion) on Securities (149) (87) (412)
Provision (Credit) for Deferred Income Taxes 412 (1) (90)
(Gain) Loss on Sale of Other Real Estate and Repossessions (304) (8) (153)
(Gain) Loss on Sale of Equipment (1) - 6
(Gain) Loss on Securities (189) (284) (442)
Changes in Assets and Liabilities:
(Increase) Decrease in Accrued Interest Receivable (145) 81 (372)
(Increase) Decrease in Other Assets (365) (728) (41)
Increase (Decrease) in Accrued Interest Payable 84 90 268
Increase (Decrease) in Other Liabilities 54 (394) 288
Net Cash Provided by Operating Activities 4,615 3,677 3,838
Cash Flows From Investing Activities
Maturities or Calls of Securities Available for Sale 61,775 62,565 65,451
Maturities or Calls of Securities Held to Maturity - - 767
Purchases of Securities Available for Sale (64,041) (42,235) (67,651)
Purchases of Securities Held to Maturity - - (502)
Proceeds from Sale of Securities Available for Sale 189 276 442
Net (Increase) Decrease in Federal Funds Sold 1,175 (5,950) 825
Net (Increase) Decrease in Loans (15,174) (27,806) (10,626)
Proceeds from Sale of Other Real Estate and Repossessions 850 11 293
Proceeds from Sale of Premises and Equipment - - 215
Purchases of Premises and Equipment (1,953) (1,863) (398)
Proceeds from Other Borrowings 407 411 350
Net Cash Used in Investing Activities (16,772) (14,591) (10,834)
Cash Flows From Financing Activities
Net Increase (Decrease) in Demand Deposits, NOW
and Savings Accounts 476 1,605 (3,367)
Net Increase (Decrease) in Certificates of Deposits 12,477 9,375 12,227
Dividends Paid (1,627) (1,352) (1,080)
Net Cash Provided By Financing Activities 11,326 9,628 7,780
Increase (Decrease) in Cash and Cash Equivalents (831) (1,286) 784
Cash and Cash Equivalents - Beginning of Year 13,946 15,232 14,448
Cash and Cash Equivalents - End of Year $13,115 $13,946 $15,232
Supplemental Disclosure of Cash Flow Information:
Income Tax Payments $1,536 $2,403 $2,032
Interest Paid on Deposits $7,628 $7,154 $6,243
Noncash Investing Activities:
Other Real Estate Acquired in Settlement of Loans $556 $71 $46
Change in Unrealized Gain (Loss) on
Securities Available for Sale $568 ($465) $2,807
Change in Deferred Tax Effect on
Unrealized Gain (Loss) on Securities Available for Sale $193 ($158) $954
Transfer of Securities from Held to Maturity
to Available for Sale - - $18,384
Noncash Financing Activities:
Dividends Declared and Not Paid $473 $405 $338
<FN>
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
One American Corp. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 1997, 1996, and 1995
NOTE A
Summary of Significant Accounting Policies
The accounting principles followed by One American Corp.
(the Company) and its wholly-owned subsidiaries, First American
Bank and Trust (the Bank), and One American Agency, Inc. are
those which are generally practiced within the banking industry.
The methods of applying those principles conform with generally
accepted accounting principles and have been applied on a
consistent basis. The principles which significantly affect the
determination of financial position, results of operations,
changes in stockholders' equity, and cash flows are summarized
below.
Principles of Consolidation - The consolidated financial
statements include the accounts of One American Corp. and its
wholly-owned subsidiaries, First American Bank and Trust, and One
American Agency, Inc. All significant intercompany balances and
transactions have been eliminated. Certain reclassifications to
previously published financial statements have been made to
comply with current reporting requirements.
Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during
the period. Actual results could differ from those estimates.
Securities - Securities are being accounted for in
accordance with Statement of Financial Accounting Standards
(SFAS) No. 115, "Accounting for Investments in Debt and Equity
Securities," which requires the classification of securities as
held to maturity, trading, or available for sale.
Securities classified as held to maturity are those debt
securities the Bank has both the intent and ability to hold to
maturity regardless of changes in market conditions, liquidity
needs or changes in general economic conditions. These
securities are carried at cost adjusted for amortization of
premium and accretion of discount, computed by various methods
approximating the interest method over their contractual lives.
Securities classified as available for sale are those debt
securities that the Bank intends to hold for an indefinite period
of time but not necessarily to maturity. Any decision to sell a
security classified as available for sale would be based on
various factors, including significant movements in interest
rates, changes in the maturity mix of the Bank's assets and
liabilities, liquidity needs, regulatory capital considerations,
and other similar factors. Securities available for sale are
carried at fair value. Unrealized gains or losses are reported
as increases or decreases in stockholders' equity, net of the
related deferred tax effect. Realized gains or losses,
determined on the basis of the cost of specific securities sold,
are included in earnings. The Bank had no securities classified
as held to maturity or trading at December 31, 1997 or 1996.
Loans - Loans are stated at principal amounts outstanding,
less unearned income and allowance for loan losses. Interest on
commercial loans is accrued daily based on the principal
outstanding. Interest on installment loans is recognized and
included in interest income using the sum-of-the-digits method,
which does not differ materially from the interest method.
Impaired loans are being accounted for in accordance with
Statement of Financial Standards (SFAS) No. 114, "Accounting by
Creditors for Impairment of a Loan," as amended by Statement No.
118, "Accounting by Creditors for Impairment of a Loan - Income
Recognition and Disclosure." The statements generally require
impaired loans to be measured on the present value of expected
future cash flows discounted at the loan's effective interest
rate, or as an expedient, at the loan's observable market price
or the fair value of the collateral if the loan is collateral
dependent.
A loan is impaired when it is probable the creditor will be
unable to collect all contractual principal and interest payments
due in accordance with the terms of the loan agreement. Interest
on impaired loans is discontinued when, in management's opinion,
the borrower may be unable to meet payments as they become due.
Generally, the Bank discontinues the accrual of interest income
when a loan becomes 90 days past due as to principal or interest.
<PAGE>
When a loan is placed on non-accrual status, previously
recognized but uncollected interest is reversed to income or
charged to the allowance for loan losses. Interest income is
subsequently recognized only to the extent cash payments are
received.
Allowance for Loan Losses - The allowance for loan losses is
an amount which in management's judgment is adequate to absorb
potential losses in the loan portfolio. The allowance for loan
losses is based upon management's review and evaluation of the
loan portfolio. Factors considered in the establishment of the
allowance for loan losses include management's evaluation of
specific loans, the level and composition of classified loans,
historical loss experience, results of examinations by regulatory
agencies, an internal asset review process, expectations of
future economic conditions and their impact on particular
borrowers, and other judgmental factors.
The allowance for loan losses is based on estimates of
potential future losses, and ultimate losses may vary from the
current estimates. These estimates are reviewed periodically and
as adjustments become necessary, the effect of the change in
estimate is charged to operating expenses in the period incurred.
All losses are charged to the allowance for loan losses when the
loss actually occurs or when management believes that the
collectibility of the principal is unlikely. Recoveries are
credited to the allowance at the time of recovery.
Bank Premises and Equipment - Bank premises and equipment
are stated at cost less accumulated depreciation. Depreciation
is provided at rates based upon estimated useful service lives
(ten to thirty years for buildings, three to ten years for
equipment) using the straight-line method for financial reporting
purposes and accelerated methods for income tax purposes.
The cost of assets retired or otherwise disposed of and the
related accumulated depreciation are eliminated from the accounts
in the year of disposal and the resulting gains or losses are
included in current operations.
Expenditures for maintenance and repairs are charged to
operations as incurred. Costs of major additions and
improvements are capitalized.
Other Real Estate - Other real estate is comprised of
properties acquired through foreclosure or negotiated settlement.
The carrying value of these properties is lower of cost or fair
value less estimated selling expenses. Loan losses arising from
the acquisition of these properties are charged against the
allowance for loan losses. Any subsequent market reductions
required are charged to other real estate expense. Revenues and
expenses associated with maintaining or disposing of foreclosed
properties are recorded during the period in which they are
incurred.
Income Taxes - The provision for income taxes is based on
income as reported in the financial statements after interest
income from state and municipal securities is excluded. Also
certain items of income and expenses are recognized in different
time periods for financial statement purposes than for income tax
purposes. Thus, provisions for deferred taxes are recorded in
recognition of such timing differences.
Deferred taxes are provided utilizing a liability method in
accordance with SFAS No. 109 whereby deferred tax assets are
recognized for deductible temporary differences and operating
loss and tax credit carryforwards and deferred tax liabilities
are recognized for taxable temporary differences. Temporary
differences are the differences between the reported amounts of
assets and liabilities and their tax bases. Deferred tax assets
are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or all
of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effects of changes in
tax laws and rates on the date of enactment.
The Company and its subsidiaries file a consolidated federal
income tax return. In addition, state income tax returns are
filed individually by the Companies in accordance with state
statutes.
Earnings per Common Share - The computation of earnings per
share and other per share amounts of common stock is based on the
weighted average number of shares of common stock outstanding
during each year, which is 1,351,615 for all periods presented.
Statements of Cash Flows - For purposes of reporting cash
flows, cash and cash equivalents include cash on hand and amounts
due from banks (including cash items in process of clearing).
Current Accounting Developments - The Financial Accounting
Standards Board has issued Statement No. 125, "Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities." This statement becomes effective for transfers
<PAGE>
and servicing of financial assets and extinguishments of
liabilities occurring after December 31, 1996. This statement
provides accounting and reporting standards for transfers and
servicing of financial assets and extinguishments of liabilities.
The statement generally requires that after a transfer of
financial assets, an entity would recognize all financial assets
and servicing it controls and liabilities it has incurred , and
would not recognize financial assets when control has been
surrendered or liabilities when they have been extinguished. The
application of this statement had no effect on the financial
statements as of December 31, 1997.
NOTE B
Acquisitions
On September 23, 1996, the Bank acquired the First American
Bank of Tangipahoa located in Hammond, Tangipahoa Parish,
Louisiana for a purchase price of $1.8 million. Pursuant to a
Merger and Acquisition Agreement, the Bank acquired assets with a
fair value of $6.9 million and assumed $5.7 million in deposits
and specific liabilities as disclosed in the table below. The
excess of the purchase price over the value of the net tangible
assets has been assigned to goodwill and is being amortized over
fifteen years. This acquisition was accounted for using the
purchase method of accounting, and the results of operations are
included in the consolidated financial statements from the date
of acquisition.
In thousands 09/23/96
Assets:
Cash and due From Banks $727
Federal Funds Sold 1,825
Securities 235
Loans, Net 4,044
Bank Premises 6
Other Real Estate 22
Accrued Interest Receivable 44
Other Assets 5
Total Assets $6,908
Liabilities and Stockholders Equity:
Deposits $5,659
Accrued Interest Payable 19
Other Liabilites 17
Stockholders' Equity 1,213
Total Liabities and Stockholders Equity $6,908
Gain on purchased assets is recognized from acquired loans
from previous bank acquisitions on a cost recovery method as
principal payments are made and is included in the financial
statements as Gain on Purchased Assets.
NOTE C
Cash and Due from Banks
The Bank is required to maintain average cash reserve
balances. The amounts of those reserves at December 31, 1997 and
1996, were approximately $3.6 million and $3.0 million,
respectively.
<PAGE>
NOTE D
Securities
Amortized costs and fair values of securities available for
sale as of December 31, 1997 and 1996 are summarized as follows:
<TABLE>
<CAPTION>
1997
Gross Gross
Amortized Unrealized Unrealized Fair
($ in thousands) Cost Gains Losses Value
<S> <C> <C> <C> <C>
U. S. Treasury Securities $38,348 $128 ($7) $38,469
Securities of Other U. S. Government Agencies 54,323 80 (107) 54,296
Mortgage-Backed Securities 9,762 125 (13) 9,874
Obligations of State and Political Subdivisions 10,877 459 - 11,336
Equity Securities 902 - - 902
Totals $114,212 $792 ($127) $114,877
<CAPTION>
1996
Gross Gross
Amortized Unrealized Unrealized Fair
($ in thousands) Cost Gains Losses Value
<S> <C> <C> <C> <C>
U. S. Treasury Securities $34,232 $86 ($14) $34,304
Securities of Other U. S. Government Agencies 58,610 14 (499) 58,125
Mortgage-Backed Securities 8,674 205 (50) 8,829
Obligations of State and Political Subdivisions 9,430 355 - 9,785
Equity Securities 851 - - 851
Totals $111,797 $660 ($563) $111,894
</TABLE>
Included in the category of Securities of Other US
Government Agencies at December 31, 1997 is $17.5 million par
value of structured notes, with an amortized cost of $17.5
million and a fair value of $17.4 million. At December 31, 1996,
the Bank held $21.5 million of par value of these notes with an
amortized cost of $21.5 million with a fair value of $21.5
million. The structured notes, which are issued by US Government
Agencies, are debt securities whose cash flows are dependent on
one or more indices in ways that create interest rate risk.
Management understands the risks associated with these types of
instruments and has the capability to effectively monitor the
notes activity. Although classified in the available for sale
category, it is management's intention to hold the structured
notes until the notes mature at par value. Based on the variable
nature of said securities and the securities percentage
relationship to earning assets, a +/- 200 basis point interest
rate shock and income simulation on the security class showed
minimal impact on earnings. Further, management is of the
opinion that earning trends indicate the ability to accept any
adverse risk associated with the possible sale of said securities
should the decision to hold the structured notes to maturity
change.
The Bank also has approximately $342 thousand in par value
of Louisiana Agricultural Finance Authority Bonds and Louisiana
Housing Finance Authority Bonds with a book value of $1, on
nonaccrual status. Under a directive from state regulatory
agencies the original $2.35 million in par value of the
Guaranteed Investment Contracts were placed on nonaccrual status
in May, 1992. Due to the directive, the bonds were written down
to $.20 on the dollar or $470 thousand. While management has
written down these bonds in accordance with regulatory policy as
mentioned above, management continues to feel that the fair value
was not representative of the potential liquidation value of
these bonds. Management is of the opinion that the permanent
impairment of the bonds was not in excess of the prescribed
regulatory write downs. A class action suit was filed on behalf
of the bondholders. In summary, the suit sought a determination
of the priority treatment the bondholders would receive under
California statutes in the liquidation of Executive Life
Insurance Company. Under Priority 5 the Guaranteed Investment
Contracts (GICs), which support the municipal bonds, would be
treated as insurance policies and would have the same payout
ratio as other policies. Under Priority 6, the GICs would have
the status of a general unsecured creditor. On November 15,
1992, the Superior Court in California ruled the GICs were a
<PAGE>
Priority 5. As a result of pending litigation, continued
settlement proposals are taking place between the guarantors of
the bonds and the bondholders. To date, the Bank has recovered
approximately $2.2 million as partial payments of the $2.35
million in original par value. Of the $2.2 million, $1.8 million
was recognized as gains on securities available for sale since
the original write down. The remaining $470 thousand was applied
against the book value. Of the
$1.8 million in gains recognized since the write down, $190
thousand was recognized in 1997 and $277 thousand was recognized
in 1996. The Bank continues to pursue the collection of
principal on these securities. However, the amount of any future
fulfillment of these collection actions remain uncertain.
The following table shows the amortized cost, fair value,
maturity distribution, and weighted average yield of the
securities available for sale as of December 31, 1997.
Maturities may differ from contractual maturities in mortgage-
backed securities because the mortgages underlying the securities
may be called or repaid without any penalties.
($ in thousands) Amortized Fair Average
Cost Value Yield
U. S. Treasury Securities
Within 1 Year $18,352 $18,374 5.58%
After 1 but Within 5 Years 19,996 20,095 5.99%
After 5 but Within 10 Years - - -
After 10 Years - - -
38,348 38,469 5.79%
Securities of Other U. S. Government Agencies
Within 1 Year 24,339 24,292 5.16%
After 1 but Within 5 Years 29,984 30,004 5.94%
After 5 but Within 10 Years - - -
After 10 Years - - -
54,323 54,296 5.59%
Mortgage-Backed Securities
Within 1 Year 5 5 9.72%
After 1 but Within 5 Years 320 332 9.30%
After 5 but Within 10 Years 4,456 4,511 7.13%
After 10 Years 4,981 5,026 6.64%
9,762 9,874 6.95%
Obligations of State and Political Subdivisions*
Within 1 Year 536 538 8.38%
After 1 but Within 5 Years 6,408 6,671 8.35%
After 5 but Within 10 Years 3,340 3,498 7.47%
After 10 Years 593 629 7.94%
10,877 11,336 8.06%
Equity Securities 902 902 5.57%
902 902 5.57%
Totals $114,212 $114,877 6.02%
* Tax Equivalent Basis - 34%
Securities available for sale with a carrying amount of
$33.4 million and $38.2 million at December 31, 1997 and 1996,
respectively, were pledged as collateral on public deposits and
for other purposes as required or permitted by law.
The Bank has invested in Federal Home Loan Bank of Dallas
stock which is included in Equity Securities and is reflected at
the lower of cost or fair value in these financial statements.
The cost of these securities was $902 thousand and $851 thousand,
which approximates fair value, at December 31, 1997 and 1996,
respectively.
<PAGE>
Gross realized gains and losses from the sale of securities
for the years ended December 31, 1997, 1996, and 1995 are as
follows:
($ in thousands) 1997 1996 1995
Realized gains $190 $285 $442
Realized losses - - -
$190 $285 $442
NOTE E
Loans
An analysis of the loan portfolio at December 31, 1997 and
1996, is as follows:
($ in thousands) 1997 1996
Commercial, Financial, and Agricultural $15,811 $10,442
Real Estate - Construction 3,987 3,184
Real Estate - Mortgage 113,117 105,800
Individuals 13,892 13,559
Foreign - 1,361
All Other Loans 2,395 1,578
Total Loans 149,202 135,924
Unearned Income (37) (65)
Total Loans, net of Unearned Income $149,165 $135,859
Impaired loans having recorded investments of $3.2 million
at December 31, 1997 have been recognized in conformity with FASB
Statement No. 114 as amended by FASB Statement No. 118. The
average recorded investment in impaired loans during the year
ended December 31, 1997 was approximately $3.5 million. Impaired
loans at December 31, 1996 were $4.0 million. The allowance for
loan losses related to these loans was
$849 thousand at December 31, 1997 and $1.9 million at December
31, 1996. Interest received on impaired loans amounted to $348
thousand and $458 thousand at December 31, 1997 and 1996,
respectively. All non-accrual loans were considered impaired at
December 31, 1997. Non-accrual loans not included in impaired
loans were immaterial at December 31, 1996.
The Bank is permitted, under the laws of the State of
Louisiana, to make extensions of credit to its executive officers
and directors and their affiliates in the ordinary course of
business. An analysis of the aggregate loans, for December 31,
1997 and 1996, are as follows:
($ in thousands) 1997 1996
Balance - Beginning of Year $2,698 $1,955
New Loans 3,455 2,672
Repayments (1,085) (1,929)
Balance - End of Year $5,068 $2,698
Maximum Balance During the Year $5,694 $2,796
<PAGE>
NOTE F
Allowance for Loan Losses
Following is a summary of the activity in the allowance for
loan losses:
($ in thousands) 1997 1996 1995
Balance - Beginning of Year $3,083 $3,273 $3,077
Current Provision from Income 1,025 90 -
Recoveries on Loans Charged-Off 181 230 634
Loans Charged-Off (2,099) (510) (438)
Balance - End of Year $2,190 $3,083 $3,273
Ratio of Allowance for Loan Losses to
Impaired Loans at End of Year 67.39% 74.91% 90.92%
Ratio of Allowance for Loan Losses to Loans
Outstanding at End of Year 1.47% 2.27% 3.04%
Ratio of Net Loans Charged-Off to
Loans Outstanding at End of Year 1.29% 0.20% (.18%)
NOTE G
Bank Premises and Equipment
Bank premises and equipment costs and the related
accumulated depreciation at December 31, 1997 and 1996, are as
follows:
($ in thousands) 1997 1996
Land $3,115 $2,645
Bank Premises 8,743 8,008
Furniture and Equipment 5,588 4,839
17,446 15,492
Accumulated Depreciation (6,609) (5,847)
$10,837 $9,645
Depreciation charged to operating expenses for the three
years ended December 31, 1997, 1996, and 1995, respectively, was
$762 thousand, $679 thousand, and $686 thousand.
<PAGE>
NOTE H
Deposits
Following is a detail of deposits as of December 31, 1997
and 1996:
($ in thousands) 1997 1996
Non-interest Bearing Accounts $52,015 $45,907
NOW and Super NOW Accounts 24,585 24,273
Insured Money Market Accounts 51,355 56,535
Savings Accounts 31,417 32,181
Certificates of Deposit over $100,000 12,528 12,352
Other Certificates of Deposit 91,757 79,456
Total Deposits $263,657 $250,704
Interest expense on Certificates of Deposit over $100
thousand at December 31, 1997, 1996, and 1995, amounted to $542
thousand, $472 thousand and $387 thousand, respectively.
Public Fund deposits at December 31, 1997 and 1996, were
$16.2 million and $18.3 million, respectively.
NOTE I
Stockholders' Equity and Regulatory Matters
Stockholders' Equity of the Company includes the
undistributed earnings of the Bank. Dividends are paid by the
Company from its assets which are provided primarily by dividends
from the Bank. Dividends are payable only out of retained
earnings and current earnings of the Company. Certain
restrictions exist regarding the ability of the Bank to transfer
funds to the Company in the form of cash dividends. Louisiana
statutes require approval to pay dividends in excess of a state
bank's earnings in the current year plus retained net profits for
the preceding year. As of January 1, 1998, the Bank had retained
earnings of $17.5 million of which $5.2 million was available for
distribution without prior regulatory approval.
The company and the Bank are subject to various regulatory
capital requirements administered by federal and state banking
agencies. Failure to meet minimum regulatory capital
requirements can initiate certain mandatory, and possible
additional discretionary actions by regulators, that if
undertaken, could have a direct material affect on the Company's
financial statements. Under the capital adequacy guidelines and
the regulatory framework for prompt corrective action, the
Company and the Bank must meet specific capital guidelines
involving quantitative measures of assets, liabilities, and
certain, off-balance-sheet items as calculated under regulatory
accounting practices. The Company and the Bank's capital amounts
and classification under the prompt corrective action guidelines
are also subject to qualitative judgments by the regulators about
components, risk weightings and other factors.
Quantitative measures established by regulation to ensure
capital adequacy require the Company to maintain minimum amounts
and ratios. As detailed below, as of December 31, 1997 and 1996,
the Company met all of the capital adequacy requirements to which
it is subject.
As of December 31, 1997 and 1996, the Company was
categorized as well capitalized under the regulatory framework
for prompt corrective action. There are no conditions or events
since the most recent notification that management believes have
changed the prompt corrective action category.
<PAGE>
Following is a summary of capital levels at December 31,
1997 and 1996:
<TABLE>
<CAPTION>
To Be Well
Capitalized
Under
Required for Prompt
Capital Corrective
Actual Adequacy Actions
As of December 31, 1997 Ratios Purposes Provision
<S> <C> <C> <C>
Total Capital (to Risk Weighted Assets) 25.1% 8.00% 10.00%
Tier 1 Capital (to Risk Weighted Assets) 23.9% 4.00% 6.00%
Tier 1 Leveraged Capital (to Average Assets) 11.7% 4.00% 5.00%
As of December 31, 1996
Total Capital (to Risk Weighted Assets) 25.3% 8.00% 10.00%
Tier 1 Capital (to Risk Weighted Assets) 24.1% 4.00% 6.00%
Tier 1 Leveraged Capital (to Average Assets) 11.8% 4.00% 5.00%
</TABLE>
Under current regulations, the Bank is limited in the amount it
may loan to its parent. Loans to the Parent may not exceed 10%
of the Bank's capital and surplus. There were no loans
outstanding at December 31, 1997 and 1996.
NOTE J
Employee Benefit Plans
The Bank maintains a Salary Deferral Plan qualified under
Internal Revenue Service Code Section 401(k) for all employees
who are 21 years of age and have completed one year of service.
Covered employees may elect to contribute 1% to 15% of gross pay
to the plan. The majority of the plans assets are invested in
mutual funds. As part of the plan, the Bank has, at its
discretion, the ability to match the contributions or make
supplemental contributions. No amounts were contributed by the
Bank for either 1997 or 1996.
The Bank maintains a noncontributory defined benefit pension
plan covering all employees who qualify as to age and length of
service. Current policy is to fund annual pension costs as they
accrue. Pension expense was $151 thousand, $127 thousand and
$164 thousand for the years ended December 31, 1997, 1996, and
1995, respectively. The majority of the plans assets are invested
in money market funds or mutual funds. The following table sets
forth the plan's funded status at December 31, 1997 and 1996.
($ in thousands) 1997 1996
Actuarial Present Value of Benefit Obligations:
Vested Benefits $4,266 $3,448
Accumulated Benefits $4,584 $3,681
Projected Benefits ($6,146) ($4,842)
Plan Assets at Fair Value 6,204 5,346
Projected Benefit Obligation Less
Than (In Excess Of) Plan Assets 58 504
Unrecognized Net (Gain) Loss 336 (1)
Unrecognized Net Obligation (Asset) (217) (236)
Prepaid Pension Expense $177 $267
<PAGE>
Assumptions used in the determination of pension plan
information consisted of the following:
1997 1996
Discount Rate 7.00% 7.50%
Rate of Increase in Compensation Levels 5.50% 5.50%
Expected Long-Term Rate of Return
on Plan Assets 9.00% 9.00%
Net pension expense for 1997, 1996, and 1995 included the
following components:
<TABLE>
<CAPTION>
($ in thousands) 1997 1996 1995
<S> <C> <C> <C>
Service Cost $268 $248 $245
Interest Cost 376 328 297
Return on Assets (851) (496) (724)
Net Amortization and Deferral $358 $47 $346
</TABLE>
The Bank's employee benefit program also includes self-
funded health and dental insurance plans for all full-time
employees. The costs of these plans are completely funded by the
Bank. The employees can also elect to purchase dependent
coverage under the plans. The Bank pays a premium to a reinsurer
for coverage on losses and claims that exceed $20,000 per
individual per plan year. Amounts paid by the Bank in
association with these plans totaled $548 thousand and $530
thousand for the years ended December 31, 1997 and 1996,
respectively. The Bank had set aside reserves in the amount of
$647 thousand for payment of unreported claims with dates of
service through December 31, 1997.
NOTE K
Other Operating Expenses
The analysis of other operating expenses for the years ended
December 31, 1997, 1996, and 1995, are as follows:
<TABLE>
<CAPTION>
($ in thousands) 1997 1996 1995
<S> <C> <C> <C>
Advertising and Public Relations $301 $349 $344
Armored Courier Service 131 115 94
Director Fees 263 200 152
Equipment Expense 1,047 946 888
Legal and Professional 506 400 266
Postage and Shipping 180 175 167
Regulatory Assessments 67 32 267
Service Charges-Other Institutions 122 126 112
Stationery, Printing, and Supplies 356 338 328
Telephone 295 233 189
Other 600 510 479
$3,868 $3,424 $3,286
</TABLE>
NOTE L
Income Taxes
The total provision for income taxes charged to income
amounted to $2.0 million for 1997, $2.3 million for 1996, and
<PAGE>
$2.4 million for 1995. The provisions represent effective tax
rates of 33% for 1997 and 31% for 1996 and 1995. Following is a
reconciliation between income tax expense based on the federal
statutory tax rates and income taxes reported in the statements
of income.
<TABLE>
<CAPTION>
($ in thousands) 1997 1996 1995
Income Taxes Based on Statutory Rates -
<C> <C> <C> <C>
34% for periods shown $2,069 $2,492 $2,603
Tax Exempt Income (196) (188) (216)
Other - Net 177 (23) 23
$2,050 $2,281 $2,410
</TABLE>
The components of consolidated income tax expense (benefits)
are:
<TABLE>
<CAPTION>
($ in thousands) 1997 1996 1995
<S> <C> <C> <C>
Provision for Current Taxes $1,638 $2,282 $2,500
Provision (Credit) for Deferred Taxes 412 (1) (90)
$2,050 $2,281 $2,410
</TABLE>
A deferred income tax asset of $25 thousand and $630
thousand is included in other assets at December 31, 1997 and
1996, respectively. The deferred tax provision (credit) consists
of the following timing differences:
<TABLE>
<CAPTION>
($ in thousands) 1997 1996 1995
Depreciation Expense for Tax Reporting
<S> <C> <C> <C>
in Excess of Amount for Financial Reporting ($3) ($2) $14
Provision for Loan Losses for Financial
Reporting in Excess of Amount for
Tax Reporting 427 21 (63)
Accretion Income for Financial Reporting
in Excess of Tax Reporting 14 (17) (4)
Increase in Insurance Reserve (10) (21) (147)
Increase (Decrease) in Prepaid Pension (16) 18 110
$412 ($1) ($90)
</TABLE>
The net deferred tax asset consists of the following
components at December 31, 1997 and 1996:
($ in thousands) 1997 1996
Depreciation ($346) ($349)
Provision for Loan Losses 566 993
Accretion Income (35) (21)
Insurance Reserve 178 168
Prepaid Pension (112) (128)
Unrealized (Gain) Loss on Securities
Available for Sale (226) (33)
Total Deferred Tax Asset $25 $630
NOTE M
Short-Term Borrowings
The Bank maintains an open line of credit with the Federal
Home Loan Bank of Dallas. The total line of credit available
with Federal Home Loan Bank of Dallas amounts to approximately
$9.6 million at December 31, 1997. This amount is computed based
on the Bank's stock position less current advances, not to exceed
65% of the Bank's outstanding 1-4 family mortgage loans. The
agreement provides for interest based upon the federal funds rate
on outstanding balances for short term purposes and a certain
spread above the treasury yield curve for longer term advances.
<PAGE>
Drawings on the line included in other liabilities, were $1.2
million and $761 thousand at December 31, 1997 and 1996
respectively. The line is collateralized by a blanket lien on 1-
4 family mortgage loans.
NOTE N
Off-Balance Sheet Instruments
The Company is a party to financial instruments with off-
balance sheet risk in the normal course of business to meet the
financing needs of its customers. These financial instruments
include commitments to extend credit, financial guarantees, and
letters of credit. Those instruments involve, to varying
degrees, elements of credit risk in excess of the amount
recognized in the balance sheets.
The Company's exposure to credit loss in the event of
nonperformance by the other party to the financial instrument for
commitments to extend credit and letters of credit is represented
by the contractual amount of those instruments. The Bank uses
the same credit policies in making commitments and conditional
obligations as they do for on-balance sheet instruments.
In the normal course of business the Company has made
commitments to extend credit of $11.7 million at December 31,
1997. This amount includes unfunded commitments aggregating
$11.1 million and letters of credit of $562 thousand.
NOTE O
Concentrations of Credit
The Bank's business activities are with customers in the
Bank's market area, which consists primarily of the southeast
region of the State of Louisiana. Investments in state and
municipal securities also involve governmental entities within
the Bank's market area. The concentrations of credit by type of
loan are shown in Note E. Most of the Bank's credits are to
individuals and small businesses secured by real estate. The
Bank, as a matter of policy, does not extend credit to any single
borrower or group of related borrowers in excess of
$4 million.
NOTE P
Fair Value of Financial Instruments
The following methods and assumptions were used to estimate
the fair value of each class of financial instruments for which
it is practicable to estimate that value:
Cash and Short-Term Investments - For those short-term
instruments, the carrying amount is a reasonable estimate of fair
value.
Securities - Fair value of securities held to maturity and
available for sale is based on quoted market prices or dealer
quotes. If a quoted market price is not available, fair value is
estimated using quoted market prices for similar securities.
Loans - The fair value for loans is estimated using
discounted cash flow analyses, with interest rates currently
being offered for similar loans to borrowers with similar credit
rates. Loans with similar classifications are aggregated for
purposes of the calculations. The allowance for loan losses
which was used to measure the credit risk, is subtracted from
loans.
Deposits - The fair value of demand deposits, savings
accounts, and certain money market deposits is the amount payable
on demand at the reporting date. The fair value of fixed-
maturity certificates of deposit is estimated using discounted
cash flow analyses, with interest rates currently offered for
deposits of similar remaining maturities.
Commitments to Extend Credit and Standby Letters of Credit -
The fair value of commitments is estimated using the fees
currently charged to enter into similar agreements, taking into
account the remaining terms of the agreements and the present
creditworthiness of the parties. For fixed-rate loan
commitments, fair value also considers the difference between
<PAGE>
current levels of interest rates and the committed rates. The
fair value of letters of credit is based on fees currently
charged for similar agreements at the reporting date. The
estimated approximate fair values of the Bank's financial
instruments as of December 31, 1997 and 1996 are as follows:
($ in thousands) 1997 1996
Carrying Carrying
Financial Assets: Amount Fair Value Amount Fair Value
Cash and
Short-Term Investments $25,265 $25,265 $27,271 $27,271
Securities 114,877 114,877 111,894 111,894
Loans - Net 146,975 147,511 132,776 132,683
$287,117 $287,653 $271,941 $271,848
Financial Liabilities:
Deposits $263,657 $263,259 $250,704 $250,175
Unrecognized Financial Instruments
Commitments to Extend Credit
and Letters of Credit $- $- $- $-
NOTE Q
Litigation and Contingencies
During the normal course of business, the Company is
involved in various legal proceedings. In the opinion of
management and counsel, any liability resulting from such
proceedings would not have a material adverse effect on the
Company's financial statements.
<PAGE>
NOTE R
Parent Company Financial Statements
The financial statements for One American Corp. (Parent
Company Only) are presented below:
BALANCE SHEETS
December 31, 1997 and 1996
($ in thousands) 1997 1996
Assets
Cash $2,107 $1,699
Receivables from Subsidiaries 20 18
Income Tax Receivable 12 122
Investment in Subsidiaries:
First American Bank and Trust 34,397 32,044
One American Agency, Inc. 233 194
34,630 32,238
Total Assets $36,769 $34,077
Liabilities
Accrued Dividend Payable $472 $135
Payables to Subsidiaries 42 407
514 542
Stockholders' Equity
Common Stock 7,500 7,500
Surplus 5,000 5,000
Retained Earnings 24,382 21,660
Treasury Stock - 148,450 and 148,385 shares at cost (627) (625)
Total Stockholders' Equity 36,255 33,535
Total Liabilities and Stockholders' Equity $36,769 $34,077
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF INCOME
for the years ended December 31, 1997, 1996, and 1995
($ in thousands) 1997 1996 1995
Income
<S> <C> <C> <C>
Interest Income $44 $34 $17
Dividends from Subsidiaries:
First American Bank and Trust 2,025 1,800 1,425
One American Agency, Inc. - - -
Total Income 2,069 1,834 1,442
Expenses
Operating Expenses 52 48 53
Total Expenses 52 48 53
Income before Income Taxes and Equity in
Undistributed Net Income of Subsidiaries 2,017 1,786 1,389
Income Tax Expense (Benefit) (3) (5) (12)
Income before Equity in Undistributed
Net Income of Subsidiaries 2,020 1,791 1,401
Equity in Undistributed Net Income of Subsidiaries 2,017 3,259 3,846
Net Income $4,037 $5,050 $5,247
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOWS
for the years ended December 31, 1997, 1996, and 1995
($ in thousands) 1997 1996 1995
Cash Flows From Operating Activities:
<S> <C> <C> <C>
Net Income $4,037 $5,050 $5,247
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Equity in Undistributed Net Income of Subsidiaries (2,017) (3,259) (3,846)
Changes in Assets and Liabilities:
Increase (Decrease) in Payables to Subsidiaries (93) 135 -
(Increase) Decrease in Receivables from Subsidiaries (2) 343 (361)
(Increase) Decrease in Income Tax Receivables 110 (122) 13
Increase (Decrease) in Income Taxes Payable - (348) 348
Net Cash Provided by Operating Activities 2,035 1,799 1,401
Cash Flows From Financing Activities:
Dividends Paid (1,627) (1,352) (1,080)
Net Cash Used in Financing Activities (1,627) (1,352) (1,080)
Net Increase in Cash 408 447 321
Cash - Beginning of Year 1,699 1,252 931
Cash - End of Year $2,107 $1,699 $1,252
Noncash Financing Activities:
Dividends Declared and Not Paid $473 $405 $338
Change in Unrealized Gain (Loss) on Securities Available
For Sale, Net $375 ($307) $1,853
Book Value per Share and Efficiency Ratio
December 31,December 31,
1997 1996
Book Value per Share $26.82 $24.81
Efficiency Ratio 57.6% 54.9%
</TABLE>
<PAGE>
Exhibit 7(a)(2)
<TABLE>
<CAPTION>
Consolidated Balance Sheets
One American Corp. and Subsidiaries Unaudited Unaudited Unaudited
March 31, 1998 and 1997 March 31, December 31,March 31,
In thousands 1998 1997 1997
<S> <C> <C> <C>
Assets
Cash and Due From Banks $13,513 $10,219 $10,946
Interest Bearing Deposits in Other Banks 5,265 2,896 2,283
Federal Funds Sold and Securities
Purchased Under Resale Agreements 15,625 12,150 10,650
Securities
Available for Sale (Amortized Cost of $112,500, $114,212
and $114,094, respectively) 113,176 114,877 113,824
Total Securities 113,176 114,877 113,824
Loans 150,399 149,165 141,007
Less: Allowance for Loan Losses (2,621) (2,190) (3,171)
Loans, Net 147,778 146,975 137,836
Bank Premises and Equipment 11,045 10,837 9,682
Other Real Estate 78 78 51
Accrued Interest Receivable 1,981 2,176 2,065
Other Assets 2,161 2,186 2,323
Total Assets $310,622 $302,394 $289,660
Liabilities
Deposits:
Noninterest Bearing $55,130 $52,015 $48,922
Interest Bearing 215,658 211,642 204,562
Total Deposits 270,788 263,657 253,484
Accrued Interest Payable 723 777 581
Other Liabilities 2,373 1,705 1,735
Total Liabilities 273,884 266,139 255,800
Stockholders' Equity
Common Stock-$5.00 par value;
Authorized-10,000,000 shares;
Issued-1,500,000 shares 7,500 7,500 7,500
Surplus 5,000 5,000 5,000
Retained Earnings 24,434 23,943 22,162
Unrealized Gain (Loss) on Securities Available for Sale, Net 446 439 (177)
Treasury Stock - 148,910, 148,450 and 148,385 shares at cost (642) (627) (625)
Total Stockholders' Equity 36,738 36,255 33,860
Total Liabilities and Stockholders' Equity $310,622 $302,394 $289,660
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Income
One American Corp. and Subsidiaries
for the three months ended March 31, 1998 and 1997 UnauditedUnaudited
In thousands, except per share data 1998 1997
<S> <C> <C>
Interest Income
Interest and Fees on Loans $3,504 $3,159
Interest on Securities:
Taxable Interest 1,464 1,480
Nontaxable Interest 150 134
Total Interest on Securities 1,614 1,614
Other Interest Income 229 234
Total Interest Income 5,347 5,007
Interest Expense on Deposits 2,008 1,855
Net Interest Income 3,339 3,152
Provision for Loan Losses 450 75
Net Interest Income After
Provision for Loan Losses 2,889 3,077
Other Income
Service Charges on Deposit Accounts 521 521
Gain on Securities - 24
Gain on Purchased Assets 260 111
Other Operating Income 217 190
Total Other Income 998 846
Income Before Other Expenses 3,887 3,923
Other Expenses
Salaries and Employee Benefits 1,223 1,100
Net Occupancy Expense 320 293
Net ORE and Repossession Expense (34) (9)
Other Operating Expenses 911 1,010
Total Other Expenses 2,420 2,394
Income Before Income Taxes 1,467 1,529
Applicable Income Taxes 502 557
Net Income $965 $972
Net Income Per Share $0.71 $0.72
Cash Dividends Per Share $0.35 $0.30
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Changes in Stockholders' Equity
One American Corp. and Subsidiaries
for the three months ended March 31, 1998 and 1997 UnauditedUnaudited
In thousands 1998 1997
<S> <C> <C>
Common Stock
Balance - Beginning and End of Period $7,500 $7,500
Surplus
Balance - Beginning and End of Period $5,000 $5,000
Retained Earnings
Balance - Beginning of Period $23,943 $21,596
Net Income 965 972
Cash Dividends (474) (406)
Balance - End of Period $24,434 $22,162
Unrealized Gain (Loss) on Securities Available for Sale, Net
Balance - Beginning of Period $439 $64
Net Change in Unrealized Gain (Loss) 7 (241)
Balance - End of Period $446 ($177)
Treasury Stock
Balance - Beginning of Period ($627) ($625)
Treasury Stock Purchased ( 460 shares ) (15) -
Balance - End of Period ($642) ($625)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Cash Flows
One American Corp. and Subsidiaries
for the three months ended March 31, 1998 and 1997 UnauditedUnaudited
In thousands 1998 1997
<S> <C> <C>
Cash Flows From Operating Activities
Net Income $965 $972
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Gain on Purchased Assets (260) (111)
Provision for Depreciation 199 182
Provision for Loan Losses 450 75
Net Amortization (Accretion) on Securities (84) (27)
Provision (Credit) for Deferred Income Taxes (93) 10
(Gain) Loss on Sale of Other Real Estate and Repossession (16) (11)
(Gain) Loss on Securities - (24)
Changes in Assets and Liabilities:
(Increase) Decrease in Accrued Interest Receivable 195 (34)
(Increase) Decrease in Other Assets 115 216
Increase (Decrease) in Accrued Interest Payable (54) (112)
Increase (Decrease) in Other Liabilities 689 576
Net Cash Provided by Operating Activities 2,106 1,712
Cash Flows From Investing Activities
Maturities or Calls of Securities Available for Sale 23,313 15,549
Purchases of Securities Available for Sale (21,518) (17,816)
Proceeds from Sale of Securities Available for Sale - 24
Net (Increase) Decrease in Federal Funds Sold (3,475) 2,675
Net (Increase) Decrease in Loans (1,027) (5,024)
Proceeds from Sale of Other Real Estate and Repossessions 50 28
Purchases of Premises and Equipment (407) (219)
Proceeds from Other Borrowings (36) (21)
Net Cash Used in Investing Activities (3,100) (4,804)
Cash Flows From Financing Activities
Net Increase (Decrease) in Demand Deposits, NOW
and Savings Accounts 6,275 (1,175)
Net Increase (Decrease) in Certificates of Deposits 856 3,955
Dividends Paid (474) (405)
Net Cash Provided By Financing Activities 6,657 2,375
Increase (Decrease) in Cash and Cash Equivalents 5,663 (717)
Cash and Cash Equivalents - Beginning of Year 13,115 13,946
Cash and Cash Equivalents - End of Year $18,778 $13,229
Supplemental Disclosure of Cash Flow Information:
Income Tax Payments - -
Interest Paid on Deposits $2,062 $1,967
Noncash Investing Activities:
Other Real Estate Acquired in Settlement of Loans - -
Change in Unrealized Gain (Loss) on
Securities Available for Sale $11 ($365)
Change in Deferred Tax Effect on
Unrealized Gain (Loss) on Securities Available for Sale $4 ($124)
Noncash Financing Activities:
Dividends Declared and Not Paid $474 $406
Book Value per Share and Efficiency Ratio
March 31, March 31,
1998 1997
Book Value per Share $27.19 $25.05
Efficiency Ratio 55.8% 59.9%
</TABLE>
<PAGE>
Exhibit 7(b)(1)
<TABLE>
<CAPTION>
Pro Forma Consolidated Balance Sheet
One American Corp. and Subsidiaries
December 31, 1997 Unaudited
In thousands 1997
Assets
<S> <C>
Cash and Due From Banks $5,719
Interest Bearing Deposits in Other Banks 2,896
Federal Funds Sold and Securities
Purchased Under Resale Agreements 12,150
Securities
Available for Sale (Amortized Cost of $114,212)
Total Securities 114,877
Loans 149,165
Less: Allowance for Loan Losses (2,190)
Loans, Net 146,975
Bank Premises and Equipment 10,837
Other Real Estate 78
Accrued Interest Receivable 2,176
Other Assets 2,186
Total Assets $297,894
Liabilities
Deposits:
Noninterest Bearing 52,015
Interest Bearing 211,642
Total Deposits 263,657
Accrued Interest Payable 777
Other Liabilities 1,705
Total Liabilities 266,139
Stockholders' Equity
Common Stock-$2.50 par value;
Authorized-10,000,000 shares;
Issued-3,000,000 shares 7,500
Surplus 5,000
Retained Earnings 23,943
Unrealized Gain (Loss) on Securities Available for Sale, Net 439
Treasury Stock - 476,900 shares at cost (5,127)
Total Stockholders' Equity 31,755
Total Liabilities and Stockholders' Equity $297,894
Book Value per Share $12.59
Efficiency Ratio 57.6%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Pro Forma Consolidated Balance Sheet
One American Corp. and Subsidiaries Unaudited
March 31, 1998 March 31,
In thousands 1998
<S> <C>
Assets
Cash and Due From Banks $9,013
Interest Bearing Deposits in Other Banks 5,265
Federal Funds Sold and Securities
Purchased Under Resale Agreements 15,625
Securities
Available for Sale (Amortized Cost of $112,500)
Total Securities 113,176
Loans 150,399
Less: Allowance for Loan Losses (2,621)
Loans, Net 147,778
Bank Premises and Equipment 11,045
Other Real Estate 78
Accrued Interest Receivable 1,981
Other Assets 2,161
Total Assets $306,122
Liabilities
Deposits:
Noninterest Bearing $55,130
Interest Bearing 215,658
Total Deposits 270,788
Accrued Interest Payable 723
Other Liabilities 2,373
Total Liabilities 273,884
Stockholders' Equity
Common Stock-$2.50 par value;
Authorized-10,000,000 shares;
Issued-3,000,000 shares 7,500
Surplus 5,000
Retained Earnings 24,434
Unrealized Gain (Loss) on Securities Available for Sale, Net 446
Treasury Stock - 477,820 shares at cost (5,142)
Total Stockholders' Equity 32,238
Total Liabilities and Stockholders' Equity $306,122
Book Value per Share $12.77
Efficiency Ratio 55.8%
</TABLE>
<PAGE>
Exhibit 7(b)(2)
<TABLE>
<CAPTION>
Pro Forma Consolidated Statement of Income
One American Corp. and Subsidiaries
for the year ended December 31, 1997 Unaudited
in thousands, except per share data 1997
Interest Income
<S> <C>
Interest and Fees on Loans $13,437
Interest on Securities:
Taxable Interest 5,948
Nontaxable Interest 576
Total Interest on Securities 6,524
Other Interest Income 796
Total Interest Income 20,757
Interest Expense on Deposits 7,712
Net Interest Income 13,045
Provision for Loan Losses 1,025
Net Interest Income After
Provision for Loan Losses 12,020
Other Income
Service Charges on Deposit Accounts 2,092
Gain on Securities 190
Gain on Purchased Assets 607
Other Operating Income 851
Total Other Income 3,740
Income Before Other Expenses 15,760
Other Expenses
Salaries and Employee Benefits 4,749
Net Occupancy Expense 1,236
Net ORE and Repossession Expense (180)
Other Operating Expenses 3,868
Total Other Expenses 9,673
Income Before Income Taxes 6,087
Applicable Income Taxes 2,050
Net Income $4,037
Net Income Per Share $1.60
Cash Dividends Per Share $.67
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Pro Forma Consolidated Statement of Income
One American Corp. and Subsidiaries
for the three months ended March 31, 1998 Unaudited
In thousands, except per share data 1998
<S> <C>
Interest Income
Interest and Fees on Loans $3,504
Interest on Securities:
Taxable Interest 1,464
Nontaxable Interest 150
Total Interest on Securities 1,614
Other Interest Income 229
Total Interest Income 5,347
Interest Expense on Deposits 2,008
Net Interest Income 3,339
Provision for Loan Losses 450
Net Interest Income After
Provision for Loan Losses 2,889
Other Income
Service Charges on Deposit Accounts 521
Gain on Securities -
Gain on Purchased Assets 260
Other Operating Income 217
Total Other Income 998
Income Before Other Expenses 3,887
Other Expenses
Salaries and Employee Benefits 1,223
Net Occupancy Expense 320
Net ORE and Repossession Expense (34)
Other Operating Expenses 911
Total Other Expenses 2,420
Income Before Income Taxes 1,467
Applicable Income Taxes 502
Net Income $965
Net Income Per Share $0.38
Cash Dividends Per Share $0.19
</TABLE>
<PAGE>
Exhibit 9(a)
_______________________________________________
ONE AMERICAN CORP.
2785 LOUISIANA HIGHWAY 20 WEST
VACHERIE, LOUISIANA
_______________________________________________
ANNOUNCING THE ONE AMERICAN CORP.
STOCK REPURCHASE PROGRAM
_______________________________________________
July 21, 1998
Repurchase Price Per Share: $25.00
Total Allocated Funds: $4,500,000
Maximum Number of Shares to be Repurchased: 180,000
Any stockholder of One American Corp. who desires to sell his or
her shares of One American Corp. under the Stock Repurchase
Program should carefully read these materials and the enclosed
Letter of Transmittal and follow the instructions in these
materials on how to tender shares for payment.
Introduction
The Board of Directors of One American Corp. announces the One
American Corp. Stock Repurchase Program. Under the Stock
Repurchase Program, One American Corp. will pay $25.00 in cash
per share for each share of One American Corp. held by any
stockholder who desires to sell his or her shares, subject to the
limitations described herein. The Board of Directors has
allocated $4,500,000 to fund the Stock Repurchase Program and,
based on that allocation, up to 180,000 shares of One American
Corp. may be acquired under the Stock Repurchase Program at the
$25.00 per share price. In the event the Stock Repurchase
Program is oversubscribed, shares will be repurchased on a pro
rata basis, to the extent funds remain, after first giving
preference to acquiring stock from those stockholders owning less
than 100 shares who have tendered all such shares for repurchase.
Any tendered shares not purchased by One American Corp., will be
returned to the tendering stockholder.
Scheduled Termination Date and Right of Withdrawal
Federal law requires the Stock Repurchase Program to remain open
for at least 20 business days. However, the Board of Directors
of One American Corp. has elected to keep the Stock Repurchase
Program in effect for 24 business days from July 21 through, and
including August 21, 1998. Therefore, unless the Board of
Directors determines in its discretion to suspend or extend the
Stock Repurchase Program, it will remain in effect until its
scheduled termination date on August 21, 1998, and, in no event,
will the Stock Repurchase Program end prior to August 17, 1998,
20 business days from the date the program is initiated.
The Stock Repurchase Program will be extended by the Board only
upon prior notice to stockholders. At this time, the Board has
no intention of reinstating the Stock Repurchase Program once it
expires. Any stockholder who has tendered shares for repurchase
may withdraw the shares at any time prior to August 17 (20
business days from the initiation of the program) and thereafter
as long as the Stock Repurchase Program remains open. After the
expiration of 40 business days from the commencement of the Stock
Repurchase Program (September 15, 1998), shares that have been
tendered for repurchase but which have not yet been accepted for
payment by One American Corp. may also be withdrawn by the
stockholder.
Manner of Tender for Repurchase or Withdrawal
If you desire to tender your shares for purchase by One American
Corp. under the Stock Repurchase Program, please read carefully
the enclosed Letter of Transmittal, sign it as appropriate, and
return it to us along with your certificates representing shares
of One American Corp. Your shares will be deemed to have been
accepted for payment on the date that One American Corp. receives
a completed and signed Letter of Transmittal and the accompanying
stock certificates. If the documents are not properly completed
or you fail to return your stock certificates, One American Corp.
will notify you that your shares have not been accepted for
payment and will advise you of any additional information
necessary in order to have your shares accepted for payment.
If a stockholder desires to withdraw shares previously tendered
for payment, the stockholder shall provide a written Notice of
Withdrawal within the time frames for withdrawals set forth
herein to Ms. Gloria A. Kliebert, One American Corp., 2785
Louisiana Highway 20 West, Vacherie, Louisiana. The Notice of
Withdrawal must be postmarked by a date consistent with the time
frames set forth herein for making such a withdrawal. If One
American Corp. receives a Notice of Withdrawal postmarked within
the relevant time period, the shares tendered for repurchase (or
substitute shares) will be returned to the stockholder and the
Letter of Transmittal previously executed by the stockholder will
be cancelled.
Source and Amount of Funds for the Stock Repurchase Program
The Stock Repurchase Program will be funded either from excess
bank capital that will be declared as a dividend from First
American Bank to One American Corp. or from existing cash
balances of One American Corp. The total amount of funds to be
utilized for the purchase will be a maximum of $4,500,000 to
purchase up to 180,000 shares at $25.00 per share. No funds are
expected to be borrowed, directly or indirectly, for purposes of
the Stock Repurchase Program.
Reasons for Implementing the Stock Repurchase Program
One American Corp., through its subsidiary, First American Bank
and Trust, operates as a profitable, well-managed, locally-owned
and independent community bank. The Board of Directors
acknowledges, though, that operating as a locally-owned and
independent financial institution may have the effect of limiting
any active market for the shares of One American Corp. and that,
from time to time, various stockholders may have a desire to
liquidate their holdings in One American Corp. Therefore, the
Board of Directors has implemented the Stock Repurchase Program
to provide liquidity to those stockholders who determine that it
is in their best interest to sell their shares of One American
Corp. rather than to hold them over the long term. This Stock
Repurchase Program will also allow the bank to utilize excess
bank capital in an efficient manner and as a basis of providing
liquidity to stockholders. Stock that is repurchased will be
deemed to be cancelled and will no longer be outstanding for any
purpose.
Financial Information Regarding One American Corp.
A summary of the audited financial statements of One American
Corp. and its subsidiaries for the years ended December 31, 1997
and December 31, 1996 is attached as Exhibit A hereto for your
reference. Likewise, a summary of the unaudited financial
statements of One American Corp. and its subsidiaries as of March
31, 1998 and 1997 are attached hereto as Exhibit B for your
reference. Stockholders are urged to review those financial
statements when considering whether to sell shares pursuant to
this Stock Repurchase Program. If a stockholder desires more
complete financial information, including a copy of recent
required public filings, those financial statements may be
obtained, without additional charge, by calling Mr. Frank J.
Bourgeois at 504/265-2265.
Selected Ratios and Per Share Values
The following key ratios are as of and for the periods indicated:
Three Three
Months Months Year Year
Ended Ended Ended Ended
3/31/98 3/31/97 12/31/97 12/31/96
Loans to 54.57% 54.37% 55.74% 52.96%
Deposits
Return on 1.27% 1.35% 1.38% 1.82%
Average
Assets
(Annualized)
Return on 10.71% 11.52% 11.52% 15.64%
Average
Equity
(Annualized)
Book Value* $13.59 $12.53 $13.41 $12.41
Per Share
Earnings* $0.36 $0.36 $1.50 $1.87
Per Share
* Restated to reflect recent stock split.
Trading History for Stock of One American Corp.; Dividends
There is no active trading market for the stock of One American
Corp. During 1997 and through June 30, 1998, management is aware
of only 367 trades in the stock through private transactions. Of
the trades that took place during 1997 and 1998, of which
management is aware of the trading price, the trading prices
ranged from $15.50 per share to $25.00 per share. Because no
active market exists for shares of One American Corp, the Board
of Directors believes that the Stock Repurchase Program, for as
long as it is in effect, provides a ready-buyer for such shares
at an established price.
One American Corp. has paid cash dividends of $.625 per share in
1997, $.525 per share in 1996 and $.325 per share in 1995. In
1998, it is anticipated that One American Corp. will pay cash
dividends of $.70 per share. The exact amount of future
dividends on the stock of One American Corp. will be a function
of the profitability of First American Bank in general and
applicable tax rates in effect from year to year. Because One
American Corp.'s ability to pay dividends in the future will
directly depend on First American Bank's future profitability,
future dividend payments cannot be assured.
How the Stock Repurchase Price is Determined
The price per share for the Stock Repurchase Program was set by
the Board of Directors after a careful analysis of the overall
condition of One American Corp. and its subsidiary bank. The
Board of Directors believes that the price is an attractive price
for those stockholders who desire some immediate liquidity for
their shares.
Certain Conditions Associated with the Stock Repurchase Program
The Stock Repurchase Program is subject to the following
conditions:
1. The Stock Repurchase Program is open to all
stockholders of One American Corp. Stockholders may
tender for repurchase any or all of their shares.
Stockholders are advised that tendering fewer than all
of their shares may result in a different tax treatment
than if all shares were to be tendered. The tax
aspects of tendering shares are discussed later in
these materials.
2. The Board of Directors has allocated $4,500,000 to
fund the Stock Repurchase Program. Based on that
allocation, up to 180,000 shares can be acquired under
the Stock Repurchase Program at the $25.00 per share
price. However, in the event more than 180,000 shares
are tendered for repurchase and the Board elects not to
allocate additional funds to the Stock Repurchase
Program, or in the event additional funds are allocated
and the Stock Repurchase Program is still
oversubscribed, shares will be repurchased based on a
pro rata basis after first giving preference to
acquiring the stock from those stockholders owning less
than 100 shares and who have tendered all such shares
for repurchase. Any tendered shares not purchased by
One American Corp. will be returned to the tendering
stockholder.
3. One American Corp. is a bank holding company
registered under the Bank Holding Company Act and is
subject to that Act and the regulations issued under
that Act by the Board of Governors of the Federal
Reserve System. Those regulations require bank holding
companies to seek the prior approval of the Federal
Reserve System if the holding company redeems its
outstanding shares and if the gross consideration for
the purchase, when aggregated with the net
consideration paid by the company for all such
purchases or redemptions during the preceding 12
months, is equal to 10% or more of the company's
consolidated net worth, unless both before and
immediately after the redemption, the bank holding
company is well capitalized; the bank holding company
is well managed; and the bank holding company is not
subject to any unresolved supervisory issues. At this
time, One American Corp. believes it meets each of
these conditions even if as many as 180,000 shares are
tendered for repurchase under the Stock Repurchase
Program. Therefore, the Board of Directors of One
American Corp. does not anticipate having to seek
approval from the Federal Reserve for the Stock
Repurchase Program.
Certain Federal Income Tax Consequences
The repurchase of shares of One American Corp. under the Stock
Repurchase Program will be a "redemption" of such shares and,
therefore, will be a taxable transaction for federal income tax
purposes and may also be a taxable transaction under applicable
state, local and other tax laws. Under the rules applicable to
redemptions, such a repurchase will be treated as a "sale" of the
shares, and therefore subject to taxation as a capital gain, if
the exchange is "substantially disproportionate" with respect to
the stockholder. A repurchase will be "substantially
disproportionate" if, after the repurchase, the percentage of the
outstanding shares of the company owned by the stockholder is
less than 80% of the percentage of the outstanding shares of the
company owned by the stockholder before the repurchase. If a
repurchase does not satisfy the "substantially disproportionate"
test, the repurchase will nonetheless be treated as a "sale" if
it results in a complete redemption of the stockholder's interest
in One American Corp. or is otherwise not essentially equivalent
to a dividend, which is taxed as ordinary income.
If a sale of the shares is "substantially disproportionate" or
results in a complete redemption and is, therefore, taxed as a
capital gain, gain will be recognized in an amount equal to the
excess of the share repurchase price received over the
stockholder's basis in the shares repurchased. The gain will be
capital gain assuming the shares are held as a capital asset.
Capital gain will be long-term capital gain if such stockholder's
holding period with respect to the shares is longer than 18
months. If none of the tests are satisfied, the share repurchase
price received by a stockholder will be treated as a "dividend",
taxable as ordinary income, to the extent of the stockholder's
proportionate share interest in One American Corp.'s earnings and
profits and without reduction for the stockholder's basis in the
shares tendered.
For purposes of the "substantially disproportionate" and other
tests, constructive ownership rules generally will apply in
determining the stockholder's ownership. Thus, a stockholder may
be deemed to own shares actually owned, and in some cases
constructively owned, by certain related individuals and certain
entities in which the stockholder has an interest and shares
which such stockholder has the right to acquire by exercise of an
option or by conversion of a convertible debenture or note.
THE TAX DESCRIPTION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY. EACH STOCKHOLDER IS URGED TO CONSULT HIS OR
HER OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES
TO HIM OR HER OF THE STOCK REPURCHASE PROGRAM, INCLUDING THE
APPLICABILITY AND EFFECT OF STATE, LOCAL AND OTHER TAX LAWS AND
ANY POSSIBLE CHANGES IN THE LAW.
Recommendation of the Board
The Board of Directors is pleased to offer you the opportunity to
have some liquidity for shares of One American Corp., if you have
a desire to sell. However, the Board makes no recommendation as
to whether a stockholder should tender his or her shares for
repurchase under the Stock Repurchase Program. If you have any
questions at all about the Stock Repurchase Program, please feel
free to contact us.
EXHIBIT A
SUMMARY YEAR-END FINANCIAL STATEMENTS
Year Ended Year Ended
December 31, 1997 December 31, 1996
INCOME STATEMENT
Interest Income 20,757 19,717
Interest Expense 7,712 7,244
Other Income 3,740 3,992
Other Expense 9,673 9,044
Provision for Loan Losses 1,025 90
Net Income Before Taxes 6,087 7,331
Taxes 2,050 2,281
Net Income 4,037 5,050
BALANCE SHEET
Assets:
Cash and Due $13,115 $13,946
Securities 127,027 125,219
Loans (Net) 146,975 132,776
Other Assets 15,277 14,170
Total Assets 302,394 286,111
Liabilities:
Deposits 263,657 250,704
Other Liabilities 2,482 1,872
Shareholders' Equity 36,255 33,535
Total Liabilities and 302,394 286,111
Shareholders' Equity
EXHIBIT B
SUMMARY INTERIM FINANCIAL STATEMENTS
Quarter Ended Quarter Ended
March 31, 1998 March 31, 1997
INCOME STATEMENT
Interest Income 5,347 5,007
Interest Expense 2,021 1,855
Other Income 1,019 846
Other Expense 2,424 2,394
Provision for Loan Losses 450 75
Net Income Before Taxes 1,471 1,529
Taxes 502 557
Net Income 969 972
BALANCE SHEET
Assets:
Cash and Due $18,778 $13,229
Securities 128,801 124,474
Loans (Net) 147,778 137,836
Other Assets 15,265 14,121
Total Assets 310,622 289,660
Liabilities:
Deposits 270,788 253,484
Other Liabilities 3,096 2,316
Shareholders' Equity 36,738 33,860
Total Liabilities and 310,622 289,660
Shareholders' Equity