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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 1, 1999
FIRST FINANCIAL BANCORP.
(Exact name of registrant as specified in its charter)
Ohio 0-12379 31-1042001
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
300 High Street, Hamilton, Ohio 45011
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (513) 867-4700
Page 1 of 9
<PAGE> 2
ITEM 2: ACQUISITION OR DISPOSITION OF ASSETS
On June 1, 1999, Sand Ridge Financial Corporation, an Indiana corporation and a
registered bank holding company ("Sand Ridge"), was merged (the "Merger") into
First Financial Bancorp., an Ohio corporation and a registered bank holding
company ("First Financial"), pursuant to the terms of a Plan and Agreement of
Merger. As a result of the Merger, each outstanding share of Sand Ridge's no par
common stock, which has a stated value of $10.00 per share, was converted into
85.25 shares of First Financial's no par common stock. Cash was paid for
fractional shares. Approximately 5,115,000 shares of First Financial's common
stock were issued in the Merger. The Merger was accounted for as a pooling of
interests under generally accepted accounting principles. A copy of the News
Release, dated May 25, 1999, issued by First Financial relating to the
consummation of the Merger is attached as Exhibit 99(a) and is incorporated
herein by reference.
First Financial's Registration Statement on Form S-4 (Registration No.
333-73283), which was declared effective by the Securities and Exchange
Commission on April 9, 1999, sets forth certain information concerning First
Financial, Sand Ridge, and the Merger, including without limitation, a
description of the assets involved, the nature and amount of consideration paid
by First Financial, the method used for determining the amount of such
consideration, the nature of any material relationships between Sand Ridge and
First Financial or any officer or director of First Financial or any associate
of any such officer or director, the nature of Sand Ridge's business and First
Financial's intended use of the assets acquired in the Merger. Such information
is incorporated herein by reference as additional information in response to
Item 2 of this Current Report on Form 8-K.
ITEM 5: OTHER INFORMATION
The information contained or incorporated by reference in this Current Report on
Form 8-K may contain forward-looking statements that are provided to assist in
the understanding of anticipated future financial performance. However, such
performance involves risks and uncertainties which may cause results to differ
materially.
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS
(a) The historical financial statements for December 31, 1998, including
the Report of Independent Auditors and the Notes to Consolidated
Financial Statements, of Sand Ridge required by Item 7(a) of Form 8-K,
which were included on pages F-15 through F-40 of the Proxy
Statement/Prospectus, dated March 3, 1999, previously filed with the
Securities and Exchange Commission pursuant to 424(b)(3), are
incorporated herein by reference. The historical financial statements
for March 31, 1999 are included as exhibits as follows:
Consolidated Balance Sheet as of March 31, 1999
Consolidated Statements of Income for the periods ended March 31, 1998
and 1999
Consolidated Statements of Cash Flows for the periods ended March 31,
1998 and 1999
Notes to Consolidated Financial Statements
(b) The pro forma financial statements, are included as Exhibit 99(b)
(c) Exhibits:
2(a) Plan and Agreement of Merger, dated December 16, 1998, between
First Financial Bancorp. and Sand Ridge Financial
Corporation--previously filed as Appendix A to the Proxy
Statement/Prospectus, dated March 3, 1999, filed with the
Securities and Exchange Commission pursuant to 424(b)(3), and
incorporated herein by reference.
Page 2 of 9
<PAGE> 3
99(a) Press release dated May 25, 1999, relating to the merger of
Sand Ridge Financial Corporation with and into First Financial
Bancorp.
99(b) Pro forma financial statements:
Pro Forma Consolidated Balance Sheet as of March 31, 1999
Pro Forma Consolidated Statement of Income for the three
months ended March 31, 1999
Pro Forma Consolidated Statement of Income for the three
months ended March 31, 1998
Pro Forma Consolidated Statement of Income for the year ended
December 31, 1998
Pro Forma Consolidated Statement of Income for the year ended
December 31, 1997
Pro Forma Consolidated Statement of Income for the year ended
December 31, 1996
Notes to Pro Forma Consolidated Financial Statements
99(c) Form S-4 (Registration No. 333-73283), which was declared
effective by the Securities and Exchange Commission on April
9, 1999 filed with the Securities and Exchange Commission
pursuant to 424(b)(3), and incorporated herein by reference.
Page 3 of 9
<PAGE> 4
SIGNATURE
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.
FIRST FINANCIAL BANCORP.
(Registrant)
DATE June 16, 1999 /s/ Michael R. O'Dell
------------- --------------------------
Michael R. O'Dell
Senior Vice President, Chief
Financial Officer and Secretary
Page 4 of 9
<PAGE> 5
SAND RIDGE FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
As of
March 31, 1999
--------------
<S> <C>
ASSETS
Cash and due from banks $ 11,919
Interest-bearing deposits with other banks 100
Federal funds sold and securities purchased
under agreements to resell 0
Investments available-for-sale, at market value 199,280
Loans:
Commercial 36,888
Real estate-mortgage 246,220
Installment 39,898
Credit card 2,571
--------
Total loans 325,577
Less:
Allowance for loan losses 4,778
--------
Net loans 320,799
Premises and equipment 5,900
Deferred taxes 2,503
Accrued interest and other assets 5,121
--------
TOTAL ASSETS $545,622
========
LIABILITIES
Deposits:
Noninterest-bearing $ 53,895
Interest-bearing 388,648
--------
Total deposits 442,543
Short-term borrowings
Federal funds purchased and securities sold
under agreements to repurchase 19,972
Federal Home Loan Bank borrowings 20,314
Other 706
--------
Total short-term borrowings 40,992
Long-term borrowings 13,712
Accrued interest and other liabilities 3,545
--------
TOTAL LIABILITIES 500,792
SHAREHOLDERS' EQUITY
Common stock - no par value
Authorized - 60,000,000 shares
Issued - 36,320,338 shares in 1999 600
Surplus 4,600
Retained earnings 37,761
Accumulated comprehensive income 1,869
--------
TOTAL SHAREHOLDERS' EQUITY 44,830
--------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $545,622
========
</TABLE>
Page 5 of 9
<PAGE> 6
SAND RIDGE FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------
1999 1998
---- ----
<S> <C> <C>
Interest income
Loans, including fees $6,324 $5,861
Investment securities
Taxable 1,427 1,426
Tax-exempt 1,424 912
------ ------
Total investment interest 2,851 2,338
Interest-bearing deposits with other banks 2 2
Federal funds sold and securities
purchased under agreements to resell 2 42
- --
Total interest income 9,179 8,243
Interest expense
Deposits 3,745 3,734
Short-term borrowings 238 184
Long-term borrowings 533 77
--- --
Total interest expense 4,516 3,995
------ ------
Net interest income 4,663 4,248
Provision for loan losses 525 350
------ ------
Net interest income after
provision for loan losses 4,138 3,898
Noninterest income
Service charges on deposit accounts 586 502
Trust income 41 46
Investment securities gains 0 49
Other 553 469
------ ------
Total noninterest income 1,180 1,066
Noninterest expenses
Salaries and employee benefits 1,665 1,545
Net occupancy expenses 228 189
Furniture and equipment expenses 256 264
Data processing expenses 158 161
Deposit insurance expenses 20 18
State taxes 0 0
Amortization of intangibles 0 0
Other 927 865
------ ------
Total noninterest expenses 3,254 3,042
------ ------
Income before income taxes 2,064 1,922
Income tax expense 429 512
------ ------
Net earnings $1,635 $1,410
====== ======
Net earnings per share - basic $27.25 $23.50
====== ======
Net earnings per share - diluted $27.25 $23.50
====== ======
Cash dividends declared per share $ 4.75 $ 0.00
====== ======
Average shares outstanding 60,000 60,000
====== ======
</TABLE>
Page 6 of 9
<PAGE> 7
SAND RIDGE FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
Three months ended
March 31,
---------------------------
1999 1998
-------- --------
<S> <C> <C>
Operating activities
Net earnings $ 1,635 $ 1,410
Adjustments to reconcile net cash provided by
operating activities
Provision for loan losses 525 350
Provision for depreciation and amortization 226 234
Net amortization of investment security
premiums and accretion of discounts 162 42
Realized investment securities gains 0 (49)
Deferred income taxes (152) 82
Net change in:
Other assets (119) (1,001)
Other liabilities (1,862) (1,203)
-------- --------
Net cash provided by (used in) operating activities 415 (135)
Investing activities
Proceeds from sales of securities available-for-sale 0 9,579
Proceeds from calls, paydowns and maturities of securities
available-for-sale 15,864 6,278
Purchases of securities available-for-sale (11,427) (26,849)
Net decrease (increase) in interest-bearing
deposits with other banks 0 0
Net increase in federal funds sold and
securities purchased under agreements to resell 0 (13,400)
Net increase in loans and leases (8,036) (988)
Recoveries from loans and leases previously charged off 326 76
Proceeds from disposal of other real estate owned 0 0
Purchases of premises and equipment (175) (136)
-------- --------
Net cash used in investing activities (3,448) (25,440)
Financing activities
Net decrease in total deposits (6,559) 31,984
Net increase in short-term borrowings (3,427) (14,087)
Net increase in long-term borrowings 0 (1)
Cash dividends declared (285) 0
-------- --------
Net cash (used in) provided by financing activities (10,271) 17,896
-------- --------
Increase (Decrease) in cash and cash equivalents (13,304) (7,679)
Cash and cash equivalents at beginning of year 25,223 23,010
-------- --------
Cash and cash equivalents at end of year $ 11,919 $ 15,331
======== ========
Supplemental disclosures
Interest paid $ 4,969 $ 3,952
======== ========
Income taxes paid $ 258 $ 1,491
======== ========
Recognition of deferred tax assets
attributable to SFAS No. 115 $ 152 $ 220
======== ========
</TABLE>
Page 7 of 9
<PAGE> 8
SAND RIDGE FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The consolidated financial statements for interim periods are unaudited;
however, in the opinion of the management of Sand Ridge Financial Corporation
("Sand Ridge"), all adjustments (consisting of only normal recurring
adjustments) necessary for a fair presentation have been included.
NOTE 1: BASIS OF PRESENTATION
The consolidated financial statements of Sand Ridge, a bank holding company,
include the accounts of Sand Ridge and its wholly-owned subsidiary - Sand Ridge
Bank. All significant intercompany transactions and accounts have been
eliminated in consolidation.
The accompanying financial statements have been prepared in accordance with the
instructions for Form 10-Q and, therefore, do not include all information and
footnotes necessary to be in conformity with generally accepted accounting
principles.
NOTE 2: FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
In the normal course of business, Sand Ridge offers a variety of financial
instruments with off-balance sheet risk to its customers to aid them in meeting
their requirements for liquidity and credit enhancement and to reduce its own
exposure to fluctuations in interest rates. These financial instruments include
standby letters of credit and commitments outstanding to extend credit.
Generally accepted accounting principles do not require these financial
instruments to be recorded in the consolidated financial statements, and
accordingly, they are not. Sand Ridge does not use off-balance sheet derivative
financial instruments (such as interest rate swaps) as defined in the Financial
Accounting Standards Board's (FASB) Statement No. 119 "Disclosure about
Derivative Financial Instruments and Fair Value of Financial Instruments". Sand
Ridge's exposure to credit loss in the event of nonperformance by the other
party to the financial instrument for standby letters of credit and commitments
outstanding to extend credit is represented by the contractual amounts of those
instruments. Sand Ridge uses the same credit policies in making commitments and
conditional obligations as it does for on-balance sheet instruments. Following
is a discussion of these transactions.
Standby letters of credit are conditional commitments issued by Sand Ridge to
guarantee the performance of a customer to a third party. Sand Ridge's portfolio
of standby letters of credit consists primarily of performance assurances made
on behalf of customers who have a contractual commitment to produce or deliver
goods or services. The risk to Sand Ridge arises from its obligation to make
payment in the event of the customers' contractual default. As of March 31,
1999, Sand Ridge had
Page 8 of 9
<PAGE> 9
issued standby letters of credit aggregating $955,000 compared to $780,000
issued as of December 31, 1998. Management conducts regular reviews of these
instruments on an individual customer basis, and the results are considered in
assessing the adequacy of Bancorp's allowance for loan losses. Management does
not anticipate any material losses as a result of these letters of credit.
Loan commitments are agreements to lend to a customer as long as there is no
violation of any condition established in the contract. Commitments generally
have fixed expiration dates or other termination clauses and may require payment
of a fee. Since many of the commitments are expected to expire without being
drawn upon, the total commitment amounts do not necessarily represent future
cash requirements. Sand Ridge evaluates each customer's creditworthiness on an
individual basis. The amount of collateral obtained, if deemed necessary by Sand
Ridge upon extension of credit, is based on management's credit evaluation of
the counterparty. The collateral held varies, but may include securities, real
estate, inventory, plant, or equipment. Sand Ridge had commitments outstanding
to extend credit totaling $40,572,000 at March 31, 1999 and $38,875,000 at
December 31, 1998. Management does not anticipate any material losses as a
result of these commitments.
Page 9 of 9
<PAGE> 1
EXHIBIT 99(a)
news news news news news news
[FIRST FINANCIAL BANCORP LOGO]
May 25, 1999
FOR IMMEDIATE RELEASE
FIRST FINANCIAL ANNOUNCES QUARTERLY DIVIDEND
AND FINALIZES TWO ACQUISITIONS
HAMILTON, Ohio -- Following today's meeting of the board of directors of First
Financial Bancorp, Barry J. Levey, chairman of the board, and Stanley N.
Pontius, president and chief executive officer, announced that the board had
declared a REGULAR QUARTERLY CASH DIVIDEND OF 15 CENTS PER SHARE on 36,253,461
currently outstanding shares and on 6,337,650 shares to be issued as a result of
pending acquisition activity. THE DIVIDEND IS PAYABLE ON JULY 1, 1999, TO
SHAREHOLDERS OF RECORD AS OF JUNE 4, 1999, AND REPRESENTS A 10 PERCENT INCREASE
OVER THAT PAID IN THE SAME QUARTER OF 1998. First Financial has paid a dividend
in each of the 63 consecutive quarters since the holding company was formed in
April of 1983.
First Financial also noted that shareholders of the $110 million Hebron Bancorp
in Hebron, Kentucky, have approved the merger plan which was negotiated with
First Financial on December 31, 1998. Hebron Bancorp's sole affiliate, Hebron
Deposit Bank, will become First Financial's sixteenth affiliate and its first
entry into the Kentucky banking market on June 1, 1999. The bank serves
customers in Boone County which is located along Interstate 275 near the Greater
Cincinnati/Northern Kentucky International Airport.
The Hebron approval closely follows a similar action by shareholders of the $545
million Sand Ridge Financial Corporation in Highland, Indiana, who voted to
affiliate with First Financial on May 12, 1999. Consummation of this merger will
also take place on June 1, 1999, when Sand Ridge Bank will become First
Financial's seventeenth affiliate. The Sand Ridge merger expands Bancorp's reach
into Lake County, which enjoys a rapidly increasing population. Sand Ridge's
headquarters is located about 20 miles southeast of Chicago.
Both mergers are structured as tax-free exchanges of stock using the
pooling-of-interests method of accounting. They are expected to be neutral to
slightly accretive to earnings in 1999 and accretive in 2000.
<PAGE> 2
As previously announced, First Financial plans to book merger and restructuring
charges in the second quarter of 1999. The one-time merger charge of
approximately $3.4 million after-tax is for investment banking and other
professional services associated with the Sand Ridge and Hebron acquisitions.
Additionally, First Financial will book some $2.4 million after-tax in
restructuring charges for the planned consolidation of some operational
functions which also involves the sale of several facilities and more effective
use of other existing properties. First Financial also plans to discontinue its
accounts receivable financing line of business and merge two of its existing
affiliates (Union Trust Bank, Union City, Indiana, and Community First Bank and
Trust, Celina, Ohio) in the second quarter of this year.
First Financial Bancorp's common stock (symbol FFBC) closed at $22.875 per share
on the NASDAQ National Market System on Monday, May 24, 1999.
A $2.95 billion bank and savings and loan holding company with over 4,000
shareholders, First Financial Bancorp currently operates 5 Ohio, 1 Michigan, and
9 Indiana affiliates with 108 banking office locations.
The Ohio-based affiliates are First National Bank of Southwestern Ohio with 31
offices in Butler, Hamilton, Preble, and Warren counties; Community First Bank &
Trust with 22 locations in Allen, Auglaize, Mercer, Paulding, Van Wert and
Williams counties; Home Federal Bank, A Federal Savings Bank, with 5 offices in
Ohio's Hamilton and Butler counties and 2 offices in Indiana's Fayette and
Franklin counties; The Clyde Savings Bank Company with 3 offices in Sandusky
County; and First Finance Company with 3 offices in Butler and Hamilton
counties.
First Financial's Indiana affiliates are Farmers State Bank with 5 offices in
Union and Rush counties; Vevay Deposit Bank with 3 offices in Switzerland
County; Union Trust Bank with 3 facilities in Randolph County; Indiana Lawrence
Bank with 8 offices in Wabash and Fulton counties; Fidelity Federal Savings Bank
with 3 offices in Grant County; Citizens First State Bank with 6 offices in
Blackford, Jay, and Delaware counties; Union Bank & Trust Company with 3 offices
in Jennings and Bartholomew counties; Peoples Bank and Trust Company with 2
offices in Ripley and Dearborn counties; and Bright National Bank with 7 offices
in Carroll, Tippecanoe, and Clinton counties.
First Financial's Michigan affiliate is National Bank of Hastings with 2 offices
in Barry and Allegan counties.
First Financial Bancorp
P.O. Box 476
Hamilton, OH 45012-0476
(513)867-5299
Michael T. Riley
<PAGE> 1
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED BALANCE SHEET
AT MARCH 31, 1999
<TABLE>
<CAPTION>
Consolidated
FFBC Sand Ridge Pro forma
---------- ---------- ------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 124,222 $ 11,919 $ 136,141
Interest-bearing deposits with other banks 9,029 100 9,129
Federal funds sold and securities purchased
under agreements to resell 11,354 0 11,354
Investment securities held-to-maturity, at cost 32,087 32,087
(market value $33,595 at March 31, 1999 and $37,214 at
December 31, 1998)
Investments available-for-sale, at market value 288,971 199,280 488,251
Loans:
Commercial 641,344 36,888 678,232
Real estate-construction 75,634 0 75,634
Real estate-mortgage 1,060,070 246,220 1,306,290
Installment 494,882 39,898 534,780
Credit card 16,793 2,571 19,364
Lease financing 35,361 0 35,361
---------- -------- ----------
Total loans 2,324,084 325,577 2,649,661
Less:
Unearned income 2,803 0 2,803
Allowance for loan losses 30,502 4,778 35,280
---------- -------- ----------
Net loans 2,290,779 320,799 2,611,578
Premises and equipment 52,181 5,900 58,081
Goodwill 31,039 0 31,039
Other intangibles 11,126 0 11,126
Deferred income taxes 1,565 2,503 4,068
Accrued interest and other assets 53,182 5,121 58,303
---------- -------- ----------
TOTAL ASSETS $2,905,535 $545,622 $3,451,157
========== ======== ==========
LIABILITIES
Deposits:
Noninterest-bearing $ 304,936 $ 53,895 $ 358,831
Interest-bearing 2,012,361 388,648 2,401,009
---------- -------- ----------
Total deposits 2,317,297 442,543 2,759,840
Short-term borrowings
Federal funds purchased and securities sold
under agreements to repurchase 43,580 19,972 63,552
Federal Home Loan Bank borrowings 88,000 20,314 108,314
Other 482 706 1,188
---------- -------- ----------
Total short-term borrowings 132,062 40,992 173,054
Long-term borrowings 116,165 13,712 129,877
Accrued interest and other liabilities 32,465 3,545 36,010
---------- -------- ----------
TOTAL LIABILITIES 2,597,989 500,792 3,098,781
SHAREHOLDERS' EQUITY
Common stock - no par value
Authorized - 60,000,000 shares
Issued - 36,320,338 shares in 1999 297,687 600 302,887
Surplus 0 4,600 0
Retained earnings 11,062 37,761 48,823
Accumulated comprehensive income 1,162 1,869 3,031
Treasury Stock, at cost, 70,039 (509) 0 (509)
Restricted Stock Awards (1,856) 0 (1,856)
---------- -------- ----------
TOTAL SHAREHOLDERS' EQUITY 307,546 44,830 352,376
---------- -------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $2,905,535 $545,622 $3,451,157
========== ======== ==========
</TABLE>
<PAGE> 2
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three months ended
March 31, 1999
-----------------------------------------------------
First Sand Ridge Consolidated
Financial Financial Pro forma
--------- ---------- ------------
<S> <C> <C> <C>
Interest income
Loans, including fees $50,701 $6,324 $57,025
Investment securities
Taxable 4,239 1,427 5,666
Tax-exempt 785 1,424 2,209
------- ------ -------
Total investment interest 5,024 2,851 7,875
Interest-bearing deposits with other banks 54 2 56
Federal funds sold and securities
purchased under agreements to resell 29 2 31
------- ------ -------
Total interest income 55,808 9,179 64,987
Interest expense
Deposits 19,074 3,745 22,819
Short-term borrowings 1,257 238 1,495
Long-term borrowings 1,369 533 1,902
------- ------ -------
Total interest expense 21,700 4,516 26,216
------- ------ -------
Net interest income 34,108 4,663 38,771
Provision for loan losses 1,939 525 2,464
------- ------ -------
Net interest income after
provision for loan losses 32,169 4,138 36,307
Noninterest income
Service charges on deposit accounts 3,059 586 3,645
Trust income 3,396 41 3,437
Investment securities gains 17 0 17
Other 2,300 553 2,853
------- ------ -------
Total noninterest income 8,772 1,180 9,952
Noninterest expenses
Salaries and employee benefits 13,028 1,665 14,693
Net occupancy expenses 1,574 228 1,802
Furniture and equipment expenses 1,257 256 1,513
Data processing expenses 1,450 158 1,608
Deposit insurance expenses 119 20 139
State taxes 476 0 476
Amortization of intangibles 943 0 943
Other 4,958 927 5,885
------- ------ -------
Total noninterest expenses 23,805 3,254 27,059
------- ------ -------
Income before income taxes 17,136 2,064 19,200
Income tax expense 6,006 429 6,435
------- ------ -------
Net earnings $11,130 $1,635 $12,765
======= ====== =======
Net earnings per share - basic $ 0.31 $27.25 $ 0.31
======= ====== =======
Net earnings per share - diluted $ 0.31 $27.25 $ 0.31
======= ====== =======
Cash dividends declared per share $ 0.15 $ 4.75 $ 0.15
======= ====== =======
Average shares outstanding 36,225,639 60,000 41,340,639
========== ====== ==========
</TABLE>
<PAGE> 3
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three months ended
March 31, 1998
---------------------------------------------------
First Sand Ridge Consolidated
Financial Financial Pro forma
--------- ---------- ------------
<S> <C> <C> <C>
Interest income
Loans, including fees $45,911 $5,861 $51,772
Investment securities
Taxable 5,484 1,426 6,910
Tax-exempt 1,070 912 1,982
------- ------ -------
Total investment interest 6,554 2,338 8,892
Interest-bearing deposits with other banks 63 2 65
Federal funds sold and securities
purchased under agreements to resell 160 42 202
------- ------ -------
Total interest income 52,688 8,243 60,931
Interest expense
Deposits 19,577 3,734 23,311
Short-term borrowings 871 184 1,055
Long-term borrowings 769 77 846
------- ------ -------
Total interest expense 21,217 3,995 25,212
------- ------ -------
Net interest income 31,471 4,248 35,719
Provision for loan losses 1,250 350 1,600
------- ------ -------
Net interest income after
provision for loan losses 30,221 3,898 34,119
Noninterest income
Service charges on deposit accounts 2,822 502 3,324
Trust income 2,798 46 2,844
Investment securities gains 44 49 93
Other 2,141 469 2,610
------- ------ -------
Total noninterest income 7,805 1,066 8,871
Noninterest expenses
Salaries and employee benefits 11,986 1,545 13,531
Net occupancy expenses 1,422 189 1,611
Furniture and equipment expenses 1,176 264 1,440
Data processing expenses 1,396 161 1,557
Deposit insurance expenses 100 18 118
State taxes 399 0 399
Amortization of intangibles 947 0 947
Other 5,166 865 6,031
------- ------ -------
Total noninterest expenses 22,592 3,042 25,634
------- ------ -------
Income before income taxes 15,434 1,922 17,356
Income tax expense 5,331 512 5,843
------- ------ -------
Net earnings $10,103 $1,410 $11,513
======= ====== =======
Net earnings per share - basic $ 0.28 $23.50 $ 0.28
======= ====== =======
Net earnings per share - diluted $ 0.28 $23.50 $ 0.28
======= ====== =======
Cash dividends declared per share $ 0.14 $ 4.50 $ 0.14
======= ====== =======
Average shares outstanding 36,421,422 60,000 41,536,422
========== ====== ==========
</TABLE>
<PAGE> 4
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Twelve months ended
December 31, 1998
-----------------------------------------------------
First Sand Ridge Consolidated
Financial Financial Pro forma
--------- ---------- ------------
<S> <C> <C> <C>
Interest income
Loans, including fees $193,924 $24,295 $218,219
Investment securities
Taxable 21,108 6,572 27,680
Tax-exempt 3,789 4,326 8,115
-------- ------- --------
Total investment interest 24,897 10,898 35,795
Interest-bearing deposits with other banks 272 9 281
Federal funds sold and securities
purchased under agreements to resell 418 140 558
-------- ------- --------
Total interest income 219,511 35,342 254,853
Interest expense
Deposits 80,282 16,556 96,838
Short-term borrowings 4,204 597 4,801
Long-term borrowings 3,961 898 4,859
-------- ------- --------
Total interest expense 88,447 18,051 106,498
-------- ------- --------
Net interest income 131,064 17,291 148,355
Provision for loan losses 6,077 2,050 8,127
-------- ------- --------
Net interest income after
provision for loan losses 124,987 15,241 140,228
Noninterest income
Service charges on deposit accounts 11,949 2,368 14,317
Trust income 11,975 171 12,146
Investment securities gains 804 119 923
Other 9,613 1,875 11,488
-------- ------- --------
Total noninterest income 34,341 4,533 38,874
Noninterest expenses
Salaries and employee benefits 49,798 6,532 56,330
Net occupancy expenses 5,612 781 6,393
Furniture and equipment expenses 4,832 1,027 5,859
Data processing expenses 5,616 610 6,226
Deposit insurance expenses 414 49 463
State taxes 1,744 0 1,744
Amortization of intangibles 4015 0 4,015
Other 20,708 3,682 24,390
-------- ------- --------
Total noninterest expenses 92,739 12,681 105,420
-------- ------- --------
Income before income taxes 66,589 7,093 73,682
Income tax expense 22,483 1,645 24,128
-------- ------- --------
Net earnings $ 44,106 $ 5,448 $ 49,554
======== ======= ========
Net earnings per share - basic $ 1.21 $ 90.80 $ 1.19
======== ======= ========
Net earnings per share - diluted $ 1.21 $ 90.80 $ 1.19
======== ======= ========
Cash dividends declared per share $ 0.57 $ 18.00 $ 0.57
======== ======= ========
Average shares outstanding 36,375,686 60,000 41,490,686
========== ====== ==========
</TABLE>
<PAGE> 5
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Twelve months ended
December 31, 1997
-----------------------------------------------------
First Sand Ridge Consolidated
Financial Financial Pro forma
--------- ---------- ------------
<S> <C> <C> <C>
Interest income
Loans, including fees $166,336 $22,642 $188,978
Investment securities
Taxable 20,011 5,107 25,118
Tax-exempt 4,986 3,391 8,377
-------- ------- --------
Total investment interest 24,997 8,498 33,495
Interest-bearing deposits with other banks 253 9 262
Federal funds sold and securities
purchased under agreements to resell 599 973 1,572
-------- ------- --------
Total interest income 192,185 32,122 224,307
Interest expense
Deposits 70,311 15,719 86,030
Short-term borrowings 5,518 69 5,587
Long-term borrowings 1,004 469 1,473
-------- ------- --------
Total interest expense 76,833 16,257 93,090
-------- ------- --------
Net interest income 115,352 15,865 131,217
Provision for loan losses 4,736 1,800 6,536
-------- ------- --------
Net interest income after
provision for loan losses 110,616 14,065 124,681
Noninterest income
Service charges on deposit accounts 10,398 2,145 12,543
Trust income 9,905 145 10,050
Investment securities gains 54 85 139
Other 6,620 1,476 8,096
-------- ------- --------
Total noninterest income 26,977 3,851 30,828
Noninterest expenses
Salaries and employee benefits 42,385 5,602 47,987
Net occupancy expenses 5,025 700 5,725
Furniture and equipment expenses 4,374 1,028 5,402
Data processing expenses 4,960 582 5,542
Deposit insurance expenses 375 47 422
State taxes 1,718 0 1,718
Amortization of intangibles 1,326 0 1,326
Other 17,514 3,270 20,784
-------- ------- --------
Total noninterest expenses 77,677 11,229 88,906
-------- ------- --------
Income before income taxes 59,916 6,687 66,603
Income tax expense 19,608 1,694 21,302
-------- ------- --------
Net earnings $ 40,308 $ 4,993 $ 45,301
======== ======= ========
Net earnings per share - basic $ 1.11 $ 83.21 $ 1.09
======== ======= ========
Net earnings per share - diluted $ 1.10 $ 83.21 $ 1.08
======== ======= ========
Cash dividends declared per share $ 0.52 $ 17.00 $ 0.52
======== ======= ========
Average shares outstanding 36,402,415 60,000 41,517,415
========== ====== ==========
</TABLE>
<PAGE> 6
EXHIBIT 99(b)
PRO FORMA UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Twelve months ended
December 31, 1996
-----------------------------------------------------
First Sand Ridge Consolidated
Financial Financial Pro forma
--------- ---------- ------------
<S> <C> <C> <C>
Interest income
Loans, including fees $144,941 $21,149 $166,090
Investment securities
Taxable 19,330 4,689 24,019
Tax-exempt 6,047 2,759 8,806
-------- ------- --------
Total investment interest 25,377 7,448 32,825
Interest-bearing deposits with other banks 450 19 469
Federal funds sold and securities
purchased under agreements to resell 507 316 823
-------- ------- --------
Total interest income 171,275 28,932 200,207
Interest expense
Deposits 65,907 14,052 79,959
Short-term borrowings 3,521 271 3,792
Long-term borrowings 279 149 428
-------- ------- --------
Total interest expense 69,707 14,472 84,179
-------- ------- --------
Net interest income 101,568 14,460 116,028
Provision for loan losses 3,433 1,440 4,873
-------- ------- --------
Net interest income after
provision for loan losses 98,135 13,020 111,155
Noninterest income
Service charges on deposit accounts 9,182 1,694 10,876
Trust income 8,278 106 8,384
Investment securities gains (8) (28) (36)
Other 4,645 1,505 6,150
-------- ------- --------
Total noninterest income 22,097 3,277 25,374
Noninterest expenses
Salaries and employee benefits 37,586 4,832 42,418
Net occupancy expenses 4,790 614 5,404
Furniture and equipment expenses 3,911 882 4,793
Data processing expenses 4,773 553 5,326
Deposit insurance expenses 2889 12 2,901
State taxes 1,706 0 1,706
Amortization of intangibles 657 0 657
Other 14,949 2,606 17,555
-------- ------- --------
Total noninterest expenses 71,261 9,499 80,760
-------- ------- --------
Income before income taxes 48,971 6,798 55,769
Income tax expense 15,031 1,914 16,945
-------- ------- --------
Net earnings $ 33,940 $ 4,884 $ 38,824
======== ======= ========
Net earnings per share - basic $ 0.96 $ 81.39 $ 0.96
======== ======= ========
Net earnings per share - diluted $ 0.96 $ 81.39 $ 0.96
======== ======= ========
Cash dividends declared per share $ 0.46 $ 16.00 $ 0.46
======== ======= ========
Average shares outstanding 35,359,522 60,000 40,474,522
========== ====== ==========
</TABLE>
<PAGE> 7
EXHIBIT 99(b)
SAND RIDGE FINANCIAL CORPORATION
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
General
Reclassification of information has been made at times to provide consistency in
the presentation of financial information for the corporations involved. These
reclassifications are not material in nature and had no effect on net earnings.
(A) First Financial exchanged 5,115,000 shares of First Financial Common
Stock for all the 60,000 outstanding shares of Sand Ridge Financial
Corporation Common Stock. The exchange ratio was 85.25 shares of First
Financial Common Stock for each share of Sand Ridge Financial
Corporation Common Stock which was calculated by dividing 5,115,000 by
60,000 which was the aggregate number of shares of Sand Ridge Financial
Corporation's Common Stock issued and outstanding immediately prior to
the consummation.
(B) First Financial Common Stock and Sand Ridge Financial Common Stock do
not have par values. Sand Ridge Financial Common Stock, however, has a
stated value of $10.00 per share, while First Financial Common Stock
does not have a stated value. Since First Financial Common Stock does
not have a stated value, its capital accounts do not include an
"additional paid-in capital" or "surplus" account. As a result, Sand
Ridge Financial Corporation's additional paid-in capital was
transferred to its "common stock" account in the "consolidated
pro-forma column, as shown in the table below:
<TABLE>
<S> <C> <C> <C>
Common stock $ 600 $ 4,600 $5,200
Surplus 4,600 (4,600) 0
------ ------- ------
Total common stock and surplus $5,200 $ 0 $5,200
====== ======= ======
</TABLE>
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