SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: August 31, 1996
ARROW FINANCIAL CORPORATION
A New York Corporation
0-12507 22-2448962
Commission File Number I.R.S. Employer Identification No.
250 Glen Street
GLEN FALLS, NEW YORK 12801
Registrant's telephone number: (518) 745-1000
Item 7. Financial Statements and Exhibits.
(a) Financial Statements - not applicable
(b) Pro Forma Financial Information
On September 28, 1996, the Registrant's wholly-owned subsidiary, Green
Mountain Bank ("GMB"), Rutland, Vermont, sold five of its six
remaining branches, and substantially all of its remaining deposits
and loans to ALBANK, FSB, Albany, New York (the "ALBANK Transaction").
On August 31, 1996, GMB sold substantially all of its trust business
to Vermont National Bank, Brattleboro, Vermont (the "VNB
Transaction"). The pro forma financial information below shows (i)
the effect the ALBANK Transaction and the VNB Transaction would have
had on the Registrant's unaudited balance sheet as of June 30, 1996,
had those transactions occurred on that date, and (ii) the effect the
ALBANK Transaction and the VNB Transaction would have had on the
Registrant's unaudited income statements for the year ended December
31, 1995 and the six-month period ended June 30, 1996, had those
transactions and a similar transaction effected in January 1996
involving the sale of eight GMB branches to Mascoma Savings Bank, FSB
Lebanon, New Hampshire, occurred on January 1, 1995. The pro forma
unaudited balance sheet as of June 30, 1996, shows that the Registrant
would have had approximately $99.7 million less in total assets as of
that date than the amount of the total assets actually held on such
date. The pro forma unaudited income statement for the six-month
period ended June 30, 1996, shows that the Registrant would have had
approximately $5.7 million less in net income for such period than the
income actually recognized therefor.
Arrow Financial Corporation
Pro Forma Consolidated Balance Sheet
June 30, 1996
Unaudited
As Reported ALBANK, FSB Pro Forma
June 30, Sale June 30,
1996 Transactions 1996
ASSETS
Cash and Due
From Banks $ 20,463 $ (769) $ 19,694
Federal Funds Sold --- 7,773 7,773
Investments 187,163 --- 187,163
Loans 487,291 (108,336) 378,955
Allowance for
Loan Losses (11,540) 6,253 (5,287)
Net Loans 475,751 (102,083) 373,668
Premises & Equipment 12,672 (2,740) 9,932
Other Assets 17,456 (1,850) 15,606
Total Assets $713,505 $ (99,669) $613,836
LIABILITIES
Deposits $610,503 $(107,711) $502,792
Other Borrowed Funds 24,134 --- 24,134
Other Liabilities 12,293 4,390 16,683
Total Liabilities 646,930 (103,321) 543,609
SHAREHOLDERS' EQUITY
Common Stock 5,979 --- 5,979
Surplus 41,138 --- 41,138
Other Shareholders'
Equity 19,458 3,652 23,110
Total Shareholders'
Equity 66,575 3,652 70,227
Total Liabilities
and Shareholders'
Equity $713,505 $ (99,669) $613,836
The pro forma consolidated income statements for the year ending
December 31, 1995 and the six month period ending June 30, 1996 which
follow are presented in accordance with the Form 8-K instructions for
"Item 2. Acquisition or Dispositions of Assets" and "Item 7. Financial
Statements and Exhibits." Accordingly, these pro forma statements may
not be indicative of the on-going operating income of the Company
after disposition of the Vermont banking operations.
Pro Forma Consolidated Income Statement
December 31, 1995
Unaudited
As Reported Vermont Pro Forma
December 31, 1995 December 31,
1995 Operations 1995 (3)
Interest Income $60,718 $18,422 $42,296
Interest Expense 24,865 7,192 17,673
Net Interest Income
Before Provision
for Loan Losses 35,853 11,230 24,623
Provision for
Loan Losses 1,170 --- 1,170
Net Interest Income
After Provision
for Loan Losses 34,683 11,230 23,453
Other Income (1) 14,496 3,278 11,218
Other Expense 29,769 11,480 18,289
Income Before
Income Taxes 19,410 3,028 16,382
Provision for
Income Taxes 6,986 989 5,997
Net Income $12,424 $ 2,039 $10,385
Earnings Per
Share (2) $1.97 $0.32 $1.65
Notes:
(1) Other income in both the actual and pro forma columns includes a
$5.0 million pre-tax financial institution bond settlement. Without
this nonrecurring item, earnings per share would have been $1.46 and
$1.14, respectively.
(2) Per share amounts are restated for the ten percent stock dividend
paid in November 1996.
(3) Pro forma December 31, 1995 amounts, including earnings per share,
are not adjusted to reflect use of proceeds resulting from the sale.
Pro Forma Consolidated Income Statement
June 30, 1996
Unaudited
As Reported Vermont Pro Forma
June 30, 1996 June 30,
1996 Operations 1996 (2)
Interest Income $28,564 $ 6,694 $21,870
Interest Expense 11,051 2,135 8,916
Net Interest Income
Before Provision
for Loan Losses 17,513 4,559 12,954
Provision for
Loan Losses 448 --- 448
Net Interest Income
After Provision
for Loan Losses 17,065 4,559 12,506
Other Income (3) 11,669 8,511 3,158
Other Expense 13,284 4,611 8,673
Income Before
Income Taxes 15,450 8,459 6,991
Provision for
Income Taxes 5,396 2,768 2,628
Net Income $10,054 $5,691 $ 4,363
Earnings Per
Share (1) $1.66 $0.94 $0.72
Notes:
(1) Per share amounts are restated for the ten percent stock dividend
paid in November 1996.
(2) Pro forma June 30, 1996 amounts, including earnings per share, are
not adjusted to reflect use of proceeds resulting from the sale.
(3) Included in the Vermont 1996 Income column is a $7.1 million gain
from the January 15, 1996 sale of eight branches to Mascoma Savings
Bank.
Exhibits.
The following exhibits are filed with this report:
Exhibit No. Document
2.1 Purchase and Assumption Agreement among
Arrow Financial Corporation, Arrow
Vermont Corporation, Green Mountain Bank
and ALBANK, FSB, dated February 26,
1996 (Incorporated herein by reference to
Form 8-K dated February 26, 1996).
2.2 Service Purchasing Agreement among
Arrow Financial Corporation, Arrow
Vermont Corporation, Green Mountain Bank
and ALBANK, FSB, dated February 26,
1996 (Incorporated herein by reference to
Form 8-K dated February 26, 1996).
2.3 Amendment to the Purchase and
Assumption Agreement dated
September 25, 1996 (Incorporated herein by
reference to Form 8-K dated August 31, 1996).
2.4 Amendment to the Service Purchasing
Agreement dated September 25, 1996
(Incorporated herein by reference to
Form 8-K dated August 31, 1996).
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.
Date: December 10, 1996
ARROW FINANCIAL CORPORATION
By: /s/John J. Murphy
John J. Murphy
Executive Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit Number
Description
2.1
Purchase and Assumption Agreement among Arrow Financial
Corporation, Arrow Vermont Corporation, Green Mountain Bank
and ALBANK, FSB, dated February 26, 1996 (Incorporated herein
by reference to Form 8-K dated February 26, 1996).
2.2
Service Purchasing Agreement among Arrow Financial
Corporation, Arrow Vermont Corporation, Green Mountain Bank
and ALBANK, FSB, dated February 26, 1996 (Incorporated herein
by reference to Form 8-K dated February 26, 1996).
2.3
Amendment to the Purchase and Assumption Agreement dated
September 25, 1996. (Incorporated herein
by reference to Form 8-K dated August 31, 1996).
2.4
Amendment to the Service Purchasing Agreement dated
September 25, 1996. (Incorporated herein
by reference to Form 8-K dated August 31, 1996).
