<PAGE>
UNITED STATES
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
January 27, 1998
----------------
Date of Report (Date of Earliest Event Reported)
WESTERN BANCORP
---------------
(Exact Name of Registrant As Specified In Its Charter)
CALIFORNIA
----------
(State or Other Jurisdiction of Incorporation)
0-13551 95-3863296
------- ----------
(Commission File Number) (IRS Employer Identification No.)
4100 Newport Place, Suite 900
Newport Beach, California 92660
-------------------------------
(Address of Principal Executive Offices)(Zip Code)
(714) 863-2300
--------------
(Registrant's Telephone Number, including Area Code)
Not Applicable
------------------------------------------------------------
(Former Name or Former Address, If Changed Since Last Report)
1
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On January 27, 1998, Western Bancorp consummated the acquisition of Santa Monica
Bank (the "Acquisition") through the merger of Santa Monica Bank with and into
Western Bank, a wholly-owned subsidiary of Western Bancorp. The name of Western
Bank has been changed to Santa Monica Bank. The Acquisition will be accounted
for as a purchase. As a result of the Acquisition, approximately 4,972,000
shares of common stock Western Bancorp ("Western Common Stock") were issued to
certain holders of common stock of Santa Monica Bank ("Santa Monica Common
Stock") and to certain private investors.
Pursuant to an Agreement and Plan of Merger, dated as of July 30, 1997 and
amended and restated as of November 20, 1997 (the "Merger Agreement"), by and
among Western Bancorp, Western Bank and Santa Monica Bank, the total value of
the consideration paid in the Acquisition was approximately $198.4 million in
Western Common Stock and cash. Of the 7,084,244 shares of Santa Monica Common
Stock outstanding at the time of the Acquisition, approximately 57.3% elected to
receive cash and approximately 42.7% are receiving shares of Western Common
Stock at an exchange ratio of 0.875 shares of Western Common Stock for each
share of Santa Monica Common Stock, or approximately 2,647,000 shares of
Western Common Stock.
Of the total consideration paid in the Acquisition, approximately $113,722,700
was paid in cash to those holders of Santa Monica Common Stock who elected to
receive cash (the "Cash Consideration"). The source of funds for the Cash
Consideration was (i) $9,000,000 in the form of a cash dividend paid by Southern
California Bank to Western Bancorp; (ii) $45,000,000 in the form of a cash
dividend paid by Santa Monica Bank to Western Bancorp; and (iii) a portion of
the $65,171,400 raised in a private placement of Western Common Stock.
As a part of the Acquisition, Aubrey L. Austin, the former President and Chief
Executive Officer of Santa Monica Bank, was appointed Chairman, President and
Chief Executive Officer of Santa Monica Bank and was appointed to the Board of
Directors of Western Bancorp.
The description of the Merger Agreement contained herein is qualified in its
entirety by reference to the Merger Agreement.
ITEM 5. OTHER EVENTS
A press release announcing the consummation of the Acquisition was issued on
January 27, 1998, a copy of which is attached hereto as Exhibit 99.1 and is
incorporated herein in its entirety by this reference.
On February 2, 1998, a press release was issued announcing year end 1997
financial results for Western Bancorp, a copy of which is attached hereto as
Exhibit 99.2 and is incorporated herein in its entirety by this reference.
2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA
FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired.
Financial statements for Santa Monica Bank required by this item will
be filed by amendment to this Current Report on Form 8-K within 60
days of the date hereof.
(b) PRO FORMA Financial Information.
PRO FORMA financial statements for Santa Monica Bank required by this
item will be filed by amendment to this Current Report on Form 8-K
within 60 days of the date hereof.
(c) Exhibits.
The following exhibits are filed with this Current Report on Form 8-K:
Exhibit
Number Description
- ------ -----------
2.1 Agreement and Plan of Merger, dated as of July 30, 1997 and amended
and restated as of November 20, 1997, by and among Western Bancorp,
Western Bank and Santa Monica Bank (incorporated by reference to
Appendix A to the Registration Statement on Form S-4, Registration
Number 333-40611)
99.1 Press Release of Western Bancorp, dated January 27, 1998
99.2 Press Release of Western Bancorp, dated February 2, 1998
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunder duly authorized.
Dated: February 11, 1997
WESTERN BANCORP
By: /s/ Arnold C. Hahn
---------------------------------------
Name: Arnold C. Hahn
Title: Executive Vice President and
Chief Financial Officer
3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
2.1 Agreement and Plan of Merger, dated as of July 30, 1997 and amended
and restated as of November 20, 1997, by and among Western Bancorp,
Western Bank and Santa Monica Bank (incorporated by reference to
Appendix A to the Registration Statement on Form S-4, Registration
Number 333-40611)
99.1 Press Release of Western Bancorp, dated January 27, 1998
99.2 Press Release of Western Bancorp, dated February 2, 1998
4
<PAGE>
EXHIBIT 99.1
[LOGO]
WESTERN BANCORP
- --------------------------------------------------------------------------------
PRESS RELEASE
- --------------------------------------------------------------------------------
Western Bancorp (NASDAQ: WEBC)
4100 Newport Place, Suite 900
Newport Beach, California 92660
Contacts: Matthew P. Wagner Arnold C. Hahn Aubrey L. Austin
President & Chief Chief Financial Officer President & Chief
Executive Officer Executive Officer
Santa Monica Bank
Phone: 310/477-2401 714/863-2351 310/917-6200
Fax: 310/231-0321 714/757-5844 310/917-6573
FOR IMMEDIATE RELEASE
WESTERN BANCORP ANNOUNCES CLOSING OF
SANTA MONICA BANK ACQUISITION
January 27, 1998
Newport Beach, California ... On January 27, 1998, Western Bancorp consummated
the acquisition of Santa Monica Bank through the merger of Santa Monica Bank
with and into Western Bank, a wholly-owned subsidiary of Western Bancorp. The
name of Western Bank has been changed to Santa Monica Bank. The acquisition
will be accounted for as a purchase. As a result of this acquisition,
approximately 4,972,000 shares of Western Bancorp Common Stock are being issued
to certain holders of common stock of Santa Monica Bank and to certain private
investors. Western Bancorp's two banking subsidiaries, Santa Monica Bank and
Southern California Bank, together had over $2 billion in assets on a pro-forma
basis, as of December 31, 1997.
Of the 7,084,244 shares of Santa Monica Bank outstanding at the time of the
acquisition, approximately 57.3% elected to receive cash and approximately 42.7%
will receive Western Bancorp stock. U.S. Stock Transfer Corporation, the
exchange agent, is processing payments to former Santa Monica Bank shareholders
who elected to receive cash and is sending a transmittal letter to the remaining
Santa Monica Bank shareholders so that they may exchange their Santa Monica Bank
stock certificates for Western Bancorp stock certificates.
<PAGE>
EXHIBIT 99.2
[LOGO]
WESTERN BANCORP
- --------------------------------------------------------------------------------
PRESS RELEASE
- --------------------------------------------------------------------------------
Western Bancorp (NASDAQ: WEBC)
4100 Newport Place, Suite 900
Newport Beach, California 92660
Contacts: Matthew P. Wagner Arnold C. Hahn
President & Chief Financial Officer
Chief Executive Officer
Phone: 310/477-2401 714/863-2351
FAX: 310/231-0321 714/757-5845
FOR IMMEDIATE RELEASE
WESTERN BANCORP ANNOUNCES 1997 EARNINGS
February 2, 1998
Newport Beach, California . . . Western Bancorp ("Western") today announced that
its consolidated net income for the year ended December 31, 1997 was $3,162,000,
or $0.29 per diluted share. This compares with earnings of $8,989,000, or $1.09
per diluted share, for the year ended December 31, 1996. On an operating basis,
before the amortization of goodwill of $2,538,000 in 1997 and $1,004,000 in
1996, and after-tax merger costs of $11,881,000 in 1997 and before an after-tax
gain on sale of loans of $46,000 in 1997 and $389,000 in 1996, net income for
the twelve month periods would have been $17,473,000 and $9,604,000 in 1997 and
1996, respectively, or $1.63 and $1.16 per diluted share, respectively, a growth
of approximately 41%.
Western had a consolidated net loss of $4,366,000, or $0.41 per diluted share,
for the three months ended December 31, 1997. This compares with earnings of
$3,391,000, or $0.32 per diluted share, for the three months ended December 31,
1996. On an operating basis, before the amortization of goodwill in 1997 and
1996 and before after tax merger costs of $8,744,000 in 1997, net income for the
three month period would have been $5,011,000 and $4,025,000 in 1997 and 1996,
respectively, or $0.46 and $0.38 per diluted share, respectively, a growth of
approximately 21%.
<PAGE>
Earnings for 1997 and the fourth quarter of fiscal 1996 include the earnings of
Western Bank, which was acquired on September 30, 1996. The acquisition was
accounted for as a purchase and, therefore, the earnings of Western Bank have
been included in operating results since October 1, 1996.
Before the amortization of goodwill and merger costs in 1997 and before the
after-tax gain on sale of loans in 1997 and 1996, return on average assets
increased to 1.32% in 1997 versus 0.98% for 1996. Return on average equity
increased from 10.5% to 13.1% for 1997 versus 1996. Before goodwill
amortization and merger costs, the efficiency ratio in the fourth quarter of
1997 was 55.5% versus 77.4% for the same period in 1996. The efficiency ratio
for 1997 versus 1996 declined to 60.2% from 77.0%.
Western remains well capitalized with a leverage ratio of approximately 7.3%,
Tier 1 capital of approximately 9.8% and total capital to risk weighted assets
of approximately 11.0%
On January 27, 1998, Western Bancorp consummated the acquisition of Santa Monica
Bank through the merger of Santa Monica Bank with and into Western Bank, a
wholly-owned subsidiary of Western Bancorp. The name of Western Bank has been
changed to Santa Monica Bank. The acquisition will be accounted for as a
purchase. As a result of this acquisition, approximately 4,972,000 shares of
Western Bancorp Common Stock were issued to certain holders of common stock of
Santa Monica Bank and to certain private investors. Western Bancorp's two
banking subsidiaries, Santa Monica Bank and Southern California Bank, together
had over $2 billion in assets on a pro-forma basis, as of December 31, 1997.
Western Bancorp's book value per common share outstanding was $17.89 on a
pro-forma basis as of December 31, 1997.
Mr. Matthew P. Wagner, President and Chief Executive Officer of Western Bancorp,
stated "Western Bancorp continues to make substantial progress on its goal of
becoming one of the top performing community banks in the country. There has
been a long list of accomplishments since we announced our third quarter
results. We have completed two mergers and our integration plans are proceeding
smoothly. As our results indicate, even though we still have much work to do to
meet our financial goals, quarter after quarter we are accomplishing significant
operating improvements. It should be noted that without merger costs, operating
expenses decreased from $15,784,000 in the fourth quarter of 1996 to $12,202,000
in the fourth quarter of 1997, an annualized expense run rate reduction of over
$14,000,000."
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements that involve inherent
risks and uncertainties. Western Bancorp cautions readers that a number of
important factors could cause actual results to differ materially from those in
the forward-looking statements. These factors include economic conditions and
competition in the geographic and business areas in which Western Bancorp and
its subsidiaries operate, inflation, fluctuations in interest rates, legislation
and governmental regulation and the progress of integrating Santa Monica Bank,
Western Bank and Southern California Bank.
2
<PAGE>
<TABLE>
<CAPTION>
CONDENSED INCOME STATEMENTS Year Ended Three Months Ended
December 31 December 31
-------------------------- --------------------------
1997 1996 1997 1996
---- ---- ---- ----
(In thousands except per share data)
<S> <C> <C> <C> <C>
INTEREST INCOME:
Interest and fees on loans $ 80,639 $ 58,374 $ 20,939 $ 18,426
Interest on interest bearing deposits in other
banks 3 3 1 2
Interest on investment securities 15,711 12,862 3,368 4,703
Interest on federal funds sold 4,681 2,998 1,887 917
----------- ----------- ----------- -----------
TOTAL INTEREST INCOME 101,034 74,237 26,195 24,048
INTEREST EXPENSE:
Interest expense on deposits 28,276 21,382 7,361 7,062
Interest expense on notes payable and other
interest-bearing liabilities 1,302 1,106 286 283
----------- ----------- ----------- -----------
TOTAL INTEREST EXPENSE 29,578 22,488 7,647 7,345
----------- ----------- ----------- -----------
NET INTEREST INCOME: 71,456 51,749 18,548 16,703
Less: provision for loan and lease losses 2,800 1,018 675 623
----------- ----------- ----------- -----------
NET INTEREST INCOME AFTER PROVISION FOR LOAN
AND LEASE LOSSES 68,656 50,731 17,873 16,080
NON-INTEREST INCOME:
Service charges and fees on deposit accounts 3,240 3,466 778 883
Other fees and charges 3,859 3,555 728 778
Escrow fees 827 781 276 217
Gain on sale of loans and other assets 78 665 - -
Securities gains 342 281 - 267
Other income 1,340 1,127 533 722
----------- ----------- ----------- -----------
TOTAL NON-INTEREST INCOME 9,686 9,875 2,315 2,867
NON-INTEREST EXPENSE:
Salaries and benefits 25,023 23,016 5,851 7,964
Occupancy, furniture and equipment 8,144 7,649 2,087 1,882
Advertising and business development 1,225 1,342 284 455
Other real estate owned 242 (134) (93) (465)
Professional services 3,706 6,054 927 2,529
Telephone, stationery and supplies 2,735 2,201 667 945
Goodwill amortization 2,538 1,004 633 634
Data processing 1,667 1,064 465 500
Customer services cost 1,263 510 396 76
Merger costs 14,201 - 10,731 -
Other 4,793 5,255 985 1,264
----------- ----------- ----------- -----------
TOTAL NON-INTEREST EXPENSE 65,537 47,961 22,933 15,784
----------- ----------- ----------- -----------
Income (loss) before income taxes 12,805 12,645 (2,745) 3,163
Income taxes 9,643 3,656 1,621 (228)
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ 3,162 $ 8,989 $ (4,366) $ 3,391
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Number of shares (weighted average) 10,523.9 8,095.7 10,621.0 10,415.6
Diluted shares (weighted average) 10,731.6 8,248.4 10,835.0 10,647.9
Earnings (loss) per share $ 0.30 $ 1.11 $ (0.41) $ 0.33
Earnings (loss) per diluted share $ 0.29 $ 1.09 $ (0.41) $ 0.32
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
CONDENSED BALANCE SHEETS
December 31, December 31,
1997 1996
------------- -------------
(In thousands except per share data)
<S> <C> <C>
ASSETS:
Cash and due from banks $ 97,456 $ 96,202
Federal funds sold 138,702 22,517
------------- -------------
TOTAL CASH AND CASH EQUIVALENTS 236,158 118,719
FRB and FHLB stock 5,610 5,291
Securities:
Securities held to maturity - 7,270
Securities available for sale 201,904 320,257
------------- -------------
Total securities 207,514 332,818
Net loans 864,840 801,601
Property, plant and equipment 13,685 14,955
Other real estate owned 6,261 7,082
Goodwill 30,431 32,968
Other assets 24,621 30,770
------------- -------------
TOTAL ASSETS $ 1,383,510 $ 1,338,913
------------- -------------
------------- -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Non-interest bearing deposits $ 457,503 $ 422,854
Interest bearing deposits 769,290 754,160
------------- -------------
TOTAL DEPOSITS 1,226,793 1,177,014
Borrowed funds 12,751 21,446
Accrued interest payable & other liabilities 14,311 11,406
------------- -------------
TOTAL LIABILITIES 1,253,855 1,209,866
SHAREHOLDERS' EQUITY:
Preferred stock - -
Common stock 112,947 111,326
Retained earnings 16,802 18,583
Unrealized net (losses) on investments
available for sale, net (94) (862)
------------- -------------
TOTAL SHAREHOLDERS' EQUITY 129,655 129,047
------------- -------------
Total liabilities and shareholders' equity $ 1,383,510 $ 1,338,913
------------- -------------
------------- -------------
Number of common shares outstanding 10,648.3 10,438.8
Common shareholders' equity per share $ 12.18 $ 12.36
Tangible common shareholders' equity per share $ 9.32 $ 9.20
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Year Ended Three Months Ended
December 31 December 31
--------------------------- ---------------------------
1997 1996 1997 1996
---- ---- ---- ----
(Dollars and shares in thousands except per share data)
<S> <C> <C> <C> <C>
PER SHARE INFORMATION
Number of shares (weighted average) 10,523.9 8,095.7 10,621.0 10,415.6
Diluted shares (weighted shares) 10,731.6 8,248.4 10,835.0 10,647.9
Income (loss) per share $ 0.30 $ 1.11 $ (0.41) $ 0.33
Income (loss) per diluted share $ 0.29 $ 1.09 $ (0.41) $ 0.32
BEFORE MERGER COSTS AND GOODWILL AMORTIZATION
Income (loss) per share $ 1.66 $ 1.19 $ 0.47 $ 0.39
Income (loss) per diluted share $ 1.63 $ 1.16 $ 0.46 $ 0.38
PROFITABLILITY MEASURES:
Return on average assets 0.23% 0.90% (1.25%) 1.00%
Return on average equity 2.4% 9.8% (12.9%) 10.1%
BEFORE MERGER COSTS AND GOODWILL AMORTIZATION
Return on average tangible assets 1.32% 0.98% 1.46% 1.22%
Return on average equity 13.1% 10.5% 14.8% 12.0%
Efficiency ratio 60.2% 77.0% 55.5% 77.4%
ADJUSTMENTS TO NET INCOME (LOSS):
Net income (loss) $ 3,162 $ 8,989 $ (4,366) $ 3,391
Merger costs 14,201 - 10,731 -
Tax benefits 2,382 - 1,987 -
----------- ----------- ----------- -----------
After tax merger costs 11,819 - 8,744 -
Goodwill amortization 2,538 1,004 633 634
Gain on sale of loans available for sale - after tax (46) (389) - -
----------- ----------- ----------- -----------
Adjusted net income $ 17,473 $ 9,604 $ 5,011 $ 4,025
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
ADJUSTMENTS TO REVENUES:
Net interest income $ 71,456 $ 51,749 $ 18,548 $ 16,703
Non interest income 9,686 9,875 2,315 2,867
----------- ----------- ----------- -----------
Revenue before adjustments 81,142 61,624 20,863 19,570
Gain on sale of loans (78) (665) - -
----------- ----------- ----------- -----------
Adjusted revenue $ 81,064 $ 60,959 $ 20,863 $ 19,570
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
ADJUSTMENTS TO EXPENSES:
Non interest expense $ 65,537 $ 47,961 $ 22,933 $ 15,784
Merger costs (14,201) - (10,731) -
Goodwill amortization (2,538) (1,004) (633) (634)
----------- ----------- ----------- -----------
Adjusted expense $ 48,798 $ 46,957 $ 11,569 $ 15,150
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
AVERAGE BALANCE SHEETS Year Ended Three Months Ended
December 31 December 31
--------------------------- ---------------------------
1997 1996 1997 1996
---- ---- ---- ----
(In thousands)
<S> <C> <C> <C> <C>
AVERAGE ASSETS:
Loans and leases, net of deferred fees and costs $ 841,880 $ 608,891 $ 868,466 $ 784,774
Investments 269,481 224,301 228,939 334,247
Federal funds sold 84,106 54,901 135,498 61,417
Interest bearing deposits at banks 591 53 - 127
------------- ------------- ------------- -------------
AVERAGE EARNING ASSETS 1,196,058 888,146 1,232,903 1,180,565
Goodwill 31,695 10,781 30,105 32,651
Other assets 125,336 94,359 126,064 132,130
------------- ------------- ------------- -------------
AVERAGE TOTAL ASSETS $ 1,353,088 $ 993,286 $ 1,389,071 $ 1,345,346
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
AVERAGE LIABILITIES AND SHAREHOLDERS' EQUITY:
Non-interest bearing deposits $ 408,681 $ 300,625 $ 428,292 $ 389,298
Interest bearing deposits 786,062 578,180 804,510 794,696
------------- ------------- ------------- -------------
AVERAGE DEPOSITS 1,194,743 878,805 1,232,802 1,183,994
Other interest bearing liabilities 15,805 14,963 13,215 17,509
Other liabilities 9,385 8,196 8,673 10,720
------------- ------------- ------------- -------------
AVERAGE LIABILITIES 1,219,933 901,964 1,254,690 1,212,223
------------- ------------- ------------- -------------
Equity 133,155 91,322 134,381 133,123
------------- ------------- ------------- -------------
AVERAGE LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,353,088 $ 993,286 $ 1,389,071 $ 1,345,346
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
YIELD ANALYSIS:
(Dollars in millions)
Average earning assets $ 1,196.1 $ 888.1 $ 1,232.9 $ 1,180.6
Yield 8.45% 8.36% 8.43% 8.08%
Average interest bearing deposits $ 786.1 $ 578.2 $ 804.5 $ 794.7
Cost 3.60% 3.70% 3.63% 3.53%
Average deposits $ 1,194.7 $ 878.8 $ 1,232.8 $ 1,184.0
Cost 2.37% 2.43% 2.37% 2.37%
Average interest bearing liabilities $ 801.9 $ 593.1 $ 817.7 $ 812.2
Cost 3.69% 3.79% 3.71% 3.59%
Interest spread 4.76% 4.57% 4.72% 4.49%
Net interest margin 5.97% 5.83% 5.97% 5.61%
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
CREDIT QUALITY MEASURES
(Dollars in thousands)
QUARTER ENDED Year
------------------------------------------------------- Ended
31-Dec 30-Sep 30-Jun 31-Mar 31-Dec
1997 1997 1997 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Loans past due 90 days and still accruing $ 31 $ 1,267 $ 422 $ 472 $ 193
Nonaccrual loans and leases 7,489 9,468 14,665 17,134 16,157
Other real estate owned 6,261 8,354 7,680 10,966 7,082
---------- ---------- ---------- ---------- ----------
NON-PERFORMING ASSETS 13,750 17,822 22,345 28,100 23,239
Impaired loans gross 13,482 14,960 18,530 19,259 21,034
Allocated reserves 374 418 1,806 1,895 2,172
---------- ---------- ---------- ---------- ----------
NET INVESTMENT IN IMPAIRED LOANS 13,108 14,542 16,724 17,364 18,862
Charge-offs 422 1,461 1,394 888 4,675
Recoveries 481 551 349 121 1,123
---------- ---------- ---------- ---------- ----------
NET CHARGE-OFFS (59) 910 1,045 767 3,552
Allowance for loan and lease losses ("ALLL") 15,894 15,160 15,345 15,715 15,757
Loans and leases, net of deferred fees and costs 880,734 874,283 849,141 816,907 818,592
Average loans and leases,
net of deferred fees and costs 868,466 854,323 828,362 816,368 613,676
ALLL to loans and leases 1.80% 1.73% 1.81% 1.92% 1.92%
ALLL to nonaccrual loans and leases 212.2% 160.1% 104.6% 91.7% 97.5%
ALLL to non performing assets 115.6% 85.1% 68.7% 55.9% 67.8%
Non-performing assets to loans, leases
and OREO 1.55% 2.02% 2.61% 3.39% 2.81%
Annualized net charge-offs to average
loans and leases (0.03%) 0.43% 0.50% 0.38%
Full year net charge-offs to average
loans and leases 0.31% 0.58%
</TABLE>
7
