UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the quarter ended September 30, 1995 Commission file number 0-12047
UNITED OKLAHOMA BANKSHARES, INC.
(Exact name of registrant as specified in its charter)
Oklahoma 73-09696432
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
4600 S.E. 29th Street
Del City, Oklahoma 73115
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code(405)677-8711
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant
was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
[X] Yes No[ ]
As of October 31, 1995, 2,532,237 shares of the registrant's
common stock, par value $1.00 per share, were outstanding.
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except earnings per share)
<TABLE>
Nine months ended Three months ended
Sept. 30, Sept. 30,
1995 1994 1995 1994
(Unaudited) (Unaudited)
Interest income:
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Interest and fees on loans $ 3,020 2,430 1,058 852
Interest on federal funds sold 115 50 16 13
Interest on securities 1,319 1,292 446 439
Total interest income 4,454 3,772 1,520 1,301
Interest expense:
Interest on deposits 1,900 1,285 643 447
Interest on long-term debt - 6 - -
Total interest expense 1,900 1,291 643 447
Net interest income 2,554 2,481 877 854
Provision for loan losses 234 60 85 30
Net interest income after provision
for loan losses 2,320 2,421 792 824
Non-interest income:
Service charges on deposits 590 552 209 204
Other service charges and fees, net 186 111 69 36
Securities gains - 104 - 32
Total non-interest income 776 767 278 272
Non-interest expense:
Salaries and employee benefits 1,368 1,289 448 438
Occupancy expense, net 189 198 84 68
Other real estate owned (17) 91 (26) 2
Other 769 836 230 283
Total non-interest expense 2,309 2,414 736 791
Income before income taxes 787 774 334 305
Income tax expense 193 181 92 75
Net income $ 594 593 242 230
Earnings per share** $0.12 0.11 0.06 0.05
Average outstanding common shares 2,532 2,644 2,532 2,644
**Earnings per share is calculated on year-to-date net income less the
unpaid year-to-date preferred stock dividends. Preferred stock dividends
accrue at $98,000 per quarter. See the Consolidated Balance Sheet,
Stockholder Equity section for the number of authorized shares
outstanding and total cumulated unpaid dividends.
</TABLE>
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UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
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Sept. 30, December 31,
1995 1994
(In thousands)
ASSETS
Cash and due from banks $ 2,844 2,440
Federal funds sold 2,400 -
Securities
Held to maturity 23,418 23,451
Available for sale 7,015 7,137
Loans 41,216 41,974
Unearned discounts (4) (14)
Allowance for loan losses (511) (559)
Loans, net 40,701 41,401
Property and equipment, net 3,895 4,051
Other real estate 148 180
Accrued interest receivable 565 612
Accounts receivable 83 90
Other assets 212 358
$81,281 79,720
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Interest bearing $56,604 56,178
Non-interest bearing 15,133 13,469
Total deposits 71,737 69,647
Securities sold under repurchase agreement - 1,500
Deferred taxes 1,159 1,199
Other liabilities 751 425
Total liabilities 73,647 72,771
Commitments and contingencies - -
Stockholders'equity:
Preferred stock, 9% cumulative, nonvoting
$30 par value, redeemable at the Company's
option at par plus cumulative unpaid
dividends. Cumulative unpaid preferred
dividends amount to $3,822,580 or $26.33
per share at June 30, 1995. Authorized
150,000 shares; issued and outstanding
145,199 shares in 1995 and 1994 4,356 4,356
Class B preferred stock, $1 par value.
Authorized 500,000 shares;
none issued or outstanding - -
Common stock, $1 par value. Authorized
10,000,000 shares; issued 2,805,385
in 1995 and 1994 2,805 2,805
Additional paid-in capital 7,358 7,358
Accumulated deficit (5,721) (6,315)
Net unrealized holding loss on investment
securities available for sale,net of
deferred taxes (67) (158)
8,467 8,046
Less cost of common stock held in Treasury
(273,148 shares in 1995 and 1994) (1,097) (1,097)
Net stockholders'equity 7,634 6,949
$ 81,281 79,720
/TABLE
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UNITED OKLAHOMA BANKSHARES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
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Sept. 30, December 31,
1995 1994
(In thousands)
Preferred stock:
Balance at beginning and end of year $ 4,356 4,356
Common stock:
Balance at beginning and end of year 2,805 2,805
Additional paid-in capital:
Balance at beginning and end of year 7,358 7,358
Accumulated deficit:
Balance at beginning of year (6,315) (7,144)
Net income 594 829
Balance at end of year (5,721) (6,315)
Net unrealized holding gain (loss) on
investment securities available for sale:
Balance at beginning of year (158) -
Implementation of change in accounting
for investment securities,
net of deferred taxes - 170
Change in net unrealized holding gain
(loss) on investment securities
available for sale, net of deferred taxes 91 (328)
Balance at end of year (67) (158)
Treasury stock:
Balance at beginning and end of year (1,097) (1,086)
Purchase stock - (11)
Balance at end of year (1,097) (1,097)
Net stockholders' equity $ 7,634 6,949
</TABLE>
<PAGE>
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
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Nine months ended
Sept. 30
1995 1994
(In thousands)
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Cash flows from operating activities:
Net Income $ 594 593
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 312 280
Provision for loan losses 234 60
Provision for market decline-other real estate 6 82
Amortization of intangibles 111 111
Amortization of premium, accretion of
discounts, net 60 97
Gain on sale of securities - (104)
(Increase) decrease in interest payable 238 (18)
(Increase) decrease in interest receivable 47 54
Decrease in other assets 68 411
Decrease in deferred income taxes (40) (85)
(Decrease) increase in other liabilities 88 41
Total adjustments 1,124 929
Net cash provided by operating activities 1,718 1,522
Cash flows from investing activities:
Proceeds from principal payments on mortgage
backed securities 1,195 2,777
Proceeds from maturities of securities 525 3,143
Purchase of securities (1,534) (7,497)
Net decrease in loans 466 (2,391)
Capital expenditures (156) (152)
Net cash used in investing activities 496 (4,120)
Cash flows from financing activities:
Net increase in interest bearing and non-
interest bearing demand deposits, savings
and certificates of deposit 2,090 5,419
Repayment of long-term debt - (450)
Repayment of securities sold under repurchase (1,500) -
Net cash provided by financing activities 590 4,969
Net increase in cash and cash equivalents 2,804 2,371
Cash and cash equivalents at beginning of period 2,440 2,367
Cash and cash equivalents at end of period $ 5,244 4,738
Supplemental disclosure of noncash investing
activities:
Net unrealized holding loss on investment securites
available for sale, net of deferred tax $ 67 158
</TABLE>
<PAGE>
United Oklahoma Bankshares, Inc. and Subsidiaries
Notes to Consolidated Quarterly Financial Information
(Unaudited)
1. Summary of Significant Accounting Policies
The accounting and reporting policies of United Oklahoma
Bankshares, Inc. (the "Company") and its subsidiaries conform to
generally accepted accounting principles and practices within the
banking industry. The following represent the more significant of
those policies and practices.
Principles of Consolidation and Basis of Presentation
The consolidated financial statements include the accounts of the
Company and its subsidiaries, all wholly owned, after elimination
of all significant intercompany accounts and transactions.
Securities
The Company adopted the provisions of Statement of Financial
Accounting Standards No. 115, "Accounting for Certain Investments
in Debt and Equity Securities" (Statement 115), at January 1,
1994. Under Statement 115, the Company classified its debt and
marketable equity securities in one of three categories: trading,
available for sale, or held to maturity. Trading securities are
bought and held principally for the purpose of selling them in the
near term. No investment securities within the portfolio are
considered trading. Held to maturity securities are those
securities for which the Company has the ability and intent to
hold until maturity. All other securities not included in held to
maturity are classified as available for sale.
<PAGE>
Item 2.
Management's Discussion and Analysis of Financial
Condition and Operating Results
Results of Operations-Quarter Ended September 30, 1995
The following discussion and analysis is designed to provide a
better understanding of the significant factors related to the
Company's results of operations, financial condition, liquidity
and capital resources (including its subsidiary bank, United Bank
(UB) and its non-bank subsidiaries). Management is unaware of any
trends, events or uncertainties that will have or that are
reasonably likely to have a material effect on the Company's
operations.
Overview
Net income for the third quarter of 1995 was approximately
$242,000, compared to $230,000 for the third quarter of 1994.
The before tax income for the third quarter of 1995 was $334,000
compared to $305,000 for the third quarter of 1994. Earnings per
share reflected income of $0.12 at September 30, 1995 compared to
income of $0.11 per share at September 30, 1994. Earnings per share is
calculated on year-to date net income less the unpaid year-to date
preferred stock dividends. Unpaid preferred stock dividends
accrue at $98,000 per quarter.
Net Interest Income
Net interest income was $2,554,000 for the nine months ended September
30, 1995 compared to $2,481,000 for the same period in 1994,
representing an increase of $73,000 or 3%. The volume of average
earning assets increased $4,183,000 while average interest bearing
liabilities increased $2,111,000 between September 30, 1994 and 1995.
The yield on average earning assets increased 84 basis points from
September 30, 1994 to September 30, 1995 while the rate paid on average
interest bearing liabilities increased 125 basis points during the
same time period resulting in a decrease in the spread between the
yield on earning assets and rate paid on interest bearing
liabilities of 41 basis points.
Allowance for Loan Losses
The allowance for loan losses was approximately $511,000 at September
30, 1995 compared to $559,000 at December 31, 1994 and $530,000 at
September 30, 1994. As a percentage of loans, the allowance for loan
losses was 1.26%, 1.33% and 1.35% at September 30, 1995, December 31
and September 30, 1994 respectively.
<PAGE>
Securities
The Company has designated securities as "Held to maturity"
or "Available for sale". A comparison of recorded value
and market value of securities is as follows (in thousands):
September 30, 1995
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Held to maturity:
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Market value
U. S. Treasury securities $ 1,265 2 (2) 1,265
Mortgage-backed securities 12,191 74 (103) 12,162
State & municipals 9,962 87 (67) 9,982
Total "Held to maturity" $ 23,418 163 (172) 23,409
Available for sale:
U. S. Treasury securities $ $827 9 - 836
Mortgage-backed securities 6,299 - (120) 6,179
Total "Available for sale" $ 7,126 9 (120) 7,015
</TABLE>
Non-performing Assets
Non-performing assets, including other real estate, totalled
$418,000 at September 30, 1995, a decrease of $60,000 from December
31, 1994.
The following table sets forth such loans and other real estate
at the dates indicated.-
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Sept. 30, December 31, Sept. 30,
1995 1994 1994
(Dollars in thousands)
Non-accrual loans 270 178 457
Loans contractually past due 90 days or more - - 31
Total nonperforming loans 270 178 488
Other real estate 148 180 222
Total nonperforming assets 418 358 710
Nonperforming loans to total loans 0.66% 0.43% 1.24%
</TABLE>
<PAGE>
Capital and Liquidity
The Company's primary capital totalled $8,108,000 and $7,361,000
at September 30, 1995 and December 31, 1994, respectively. Equity
capital totalled $7,634,000 and $6,949,000 at September 30, 1995 and
December 31, 1994, respectively. The Company's ratio of primary
capital and equity capital to assets are as follows:
September 30, December 31,
1995 1994
Company's primary capital to asset ratio 9.88% 9.37%
Company's equity capital to asset ratio 9.35 8.89
UB's primary capital totalled $8,053,000 and $7,321,000 at September
30, 1995 and December 31, 1994 respectively. Equity capital
totalled $7,579,000 and $6,909,000 at September 30, 1995 and December
31, 1994 respectively. UB's ratio of primary capital and equity
capital to assets are as follows:
September 30, December 31,
1995 1994
UB's primary capital to asset ratio 9.82% 9.32%
UB's equity capital to asset ratio 9.29 8.84
UB is subject to certain regulatory capital regulations which
require the maintenance of certain levels of capital as a
percentage of risk-adjusted assets. These regulations define
capital as either core capital (Tier 1) or supplementary capital
(Tier 2). Core capital consists primarily of common shareholders'
equity, while supplementary capital is comprised of preferred
stock, certain debt instruments, and a portion of the allowance
for loan losses. At December 31, 1994, the required core capital
is 4.00% and total risk-based capital is 8.00%. UB's core and
total risk-based capital exceed regulatory guidelines at September 30,
1995 and December 31, 1994 respectively, and are as follows:
September 30, December 31,
1995 1994
Tier 1 capital (core) 13.54% 13.05%
Tier 2 capital (total risk-based) 14.70 14.11
<PAGE>
Accounting Standards Adopted
The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards No. 114, "Accounting by Creditors
for Impairment of a Loan." The Company adopted this statement in
January 1, 1995. The impact of this statement does not have a
material effect on the Company's consolidated financial
statements.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company and its subsidiaries are not defendants in any
legal proceedings.
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Securities Holders
None
Item 5. Other Information
On July 20, 1995, Ameribank Corporation sent a letter to all
preferred stockholders of the Company offering to purchase all
outstanding shares of Preferred Stock. As a result of that offer,
Ameribank Corporation acquired an additional 8,256 shares of the
Company's Preferred Stock and now owns 101,046 shares, which
represents approximately 69.6% of the Preferred Stock.
On November 3, 1995, Ameribank Corporation commenced a Tender
Offer to purchase up to 1,478,036 of the outstanding shares of
Common Stock of the Company, at the purchase price of $0.50 per
share, net to the seller in cash, without interest thereon, upon
the terms and subject to the conditions set forth in the Offer to
Purchase, dated November 3, 1995. For more information regarding
this Tender Offer, please see Ameribank Corporation's Tender Offer
Statement on Schedule 14D-1 dated November 3, 1995 and filed with
the Securities Exchange Commission.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits:
(1) Exhibit 27-Financial Data Schedule
b. None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
UNITED OKLAHOMA BANKSHARES, INC.
Registrant
DATE: November 13, 1995
George N. Cook
Chairman of the Board
June A. O'Steen
Principal Accountant
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 2844
<INT-BEARING-DEPOSITS> 56604
<FED-FUNDS-SOLD> 2400
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7015
<INVESTMENTS-CARRYING> 7015
<INVESTMENTS-MARKET> 7015
<LOANS> 41216
<ALLOWANCE> (511)
<TOTAL-ASSETS> 81281
<DEPOSITS> 71737
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1910
<LONG-TERM> 0
<COMMON> 2805
0
4356
<OTHER-SE> 473
<TOTAL-LIABILITIES-AND-EQUITY> 81281
<INTEREST-LOAN> 3020
<INTEREST-INVEST> 1319
<INTEREST-OTHER> 115
<INTEREST-TOTAL> 4454
<INTEREST-DEPOSIT> 1900
<INTEREST-EXPENSE> 1900
<INTEREST-INCOME-NET> 2554
<LOAN-LOSSES> 234
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2309
<INCOME-PRETAX> 787
<INCOME-PRE-EXTRAORDINARY> 787
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 594
<EPS-PRIMARY> .12
<EPS-DILUTED> 0
<YIELD-ACTUAL> 0
<LOANS-NON> 270
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
