SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
COMMISSION FILE NO. 0-13322
A. Full title of the plan and address of the plan, if different from that of
issuer named below:
United Bankshares, Inc. Savings and Stock
Investment Plan
B. Name of issuer of the securities held pursuant to the plan and address of its
principal executive office:
United Bankshares, Inc.
300 United Center
500 Virginia Street, East
Charleston, West Virginia 25301
<PAGE>
REQUIRED INFORMATION
The United Bankshares, Inc. Savings and Stock Investment Plan (the "Plan") is
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). Accordingly, in lieu of the requirements of Items 1-3 of this
section, the Plan is filing financial statements and schedules prepared in
accordance with the financial reporting requirements of ERISA. The following
financial statements, attached hereto, are filed as part of the Annual Report:
FINANCIAL STATEMENTS AND SCHEDULES - MODIFIED CASH BASIS
(i) Report of Independent Auditors
(ii) Statements of Net Assets Available for Benefits
(iii) Statements of Changes in Net Assets Available for Benefits
(iv) Notes to Financial Statements
(v) Supplemental Schedules
INDEX TO EXHIBITS
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S-K ITEM 601 SEQUENTIAL
DESCRIPTION TABLE REFERENCE PAGE NUMBER
----------- --------------- -----------
Consent of Ernst & Young LLP (23) 11
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees or other persons who administer the Plan have duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
United Bankshares, Inc. Savings and
Stock Investment Plan
June 28, 1999 /s/ Jack C. Stokes
-----------------------------------
Jack C. Stokes
Plan Administrator
United Bankshares, Inc. Savings
and Stock Investment Plan
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Audited Financial Statements and Supplemental Schedules
(Modified Cash Basis)
December 31, 1998
CONTENTS
Report of Independent Auditors................................................1
Audited Financial Statements (Modified Cash Basis)
Statements of Net Assets Available for Benefits
(Modified Cash Basis).......................................................2
Statements of Changes in Net Assets Available for
Benefits (Modified Cash Basis).............................................3
Notes to Financial Statements (Modified Cash Basis)...........................4
Supplemental Schedules (Modified Cash Basis)
Line 27a--Schedule of Assets Held for Investment
Purposes (Modified Cash Basis).............................................9
Line 27d--Schedule of Reportable Transactions
(Modified Cash Basis).....................................................10
<PAGE>
Report of Independent Auditors
United Bankshares, Inc. Plan Sponsor
We have audited the accompanying statements of net assets available for benefits
(modified cash basis) of the United Bankshares, Inc. Savings and Stock
Investment Plan as of December 31, 1998 and 1997, and the related statements of
changes in net assets available for benefits (modified cash basis) for the years
then ended. These financial statements are the responsibility of the Plan'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.
As described in Note 1, the financial statements and supplemental schedules were
prepared on a modified cash basis of accounting, which is a comprehensive basis
of accounting other than generally accepted accounting principles.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits (modified cash
basis) of the Plan at December 31, 1998 and 1997, and the changes in its net
assets available for benefits (modified cash basis) for the years then ended, on
the basis of accounting described in Note 1.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
(modified cash basis) of assets held for investment as of December 31, 1998, and
transactions or series of transactions in excess of 5 percent of the current
value of plan assets for the year then ended, are presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974 and are not
a required part of the basic financial statements. The supplemental schedules
(modified cash basis) have been subjected to the auditing procedures applied in
our audit of the financial statements and, in our opinion, are fairly stated in
all material respects in relation to the financial statements taken as a whole.
/s/ Ernst & Young LLP
-----------------
Charleston, West Virginia
June 18, 1999
1
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Statements of Net Assets Available for Benefits
(Modified Cash Basis)
DECEMBER 31
1998 1997
---------------------------------------
ASSETS
Cash and equivalents $ 433,485 $ 387,229
Investments, at fair value (NOTE 3) 21,291,796 17,504,566
Contributions receivable 142,538 122,545
Loans receivable 21,736 23,086
---------------------------------------
Net assets available for benefits $21,889,555 $18,037,426
=======================================
SEE NOTES TO FINANCIAL STATEMENTS.
2
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Statements of Changes in Net Assets Available for Benefits
(Modified Cash Basis)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1998 1997
---------------------------------------
ADDITIONS
Contributions:
<S> <C> <C>
Employees $ 1,271,535 $ 702,710
Employer 462,581 389,074
Investment income 541,283 506,894
Interest income on loans receivable 2,249 2,239
---------------------------------------
2,277,648 1,600,917
DEDUCTIONS
Withdrawals and benefit payments 719,057 2,223,604
---------------------------------------
1,558,591 (622,687)
Net realized and unrealized appreciation in fair value of investments
(NOTE 3) 2,293,538 5,111,207
---------------------------------------
Net increases 3,852,129 4,488,520
Net assets available for benefits at beginning of year 18,037,426 13,548,906
---------------------------------------
Net assets available for benefits at end of year $21,889,555 $18,037,426
=======================================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Notes to Financial Statements
December 31, 1998
1. SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING METHOD
The accounting records of the United Bankshares, Inc. (United) Savings and Stock
Investment Plan (the Plan) are maintained on a modified cash basis of
accounting, a basis of accounting permitted by the Department of Labor. Such
accounting method includes recording investments at fair value and the recording
of contributions receivable. Other additions and deductions are recognized as
received or paid rather than as earned or incurred. Accordingly, the
accompanying financial statements are not intended to be presented in accordance
with generally accepted accounting principles.
The preparation of financial statements requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual amounts could differ from those estimates.
CASH EQUIVALENTS
Cash equivalents are short-term (maturities of less than ninety days), highly
liquid investments. The market value of cash equivalents approximates cost.
INVESTMENTS
Investments are recorded at estimated fair value based upon published quoted
prices, determined primarily by the last reported sales price on the last
business day of the year.
2. DESCRIPTION OF THE PLAN
The Plan is a contributory defined contribution plan which is available to all
full-time employees of United or any of its subsidiaries who have completed one
year of service. The Plan was established December 29, 1989 and is subject to
the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Active participants may defer up to 10% of their annual pre-tax compensation.
United contributes an amount equal to 100% of the first 2% of the employee's
deferral and 25% of the next 2% of the employee's deferral. Contributions are
made by United on a quarterly basis and consist of cash which is used by the
Plan to purchase shares of United common stock. Plan earnings are allocated to
each participant's account based upon the respective account balances.
Participating employees are immediately fully vested as to employee and employer
contributions to the Plan. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's account.
In the event of termination, partial termination, or complete discontinuance of
contributions to the Plan, the assets of the Plan will remain in trust and will
be distributed in accordance with the Plan Agreement.
4
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Notes to Financial Statements (continued)
The above description of the Plan provides only general information.
Participants should refer to the Summary Plan Description for a complete
description of the Plan's provisions.
Participants may choose to have their contributions directed to any of the
following investment options provided that investment elections are made in
multiples of 25%.
UNITED COMMON STOCK
Investments are made in United common stock which is listed and its price quoted
in the National Association of Securities Dealers Automated Quotations System
(NASDAQ).
MUTUAL STOCK FUND
Investments are intended to be in a diversified portfolio of common stocks of
highly capitalized companies.
MONEY MARKET FUND
Investments are intended to be in a portfolio of short-term United States
Government securities not subject to significant market value fluctuations.
FIXED INCOME FUND
Investments are intended to be in a portfolio of United States Treasury and
Government Agency securities with an average maturity of 3-4 years.
The allocation of Plan assets by investment program at December 31 follows:
<TABLE>
<CAPTION>
INVESTMENT PROGRAM
-------------------------------------------------------
UNITED MUTUAL MONEY FIXED
COMMON STOCK MARKET INCOME
STOCK FUND FUND FUND TOTAL
---------------------------------------------------------------------
1998
<S> <C> <C> <C> <C> <C>
Cash and equivalents $ 20,598 $ 9,053 $401,439 $ 2,395 $ 433,485
Contributions receivable 125,250 11,463 2,450 3,375 142,538
Loans receivable - - 21,736 - 21,736
Investments (NOTE 3) 18,147,624 2,302,272 - 841,900 21,291,796
=====================================================================
Net assets available for benefits $18,293,472 $2,322,788 $425,625 $847,670 $21,889,555
=====================================================================
1997
Cash and equivalents $ (1,516) $ 7 $388,724 $ 14 $ 387,229
Contributions receivable 109,909 7,148 2,089 3,399 122,545
Loans receivable - - 23,086 - 23,086
Investments (NOTE 3) 15,282,818 1,432,864 - 788,884 17,504,566
---------------------------------------------------------------------
Net assets available for benefits $15,391,211 $1,440,019 $413,899 $792,297 $18,037,426
=====================================================================
</TABLE>
5
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Notes to Financial Statements (continued)
3. INVESTMENTS
Each investment is subject to market risk. The degree of market risk varies by
investment type based upon the nature of the applicable underlying net assets.
The Plan's maximum exposure to accounting loss from such investments is
represented by the amounts appearing in the statements of net assets available
for benefits.
The estimated fair value of individual investments representing 5% or more of
the Plan's net assets is as follows:
DECEMBER 31
1998 1997
---------------------------------
Goldman Sachs Capital Growth Fund $ 2,302,272 $ 1,432,864
United Bankshares, Inc. Common Stock 18,147,624 15,282,818
4. STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY INVESTMENT
PROGRAM
<TABLE>
<CAPTION>
INVESTMENT PROGRAM
------------------------------------------------------
UNITED MUTUAL MONEY FIXED
COMMON STOCK MARKET INCOME
STOCK FUND FUND FUND TOTAL
---------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1998
Additions:
<S> <C> <C> <C> <C> <C>
Contributions from employees $ 697,375 $ 367,252 $101,263 $105,645 $ 1,271,535
Contributions from employers 462,581 - - - 462,581
Investment income 478,705 325 19,581 42,672 541,283
Interest income on loans - - 2,249 - 2,249
---------------------------------------------------------------------
1,638,661 367,577 123,093 148,317 2,277,648
Deductions:
Withdrawals and benefit payments 635,644 49,213 17,992 16,208 719,057
---------------------------------------------------------------------
1,003,017 318,364 105,101 132,109 1,558,591
Net realized and unrealized appreciation 1,719,029 554,298 - 20,211 2,293,538
---------------------------------------------------------------------
Net increases 2,722,046 872,662 105,101 152,320 3,852,129
Interfund transfers 180,215 10,107 (93,375) (96,947) -
Net assets available for benefits at
beginning of year 15,391,211 1,440,019 413,899 792,297 18,037,426
---------------------------------------------------------------------
Net assets available for benefits at
end of year $18,293,472 $2,322,788 $425,625 $847,670 $21,889,555
=====================================================================
</TABLE>
6
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Notes to Financial Statements (continued)
<TABLE>
<CAPTION>
INVESTMENT PROGRAM
------------------------------------------------------
UNITED MUTUAL MONEY FIXED
COMMON STOCK MARKET INCOME
STOCK FUND FUND FUND TOTAL
---------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1997
Additions:
<S> <C> <C> <C> <C> <C>
Contributions from employees $ 379,591 $ 178,147 $ 53,974 $ 90,998 $ 702,710
Contributions from employers 389,074 - - - 389,074
Investment income 443,765 2,852 18,555 41,722 506,894
Interest income on loans - - 2,239 - 2,239
---------------------------------------------------------------------
1,212,430 180,999 74,768 132,720 1,600,917
Deductions:
Withdrawals and benefit payments 2,137,876 54,554 9,406 21,768 2,223,604
---------------------------------------------------------------------
(925,446) 126,445 65,362 110,952 (622,687)
Net realized and unrealized appreciation 4,766,596 334,312 - 10,299 5,111,207
---------------------------------------------------------------------
Net increases 3,841,150 460,757 65,362 121,251 4,488,520
Interfund transfers 24,170 56,243 (33,752) (46,661) -
Net assets available for benefits at
beginning of year 11,525,891 923,019 382,289 717,707 13,548,906
---------------------------------------------------------------------
Net assets available for benefits at
end of year $15,391,211 $1,440,019 $413,899 $792,297 $18,037,426
=====================================================================
</TABLE>
For purposes of this disclosure, loans receivable have been combined with the
money market fund.
5. INCOME TAX STATUS
The Internal Revenue Service (IRS) has ruled that the Plan qualifies under
Section 401(a) of the Internal Revenue Code (IRC) and is, therefore, not subject
to tax under present income tax law. Once qualified, the Plan is required to
operate in conformity with the IRC to maintain its qualification. The Plan
administrator and other representatives of the Plan are not aware of any course
of action or series of events that have occurred that might adversely affect the
Plan's qualified status.
6. TRANSACTIONS WITH PARTIES-IN-INTEREST
The Plan holds 684,816 shares of United common stock, which had an estimated
fair value of $26.50 per share at December 31, 1998.
United pays certain administrative expenses on behalf of the Plan and provides
certain services at no cost to the Plan.
United National Bank, a wholly-owned subsidiary of United, acts as Trustee for
the Plan.
7
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Notes to Financial Statements (continued)
7. YEAR 2000 (UNAUDITED)
The Plan Sponsor has determined that it will be necessary to take certain steps
to ensure that the Plan's information systems are prepared to handle year 2000
dates. The Plan Sponsor is taking a two phase approach. The first phase
addresses internal systems that must be modified or replaced to function
properly. Both internal and external resources are being utilized to replace or
modify existing software applications, and test the software and equipment for
the year 2000 modifications. The Plan Sponsor anticipates substantially
completing this phase of the project by June 1999. Costs associated with
modifying software and equipment are not estimated to be significant and will be
paid by the Plan Sponsor.
For the second phase of the project, Plan management established formal
communications with its third party service providers to determine that they
have developed plans to address their own year 2000 problems as they relate to
the Plan's operations. All third party service providers have indicated that
they will be year 2000 compliant by early 1999. If modification of data
processing systems of either the Plan, the Plan Sponsor, or its service
providers is not completed timely, the year 2000 problem could have a material
impact on the operations of the Plan. Plan management has not developed a
contingency plan, because they are confident that all systems will be year 2000
ready.
8
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
EIN #56-0641179 - Plan #002
Line 27a--Schedule of Assets Held for Investment Purposes
(Modified Cash Basis)
December 31, 1998
<TABLE>
<CAPTION>
ESTIMATED
FAIR
DESCRIPTION UNITS COST VALUE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
United National Bank Liquid Asset Fund (cash equivalents) 11,448 $ 11,448 $ 11,448
Goldman Sachs Treasury Obligation Portfolio Fund (cash
equivalents) 401,437 401,437 401,437
Federated Intermediate Government Trust Fund 77,168 811,729 841,900
Goldman Sachs Capital Growth Fund 98,262 1,700,317 2,302,272
United Bankshares, Inc. common stock 684,816 6,553,608 18,147,624
Loans to participants (interest rates ranging from 7.75% to
10.00%) 21,736 - 21,736
--------------------------------------
$9,478,539 $21,726,417
======================================
</TABLE>
9
<PAGE>
United Bankshares, Inc.
Savings and Stock Investment Plan
Line 27d--Schedule of Reportable Transactions
(Modified Cash Basis)
Year Ended December 31, 1998
<TABLE>
<CAPTION>
TOTAL TOTAL
TOTAL NUMBER OF TOTAL TOTAL NUMBER OF
NUMBER SHARES OR COST NUMBER OF SHARES OR
OF UNITS OF SALES OR UNITS SOLD OR
DESCRIPTION PURCHASES PURCHASED PURCHASES REDEMPTIONS REDEEMED
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CATEGORY (iii)--SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
United Bankshares, Inc.
Common Stock 68 58,151 1,751,703 32 20,530
<CAPTION>
TOTAL TOTAL
COST PROCEEDS REALIZED
OF FROM GAIN OR
DESCRIPTION SALES SALES (LOSS)
- -------------------------------------------------------------------------------------
<S> <C> <C> <C>
CATEGORY (iii)--SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
United Bankshares, Inc.
Common Stock 46,655 531,391 484,736
</TABLE>
There were no category (i), (ii) or (iv) reportable transactions during fiscal
year 1998.
10
<PAGE>
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-32522) pertaining to the Savings and Stock Investment Plan of United
Bankshares, Inc. and in the related Prospectus of our report dated June 18,
1999, with respect to the financial statements and schedules of the United
Bankshares, Inc. Savings and Stock Investment Plan included in this Annual
Report (Form 11-K) for the year ended December 31, 1998.
/s/ Ernst & Young LLP
Charleston, West Virginia
June 25, 1999
