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 quarterly period ended June 30, 1996
Commission File Number 0-12635
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
(Exact name of Registrant as Specified in Charter)
Delaware 22-2983654
(State of Other Jurisdiction (I.R.S. Employer Identification
of Incorporation or Organization) Number>
53 South Laurel Street
Bridgeton, NJ 08302
(Address of Principal Executive Offices)
(609) 453-3000
(Registrant's Area Code and Telephone Number)
Registrant has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the period it has been subject
to such filing requirements.
[x] YES [ ] NO
Common Stock Outstanding as of June 30, 1996 1,087,268
<PAGE>
<TABLE>
PART I-Financial Information
This is the consolidated balance sheet for Southern Jersey Bancorp.
All dollar amounts are in thousands.
<CAPTION>
6/30/96 6/30/95 12/31/95
<S> <C> <C> <C>
ASSET
Cash and due from banks 18,171 15,331 18,981
Interest bearing deposits 0 3,000 0
Investment securities held to maturity 72,184 104,512 80,566
Investment securities available for sale 42,736 18,366 33,754
Market Value
6-30-96 114,611
6-30-95 122,777
12-31-95 115,240
Loan: net of unearned income 270,386 210,431 232,113
Less: Allowance for loan losses 2,689 2,451 2,413
Net Loans 267,697 207,980 229,700
Federal funds sold 4,800 20,400 27,800
Bank premises and equipment - net 6,274 5,901 5,916
Other assets 8,702 7,745 7,523
Total Assets 420,564 383,235 404,240
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES 6/30/96 6/30/95 12/31/95
<S> <C> <C> <C>
Deposits-interest bearing 325,381 283,060 286,117
Non-interest bearing deposits 52,738 61,494 77,316
------ ------ ------
Total Deposits 378,119 344,554 363,433
Fed funds purchased 0 0 0
Other Liabilities 4,848 3,964 4,164
----- ----- -----
Total Liabilities 382,967 348,518 367,597
Shareholder's Equity
Common stock par value $1.67 per share
Authorized 5,000,000 shares;
Issued 1,275,000 shares 2,129 2,129 2,129
Surplus 2,223 2,258 2,223
Undivided profits 37,075 32,890 35,103
------ ------ ------
41,427 37,277 39,455
Less: Treasury stock at cost
187,732 Common Shares 6-30-96
173,777 Common Shares 6-30-95
190,193 Common Shares 12-31-95 3,679 3,198 3,741
----- ----- -----
37,748 34,079 35,714
Allowance for unrealized gain/losses
on Available for Sale Securities (151) 638 929
Total Shareholders' Equity 37,597 34,717 36,643
------ ------ ------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 420,564 383,235 404,240
</TABLE>
<PAGE>
<TABLE>
This is the consolidated statement of earnings sheet for
Southern Jersey Bancorp. All dollar amounts are in thousands except for per
share data
<CAPTION>
Six Months Second Qtr.
Ended Ended
June 30 June 30
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest on securities:
Taxable interest income 2,779 2,904 1,464 1,391
Tax-exempt interest income 766 1,045 329 514
Interest and fees on loans 10,321 8,837 5,411 4,615
Interest on interest bearing deposits 0 102 0 51
Federal funds sold 583 174 190 141
Lease income 225 6 0 1
- - - -
Total interest income 14,674 13,068 7,394 6,713
INTEREST EXPENSE
Interest on deposits
Savings 2,894 2,728 1,555 1,317
Certificates of deposit $100,000
and over 1,288 861 655 539
Fed Funds Purchased 0 30 0 0
Other time deposits 2,926 2,470 1,339 1,350
----- ----- -- ---
Total interest expense 7,108 6,089 3,549 3,206
NET INTEREST INCOME 7,566 6,979 3,845 3,507
Provision for loan losses 615 450 315 225
Net Interest Income After --- --- --- ---
Provision for Loan Losses 6,951 6,529 3,530 3,282
OTHER OPERATING INCOME
Service charges on deposit accounts 784 667 406 348
Trust Department Income 341 325 172 166
Commissions, collection
Charges and fees 216 188 98 108
Investment security gains (losses) 0 226 0 233
Other Non-Interest Income 42 0 42 0
--- - --- -
Total Other Operating Income 1,383 1,406 718 855
OTHER OPERATING EXPENSES
Salaries and wages 2,218 2,212 1,172 1,176
Pension and other benefits 573 688 321 358
Occupancy and equipment 799 775 426 383
FDIC Assessments 48 416 24 208
Postage, stationery and supplies 117 193 50 82
Professional Fees 240 140 134 64
Other operating expenses 720 663 386 336
--- --- --- ---
Total Other Operating Expenses 4,715 5,087 2,513 2,607
Income Before Income Taxes 3,619 2,848 1,735 1,530
Applicable Income Taxes 1,050 750 600 375
----- ----- --- -----
NET INCOME 2,569 2,098 1,135 1,155
----- ----- ----- -----
Earnings per Common Share 2.36 1.91 1.04 1.05
</TABLE>
<PAGE>
<TABLE>
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands)
<CAPTION>
Six Months Ended
June 30
1996 1995
---- ----
<S> <C> <C>
Cash flow from operating activities
Net Income 2,569 2,098
Adjustments to reconcile net income to net cash
provided by operating activities
Amortization of organization expenses 0 0
Depreciation of premises and equipment 219 189
Net Loan charge offs (339) (145)
Provision of loan losses 615 450
Premium Amortization net of discount accretion 72 104
Gain or (Loss) on sale of securities 0 226
Gain on other real estate 0 0
Gain on sale of bank premises and equipment (42) 0
Increase/(decrease) in other assets (1,189) (916)
Increase/(decrease) in other liabilities 684 846
Increase/(decrease) in borrowed funds 0 0 --- ---
Net cash provided by operating activities 2,589 2,852
Cash flows from investing activities
Interest bearing deposits 0 0
Purchase of investment securities (14,282) (11,451)
Proceeds from sales of investment securities 0 12,437
Proceeds from maturities of investment securities 12,260 14,342
Increase in loans (38,217) (17,913)
Bank premises and equipment (576) (771)
Proceeds from sale of bank premises and equipment 42 0
Proceeds from sale of other real estate 224 190
--- ---
Net cash used for investing activities (40,549) (3,166)
Cash flows from financing activities
(Decrease)/Increase in total deposits 14,686 7,331
Cash dividends (598) (552)
Purchase of Treasury stock (75) (80)
Sale of Treasury stock 137 114
--- ---
Net Cash provided by financing activities 14,150 6,813
Net increase/(decrease) in cash and cash equivalents (23,810) 6,499
Cash and equivalents at beginning of year 46,781 29,232
Cash and Cash equivalent at end of quarter 22,971 35,731
Supplementary Schedule of NonCash Investing
and Financing Activities
Loans, Net of Chargeoffs transferred to Other Real
Estate Owned: 62 86
</TABLE>
<PAGE>
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
NOTES TO FINANCIAL STATEMENTS
Six Months Ended June 30, 1996
1) Principles of Consolidation: The consolidated financial statements
reflect the account of Southern Jersey Bancorp of Delaware, Inc. and
its subsidiary, The Farmers and Merchants National Bank of Bridgeton,
after the elimination of all intercompany balances and transactions.
2) There have been no significant changes in the account policies of
the registrant since December 31, 1995, the date of the most recent
annual report to security holders, nor have there occurred events
which have had a material impact on the disclosures herein.
3) The interim financial statements contained herein reflect all
adjustments which are, in the opinion of management, necessary to a
fair statement of the results for the interim periods presented.
4) In accordance with Rule 10-01(b)(8), the unaudited interim financial
statements filed under cover of Form 10-Q for June 30, 1996,
reflect adjustments that are of a normal recurring nature which are,
in the opinion of Management, necessary to a fair statement of the
results for the interim periods presented.
<PAGE>
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
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 thereunto duly authorized.
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
(Registrant)
Paul Ritter
Treasurer
Clarence D. McCormick
Chairman/CEO
DATE: August 13, 1996
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF
RESULTS IN OPERATIONS
Six Months Ended June 30, 1996
The net operating income of $2,569,000 for the first six months
of 1996 is 22.45% above the same period the prior year. Net
income after taxes for 1996 is projected to be approximately
$5,200,000 or approximately 7.17% more than 1995.
This is primarily due to the fact that during the first two quarters of
1996 a decrease in FDIC expenses and an increase in Federal Funds Sold
Income resulted in net income increase in the first quarter of 1996
compared to 1995.
An unrealized loss of approximately $151,000 was recognized on the
value of securities available for sale pursuant to FASB 115.
There has been no other significant changes in charge-offs, recoveries,
provision for loan and lease losses, non-accruing or non-performing loans in
the last quarter except for an increase of approximately $790,000 in past
due 30 - 90 days loans secured by real estate and approximately $323,000
increase in total charge-offs. These loans are adequately secured by real
estate and other collateral and minimal loss is expected at this time.
Total charge-offs for the first six months of 1996 totalled $418,000
while total recoveries during the period were $79,000.
<PAGE>
PART II - OTHER INFORMATION
EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
Exhibit 27. Financial Data Schedule
B. Reports on Form 8-K
No reports have been filed on form 8-K during this quarter.
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 18,171
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,800
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 42,736
<INVESTMENTS-CARRYING> 114,920
<INVESTMENTS-MARKET> 114,611
<LOANS> 270,386
<ALLOWANCE> 2,689
<TOTAL-ASSETS> 420,564
<DEPOSITS> 378,119
<SHORT-TERM> 0
<LIABILITIES-OTHER> 4,848
<LONG-TERM> 0
<COMMON> 2,129
0
0
<OTHER-SE> 35,468
<TOTAL-LIABILITIES-AND-EQUITY> 420,564
<INTEREST-LOAN> 10,546
<INTEREST-INVEST> 3,545
<INTEREST-OTHER> 583
<INTEREST-TOTAL> 14,674
<INTEREST-DEPOSIT> 7,108
<INTEREST-EXPENSE> 7,108
<INTEREST-INCOME-NET> 7,566
<LOAN-LOSSES> 615
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,715
<INCOME-PRETAX> 3,619
<INCOME-PRE-EXTRAORDINARY> 3,619
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,569
<EPS-PRIMARY> 2.37
<EPS-DILUTED> 2.37
<YIELD-ACTUAL> 4.67
<LOANS-NON> 4,924
<LOANS-PAST> 1,558
<LOANS-TROUBLED> 1,152
<LOANS-PROBLEM> 776
<ALLOWANCE-OPEN> 2,413
<CHARGE-OFFS> 418
<RECOVERIES> 79
<ALLOWANCE-CLOSE> 2,689
<ALLOWANCE-DOMESTIC> 2,689
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
