UNITED STATES
SECURITITES 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, 1997
Commission File Number 0-12635
SOUTH 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, 1997 1,086,231
<PAGE>
<TABLE>
PART I-Financial Information
This is the consolidated balance sheet for Southern Jersey Bancorp.
All dollar amounts are in thousands.
<CAPTION>
6/30/97 6/30/96 12/31/96
<S> <C> <C> <C>
ASSET
Cash and due from banks 16,557 18,171 18,347
Interest bearing deposits 0 0 0
Investment securities held to maturity 55,428 72,184 61,765
Investment securities available for sale 39,203 42,736 34,904
Market Value
6-30-97 55,434
6-30-96 71,875
12-31-96 61,901
Loan net of unearned income 296,021 270,386 290,885
Less: Allowance for loan losses 3,654 2,689 3,190
------- ------- -------
Net Loans 292,367 267,697 287,695
------- ------- -------
Federal funds sold 18,900 4,800 12,900
Bank premises and equipment - net 6,064 6,274 6,214
Other assets 18,407 8,702 8,499
------- ------- -------
Total Assets 446,926 420,564 430,324
======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES 6/30/97 6/30/96 12/31/96
<S> <C> <C> <C>
Deposits-interest bearing 340,824 325,381 330,041
Non-interest bearing deposits 58,203 52,738 55,343
------ ------ ------
Total Deposits 399,027 378,119 385,384
Federal Funds Purchased 0 0 0
Other Liabilities 6,206 4,848 5,189
----- ----- -----
Total Liabilities 405,233 382,967 390,573
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 2,260 2,223 2,260
Undivided profits 41,241 37,075 39,236
------ ------ ------
45,630 41,427 43,625
Less: Treasury stock at cost
188,769 Common Shares 6-30-97
187,732 Common Shares 6-30-96
190,196 Common Shares 12-31-96 3,847 3,679 3,896
----- ----- -----
41,783 37,748 39,729
Allowance for unrealized gain/losses
on Available for Sale Securities (90) (151) 22
------ ------ ------
Total Shareholders' Equity 41,693 37,597 39,751
------ ------ ------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 446,926 420,564 430,324
======= ======= =======
</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
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest on securities:
Taxable interest income 2,242 2,779 1,154 1,464
Tax-exempt interest income 725 766 363 329
Interest and fees on loans 12,762 10,321 6,548 5,411
Interest on interest bearing deposits 0 0 0 0
Federal funds sold 550 583 270 190
Lease income 0 225 0 0
---- ---- ---- ---
Total interest income 16,279 14,674 8,335 7,394
INTEREST EXPENSE
Interest on deposits
Savings 2,748 2,894 1,561 1,555
Certificates of deposit $100,000
and over 1,747 1,288 876 655
Fed Funds Purchased 0 0 0 0
Other time deposits 3,406 2,926 1,569 1,339
----- ----- ----- -----
Total interest expense 7,901 7,108 4,006 3,549
NET INTEREST INCOME 8,378 7,566 4,329 3,845
Provision for loan losses 660 615 315 315
Net Interest Income After --- --- --- ---
Provision for Loan Losses 7,718 6,951 4,014 3,530
OTHER OPERATING INCOME
Service charges on deposit accounts 827 784 419 406
Trust Department Income 359 341 178 172
Commissions, collection
Charges and fees 192 216 98 98
Investment security gains (losses) 0 0 0 0
Other Non-Interest Income 2 42 2 42
--- --- --- ---
Total Other Operating Income 1,380 1,383 697 718
OTHER OPERATING EXPENSES
Salaries and wages 2,499 2,218 1,318 1,172
Pension and other benefits 580 573 279 321
Occupancy and equipment 890 799 507 426
FDIC Assessments 67 48 34 24
Postage, stationery and supplies 242 117 103 50
Professional Fees 215 240 103 134
Other operating expenses 808 720 423 386
--- --- --- ---
Total Other Operating Expenses 5,301 4,715 2,767 2,513
Income Before Income Taxes 3,797 3,619 1,944 1,735
Applicable Income Taxes 1,140 1,050 540 600
----- ----- ---- -----
NET INCOME 2,657 2,569 1,404 1,135
===== ===== ===== =====
Earnings per Common Share 2.45 2.36 1.30 1.04
</TABLE>
<PAGE>
<TABLE>
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands)
<CAPTION>
Six Months Ended
June 30
1997 1996
---- ----
<S> <C> <C>
Cash flow from operating activities
Net Income 2,657 2,569
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of organization expenses 0 0
Depreciation of premises and equipment 232 219
Net Loan charge offs (196) (339)
Provision of loan losses 660 615
Premium Amortization net of discount accretion 78 72
Gain or (Loss) on sale of securities 0 0
Gain on other real estate 2 0
Gain on sale of bank premises and equipment 0 (42)
Increase in other assets (9,920) (1,189)
Increase/(decrease) in other liabilities 1,017 684
Increase/(decrease) in borrowed funds 0 0
----- ----
Net cash provided by operating activities (5,470) 2,589
Cash flows from investing activities
Interest bearing deposits 0 0
Purchase of investment securities (11,823) (14,282)
Proceeds from sales of investment securities 6,463 0
Proceeds from maturities of investment securities 6,662 12,260
Increase in loans (5,136) (38,217)
Bank premises and equipment 82 (576)
Proceeds from sale of bank premises and equipment 80 42
Proceeds from sale of other real estate 312 224
--- ---
Net cash used for investing activities (3,360) (40,549)
Cash flows from financing activities
(Decrease)/Increase in total deposits 13,643 14,686
Cash dividends (652) (598)
Purchase of Treasury stock (90) (75)
Sale of Treasury stock 139 137
---- ----
Net Cash provided by financing activities 13,040 14,150
Net increase/(decrease) in cash and cash equivalents 4,210 (23,810)
Cash and equivalents at beginning of year 31,247 46,781
------ ------
Cash and Cash equivalent at end of quarter 35,457 22,971
====== ======
Supplementary Schedule of NonCash Investing
and Financing Activities
Loans, Net of Chargeoffs transferred to Other Real Estate Owned:
0 62
</TABLE>
<PAGE>
SOUTHERN JERSEY BANCORP OF DELAWARE, INC.
NOTES TO FINANCIAL STATEMENTS
Six Months Ended June 30, 1997
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, 1996, 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, 1997,
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: June 14, 1997
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF
RESULTS IN OPERATIONS
Six Months Ended June 30, 1997
The net operating income of $2,657,000 for the first six months
of 1997 is 3.43% above the same period in the prior year. Net
income after taxes for 1997 is projected to be approximately
$5,500,000 or approximately 3.2% more than 1996.
This is primarily due to the fact that during the first half of 1997 there
was an increase in the interest and fee income generated by the loan
portfolio as compared to the first half of 1996. This increase outpaced the
growth in deposit expense for the same period and resulted in a net
interest income increase in the first half of 1997 as compared to 1996.
The increase in net interest income was an important factor in the increase
in net income for the first half of 1997 as compared to the first half of
1996.
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 quater except for an increase of approximately $3,339,000
in loans to individuals for household, family and other personal expenditure
loans 30 through 89 days past due and an increase of approximately $712,000
in commercial loans past due 90 days or more. 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 1997 totalled $228,000 while
total recoveries during the same period were $32,000.
<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-30-1997
<CASH> 16,557
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 18,900
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 39,203
<INVESTMENTS-CARRYING> 55,428
<INVESTMENTS-MARKET> 55,434
<LOANS> 296,021
<ALLOWANCE> 3,654
<TOTAL-ASSETS> 446,926
<DEPOSITS> 399,027
<SHORT-TERM> 0
<LIABILITIES-OTHER> 6,206
<LONG-TERM> 0
<COMMON> 2,129
0
0
<OTHER-SE> 39,564
<TOTAL-LIABILITIES-AND-EQUITY> 446,926
<INTEREST-LOAN> 12,762
<INTEREST-INVEST> 2,967
<INTEREST-OTHER> 550
<INTEREST-TOTAL> 16,279
<INTEREST-DEPOSIT> 7,901
<INTEREST-EXPENSE> 7,901
<INTEREST-INCOME-NET> 8,378
<LOAN-LOSSES> 660
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 5,301
<INCOME-PRETAX> 3,797
<INCOME-PRE-EXTRAORDINARY> 3,797
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,657
<EPS-PRIMARY> 2.45
<EPS-DILUTED> 2.45
<YIELD-ACTUAL> 3.43
<LOANS-NON> 3,192
<LOANS-PAST> 2,777
<LOANS-TROUBLED> 654
<LOANS-PROBLEM> 961
<ALLOWANCE-OPEN> 3,440
<CHARGE-OFFS> 228
<RECOVERIES> 32
<ALLOWANCE-CLOSE> 3,654
<ALLOWANCE-DOMESTIC> 3,654
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
