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, 1995
Commission file Number 2-89561
Teche Bancshares, Inc.
Louisiana 72-1008552
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
606 South Main Street, St. Martinville, Louisiana 70582
(Address of principal executive offices70582
Registrant's telephone number, including area code:
(318) 394-9726
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.
YES (X) NO ( )
Indicated the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical date.
Common Stock, $10 Par Value - 27,900 shares as of June 30,
1995.
TECHE BANCSHARES, INC. AND SUBSIDIARY
St. Martinville, Louisiana
CONSOLIDATED BALANCE SHEETS
June 30, 1995 and December 31, 1994
(Dollars in Thousands)
June 30,
1995 Dec.31,
(Unaudited) 1994
ASSETS
Cash and due from banks $1,248 $3,019
Interest-bearing deposits in banks 297 882
Securities Available for Sale at mkt value 11,208 10,900
Securities Held To Maturity (Market Value
of $3,602 and $4,139, respectively) 3,586 4,215
Other securities at cost 254 254
Federal funds sold 1,725 0
Loans, net of allowance for loan losses
of $179 and $180, respectively) 10,953 10,968
Bank premises, furniture, and equipment 670 668
Accrued interest receivable 268 252
Other real estate owned 320 411
Deferred tax asset 0 76
Other assets 194 171
------------------------
Total assets $30,723 $31,816
========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits -
Non-interest demand 4,157 $4,379
Interest bearing -
NOW and MMDA accounts 3,991 8,006
Savings 3,098 3,453
Time, $100 and over, 6,546 4,322
Other time 9,942 9,005
------------------------
Total deposits 27,734 29,165
Accrued interest payable 125 78
Notes payable - stockholders 292 292
Other liabilities and accrued expenses 201 316
------------------------
Total liabilities 28,352 29,851
Stockholders' equity:
Common stock ($10 par value, 100,000
shares authorized, 28,125 shares
issued and outstanding) 281 281
Surplus 1,143 1,143
Retained earnings 960 808
------------------------
2,384 2,232
Less: 225 shares of treasury stock (21) (21)
Allowance for unrealized
loss on mkt securities 0 (4)
Market Value Allowance on
AFS Bonds 8 (242)
------------------------
Total stockholders' equity 2,371 1,965
------------------------
Total liabilities and stockholders' equity $30,723 $31,816
========================
The accompanying notes are an integral part of this statement.
TECHE BANCSHARES, INC. AND SUBSIDIARY
St. Martinville, Louisiana
CONSOLIDATED STATEMENTS OF INCOME
Six Months Ended June 30, 1995 and 1994;
(Dollars in Thousands except Earnings per Share)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1995 1994 1995 1994
Interest income:
Interest and fees on loans $279 $251 $560 $500
Interest on investment securities -
U.S. government's 240 195 457 344
State/political sub's 1 1 2 2
Interest on interest-bearing deposits
in banks 6 16 20 34
Dividends on equities 0 0 0 1
Interest on federal funds 35 9 55 26
------------------------------------------------
Total interest income 561 472 1,094 907
Interest expense:
Interest on deposits $234 $162 $440 $310
Stockholder loans 4 5 7 10
------------------------------------------------
Total interest expense 238 167 447 320
------------------------------------------------
Net interest income 323 305 647 587
Other income:
Service charges deposits 58 49 110 98
Gain on sale of ORE 6 11 10 11
Other income and charges 16 18 31 32
------------------------------------------------
Total other income 80 78 151 141
Other expenses:
Salaries/employee benefits 121 119 249 228
Occupancy expense 47 41 98 82
Loss on sale of AFS securities 1 0 5 0
Other operating expenses 105 112 213 211
------------------------------------------------
Total other expenses 274 272 565 521
------------------------------------------------
Income before income taxes 129 111 233 207
Income taxes 45 34 81 57
------------------------------------------------
Net income $84 $77 $152 $150
Earnings per share $3.01 $2.78 $5.44 $5.38
The accompanying notes are an integral part of this statement.
TECHE BANCSHARES, INC. AND SUBSIDIARY
St. Martinville, Louisiana
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
For the Six Months Ended June 30, 1995 and 1994
Allowance for
Unrealized Unrealized
Loss on Gain (Loss)
Common Stock Marketable on
Treasury Stk Equity AFS
Surplus Securities Securities Total
Balances, January 1, 1995 $2,211 ($4) ($242) $1,965
Net income six months 152 - $152
Change in Unrealized AFS 250 $250
Realized loss mkt securities 4 $4
------- ------- ------- -------
Balances, June 30, 1995 2,363 $0 $8 $2,371
======= ======= ======= =======
Balances, January 1, 1994 $2,001 ($4) $0 $1,997
Net income six months 150 $150
Change in Unrealized AFS (92) ($92)
------- ------- ------- -------
Balances, June 30, 1994 $2,151 ($4) ($92) $2,055
======= ======= ======= =======
The accompanying notes are an integral part of this statement.
TECHE BANCSHARES, INC. AND SUBSIDIARY
St. Martinville, Louisiana
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the Six Months Ended June 30, 1995 and 1994
June 30, June 30,
1995 1994
Cash flows from operating activities:
Net income $152 $150
Adjustments to reconcile net income
to net cash provided by
operating activities -
Depreciation of bank premises 40 34
(Gain) Loss on Other real estate (10) (11)
(Gain) Loss on sale of securities 5 0
(Inc)dec accrued int recievable (16) (53)
(Inc) dec other assets 22 2
(Inc) dec deferred tax asset 76 15
Inc(dec) accrued interest payable 48 25
Inc(dec) other liabilities (115) 59
Net cash provided by operating ------------------------
activities 202 221
Cash flows from investing activities:
Dec interest-bearing deposits in banks 585 0
Dec(inc) in federal funds (1,725) 275
Dec(inc) in investment securities 525 (1,151)
Net dec (inc) in loans 15 (730)
Capital expenditures premises & equip (42) (17)
Proceeds from sale of other real estate 100 200
------------------------
Net cash used in investing activities (542) (1,423)
Cash flows from financing activities:
Net increase (decrease) in -
Demand deposits (222) 119
NOW and MMDA (4,015) (3,710)
Savings deposits (354) 78
Time deposits $100,000 and over 2,223 2,543
Other time deposits 937 (58)
------------------------
Net cash provided by financing activities (1,431) (1,028)
Net increase in cash and cash equivalents (1,771) (2,230)
Cash and cash equivalents, beginning 3,019 3,287
Cash and cash equivalents, end of period $1,248 $1,057
Cash paid during the period:
Interest $400 $295
Income Taxes $38 $7
The accompanying notes are an integral part of this statement.
TECHE BANCSHARES, INC.
NOTES TO FINANCIAL STATEMENTS
June 30, 1995
The information furnished reflects all normal, recurring
adjustments which are, in the opinion of management, necessary for
a fair statement of Teche Bancshares, Inc. and its subsidiary for
the six (6) months ended June 30, 1995. Results for the interim
period presented are not necessarily indicative of results which may
be expected for any other interim period or for the year as a whole.
TECHE BANCSHARES, INC.
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
June 30, 1995
Liquidity
Liquidity is the ability to ensure that adequate funds are
available to satisfy contractual liabilities, fund operations, meet
withdrawal requirements of depositors and provide for customer's
credit needs in a timely manner. Our primary source of liquidity is
our core deposits. We supplement our core deposits with a line of
credit with one of our correspondent banks, public fund time
deposits, repurchase agreements with correspondent banks and a line
of credit with the Federal Home Loan Bank. Our sources of liquidity
are adequate to fund the loan demand that we are experiencing.
Capital Resources and Asset Quality
Our consolidated risk based capital to asset ratio was 17.8%
and Tier one capital ratio was 7.71% at June 30, 1995. The bank
only risk based capital ratio was 19.8% and Tier one capital was
8.67%. Banks are required to maintain a risk weighed capital to
asset ratio of 8% and Tier one capital ratio of 5%. Our risk based
capital ratio and Tier one capital ratio both exceed the required
amount.
Asset quality continues to be satisfactory due to our
increased emphasis on credit quality in our loan portfolio.
Management is of the opinion that we have all of our problem credits
identified and that an adequate allowance has been made for any
potential future losses.
We continuously monitor the quality of our loans. Loans past
due 90 days or greater still accruing at June 30, 1995 were $24,822
a decrease of $31,781 from December 31, 1994. Loans on which the
accrual of interest had been discontinued at June 30, 1995 totalled
$15,902 which is up $9,026 as compared to the amount at December 31,
1994.
We are actively marketing our other real estate owned. At
June 30, 1995 other real estate owned totalled $320,703 which is
down $90,449 or 21.9% from December 31, 1994.
Results of Operations
Net Income
Our net income for the six months ended June 30, 1995 was
$151,644 up $1,415 as compared to that of the same period last year.
Our net interest income increased during the period, however the
increase in income was offset by increases in expenses and income
tax expense. In prior years, we had net operating loss
carryforwards that were used to reduce our income tax expense. In
1994 we used all of the remaining tax credits and net operating loss
carryforwards that we had.
Revenue
Our net interest income for the six months ended June 30, 1995
is up $60,825 as compared to the same period in 1994. Starting in
the first quarter of 1994, interest rates rose very rapidly. This
increase in rates caused our bank to increase the rate paid on
deposits faster than we were able to reprice our assets. During the
first quarter of 1995, our asset repricing started to catch up with
the deposit repricing. Since that time our net interest income has
improved. Additionally, we have improved our net interest income
through actively managing our interest expense.
Provision for Loan Losses
Our bad debt reserve totalled $179,890 at June 30, 1995 which
represents 1.6% of our gross loans. Our reserve for loan loss was
adequate and did not require any additional provisions during the
first six months of 1995.
Other Income
Our other income is up $9,155 when compared to the same period
last year. The increase was due to an increase in NSF income and
credit life insurance commissions collected. The NSF income
increase was the result of a change in the volume of items
overdrawn.
Other Expenses
Other expenses are up $43,781 as compared to the same time
last year. The primary causes for this increase in expenses were
increases in employee salaries and occupancy expenses. The
increases in salaries were the result of raises that were placed in
effect during the last quarter of 1994. The increase in occupancy
costs were due to increased costs from the addition of the ATM and
depreciation expense associated with recent equipment purchases.
During the first quarter of 1995 we added a 24-hour voice response
system in order to provide better customer service. The 394-TECH
line provides customers 24 hour access to balance information,
checks cleared, time and temperature, deposits cleared and banking
hours. We actively monitor our costs and are always searching for
ways to cost effectively deliver services to our customers.
Provision for Income Tax
A provision is made for income tax to reflect one-half
(6/12ths) of the annualized income tax that we anticipate we will
incur. In prior years we had net operating loss carryforwards and
investment tax credits that reduced our income tax expense. During
1994 we used all of the remaining credits and operating loss
carryforwards that were available.
PART II - OTHER INFORMATION
Item #1 Legal proceedings
Inapplicable
Item #2 Changes in Securities
Inapplicable
Item #3 Defaults Upon Senior Securities
Inapplicable
Item #4 Submission of Matters to be a Vote of Securities Holders
Inapplicable
Item #5 Other information
Inapplicable
Item #6 Exhibits and Reports on Form 8-K
Inapplicable
TECHE BANCSHARES, INC.
Pursuant to the requirement of the Securities Exchange Act of
1934, the Bank has duly caused this quarterly report to be signed on
its behalf by the undersigned thereunto duly authorized.
TECHE BANCSHARES, INC.
Registrant
/s/ Alcee J. Durand, Jr.
August 14, 1995 Alcee J. Durand, Jr.
Date President/CEO
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