<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
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Commission file number 0-133312
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THE FIRST JERMYN CORP.
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(Exact name of small business issuer as specified in its charter)
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Pennsylvania 23-2275242
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
645 Washington Avenue; P.O. Box 39; Jermyn Pennsylvania 18433-0039
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(Address of principal executive offices) (Zip Code)
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Issuer's telephone number 717-876-6500
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Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 during the past 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
- --
State the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at July 31, 1997
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Common stock, $1.25 par value 884,680
<PAGE> 2
THE FIRST JERMYN CORP. AND SUBSIDIARIES
FORM 10-QSB
QUARTER ENDED JUNE 30, 1997
INDEX
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PAGE
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PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS:
Consolidated Balance Sheets - June 30, 1997 and
December 31, 1996 1
Consolidated Statements of Income - Three Months and Six Months
Ended June 30, 1997 and 1996 2
Consolidated Statements of Cash Flows
Six Months Ended June 30, 1997 and 1996 3
Notes to Consolidated Financial Statements 4
ITEM 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
PART II - OTHER INFORMATION 12
SIGNATURES 13
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<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
THE FIRST JERMYN CORP. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands of dollars, except per share information)
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<CAPTION>
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June 30, December 31,
ASSETS 1997 1996
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<S> <C> <C>
Cash and due from banks $ 10,616 8,103
Federal funds sold 11,100 1,900
Securities available for sale 16,150 24,235
Mortgage backed securities available for sale 25,899 25,006
Investment securities 51,373 57,827
Loans, gross 195,944 197,598
Less: Unearned discount and origination fees (903) (988)
Allowance for loan losses (2,835) (3,111)
- ---------------------------------------------------------------------------------------------------------------
Loans, net 192,206 193,499
Accrued interest receivable 2,220 2,470
Bank premises, leasehold improvements and furniture and equipment-net 4,952 5,067
Real estate owned other than bank premises 249 199
Other assets 2,977 3,257
- ---------------------------------------------------------------------------------------------------------------
Total assets $ 317,742 321,563
===============================================================================================================
LIABILITIES
- ---------------------------------------------------------------------------------------------------------------
Deposits:
Noninterest-bearing demand $ 28,047 30,437
Interest-bearing 257,426 259,678
- ---------------------------------------------------------------------------------------------------------------
Total deposits 285,473 290,115
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Capitalized lease obligation 783 821
Accrued interest payable 1,244 1,250
Other liabilities 126 703
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Total liabilities 287,626 292,889
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SHAREHOLDERS' EQUITY
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Common stock, $1.25 par value, authorized 2,500,000 shares;
Outstanding 899,885 shares 1,125 1,125
Surplus 3,876 3,876
Retained earnings 25,589 24,343
Unrealized loss on securities available for sale, net of tax (278) (474)
Less treasury stock-at cost (15,205 shares) (196) (196)
- ---------------------------------------------------------------------------------------------------------------
Total shareholders' equity 30,116 28,674
- ---------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $ 317,742 321,563
===============================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements
1
<PAGE> 4
THE FIRST JERMYN CORP. AND SUBSIDIARIES
Consolidated Statements of Income
(In thousands of dollars, except per share information)
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<CAPTION>
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Three months Six months
Ended June 30 Ended June 30
1997 1996 1997 1996
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Interest income:
Interest and fees on loans 4,044 3,692 7,997 7,378
Interest and dividends on securities:
U.S. Treasury 836 1,251 1,749 2,415
U.S. government agencies --- 2 --- 3
CMO's of U.S. government agencies
and corporations 407 433 795 863
State and political subdivisions 234 248 478 495
Other taxable debt --- 5 1 13
Taxable equity 2 2 4 4
Interest on federal funds sold 89 60 155 187
- ---------------------------------------------------------------------------------------------------------------------------
Total interest income 5,612 5,693 11,179 11,358
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Interest expense:
Deposits 2,714 2,785 5,497 5,628
Federal funds purchased --- 2 --- 2
Capitalized lease obligations 19 22 39 43
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Total interest expense 2,733 2,809 5,536 5,673
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Net interest income 2,879 2,884 5,643 5,685
Provision for loan losses 45 45 90 91
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Net interest income after provision for
loan losses 2,834 2,839 5,553 5,594
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Noninterest income:
Service charges and fees 122 86 234 199
Gain on legal settlement --- --- --- 600
Other 25 40 55 55
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Total noninterest income 147 126 289 854
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Noninterest expense:
Salaries and benefits 953 901 1,792 1,763
Net occupancy and furniture/
equipment expenses 332 295 653 602
Data processing services 105 105 220 211
Fidelity (Recovery)/Loss (372) --- (372) ---
Other expenses 475 491 956 1006
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Total noninterest expense 1,493 1,792 3,249 3,582
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Income before federal income tax provision 1,488 1,173 2,593 2,866
Federal income tax provision 436 298 728 773
- ---------------------------------------------------------------------------------------------------------------------------
Net income 1,052 875 1,865 2,093
===========================================================================================================================
Per share information
Net income $1.19 $ .99 $2.11 $2.37
Weighted average shares outstanding 884,680 884,680 884,680 884,680
===========================================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements
2
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THE FIRST JERMYN CORP. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In thousands of dollars)
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<CAPTION>
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Six months ended June 30,
1997 1996
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Operating activities:
Net income $ 1,865 $2,093
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for loan losses 90 91
Depreciation and amortization of investment securities, bank
premises, leasehold improvements and furniture and equipment 230 257
Increase in interest receivable and other assets 430 (391)
Decrease in interest payable and other liabilities (583) (13)
- ------------------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 2,032 2,037
- ------------------------------------------------------------------------------------------------------------------------------
Investing activities:
Purchases of securities available for sale (5,987) (18,248)
Proceeds from maturities of securities 19,929 9,559
Net increase in loans 1,063 (5,509)
Purchases of bank premises, leasehold improvements and
Furniture and equipment-net (115) (192)
Sales of assets acquired through foreclosure 90 22
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Net cash (used) provided by in investing activities 14,980 (14,368)
- ------------------------------------------------------------------------------------------------------------------------------
Financing activities:
Net (decrease)/ increase in noninterest-bearing demand deposits
and interest-bearing deposits (4,642) 6,566
Proceeds from federal funds purchased and
Other borrowed money --- 2,130
Principal payments on capitalized lease obligation (38) (35)
Dividends paid (619) (530)
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Net cash provided by (used) financing activities (5,299) 8,131
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(Decrease)/Increase in cash and cash equivalents 11,713 (4,200)
Cash and cash equivalents at beginning of period 10,003 14,201
- ------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period 21,716 10,001
==============================================================================================================================
Cash paid during the period:
Interest $ 5,542 5,664
Federal Income Taxes 803 847
==============================================================================================================================
Noncash transactions:
Transfer of loans to real estate owned $ 140 50
Net unrealized (loss) gain on securities available for sale, net of tax $ 196 (144)
==============================================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements
3
<PAGE> 6
FIRST JERMYN CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (unaudited)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying consolidated financial statements were prepared in
accordance with instructions to Form 10-QSB, and therefore, do not
include information or footnotes necessary for a complete presentation
of financial position, results of operations and cash flows in
conformity with generally accepted accounting principles. However,
all normal, recurring adjustments which, in the opinion of management,
are necessary for a fair presentation of the financial statements,
have been included. These financial statements should be read in
conjunction with the audited financial statements and the notes
thereto included in the Bank's Annual Report for the period ended
December 31, 1996. The results for the six months ended June 30, 1997
are not necessarily indicative of the results that may be expected for
the year ended December 31, 1997.
BUSINESS
The Company's principal subsidiary, The First National Bank of Jermyn,
conducts business from its branch bank system located in Lackawanna
County, Pennsylvania. The Bank is subject to competition from other
financial institutions and other companies which provide financial
services. The Bank is subject to the regulations of certain federal
agencies and undergoes periodic examinations by those regulatory
authorities.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of all of
the Company's wholly-owned subsidiaries. All significant intercompany
transactions have been eliminated in consolidation. Additionally,
certain reclassifications have been made in order to conform with the
current year's presentation. The accompanying consolidated financial
statements have been prepared on an accrual basis.
(2) EARNINGS PER SHARE
Earnings per share was $1.19 and $2.11 for the three-month and six
month periods ended June 30, 1997 as compared to $.99 and $2.37 for
the three month and six month periods ended June 30, 1996. Earnings
per share was computed based on the weighted average number of shares
outstanding during each period. The Company has no common stock
equivalents.
4
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(3) RECENT ACCOUNTING PRONOUNCEMENTS
In June 1996, the FASB Issued SFAS No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities"
("SFAS 125"). This statement provides accounting and reporting
standards for transfers and servicing of financial assets and
extinguishments of liabilities based on consistent application of a
financial-components approach that focuses on control. It
distinguishes transfers of financial assets that are sales from
transfers that are secured borrowings. Under the financial-components
approach, after a transfer of financial assets, an entity recognizes
all financial and servicing assets it controls and liabilities it has
incurred and derecognizes financial assets it no longer controls and
liabilities that have been extinguished. The approach focuses on the
assets and liabilities that exist after the transfer. If a transfer
does not meet the criteria for a sale, the transfer is accounted for
as a secured borrowing with pledge of collateral. The Company has
adopted SFAS 125 prospectively, effective January 1, 1997, the
required date of adoption. The adoption of SFAS 125 did not have a
material impact on the Company's financial condition, equity, or
results of operation.
In February 1997, the FASB issued SFAS No. 128, Earnings Per Share.
This statement establishes standards for computing and presenting
earnings per share (EPS) and applies to entities with publicly held
common stock or potential common stock. This Statement simplifies the
standards for computing earnings per share previously found in APB
Opinion NO. 15, Earnings per Share, and makes them comparable to
international EPS standards. It replaces the presentation of primary
EPS with a presentation of basic EPS. It also requires dual
presentation of basic and diluted EPS on the face of the income
statement for all entities with complex capital structures and
requires a reconciliation of the numerator and denominator of the
basic EPS computation to the numerator and denominator of the diluted
EPS computation. This Statement is effective for financial statements
issued for periods ending after December 15, 1997, including interim
periods; earlier application is not permitted. This Statement
requires restatement of all prior-period EPS data presented. Because
the Company has no securities which constitute potential common stock,
adoption of this statement will not have any impact on the Company's
EPS disclosure.
In June 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standard ("SFAS") No. 130,
Reporting Comprehensive Income. This statement establishes standards
for the reporting and display of comprehensive income and its
components in a full set of general-purpose financial statements.
SFAS No. 130 requires that all items that are required to be
recognized as components of comprehensive income be reported in a
financial statement that is displayed with the same prominence as
other financial statements. The statement does not require a specific
format for that financial statement but requires that an enterprise
display an amount representing total comprehensive income for the
period in that financial statement. SFAS No. 130 is effective for
fiscal years beginning after December 15, 1997. The Company will
include this new reporting information in its 1998 consolidated
financial statements as required.
5
<PAGE> 8
In June 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standard ("SFAS") No 131,
Disclosures About Segments of an Enterprise and Related Information.
SFAS No. 131 establishes standards for the way that public business
enterprises report information about operating segments in annual
financial statements and requires that those enterprises report
selected information about operating segments in interim financial
reports issued to shareholders. It also establishes standards for
related disclosures about products and services, geographic areas, and
major customers. SFAS No. 130 is effective for financial statements
for periods beginning after December 15, 1997. Management has not yet
determined the impact, if any, of this statement on the Company.
6
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
OVERVIEW
The Company's net income for the three month and six month periods ended June
30, 1997 was $1,052,000 and $1,865,000 or $1.19 and $2.11 per share compared to
$875,000 and $2,093,000 or $.99 and $2.37 in the same three month and six-month
periods in the preceding year. The increase in net income for the three months
ended June 30, 1997 is primarily attributable to a $372,000 recovery received
from the Company's Fidelity Bond Insurance during the second quarter of 1997
relating to employee fidelity losses recognized during the fourth quarter of
1996. The decrease in net income for the six months ended June 30, 1997
compared to 1996 is the result of a one time gain on a legal settlement which
was reflected in the 1996 numbers.
At June 30, 1997, the Company had total assets of $317.7 million compared to
$321.6 million at December 31, 1996. The decline in total assets consists of
decreases in the securities and loan portfolios which were primarily offset by
a decrease in deposits.
The Company recorded an annualized return on average assets of 1.19% for the
six-month period ending June 30, 1996, compared to 1.32% for the same period in
1997. Annualized return on average equity of 12.88% was recorded for the
six-month period ended June 30, 1997, compared to 15.59% for the same period in
l996.
The Company is susceptible to a sustained rising interest rate environment that
may erode the net interest margin. Strategies to enhance earnings and improve
the interest rate exposure of the Company will be considered, such as the sale
of existing securities available for sale and purchasing higher yielding, rate
sensitive assets with the proceeds. Additionally, the Company will be seeking
to enhance its net interest margin by increasing the higher yielding loan
portfolio with the cash flows from the repayments on the mortgage-related and
investment securities portfolios.
FINANCIAL CONDITION
CASH AND DUE FROM BANKS AND FEDERAL FUNDS SOLD
Cash and due from banks increased to approximately $10.6 million at June 30,
1997 from $8.1 million at December 31, 1996 due to normal fluctuations
resulting from the conduct of customer business. Federal Funds Sold increased
to $11.1 million at June 30, 1997 from $1.9 million at December 31, 1996 as the
Company experienced increased liquidity resulting from the maturity of
securities.
SECURITIES
Securities, including securities available for sale, mortgage backed
securities available for sale, and investment securities decreased $13.6
million or 13% to $93.4 million at June 30, 1997 from $107.1 million at
December 31, 1996. This decrease was primarily due to the maturity of certain
U.S. Treasury Securities near period end.
7
<PAGE> 10
LOANS RECEIVABLE, NET
Aggregate loans receivable totaled $192.2 million at June 30, 1997, a decrease
of $1.3 million or 0.7% from $193.5 million at December 31, 1996. The mix of
loans is substantially unchanged at those dates.
NON-PERFORMING ASSETS
The Company's total non-performing assets decreased from $3.7 million or 1.17%
of total assets at December 31, 1996 to $2.4 million or .76% of total assets at
June 30, 1997. Loans greater than ninety days delinquent but still accruing
decreased from $468,000 at December 31, 1996 to $403,000 at June 30, 1997.
Nonaccrual loans consist primarily of commercial and commercial real estate
loans. The two largest factors contributing to the decrease in nonaccrual
loans was $426,000 of charge-offs (primarily to one commercial borrower) during
the first six months of 1997 and the correction of aberrations connected to an
employee fidelity loss.
Real estate owned, increased $50,000 from $199,000 as of December 31, 1996 to
$249,000 as of June 30, 1997, due to the foreclosure of property securing
credit. There were no significant gains or losses on the sale of real estate
owned during any of the periods presented.
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<CAPTION>
6/30/97 12/31/96 6/30/96
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<S> <C> <C> <C>
Nonaccrual 1,763,000 3,080,000 2,559,000
Loans 90 days of more delinquent 403,000 468,000 783,000
Restructured --- --- ---
----------- ----------- -----------
Total non-performing loans 2,166,000 3,548,000 3,342,000
Other real estate owned other than
Bank premises 249,000 199,000 324,000
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Total non-performing assets 2,415,000 3,747,000 3,666,000
</TABLE>
At June 30, 1997, the Company's allowance for loan losses amounted to $2.84
million or 1.45% of gross loans receivable. At December 31, 1996, the
Company's allowance for loan losses was $3.11 million or l.57% of gross loans
receivable. Management believes that the allowance is adequate given the asset
quality of the institution. The table below describes the roll forward of the
allowance for loan losses for the six month periods ended June 30, 1997 and
1996.
8
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<CAPTION>
6/30/97 6/30/96
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Balance at end of period 3,111,000 3,015,000
Recoveries 60,000 43,000
Provision for land and lease losses 90,000 91,000
Charge-offs 426,000 95,000
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Balance at end of period 2,835,000 3,054,000
</TABLE>
DEPOSITS
Deposits decreased $4.6 million or 1.6% from $290.1 million at December 31,
1996 to $285.5 million at June 30, 1997. The largest single factor affecting
the decrease in deposits was a drop in noninterest bearing demand deposits
caused by a large commercial customer who temporarily deposited liquidity
balances in their demand account at December 31, 1996.
EQUITY
At June 30, 1997, total equity was $30.1 million or 9.5% of total assets
compared to $28.7 million or 8.9% of total assets as of December 31, 1996.
Total equity increased primarily due to the retention of net income during the
intervening period, net of cash dividends paid and due to a decline in the
unrealized loss on securities available for sale, net of tax, as a result of
changing market conditions.
RESULTS OF OPERATIONS
NET INCOME
The Company's net income increased $177,000 to $1,052,000 for the three months
ended June 30, 1997, compared to $875,000 recorded in the comparable prior
period primarily due to a recovery of employee fidelity losses. For the
six-month period ended June 30, 1997, net income decreased $228,000 or
approximately 11% to $1,865,000 compared to $2,093,000 for the six-months ended
June 30, 1996. This decrease for the six month period is primarily attributed
to a one time gain on a legal settlement reflected in the first half of 1996,
partially offset by a recovery of an employee fidelity loss which was
recognized in the first half of 1997.
9
<PAGE> 12
NET INTEREST INCOME
Net interest income before provision for loan losses amounted to $2.9 million
and $5.6 million for the three-month and six month periods ended June 30, 1997
as compared to $2.9 million and $5.7 million for the respective periods in
1996. In a competitive rate environment, the Company was able to maintain a
relatively constant level of core earnings of net interest income.
Total interest income decreased to $5,612,000 and $11,179,000 for the three
month and six month periods ended June 30, 1997 from $5,693,000 and $11,358,000
during the comparable prior periods. The decrease was primarily the result of
a decrease in the average interest-earning assets of $110,000 for the six
months ended June 30, 1997 compared to the six months ended June 30, 1996.
Additionally, the yield earned on average interest-earning assets decreased 4
basis points during the six months ended June 30, 1997 compared to the 1996
period.
Total interest expense decreased by $76,000 and $137,000 to $2,733,000 and
$5,536,000 for the three and six months ended June 30, 1997 from $2,809,000
and $5,673,000 for the comparable prior periods. The decrease was due to a
decrease in interest expense associated with deposits, where the average
balance decreased by $2,137,000 during the six months ended June 30, 1997
compared to the 1996 period. The decrease in interest expense on deposits was
also caused by a 4 basis point drop in the average rates paid for the six
months ended June 30, 1997 over the comparable 1996 period.
PROVISION FOR LOAN LOSSES
The Company establishes a provision for loan losses, which is charged to
operations, in order to maintain the allowance for loan losses at a level which
is deemed to be appropriate based upon an assessment of prior loss experience,
the volume and type of lending presently being conducted by the Company,
industry standards, past due loans, economic conditions in the Company's market
area generally and other factors related to the collectability of the Company's
loan portfolio. For the three month and six month periods ended June 30, 1997,
the provision for loan losses amounted to $45,000 and $90,000, an amount which
was consistent with that recorded in the comparable prior periods.
Although management utilizes its best judgment in providing for possible
losses, there can be no assurance that the Company will not have to increase
its provisions for loan losses in the future as a result of future increases in
non-performing loans or for other reasons which could adversely affect the
Company's results of operations. In addition, various regulatory agencies, as
an integral part of their examination process, periodically review the
allowance for loan losses. Such agencies may require the Company to recognize
additions to the allowance for loan losses based on their judgments of
information which is available to them at the time of their examination.
NONINTEREST INCOME
Noninterest income for the six months ending June 30, 1997 decreased
approximately $565,000 to $289,000 from the comparable prior period, primarily
due to a one-time gain on a legal settlement in the Company's favor which was
recorded in the first quarter of 1996.
10
<PAGE> 13
NONINTEREST EXPENSES
Noninterest expenses for the six month period ending June 30, 1997 decreased
approximately $333,000 from the comparable prior period. The largest factor
contributing to the decrease was a $372,000 recovery on an employee fidelity
loss which was received by the Company in the second quarter of 1996.
INCOME TAXES
Income tax expense totaled $436,000 and $728,000 for the three-month and six
month periods ended June 30, 1997 compared to $298,000 and $773,000 for the
comparable prior periods. These amounts resulted in effective tax rates of
29.3% and 28.1% for the three and six months ended June 30, 1997 compared to
25.9% and 27% for the comparable periods in 1996. The increase in tax expense
during the three month period ending June 30, 1997 was due to an increase in
income before the federal income tax provision. The decrease in tax expense
during the six month period ending June 30, 1997 was due primarily to a
decrease in income before the federal income tax provision.
CAPITAL ADEQUACY
A strong capital position is important to the continued profitability of the
Company and promotes depositor and investor confidence. The Company's capital
consists of shareholders' equity, which provides a basis for future growth and
expansion and also provides a buffer against unexpected losses. Shareholders'
equity increased $1,442,000 to $30,116,000 at June 30, 1997 compared to
December 31, 1996. It is management's intention to continue paying a reasonable
return on shareholders' investment while retaining adequate earnings to allow
for continued growth.
The Federal Reserve Board measures capital adequacy for bank holding companies
by using a risk-based capital frame-work and by monitoring compliance with
minimum leverage ratio guidelines. The minimum ratio of total risk-based
capital to risk-adjusted assets is 8% at June 30, 1997, of which 4% must be
Tier 1 capital. The Company's total risk-based capital ratio was 18.35% at
June 30, 1996. The Company's Tier 1 risk-based capital ratio was 17.10% at
June 30, 1997.
In addition, the Federal Reserve Board has established minimum leverage ratio
guidelines for bank holding companies. Those guidelines provide for a minimum
leverage ratio of 3% for bank holding companies that meet certain criteria,
including that they maintain the highest regulatory rating. All other bank
holding companies are required to maintain a leverage ratio of 3% plus an
additional cushion of at least 100 to 200 basis points. The Federal Reserve
Board has not advised the Company of any specific minimum leverage ratio
applicable to it. The Company's leverage ratio was 9.40% at June 30, 1997.
In December 1991, the Federal Deposit Insurance Corporation Improvement Act
(FDICIA) was enacted, which substantially revises the bank regulatory and
funding provisions of the Federal Deposit Insurance Act and makes revisions to
several other federal banking statutes.
11
<PAGE> 14
The Act establishes minimum capital requirements for all depository
institutions and established five capital tiers: "well capitalized",
"adequately capitalized," "under-capitalized:, "significantly
under-capitalized," and "critically under-capitalized," FDICIA imposes
significant restrictions on the operations of a bank which is not at least
adequately capitalized. A depository institutions' capital tier will depend
upon where its capital levels are in relation to various other capital measures
which include a risk-based capital measure, a leverage ratio capital measure
and other factors. Under regulations adopted, for an institution to be well
capitalized it must have a total risk-based capital ratio of at least 10%, a
Tier I risk-based capital ratio of at least 6%, and a Tier I leverage ratio of
at least 5%, and not be subject to any specific capital order or directive.
At June 30, 1997, the Bank's total risk-based capital, Tier I risk-based
capital and Tier I leverage ratios were 18.35%, 17.10% and 9.40%, respectively.
12
<PAGE> 15
FIRST JERMYN CORP. AND SUBSIDIARIES
June 30, 1997
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Annual Meeting of Shareholders held on May 14, 1997,
four Class II members of the Board of Directors ( William M.
Davis, Peter A. Sabia, and Edmund J. Biancarelli, M.D. and
Thomas G. Speicher) were elected to a three-year term which
will expire in 2000. The number of the Board of Directors
was fixed at nine. The following five members of the Board
of Directors (David M. Epstein, Esq., Robert T. Kelly, CPA,
Kuzma Leschak, Jr., I. Leo Moskovitz and Garfield G. Thomas)
continued to serve their remaining terms.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a): Exhibits:
None
(b): Reports on Form 8-K:
None
13
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FIRST JERMYN CORP. AND SUBSIDIARIES
June 30, 1997
SIGNATURES
In accordance with requirement of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
THE FIRST JERMYN CORP.
----------------------
(Registrant)
Date August 11, 1997 By/s/ William M. Davis
--------------- ----------------------
William M. Davis
Chairman, President and
Director
(Principal Executive Officer)
Date August 11, 1997 By /s/ Martha Myshak
--------------- ---------------------
Martha Myshak
(Principal Financial Officer and
Treasurer)
Date August 11, 1997 By /s/ Donald J. Gibbs
--------------- ---------------
Donald J. Gibbs
(Principal Accounting Officer
and Vice President, Finance /
Control Division Manager)
14
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000741562
<NAME> FIRST JERMYN CORP.
<S> <C>
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