<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 March 31, 2000
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Transition Period
Commission File Number 0-16362
FIRST FRANKLIN CORPORATION
--------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 31-1221029
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
4750 Ashwood Drive Cincinnati, Ohio 45241
----------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
Issuer's Telephone Number, including Area Code (513) 469-5352
----------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PROCEEDING FIVE YEARS
Check whether the Registrant has filed all documents and reports required to be
filed by Section 12, 13 or 15 (d) of the Exchange Act after the distribution of
securities under a plan confirmed by the court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
As of March 31, 2000 there were issued and outstanding 1,615,373 shares of the
Registrant's Common Stock.
Transitional Small Business Format (check one)
Yes [ ] No [X]
<PAGE> 2
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
INDEX
Page No.
Part I Financial Information
Item 1. Consolidated Balance Sheets -
March 31, 2000 and December 31, 1999 3
Consolidated Statements of Income and Retained
Earnings - Three Month Periods ended March 31, 2000
and 1999 4
Consolidated Statements of Cash Flows - Three Month
Periods ended March 31, 2000 and 1999 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part II Other Information 14
Item 5. Press Release dated March 28, 2000 15
Press Release dated April 12, 2000 16
Signatures
2
<PAGE> 3
PART I - ITEM 1.
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
<TABLE>
<CAPTION>
Mar 31,2000 Dec 31,1999
----------- -----------
(Unaudited)
<S> <C> <C>
ASSETS
Cash, including CD's & other interest-earning
deposits of $100 and $205 at 03/31/00
and 12/31/99, respectively $ 1,401 $ 3,688
Investment securities
Available-for-sale, at market value
(amortized cost of $20,185 and
$20,190, respectively) 19,210 19,197
Mortgage-backed securities
Available-for-sale, at market value
(amortized cost of $37,178 and
$39,719, respectively) 36,690 39,342
Held-to-maturity, at amortized cost
(market value of $12,840 and
$13,336, respectively) 13,183 13,596
Loans receivable, net 174,506 167,601
Real estate owned, net 0 0
Stock in Federal Home Loan Bank
of Cincinnati, at cost 2,006 1,971
Accrued interest receivable 1,622 1,311
Property and equipment, net 1,934 1,942
Other assets 1,831 1,557
--------- ---------
$ 252,383 $ 250,205
LIABILITIES
Savings accounts $ 193,138 $ 191,673
Borrowings 38,335 37,110
Advances by borrowers for taxes
and insurance 687 1,171
Other liabilities 420 496
--------- ---------
Total liabilities 232,580 230,450
--------- ---------
STOCKHOLDERS' EQUITY:
Preferred stock; $.01 par value per share;
500,000 shares authorized; no shares issued
Common stock; $.01 par value per share;
2,500,000 shares authorized; 2,010,867
shares issued at 03/31/00 and 12/31/99,
respectively 13 13
Additional paid in capital 6,189 6,189
Treasury stock, at cost- 395,494 shares at
03/31/00 and 380,494 shares at 12/31/99 (3,875) (3,733)
Retained earnings, substantially restricted 18,441 18,190
Accumulated other comprehensive income:
Unrealized loss on available-for-sale
securities, net of taxes of $(498) at 03/31/00
and $(466) at 12/31/99 (965) (904)
--------- ---------
Total stockholders' equity 19,803 19,755
--------- ---------
$ 252,383 $ 250,205
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE> 4
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
For the Three Months Ended
Mar 31, 2000 Mar 31, 1999
------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
Interest income:
Loans receivable $ 3,220 $ 2,861
Mortgage-backed securities 825 718
Investment securities 357 321
-------- --------
4,402 3,900
Interest expense:
Savings accounts 2,275 2,319
Borrowings 517 204
-------- --------
2,792 2,523
Net interest income 1,610 1,377
Provision for loan losses 19 20
-------- --------
Net interest income after provision for loan losses 1,591 1,357
-------- --------
Noninterest income:
Gain on loans sold 0 49
Service fees on NOW accounts 53 53
Other income 91 75
-------- --------
144 177
Noninterest expense:
Salaries and employee benefits 540 521
Occupancy expense 149 160
Federal insurance premiums 10 30
Advertising 114 58
Service bureau expense 62 65
Other expenses 308 331
-------- --------
1,183 1,165
Income before federal income taxes 552 369
Provision for federal income taxes 179 118
-------- --------
Net Income $ 373 $ 251
RETAINED EARNINGS-BEGINNING OF PERIOD $ 18,190 $ 17,273
Net income 373 251
Less: dividends declared (122) (128)
-------- --------
RETAINED EARNINGS-END OF PERIOD $ 18,441 $ 17,396
EARNINGS PER COMMON SHARE
Basic $ 0.23 $ 0.15
Diluted $ 0.23 $ 0.15
DIVIDENDS DECLARED PER COMMON SHARE $ 0.075 $ 0.075
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
4
<PAGE> 5
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
<TABLE>
<CAPTION>
For The Three Months Ended
Mar 31, 2000 Mar 31, 1999
------------ ------------
(Unaudited) (Unaudited)
Cash provided by (used in) operating activities:
<S> <C> <C>
Net income $ 373 $ 251
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for loan losses 19 20
Depreciation and amortization 50 126
FHLB stock dividend (34) (31)
Decrease (increase) in accrued interest receivable (311) 9
Decrease (increase) in other assets (274) 236
Decrease in other liabilities (76) (63)
Other, net (142) 61
Loans sold 120 5,236
Disbursements on loans originated for sale 0 (5,097)
-------- --------
Net cash provided by (used in) operating activities (275) 748
-------- --------
Cash provided by (used in) investing activities:
Loan principal reductions 7,886 9,079
Disbursements on mortgage and other
loans purchased or originated for investment (14,929) (13,125)
Repayments on mortgage-backed securities 2,927 6,460
Purchase of available-for-sale mortgage-backed securities 0 (3,489)
Purchase of available-for-sale investment securities 0 (3,992)
Proceeds from the sale of or maturity of available-for-sale
investment securities 5 8,715
Capital expenditures 15 (1)
-------- --------
Net cash provided by (used in) investing activities (4,096) 3,647
-------- --------
Cash provided by (used in) financing activities:
Net increase (decrease) in deposits 1,465 (7,569)
Borrowed money (repayments) 1,225 (68)
Decrease in advances by borrowers
for taxes and insurance (484) (427)
Payment of dividends (122) (128)
-------- --------
Net cash provided by (used in) financing activities 2,084 (8,192)
-------- --------
Net decrease in cash ($ 2,287) ($ 3,797)
Cash at beginning of period 3,688 8,369
-------- --------
CASH AT END OF PERIOD $ 1,401 $ 4,572
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
5
<PAGE> 6
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
BASIS OF PRESENTATION
The accompanying unaudited interim consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three month period ended March 31, 2000
are not necessarily indicative of the results that may be expected for the full
year. The December 31, 1999 Balance Sheet data was derived from audited
Financial Statements, but does not include all disclosures required by generally
accepted accounting principles.
EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS
The Financial Accounting Standards Board ("FASB") issued Statement of Financial
Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments
and Hedging Activities" which establishes standards for derivative instruments,
including derivative instruments imbedded in other contracts and for hedging
activities. It requires that an entity recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value. SFAS No. 133 is effective for all fiscal quarters of
fiscal years beginning after June 15, 2000. Management does not believe that the
adoption of this standard will impact the Company because, at this time, the
Company does not hold any of the instruments covered by the standard.
SFAS No. 130, "Reporting Comprehensive Income" requires that all items that are
required to be recognized under accounting standards as components of
comprehensive income be reported in a financial statement that is displayed with
the same prominence as other financial statements. For interim period reporting,
an organization is required to report a total for comprehensive income.
Comprehensive income for the three months ended March 31, 2000 and 1999 was
$312,000 and $132,000, respectively. The difference between net income and
comprehensive income consists solely of the effect of unrealized gains and
losses, net of taxes, on available-for-sale securities.
6
<PAGE> 7
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
First Franklin Corporation ("Company") is a savings and loan holding company,
which was incorporated under the laws of the State of Delaware in September 1987
by authorization of the Board of Directors of the Franklin Savings and Loan
Company ("Franklin"). The Company acquired all of the common stock of Franklin
issued in connection with its conversion from the mutual to stock form of
ownership, which was completed on January 25, 1988.
The Company's operating philosophy is to be an efficient and profitable
financial services organization with a professional staff committed to
maximizing shareholder value by structuring and delivering quality services that
attract customers and satisfy their needs and preferences. Management's goal has
been to maintain profitability and a strong capital position. It seeks to
accomplish this goal by pursuing the following strategies: (i) emphasizing
lending in the one- to four-family residential mortgage market, (ii) managing
deposit pricing, (iii) controlling interest rate risk, (iv) controlling
operating expenses (v) controlling asset growth, and (vi) maintaining asset
quality.
As a Delaware corporation, First Franklin is authorized to engage in any
activity permitted by the Delaware General Corporation Law. As a unitary savings
and loan holding company, the Company is subject to examination and supervision
by the Office of Thrift Supervision ("OTS"), although, the Company's activities
are not limited by the OTS as long as certain conditions are met. The Company's
assets consist of cash, interest-earning deposits, and investments in Franklin
and DirectTeller Systems Inc. ("DirectTeller").
Franklin is an Ohio chartered stock savings and loan headquartered in
Cincinnati, Ohio. It was originally chartered in 1883 as the Green Street Number
2 Loan and Building Company. The business of Franklin consists primarily of
attracting deposits from the general public and using those deposits, together
with borrowings and other funds, to originate and purchase investments and real
estate loans for retention in its portfolio and sale in the secondary market.
Franklin operates six banking offices in Hamilton County, Ohio through which it
offers a full range of consumer banking services, including mortgage loans,
credit and debit cards, checking accounts, auto loans, savings accounts,
automated teller machines, and a voice response telephone inquiry system. In
January 2000, Franklin began offering an internet banking service called
"Franklin Online" which allows users to pay bills, transfer funds, obtain
account information and download account and transaction information into
financial management programs using their home computer. To generate additional
fee income and enhance the products and services available to its customers,
Franklin also offers annuities, mutual funds, and discount brokerage services in
its offices through an agreement with a third party. Franklin receives a portion
of the sales commissions earned on these products.
Franklin has one wholly owned subsidiary, Madison Service Corporation
("Madison"). Madison was formed in 1972 to allow Franklin to diversify into
certain types of business which, by regulation, savings and loans were unable to
enter. At the present time, Madison's assets consist solely of cash and
interest-earning deposits. Its only sources of income are the interest earned on
these deposits and the fees received as a result of the agreement with the third
party broker dealer that provides the discount brokerage services at Franklin's
offices.
The Company owns 51% of DirectTeller's outstanding common stock. DirectTeller
was formed in
7
<PAGE> 8
1989 by the Company and Data Tech Services Inc. to develop and market a voice
response telephone inquiry system to allow financial institution customers to
access information about their accounts via the telephone and a facsimile
machine. Franklin currently offers this service to its customers. The inquiry
system is currently in operation at Intrieve Inc.("Intrieve"), a computer
service bureau which offers the DirectTeller system to the savings and loans it
services. The agreement with Intrieve gives DirectTeller a portion of the
profits generated by the use of the inquiry system by Intrieve's clients.
In September 1999, management and the Board of Directors reviewed the Company's
strategic plan and established various strategic objectives for the next two
years. The primary objectives of this plan are asset growth, profitability,
independence, capital adequacy and enhancing shareholder value. These objectives
will be accomplished through loan growth, the use of technology to improve
efficiency and/or customer service, an enhanced marketing effort to take full
advantage of the opportunities that exist in the marketplace, and expansion
through the addition of branch and/or loan origination offices.
Since the results of operations of Madison and DirectTelller have not been
material to the operations and financial condition of the Company, the following
discussion focuses primarily on Franklin.
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
Consolidated assets increased $2.17 million (0.9%) from $250.21 million at
December 31, 1999 to $252.38 million at March 31, 2000, compared to a $8.13
million (3.4%) decrease for the same period in 1999. During 2000,
mortgage-backed securities decreased $3.07 million, cash and investments
decreased $2.27 million, loans receivable increased $6.91 million and deposits
increased $1.47 million.
Loan disbursements were $14.93 million during the current quarter compared to
$18.22 million during the three months ended March 31, 1999. Student loans
totaling $120,000 were sold during the current three month period. At March 31,
2000, commitments to originate mortgage loans were $4.30 million. At the same
date, $3.80 million of undisbursed loan funds were being held on various
construction loans. Management believes that sufficient cash flow and borrowing
capacity exists to fund these commitments.
Liquid assets decreased $2.27 million during the three months ended March 31,
2000 to $20.61million. This decrease reflects loan and mortgage-backed
securities repayments of $10.81 million, an increase in savings deposits of
$1.47 million and increased borrowing of $1.23 million less loan disbursements
of $14.93 million. At March 31, 2000, liquid assets were 8.17% of total assets.
The Company's investment and mortgage-backed securities are classified based on
its current intention to hold to maturity or have available for sale, if
necessary. The following table shows the gross unrealized gains or losses on
mortgage-backed securities and investment securities as of March 31, 2000. No
securities are classified as trading.
8
<PAGE> 9
<TABLE>
<CAPTION>
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------------------------------------------------
(Dollars in thousands)
<S> <C> <C> <C> <C>
Available-for-sale
Investment securities $20,185 $ 27 $ 1,002 $19,210
Mortgage-backed securities 37,178 128 616 36,690
Held-to-maturity
Mortgage-backed securities 13,183 0 343 12,840
</TABLE>
At March 31, 2000, savings deposits were $193.14 million compared to $191.67
million at December 31, 1999. This is a increase of $1.47 million during the
current three month period. During the three months ended March 31, 2000, core
deposits (transaction and passbook savings accounts) increased $1.56 million.
During the same period, short-term certificates (two years or less) decreased
$5.49 million and certificates with original terms greater than two years
increased $5.40 million. The decline in short-term certificates and the increase
in long-term certificates reflects management's desire to lengthen the maturity
of its deposits. Interest of $2.04 million during the current quarter was
credited to accounts. After eliminating the effect of interest credited, savings
decreased $570,000 during the three month period ended March 31, 2000.
At March 31, 2000 Franklin had outstanding Federal Home Loan Bank ("FHLB")
advances of $38.34 million at an average cost of 5.80%. During the next twelve
months, $4.9 million of the advances mature.
In the current interest rate environment, the Company is subject to significant
interest rate risk. In the low interest rate environment that prevailed
throughout much of the 1990s, Franklin, like many financial institutions, was
not able to attract a significant amount of long-term deposits as customers
opted to pursue short-term investments so they would be poised to take advantage
of rates when they did rise. As a result, Franklin experienced a shortening of
the maturities of its liabilities. The low rates had the opposite effect on
Franklin's assets, as consumers took advantage of the low rates to lock-in
long-term mortgages. Although Franklin has sold some of its fixed-rate mortgages
in recent years, timing considerations and other market conditions have not
always been conducive to a sale. Consequently, Franklin is experiencing a
mismatch between the repricing terms of its assets and liabilities.
In 1999, Franklin implemented several new initiatives to improve its interest
rate sensitivity. One initiative is to increase Franklin's capital position,
which Franklin has addressed by suspending the payment of dividends to the
Company. It is not anticipated that this action will adversely affect the
ability of the Company to pay dividends to its shareholders. Another initiative
is to lengthen the maturities of its liabilities, which Franklin has undertaken
by emphasizing three-year and five-year certificates of deposit by pricing those
products more attractively, and to shorten the maturities of its assets, which
Franklin is addressing by limiting the origination of fixed-rate mortgages and
emphasizing the origination of one, three and five year adjustable-rate
mortgages. In addition, commercial and multi-family real estate loans will have
shorter maturities with balloon payments due in five years or less. More
emphasis is also being placed on the origination of home equity lines of credit
and adjustable-rate second mortgages, which are normally originated at higher
rates.
There are different ways to measure the effects that repricing differences will
have on net income. Under the methodology being utilized by Franklin, based on
models developed by an outside consultant which are tailored to the specific
characteristics of Franklin's balance sheet, Franklin's interest rate risk is
moderate. Under the methodology used by the OTS, however, Franklin's interest
9
<PAGE> 10
rate risk position is classified as high risk. Franklin will submit to the OTS
by June 2, 2000 an interest rate risk compliance plan which will include many of
the initiatives discussed above. If the plan is not approved or subsequently not
complied with, the OTS could take other action which could limit Franklin's
activities, growth or earnings. The plan will incorporate Franklin's specific
risk characteristics and related risk analysis methodologies, which the OTS has
indicated it will consider in approving the plan and reassessing Franklin's
interest rate risk position.
At March 31, 2000, $1.09 million of assets were classified substandard, $162,000
classified loss and $3.28 million classified as special mention compared to
$989,000 million as substandard, $163,000 as loss and $3.02 million as special
mention at December 31, 1999. Non-accruing loans and accruing loans delinquent
ninety days or more, net of reserves, were $895,000 at March 31, 2000 and
$777,000 at December 31, 1999. At March 31, 2000, the recorded investment in
loans for which impairment under SFAS No. 114 has been recognized was immaterial
to the Company's financial statements.
The following table shows the activity that has occurred on loss reserves during
the three months ended March 31, 2000.
(Dollars in thousands)
Balance at beginning of period $976
Charge offs 1
Additions charged to operations 19
Recoveries 0
----
Balance at end of period $994
The Company's capital supports business growth, provides protection to
depositors, and represents the investment of stockholders on which management
strives to achieve adequate returns. First Franklin continues to enjoy a strong
capital position. At March 31, 2000, net worth was $19.80 million, which is
7.85% of assets. At the same date, book value per share was $12.26 compared to
$12.12 at December 31, 1999.
The following table summarizes, as of March 31, 2000, the regulatory capital
position of our subsidiary, Franklin Savings.
<TABLE>
<CAPTION>
Capital Standard Actual Required Excess Actual Required Excess
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Core $18,037 $10,099 $ 7,938 7.14% 4.00% 3.14%
Risk-based 18,869 9,595 9,274 15.73% 8.00% 7.73%
</TABLE>
RESULTS OF OPERATIONS
Net income was $373,000 ($0.23 per basic share) for the current quarter compared
to $251,000 ($0.15 per basic share) for the quarter ended March 31, 1999. The
increase in net income during the current three month period reflects a $233,000
increase in net interest income and a decline of $49,000 in profits on the sale
of loans when compared to the same period in 1999.
Net interest income, before provisions for loan losses, was $1.61 million for
the current quarter compared to $1.38 million for the first quarter of 1999. The
most significant impact on net interest income between periods relates to the
interaction of changes in the volume of and rates earned or paid on
interest-earning assets and interest-bearing liabilities. The following
rate/volume analysis
10
<PAGE> 11
describes the extent to which changes in interest rates and the volume of
interest related assets and liabilities have affected net interest income during
the periods indicated.
<TABLE>
<CAPTION>
For the three month periods ended March 31,
2000 vs 1999
Total
Increase (decrease) due to increase
Volume Rate (decrease)
Interest income attributable to: (Dollars in thousands)
<S> <C> <C> <C> <C>
Loans receivable (1) $ 315 $ 44 $ 359
Mortgage-backed securities (31) 138 107
Investments 29 4 33
FHLB stock 3 0 3
----- ----- -----
Total interest-earning assets $ 316 $ 186 $ 502
Interest expense attributable to:
Demand deposits $ 12 $ 9 $ 21
Savings accounts (11) 0 (11)
Certificates (71) 17 (54)
FHLB advances 287 26 313
----- ----- -----
Total interest-bearing liabilities $ 217 $ 52 $ 269
Increase in net interest income $ 99 $ 134 $ 233
</TABLE>
(1) Includes non-accruing loans.
As the above table indicates, the increase in net interest income of $233,000 is
due to a $502,000 increase in income on interest-earning assets offset by a
$269,000 increase in the cost of interest-bearing liabilities. In both cases,
the majority of the change resulted from an increase in the amount outstanding
not a change in rates.
As the tables below illustrate, average interest-earning assets increased $16.30
million to $244.57million during the three months ended March 31, 2000, from
$228.27 million for the three months ended March 31, 1999. Average
interest-bearing liabilities increased $15.25 million from $211.50 million for
the three months ended March 31, 1999, to $226.75 million for the current three
month period. Thus, average net interest-earning assets increased $1.04 million
when comparing the two periods. The interest rate spread (the yield on
interest-earning assets less the cost of interest-bearing liabilities) was 2.27%
for the three months ended March 31, 2000, compared to 2.06% for the same period
in 1999. The increase in the interest rate spread was the result of an increase
in the yield on interest-earning assets from 6.83% for the three months ended
March 31, 1999, to 7.20% for the same three month period in 2000. The majority
of the increase in the yield on interest-earning assets is the result of an
increase in the yield on mortgage-backed securities from 5.35% to 6.45% caused
by a reduction in the amortization of purchase premiums due to a decline in
prepayments and the repricing of adjustable-rate securities.
11
<PAGE> 12
<TABLE>
<CAPTION>
For the Three Months ended March 31,2000
Average
outstanding Yield/cost
(Dollars in thousands)
<S> <C> <C>
Average interest-earning assets
Loans $171,010 7.53%
Mortgage-backed securities 51,190 6.45%
Investments 20,387 6.34%
FHLB stock 1,983 6.86%
-------- -------
Total $244,570 7.20%
Average interest-bearing liabilities
Demand deposits $ 25,393 2.25%
Savings accounts 21,180 2.72%
Certificates 144,832 5.49%
FHLB advances 35,348 5.85%
-------- -------
Total $226,753 4.93%
Net interest-earning assets/interest rate spread $ 17,817 2.27%
<CAPTION>
For the Three Months ended March 31,1999
Average
outstanding Yield/cost
(Dollars in thousands)
Average interest-earning assets
<S> <C> <C>
Loans $154,228 7.42%
Mortgage-backed securities 53,687 5.35%
Investments 18,557 6.25%
FHLB stock 1,799 6.89%
-------- -------
Total $228,271 6.83%
Average interest-bearing liabilities
Demand deposits $ 23,241 2.10%
Savings accounts 22,749 2.73%
Certificates 149,975 5.45%
FHLB advances 15,531 5.25%
-------- --------
Total $211,496 4.77%
Net interest-earning assets/interest rate spread $ 16,775 2.06%
</TABLE>
Noninterest income for the quarter ended March 31, 2000 was $144,000 compared to
$177,000 for the same quarter in 1999. The decrease in noninterest income when
comparing the three month periods is the result of a decline in profits on the
sale of loans of $49,000. This decline in loan sales reflects a decline in the
origination of fixed-rate mortgage loans due to increasing interest rates.
Noninterest expenses were $1.18 million for the current quarter compared to
$1.17 million for the quarter ended March 31, 1999. As a percentage of average
assets, this is 1.90% for the current
12
<PAGE> 13
three month period compared to 1.99% for the first three months of 1999.
13
<PAGE> 14
PART II
FIRST FRANKLIN CORPORATION AND SUBSIDIARY
Item 1. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company
or any subsidiary is a party or to which any of their property is
subject.
Item 2. CHANGES IN SECURITIES
None
Item 3. DEFAULTS UPON SENIOR SECURITIES
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
Item 5. OTHER INFORMATION
a. Press Release dated March 28, 2000
b. Press Release dated April 12, 2000
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibit 27- Financial Data Schedule
b. No current reports on Form 8-K were filed during the quarter
ended March 31, 2000
14
<PAGE> 15
FIRST FRANKLIN CORPORATION
4750 Ashwood Drive Cincinnati, Ohio 45241
(513) 469-8000 Fax (513) 469-5360
March 28, 2000
Cincinnati, Ohio
FIRST FRANKLIN CORPORATION DECLARES QUARTERLY DIVIDEND
The Board of Directors of First Franklin Corporation has declared a dividend of
$0.075 per share for the first quarter of 2000. This is the forty-ninth
consecutive dividend paid by the company. The quarterly dividend will be payable
April 17, 2000 to shareholders of record as of March 31, 2000.
First Franklin is the parent of Franklin Savings which has six branch locations
in Greater Cincinnati. The Corporation's common stock is traded on the Nasdaq
National Market under the symbol "FFHS".
CONTACT: Thomas H. Siemers
President and CEO
(513) 469-8000
4750 Ashwood Drive Cincinnati, Ohio 45241
(513) 469-8000 Fax (513) 469-5360
15
<PAGE> 16
FIRST FRANKLIN CORPORATION
4750 Ashwood Drive Cincinnati, Ohio 45241
(513) 469-8000 Fax (513) 469-5360
April 12, 2000
Cincinnati, Ohio
FIRST FRANKLIN CORPORATION ANNOUNCES EARNINGS
First Franklin Corporation, the parent of Franklin Savings and Loan Company,
Cincinnati, Ohio today announced earnings of $373,000 ($0.23 per share) for the
first quarter of 2000. This compares to earnings of $251,000 ($0.15 per share)
for the first quarter of 1999.
Franklin Savings has seven offices in Greater Cincinnati. The Corporation's
common stock is traded on the Nasdaq National Market under the symbol "FFHS".
CONTACT: Thomas H. Siemers
President and CEO
(513) 469-8000
16
<PAGE> 17
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FIRST FRANKLIN CORPORATION
/s/ Daniel T. Voelpel
-----------------------------
Daniel T. Voelpel
Vice President and Chief Financial Officer
Date: May 10, 2000
17
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 1,301
<INT-BEARING-DEPOSITS> 100
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 55,900
<INVESTMENTS-CARRYING> 13,183
<INVESTMENTS-MARKET> 12,840
<LOANS> 174,506
<ALLOWANCE> 994
<TOTAL-ASSETS> 252,383
<DEPOSITS> 193,138
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,107
<LONG-TERM> 38,335
0
0
<COMMON> 13
<OTHER-SE> 19,790
<TOTAL-LIABILITIES-AND-EQUITY> 252,383
<INTEREST-LOAN> 3,220
<INTEREST-INVEST> 1,178
<INTEREST-OTHER> 4
<INTEREST-TOTAL> 4,402
<INTEREST-DEPOSIT> 2,275
<INTEREST-EXPENSE> 2,792
<INTEREST-INCOME-NET> 1,610
<LOAN-LOSSES> 19
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,183
<INCOME-PRETAX> 552
<INCOME-PRE-EXTRAORDINARY> 373
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 373
<EPS-BASIC> .23
<EPS-DILUTED> .23
<YIELD-ACTUAL> 2.63
<LOANS-NON> 313
<LOANS-PAST> 706
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 88
<ALLOWANCE-OPEN> 976
<CHARGE-OFFS> 1
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 994
<ALLOWANCE-DOMESTIC> 252
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 742
</TABLE>
