<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
MARK ONE
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD
FROM _______________ TO _______________
Commission File Number 2-90200
-------
FIRST MCMINNVILLE CORPORATION
------------------------------------------------------
(Exact Name of Registrant As Specified in its Charter)
Tennessee 62-1198119
- ------------------------------- ----------------------------
(State or Other Jurisdiction of (IRS Employer Identification
Incorporation or Organization) Number)
200 East Main Street, McMinnville, TN 37110
-----------------------------------------------------
(Address of Principal Executive Offices and Zip Code)
(615) 473-4402
----------------------------------------------------
(Registrant's Telephone Number, including area code)
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
---- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common stock outstanding: 536,171 shares at May 1, 1997
1
<PAGE> 2
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
The unaudited consolidated financial statements of the registrant and its
wholly-owned subsidiary, First National Bank of McMinnville (the "Bank"), are as
follows:
Consolidated Balance Sheets - March 31, 1997 and December 31, 1996.
Consolidated Statements of Income - For the three months ended March
31, 1997 and 1996.
Consolidated Statements of Cash Flows - For the three months ended
March 31, 1997 and 1996.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
2
<PAGE> 3
FIRST MCMINNVILLE CORPORATION
Consolidated Balance Sheets
March 31, 1997 and December 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
--------- ------------
(In Thousands)
<S> <C> <C>
Assets
------
Loans $ 110,159 109,664
Less: Allowance for loan losses (1,749) (1,724)
--------- -------
Net loans 108,410 107,940
Securities:
Held-to-maturity, at cost (market value -
$51,846,000 and $55,232,000, respectively) 51,558 54,521
Available-for-sale, at market (amortized
cost - $27,518,000 and $24,468,000,
respectively) 27,122 24,288
Interest-bearing deposits in other banks 100 100
Federal funds sold 5,800 --
--------- -------
Total earning assets 192,990 186,849
Cash and due from banks 5,608 3,532
Bank premises and equipment, net of
accumulated depreciation 2,326 2,368
Accrued interest receivable 2,235 1,903
Deferred tax asset 487 405
Other real estate 69 69
Other assets 642 606
--------- -------
Total assets $ 204,357 195,732
========= =======
Liabilities and Stockholders' Equity
------------------------------------
Deposits $ 167,460 159,746
Securities sold under repurchase agreements 3,553 2,531
Federal funds purchased -- 500
Accrued interest and other liabilities 2,550 2,930
--------- -------
Total liabilities 173,563 165,707
--------- -------
Stockholders' equity:
Common stock, $2.50 par value; authorized
5,000,000 shares, issued 579,537 shares 1,512 1,512
Additional paid-in capital 1,512 1,512
Retained earnings 30,247 29,321
Net unrealized losses on available-for-sale
securities, net of tax benefit of
$150,000 and $68,000, respectively (246) (111)
--------- -------
33,025 32,234
Less cost of treasury stock of 43,160 shares
at March 31, 1997 and 42,754 shares at
December 31, 1996 (2,231) (2,209)
--------- -------
Total stockholders' equity 30,794 30,025
--------- -------
$ 204,357 195,732
========= =======
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
3
<PAGE> 4
FIRST MCMINNVILLE CORPORATION
Consolidated Statements of Earnings
Three Months Ended March 31, 1997 and 1996
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------
1997 1996
---- ----
(Dollars In Thousands
Except Per Share Amounts)
<S> <C> <C>
Interest income:
Interest and fees on loans $ 2,364 2,297
Interest and dividends on securities:
Taxable securities 1,001 921
Exempt from Federal income taxes 305 318
Interest on federal funds sold 29 31
Interest on interest-bearing deposits
in other banks and other interest 2 2
-------- -------
Total interest income 3,701 3,569
-------- -------
Interest expense:
Interest on negotiable order of withdrawal
accounts 117 120
Interest on money market demand and savings
accounts 272 244
Interest on certificates of deposit 1,253 1,261
Interest on securities sold under repurchase
agreements and short term borrowings 22 21
Interest on Federal funds purchased 10 --
-------- -------
Total interest expense 1,674 1,646
-------- -------
Net interest income 2,027 1,923
Provision for loan losses 30 --
-------- -------
Net interest income after
provision for loan losses 1,997 1,923
-------- -------
Non-interest income:
Service charges on deposit accounts 121 126
Other fees and commissions 59 33
Commissions and fees on fiduciary activities 11 6
Security gains related to available-for-sale
securities 9 4
Other income 10 10
-------- -------
210 179
-------- -------
Non-interest expenses:
Salaries and employee benefits 553 493
Occupancy expenses, net 55 59
Furniture and equipment expense 21 18
Data processing expense 54 52
FDIC Insurance 5 1
Other operating expenses 206 217
-------- -------
894 840
-------- -------
Earnings before income taxes 1,313 1,262
Income taxes 386 364
-------- -------
Net earnings $ 927 898
======== =======
Weighted average number of shares outstanding 536,411 549,572
======== =======
Net earnings per share $ 1.73 1.63
======== =======
Dividends per share $ -- --
======== =======
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 5
FIRST MCMINNVILLE CORPORATION
Consolidated Statements of Cash Flows
Three Months Ended March 31, 1997 and 1996
Increase (Decrease) in Cash and Cash Equivalents
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
---- ----
(In Thousands)
<S> <C> <C>
Cash flows from operating activities:
Interest received $ 3,356 3,453
Fees and commissions received 201 175
Interest paid (1,330) (1,628)
Cash paid to suppliers and employees (869) (793)
Income taxes paid (94) (129)
-------- --------
Net cash provided by operating
activities 1,264 1,078
-------- --------
Cash flows from investing activities:
Proceeds from maturities of held-to-maturity
securities 4,644 5,507
Proceeds from maturities of available-for-
sale securities 163 2,823
Proceeds from sales of available-for-sale
securities 1,323 994
Purchase of held-to-maturity securities (1,679) (1,240)
Purchase of available-for-sale securities (4,516) (4,700)
Loans made to customers, net of repayments (500) (183)
Purchase of premise and equipment (15) (45)
-------- --------
Net cash provided by (used in)
investing activities (580) 3,156
-------- --------
Cash flows from financing activities:
Net increase (decrease) in non-interest
bearing, savings and NOW deposit accounts 2,577 (1,391)
Net increase in time deposits 5,137 1,640
Increase (decrease) in securities sold under
repurchase agreement 1,022 (2,025)
Decrease in Federal funds purchased (500) --
Dividends paid (1,020) (965)
Payments to acquire treasury stock (24) (150)
-------- --------
Net cash provided by (used in)
financing activities 7,192 (2,891)
-------- --------
Net increase in cash and cash equivalents 7,876 1,343
Cash and cash equivalents at beginning of
period 3,532 5,172
-------- --------
Cash and cash equivalents at end of period $ 11,408 6,515
======== ========
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
5
<PAGE> 6
FIRST MCMINNVILLE CORPORATION
Consolidated Statements of Cash Flows, Continued
Three Months Ended March 31, 1997 and 1996
Increase (Decrease) in Cash and Cash Equivalents
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
---- ----
(In Thousands)
<S> <C> <C>
Reconciliation of net earnings to net cash
provided by operating activities:
Net earnings $ 927 898
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation 57 50
Provision for loan losses 30 --
Gain on sale of available-for-sale
securities (9) (4)
FHLB dividend reinvestment (11) (10)
Increase in other assets, net (38) (75)
Increase in other liabilities 296 268
Increase in interest receivable (332) (67)
Increase in interest payable 344 18
------- -----
Total adjustments 337 180
------- -----
Net cash provided by
operating activities $ 1,264 1,078
======= =====
Supplemental schedule of noncash activities:
Unrealized gain (loss) in values of
securities available-for-sale, net of
income tax benefit of $82,000 and
$123,000 for the quarters ended
March 31, 1997 and 1996, respectively $ (135) (201)
======= =====
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
6
<PAGE> 7
FIRST MCMINNVILLE CORPORATION
Notes to Consolidated Financial Statements
(Unaudited)
Basis of Presentation
The unaudited consolidated financial statements include the accounts of First
McMinnville Corporation and its wholly-owned subsidiary, First National Bank of
McMinnville.
The accompanying consolidated financial statements have been prepared, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations.
In the opinion of management, the statements contain all adjustments and
disclosures necessary to summarize fairly the financial position of the Company
as of March 31, 1997 and December 31, 1996, and the results of operations for
the three months ended March 31, 1997 and 1996 and changes in cash flows for the
three months ended March 31, 1997 and 1996. All significant intercompany
transactions have been eliminated. The interim consolidated financial statements
should be read in conjunction with the notes to the consolidated financial
statements presented in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1996. The results for interim periods are not necessarily
indicative of results to be expected for the complete fiscal year.
Allowance for Loan Losses
Transactions in the allowance for loan losses were as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------
1997 1996
---- ----
(In Thousands)
<S> <C> <C>
Balance, January 1, 1997 and 1996,
respectively $ 1,724 1,562
Add (deduct):
Losses charged to allowance (12) (7)
Recoveries credited to allowance 7 14
Provision for loan losses 30 --
------- -----
Balance, March 31, 1997 and 1996,
respectively $ 1,749 1,569
======= =====
</TABLE>
7
<PAGE> 8
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation
The purpose of this discussion is to provide insight into the financial
condition and results of operations of the Company and its subsidiary. This
discussion should be read in conjunction with the consolidated financial
statements. Reference should also be made to the Company's Annual Report on Form
10-KSB for the year ended December 31, 1996 for a complete discussion of factors
that impact liquidity, capital and the results of operations.
Management's discussion and analysis may include forward-looking
statements. Many factors affect First McMinnville Corporation's (the "Company")
financial condition and profitability, including changes in economic conditions,
the volatility of interest rates, political events and competition from other
providers of financial services. Because these factors are unpredictable and
beyond the Company's control, earnings may fluctuate from period to period. The
purpose of this discussion and analysis is to provide Form 10-Q readers with
information relevant to understanding and assessing the financial condition and
results of operations of the Company.
Liquidity and Interest Rate Sensitivity Management
The concept of liquidity involves the ability of the Registrant and its
subsidiary to meet future cash flow requirements, particularly those of
customers who are either withdrawing funds from their accounts or borrowing to
meet their credit needs.
Proper asset/liability management is designed to maintain stability in
the balance of interest-sensitive assets to interest-sensitive liabilities in
order to provide a stable growth in net interest margins. Earnings on
interest-sensitive assets such as loans tied to the prime rate of interest and
federal funds sold, may vary considerably from fixed rate assets such as
long-term investment securities and fixed rate loans. Interest-sensitive
liabilities such as large certificates of deposit and money market certificates,
generally require higher costs than fixed rate instruments such as passbook
savings.
Banks, in general, must maintain large cash balances to meet day-to-day
cash flow requirements as well as maintaining required reserves for regulatory
agencies. The cash balances maintained are the primary source of liquidity.
Federal funds sold, which are basically overnight or short-term loans to other
banks that increase the other bank's required reserves, are also a major source
of liquidity.
The Company's investment portfolio consists of earning assets that
provide interest income. For those securities classified as held to maturity,
the Company has the ability and intention to hold these securities until
maturity. Securities classified as available-for-sale include securities
intended to be used as part of the Company's asset/liability strategy and/or
securities that may be sold in response to changes in interest rate, prepayment
risk, the need or desire to increase capital and similar economic factors.
Securities totaling approximately $7.7 million mature or reprice within the next
twelve months.
8
<PAGE> 9
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation, Continued
A secondary source of liquidity is the Bank's loan portfolio. At March
31, 1997 commercial loans of approximately $18.5 million and other loans
(mortgage and consumer) of approximately $22.6 million either will become due or
will be subject to rate adjustments within twelve months from the respective
date. Continued emphasis is placed on structuring adjustable rate loans.
As for liabilities, certificates of deposit of $100,000 or greater of
approximately $21.2 million will become due during the next twelve months. The
Bank's deposit base increased approximately $7,714,000 during the quarter ended
March 31, 1997. Securities sold under repurchase agreements also increased
approximately $1,022,000 during the first three months of 1997. The Company
repaid Federal funds purchased of $500,000 during the first quarter of 1997.
Historically, there has been no significant reduction in immediately
withdrawable accounts such as negotiable order of withdrawal accounts, money
market demand accounts, demand deposit and regular savings. Management
anticipates that there will be no significant withdrawals from these accounts in
the future.
The Bank is limited by banking regulatory agencies as to the amount of
dividends that it can pay. At March 31, 1997, the Bank can declare during the
remainder of 1997 cash dividends in an aggregate amount not to exceed
approximately $5.9 million, exclusive of any 1997 net earnings, without prior
approval of the office of the Comptroller of the Currency. However, most of
these funds will be retained for use in the Bank's operations rather than being
paid out in dividends. It is anticipated that with present maturities, the
anticipated growth in deposit base, and the efforts of management in its
asset/liability management program, liquidity will not pose a problem in the
foreseeable future. At the present time there are no known trends or any known
commitments, demands, events or uncertainties that will result in or that are
reasonable likely to result in the Company's liquidity changing in any material
way.
Capital Resources
A primary source of capital is internal growth through retained
earnings. The ratio of stockholders' equity to total assets was 15.1% at March
31, 1997 and 15.3% at December 31, 1996. Total assets increased 4.4% during the
three months ended March 31, 1997. The annualized rate of return on
stockholders' equity for the three months ended March 31, 1997 was 12.5%
compared to 12.3% for the comparable period in 1996. The high percentage of
equity capital places downward pressure on the return on equity which is lower
than that of many financial services companies in the Registrant's peer group.
Cash dividends will be paid in the remainder of 1997 over 1996 only in the
discretion of the Board of Directors and to the extent of available profits
increase. Dividends paid during 1996 were $2.40 per share. No material changes
in the mix or cost of capital is anticipated in the foreseeable future. At the
present time there are no material commitments for capital expenditures.
9
<PAGE> 10
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation, Continued
Regulations of the Comptroller of the Currency establish required
minimum capital levels for the Bank. Under these regulations, national banks
must maintain certain capital levels as a percentage of average total assets
(leverage capital ratio) and as a percentage of total risk-based assets
(risk-based capital ratio). Under the risk-based requirements, various
categories of assets and commitments are assigned a percentage related to credit
risk ranging from 0% for assets backed by the full faith and credit of the
United States to 100% for loans other than residential real estate loans and
certain off-balance sheet commitments. Total capital is characterized as either
Tier 1 capital - common shareholders' equity, noncumulative perpetual preferred
stock and a limited amount of cumulative perpetual preferred - or Tier 2 capital
which includes the allowance for loan losses up to 1.25% of risk weighted
assets, perpetual preferred stock, subordinated debt and various other hybrid
capital instruments, subject to various limits. Goodwill is not includable in
Tier 1 or Tier 2 capital. National banks must maintain a Tier 1 capital to
risk-based assets of at least 4.0%, a Tier 2 capital to risk-based assets ratio
of at least 8.0% and a leverage capital ratio defined as Tier 1 capital to
average total assets for the most recent quarter of at least 4.0%. The same
ratios are also required in order for a national bank to be considered
"adequately capitalized" under the OCC's "prompt corrective action" regulations,
which impose certain operating restrictions on institutions which are not
adequately capitalized. The Bank has a Tier 1 risk-based ratio of 27.1%, a total
capital to risk-based ratio of 28.3% and a Tier 1 leverage ratio of 16.69%, and
was considered "well capitalized" under the regulations.
The Federal Reserve Board imposes consolidated capital guidelines on
bank holding companies which have more than $150 million in consolidated assets.
These guidelines required bank holding companies to maintain consolidated
capital ratios which are essentially the same as the minimum capital levels
required for national banks. The Company's consolidated capital ratios were
substantially the same as those set forth above for the Bank, and exceeded the
minimums required under these Federal Reserve Board guidelines.
Results of Operations
Net earnings were $927,000 for the three months ended March 31, 1997 as
compared to $898,000 for the same period in 1996.
As in most financial institutions, a major element in analyzing the
statement of earnings is net interest income, i.e., the excess of interest
earned over interest paid. This is particularly true with the volatility in
interest rates encountered in recent years.
10
<PAGE> 11
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation, Continued
Results of Operations, Continued
The Company's interest income, excluding tax equivalent adjustments,
increased by $132,000 or 3.7% during the three months ended March 31, 1997 as
compared to an increase of $253,000 or 7.6% for the same period in 1996. The
increase in 1997 was attributable primarily to an increase in average earning
assets together with a change in the mix of average earning assets with a higher
volume of loans. The ratio of average earning assets to total average assets was
96.1% for the quarter ended March 31, 1997 and 94.9% for the quarter ended March
31, 1996.
Interest expense increased by $28,000 for the three months ended March
31, 1997 or 1.7% compared to an increase of $153,000 or 10.2% for the same
period in 1996. Such increases in interest expense can be attributable to an
increase in weighted average interest rates combined with an increase in
interest bearing liabilities.
The foregoing resulted in net interest income of $2,027,000 for the
three months ended March 31, 1997 an increase of $104,000 or 5.4% compared to
the same period in 1996.
The provision for loan losses was $30,000 for the first three months of
1997. There was no provision for loan losses during the quarter ended March 31,
1996. The provision for loan losses is based on past loan experience and other
factors which, in management's judgment, deserve current recognition in
estimating possible loan losses. Such factors include growth and composition of
the loan portfolio, review of specific loan problems, the relationship of the
allowance for loan losses to outstanding loans, and current economic conditions
that may affect the borrower's ability to repay. Management has in place a
system for identifying and monitoring problems on a timely basis.
The following schedule details selected information as to
non-performing loans of the Company at March 31, 1997:
<TABLE>
<CAPTION>
Past Due
90 Days Non-Accrual
-------- -----------
(In Thousands)
<S> <C> <C>
Real estate loans $ -- --
Installment loans 12 --
Commercial 118 --
---- ----
$130 --
==== ====
Renegotiated loans $ -- --
==== ====
</TABLE>
11
<PAGE> 12
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation, Continued
Results of Operations, Continued
At March 31, 1997, loans which include the above, totaling $7,383,000
were included in the Company's internal classified loan list. Of these loans
$1,010,000 are real estate, $6,315,000 are commercial and $58,000 are consumer
loans. The collateral values securing these loans total approximately
$10,936,000, ($1,516,000 related to real property, $9,402,000 related to
commercial loans and $18,000 related to consumer loans). Such loans are listed
as classified when information obtained about possible credit problems of the
borrower has prompted management to question the ability of the borrower to
comply with the repayment terms of the loan agreement. The classifications
include four performing working capital loans in the amounts of $697,000,
$581,000, $760,000 and $2,116,000, respectively. These borrowers have
experienced losses in recent years which resulted in the classifications. These
lines are secured by collateral (consisting of real estate and personal
property). The collateral valuations received by management indicate an
estimated value of $200,000, $933,000, $1,373,000 and $2,866,000, respectively.
The loan classifications do not represent or result from trends or uncertainties
which management expects will materially impact future operating results,
liquidity or capital resources.
There were no material amounts of other interest-bearing assets
(interest-bearing deposits with other banks, municipal bonds, etc.) at March 31,
1997 which would be required to be disclosed as past due, non-accrual,
restructured or potential problem loans, if such interest-bearing assets were
loans.
Non-interest income excluding securities transactions increased $26,000
or 14.9% during the three months ended March 31, 1997 compared to an increase of
$5,000 or 2.9% for the same period in 1996. The increase in 1997 relates
primarily to increases in other fees and commissions while the increase in 1996
was due primarily to increases in service charges on deposit accounts.
Securities gains during the three months ended March 31, 1997 were
$9,000 related to transactions in the available-for-sale category. Securities
gains during the three months ended 1996 amounted to $4,000, and related to
transactions in the available-for-sale category. The gains during 1997 and 1996
were incurred primarily in conjunction with management's strategies to
restructure the investment portfolio to improve the quality of the portfolio, to
improve maturity distribution and to maintain a flexible position to react to
market conditions.
12
<PAGE> 13
FIRST MCMINNVILLE CORPORATION
FORM 10-Q, CONTINUED
Item 2. Management's Discussion and Analysis or Plan of Operation, Continued
Results of Operations, Continued
Non-interest expense increased $54,000 or 6.4% during the first three
months of 1997 compared to a decrease of $24,000 or 2.8% during the same period
in 1996. The increase in 1997 was due primarily in increases in salaries and
employee benefits. The decrease in 1996 related primarily to a decrease in the
FDIC assessment rate during 1996. The decrease in the FDIC assessment was
partially offset by an increase in salaries and employee benefits and other
operating expenses.
Management is not aware of any current recommendations by the
regulatory authorities which, if implemented, would have a material effect on
the Registrant's liquidity, capital resources or operations.
Impact of Inflation
The primary impact which inflation has on the results of the Company's
operations is evidenced by its effects on interest rates. Interest rates tend to
reflect, in part, the financial market's expectations of the level of inflation
and, therefore, will generally rise or fall as the level of expected inflation
fluctuates. To the extent interest rates paid on deposits and other sources of
funds rise or fall at a faster rate than the interest income earned on funds,
loans or invested, net interest income will vary. Inflation also impacts on
non-interest expenses as goods and services are purchased, although this has not
had a significant effect on net earnings. If the inflation rate stays flat or
increases slightly, the effect on profits will not be significant.
13
<PAGE> 14
PART II. OTHER INFORMATION
PART II.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 27 Financial Data Schedule (for SEC use only) - This schedule
contains summary financial information extracted from the financial
statements of the Company at March 31, 1997 (unaudited) and is
qualified in its entirety by reference to such financial statements as
set forth in the Company's quarterly report on Form 10-Q for the period
ending March 31, 1997.
(b) No reports on Form 8-K have been filed during the quarter for which
this report is filed.
SIGNATURES
14
<PAGE> 15
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.
FIRST MCMINNVILLE CORPORATION
-----------------------------------
(Registrant)
DATE: May 13, 1997 /s/ Charles C. Jacobs
---------------------------- ----------------------------------
Charles C. Jacobs
President and
Chief Executive Officer
DATE: May 13, 1997 /s/ Kenny D. Neal
---------------------------- ----------------------------------
Kenny D. Neal
Chief Financial and
Accounting Officer
15
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 5,608
<INT-BEARING-DEPOSITS> 100
<FED-FUNDS-SOLD> 5,800
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 27,122
<INVESTMENTS-CARRYING> 51,558
<INVESTMENTS-MARKET> 51,846
<LOANS> 110,159
<ALLOWANCE> 1,749
<TOTAL-ASSETS> 204,357
<DEPOSITS> 167,460
<SHORT-TERM> 3,553
<LIABILITIES-OTHER> 2,550
<LONG-TERM> 0
0
0
<COMMON> 1,512
<OTHER-SE> 29,282
<TOTAL-LIABILITIES-AND-EQUITY> 204,357
<INTEREST-LOAN> 2,364
<INTEREST-INVEST> 1,306
<INTEREST-OTHER> 31
<INTEREST-TOTAL> 3,701
<INTEREST-DEPOSIT> 1,642
<INTEREST-EXPENSE> 1,674
<INTEREST-INCOME-NET> 2,027
<LOAN-LOSSES> 30
<SECURITIES-GAINS> 9
<EXPENSE-OTHER> 894
<INCOME-PRETAX> 1,313
<INCOME-PRE-EXTRAORDINARY> 1,313
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 927
<EPS-PRIMARY> 1.73
<EPS-DILUTED> 1.73
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 130
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 7,383
<ALLOWANCE-OPEN> 1,724
<CHARGE-OFFS> 12
<RECOVERIES> 7
<ALLOWANCE-CLOSE> 1,749
<ALLOWANCE-DOMESTIC> 1,749
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
