<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB/A
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended June 30, 1997
[ ] Transition report under Section 13 or 15(d) of the
Exchange Act
For the transition period to
-------------------------- ----------------------
Commission file number 0-15777
FIRST INDEPENDENCE CORPORATION
------------------------------
(Exact Name of Small Business Issuer in Its Charter)
Michigan 38-2583843
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
44 Michigan, Detroit, Michigan 48226
------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(313) 256-8400
--------------
(Issuer's Telephone Number, Including Area Code)
Securities registered under Section 12 (b) of the Exchange Act:
NONE
Securities registered under Section 12 (g) of the Exchange Act:
Common stock, par value $1.00 per share
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act 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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date:
Common Stock, $1 Par Value-336,760 shares as of August 12, 1997
<PAGE> 2
FIRST INDEPENDENCE CORPORATION
INDEX
<TABLE>
<CAPTION>
PAGE
<S> <C>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheet June 30, 1997 3
Consolidated Statement of Income
Quarter ended and YTD ended June 30, 1997 and 1996 4
Consolidated Statement of Cash Flows
YTD ended June 30, 1997 and 1996 5
Notes to Consolidated Financial Statements 6-7
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 8-12
Part II. OTHER INFORMATION 13
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Exhibits and Reports on Form 8-K 13
Signatures 14
</TABLE>
2
<PAGE> 3
Part I.
FIRST INDEPENDENCE CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS 1997
-------
<S> <C>
Cash and due from banks $ 4,312,613
Federal funds sold 10,767,000
-----------
Total cash and cash equivalents 15,079,613
Securities available for sale 12,585,921
Securities held to maturity (fair value of $20,486,364) 20,533,626
-----------
Total securities 33,119,547
Loans
Commercial 9,991,007
Commercial real estate 11,185,701
Real estate mortgages 13,208,871
Consumer 7,037,810
-----------
41,423,389
Allowance for loan losses (892,322)
-----------
40,531,067
Premises and equipment, net 3,462,097
Accrued interest receivable and other assets 1,295,500
-----------
Total assets $93,487,824
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits
Noninterest-bearing $34,290,096
Interest-bearing 48,366,476
-----------
82,656,572
Securities sold under retail repurchase agreements 4,163,149
Accrued expenses and other liabilities 1,029,137
Long-term debt 900,000
-----------
Total liabilities 88,748,858
Shareholders' equity
Preferred stock 2,749,508
Common stock, $1 par value: 500,000 shares authorized;
336,760 shares issued and outstanding 336,760
Capital surplus 2,369,782
Accumulated deficit (690,962)
Unrealized loss on securities available for sale (12,851)
Unrealized holding loss on securities transferred (13,271)
-----------
Total shareholders' equity 4,738,966
-----------
Total liabilities and shareholders' equity $93,487,824
===========
</TABLE>
3
<PAGE> 4
FIRST INDEPENDENCE CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENT OF INCOME
Quarter and Year to Date ended June 30, 1997 and 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
------------------------- -------------------------
June 1997 June 1996 June 1997 June 1996
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Interest income
loans, including fees $1,009,843 $1,133,668 $2,078,465 $2,248,175
Taxable securities 459,273 474,343 887,675 926,230
Federal funds sold 202,555 117,704 375,392 259,303
---------- ---------- ---------- ----------
Total interest income 1,671,671 1,725,715 3,341,532 3,433,708
Interest expense
Deposits 462,053 435,728 924,302 850,061
Other borrowed funds 68,267 84,750 139,965 182,213
---------- ---------- ---------- ----------
Total interest expense 530,320 520,478 1,064,267 1,032,274
---------- ---------- ---------- ----------
NET INTEREST INCOME 1,141,351 1,205,237 2,277,265 2,401,434
Provision for loan losses 348,693 90,000 (525,879) 407,750
---------- ---------- ---------- ----------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 792,658 1,115,237 2,803,144 1,993,684
Noninterest income
Service charges on deposit accounts 206,061 209,880 406,465 407,490
Securities gains, net 0 0 0 116
Net gains on sales of residential real estate loans 57,094 157,711 121,722 305,335
Other 27,788 59,512 89,165 118,373
---------- ---------- ---------- ----------
Total noninterest income 290,943 427,103 617,352 831,314
Noninterest expenses
Salaries and employee benefits 635,492 709,686 1,304,247 1,371,798
Occupancy 108,983 113,598 220,039 242,261
Professional services 30,000 78,000 143,000 134,000
Insurance expense 31,617 23,988 61,089 47,977
Other noninterest expenses 557,667 446,016 1,095,378 865,641
---------- ---------- ---------- ----------
Total noninterest expenses 1,363,759 1,371,288 2,823,753 2,661,677
INCOME (LOSS) BEFORE FEDERAL INCOME TAXES (280,158) 171,052 596,743 163,321
Federal income tax expense 0 0 0 0
---------- ---------- ---------- ----------
Net income (loss) (280,158) 171,052 596,743 163,321
Preferred stock dividend requirements 8,550 8,550 17,100 17,100
---------- ---------- ---------- ----------
Income (loss) attributable to common stock $ (288,708) $ 162,502 $ 579,643 $ 146,211
========== ========== ========== ==========
Income (loss) per common and common equivalent share $ (0.86) $ 0.48 $ 1.72 $ 0.43
========== ========== ========== ==========
</TABLE>
4
<PAGE> 5
FIRST INDEPENDENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
for the six months ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
1997 1996
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 596,073 $ 163,321
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 237,300 245,400
Amortization of premiums and accretion of discounts 37,323 18,050
Provision for loan losses (525,879) 407,750
Net realized gains on securities available for sale - (116)
Origination of loans intended for sale (1,116,174) (6,639,535)
Proceeds from loans originated for sale 1,872,251 5,721,301
Net gains on sale of residential real estate loans (121,722) (305,335)
Loss on writedown of other assets 78,948 -
Changes in:
Accrued interest receivable and other assets 153,326 (131,538)
Accrued expenses and other liabilities 98,106 65,772
----------- -----------
NET CASH PROVIDED /(USED)BY OPERATING ACTIVITIES 1,309,552 (454,930)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of investment securities available for sale - 1,001,053
Proceeds from maturities of investment securities available for sale 1,048,346 3,135,194
Proceeds from maturities of investment securities held to maturity 1,500,000 4,000,000
Purchases of investment securities available for sale - (7,045,103)
Purchases of investment securities held to maturity (6,507,107) (4,665,092)
Net change in loans 4,641,127 (119,460)
Purchases of premises and equipment (142,632) (216,509)
----------- -----------
NET CASH PROVIDED/(USED) IN INVESTING ACTIVITIES 539,734 (3,909,917)
CASH FLOWS FROM FINANCING ACTIVITIES
changes in:
Deposits (873,122) 867,067
Securities sold under repurchase agreements (121,539) 1,711,290
Payment of interest on Senior Notes (54,250) -
Payment of dividends Class A and Class B Preferred Stock (42,750) -
Proceeds from issuance of preferred stock - 47,700
----------- -----------
NET CASH PROVIDED/(USED) BY FINANCING ACTIVITIES (1,091,661) 2,626,057
----------- -----------
Net increase (decrease) in cash and cash equivalents 757,625 (1,738,790)
Cash and cash equivalents, beginning of year 14,321,988 17,059,650
----------- -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $15,079,613 $15,320,860
=========== ===========
</TABLE>
5
<PAGE> 6
First Independence Corporation and Subsidiary
Notes To Financial Statements
June 30, 1997
1. The consolidated balance sheet as of June 30, 1997, the related
consolidated statements of income for the quarter and six months ended June 30,
1997 and 1996, and the statement of cash flows for the six month period ended
June 30, 1997 and 1996 are unaudited.
2. In the opinion of management, all normal recurring adjustments
necessary for a fair presentation of such financial statements have been
included. Interim results are not necessarily indicative of results for a full
year.
3. The consolidated statements include the accounts of First Independence
Corporation (the "Corporation") and its wholly owned subsidiary, First
Independence National Bank of Detroit (the "Bank"). All significant
intercompany balances and transactions have been eliminated in consolidation.
4. Securities are classified as held to maturity and carried at amortized
cost when management has the positive intent and ability to hold them to
maturity. Securities are classified as available for sale when they might be
sold before maturity. Securities available for sale are carried at fair value,
with unrealized holding gains and losses reported seperately in shareholders'
equity.
Gains and losses on sales of securities are determined using amortized
cost of the specific security sold. Interest income includes amortization of
purchased premiums and discounts.
5. Loans are reported at the principal balance outstanding, net of
deferred loan fees and costs, and the allowance for loan losses. Interest
income is reported on the interest method and includes amortization of net
deferred loan fees and costs over the loan term.
6. The allowance for possible losses on loans is maintained at a level
believed adequate by management to absorb potential losses from specific assets
identified as having greater than a normal risk of loss as well as losses from
the remainder of the portfolio. Management's determination of the level of the
allowance is based upon an evaluation of the portfolio, past experience,
current economic conditions, size and composition of the portfolio, collateral
location and values, cash flow positions, industry concentrations,
delinquencies and other relevant factors.
Loan impairment is reported when full paymant under the loan terms is
not expected. Impairment is evaluated in total for smaller-balance loans of
similiar nature such as residential mortgage, consumer, and credit card loans,
and on an individual basis for other loans. If a loan is impaired, a portion
of the allowance is allocated so that the loan is reported, net, at the present
value of estimated future cash flows using the loan's existing rate or at the
fair value of the colateral if the loan is collateral dependant. When credit
analysis of a borrower's operating results and financial condition indicates
that the underlying cash flows of the borrower's business are not adequate to
meet its debt service requirements, including the Bank's loans to the borrower,
the loan is evaluated for impairment. Often this is associated when payments
are delayed, typically 90 days or more, or when the internal grading system
indicates a substandard or doubtful classification.
6
<PAGE> 7
The following table details information concerning nonperforming
loans as of June 30, 1997.
<TABLE>
<CAPTION>
(in thousands)
<S> <C>
Non-accrual Loans 1,303
Impaired loans 1,520
Loans past due 90
days or more 1,037
-----
Total 3,860
=====
</TABLE>
Interest that would have been accrued on the non-accrual loans at June 30,
1997, had they been on accrual status would have been approximately $20,000.
7. All significant intercompany balances and transactions have been
eliminated in consolidation.
8. In 1991, a former senior officer of the Bank filed a complaint in the
Circuit Court for the County of Wayne, Michigan, against the Bank, a
non-operating subsidiary of the Bank, and the Corporation and certain directors
and another former officer thereof alleging wrongful termination. In May 1993,
a jury verdict was entered against the Corporation, a non-operating subsidiary
of the Bank, certain directors and another former officer thereof, in the
amount of $320,000 by a Wayne County Circuit Court. A judgment was entered on
the verdict in October 1994. An accrual for the judgment was recorded in 1994
and is reflected in the consolidated financial statements and attorney fees and
other litigation costs have been expensed as they were incurred. The
Corporation appealed the judgment to the Michigan Court of Appeals and on March
14, 1997, the judgment was reversed by the Court of Appeals holding that there
was no liability by the Corporation, the Bank's subsidiary, or any of the
individual defendants. The plaintiff has sought leave of the Michigan Supreme
Court to appeal the reversal by the Michigan Court of Appeals. Counsel for the
Corporation are of the opinion that the appeal is without merit.
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Summary of Operations
Net loss for the second quarter of 1997 was $280,158 or $.86 per share,
compared to net income of $171,052 or $.48 per share for the second quarter of
1996. The decrease in net income for the second quarter of 1997, as compared
to 1996, resulted from a higher loan loss provision, decrease in net interest
income, and a decrease on gains on sales of residential real estate loans.
For the first six months of 1997, Net Income was $596,743, or $1.72 per share,
an increase of $433,422 over the Net Income of $163,321 for the first six
months of 1996. The increase in Net Income resulted from the February 21,
1997, insurance settlement of $1,441,721 from its fidelity insurance
underwriters in settlement of the Bank's claims related to the fictitious
"loans" made in late 1995 and January 1996. The Bank recorded a recovery of
$1,137,000 to the allowance for loan losses for amounts previously charged off
related to the fictitious "loans." The balance of $308,000 was received by the
Bank in exchange for $308,000 in performing loans written by a consumer loan
officer with no lending authority. Subsequently, the allowance was reduced
through a negative provision of $874,572, in the first quarter of 1997.
Net Interest Income
Net interest income in the second quarter of 1997 was $1,141,351, a decrease of
$63,886 from second quarter 1996 net interest income of $1,205,237. The
decrease was attributable to lower yielding earning assets and higher rates on
deposits. As a result of lower yields on earning assets and higher rates on
deposits, net interest margin decreased 41 basis points from 5.55 percent in
the second quarter of 1996 to 5.14 percent in the second quarter of 1997.
Provision for Possible Credit Losses
The Provision for Possible Credit Losses in the second quarter in 1997 amounted
to $348,693, an increase of $258,693 from the second quarter 1996 Provision
for Possible Credit Losses of $90,000. The increase in provision is a result
of management's continued efforts to address problem loans. A detailed
analysis of the related Allowance for Possible Credit Losses, charge-offs,
recoveries, and ratios is presented on page 11.
Noninterest Income
Noninterest income for the second quarter of 1997 amounted to $290,943, a
decrease of $136,160, or 32 percent, from second quarter 1996 noninterest
income of $427,103. The decrease was largely attributable to a decrease in
gains on sales of residential real estate loans of approximately $101,000, due
to lower residential mortgage originations.
Noninterest Expenses
Noninterest expenses for the second quarter of 1997 amounted to $1,363,759, a
decrease of $7,529, or .5 percent, from second quarter 1996 noninterest expense
of $1,371,288. Salaries and benefits decreased $74,000 and professional
services decreased $48,000. These decreases were offset by an increase in
other noninterest expenses of $111,000, primarily due to an increase in FDIC
assessment of $30,000 and writedown of other assets of $62,000.
8
<PAGE> 9
Balance Sheet Analysis
Liquidity
Deposits at June 30, 1997 totaled $82,656,572 while federal funds sold were
$10,767,000 (13% of total deposits). Total securities available-for-sale at
June 30, 1997 were $12,585,921 (15% of total deposits). In addition,
approximately $6,395,000 (7.7% of total deposits) of the Bank's $33 million of
securities will mature within one year. Thus, the bank has a liquidity
position such that management believes it is capable of funding loan demand or
deposit withdrawals.
Investments
The Bank had $33,119,547 of investment securities at June 30, 1997, compared to
$29,175,658 of such securities at December 31, 1996. The following is a
summary of the maturities and weighted average yields from the investment
portfolio at June 30, 1997. Yields are not calculated on a tax equivalent
basis.
<TABLE>
<CAPTION>
After One After Five
Within But Within But Within After
(in thousands) One Year Five Years Ten Years Ten Years Total
-------- ---------- --------- --------- -----
<S> <C> <C> <C> <C> <C>
Available-for-sale
Treasury and agency $1,000 $11,354 - $ 65 $12,419
State and Political - - - - -
Other - - - 167 167
------ ------- -------- ------ -------
Total $1,000 $11,354 - 232 $12,586
====== ======= ======== ====== =======
Weighted Ave Yield 6.00% 6.03% - 6.69% 6.04%
Held-to-maturity
Treasury and agency $5,394 $15,140 - - $20,534
State and Political - - - - -
Other - - - - -
------ ------- -------- ------ -------
Total $5,394 $15,140 - - $20,534
====== ======= ======== ====== =======
Weighted Ave Yield 5.55% 6.11% - - 5.97%
</TABLE>
Loans
The following table sets forth the composition of the Bank's
loan portfolio at June 30, 1997.
<TABLE>
<S> <C> <C>
Commercial $ 9,991 24.12%
Commercial Real Estate 11,186 27.00
Residential Real Estate 13,209 31.89
Consumer 7,037 16.99
------- -------
$41,423 100.00%
</TABLE>
9
<PAGE> 10
At June 30, 1997, the Bank had $3,860,000 of loans that were nonperforming.
Nonperforming loans include non-accrual loans, loans with principal or interest
past due 90 days or more, and loans that have matured and are being extended or
rewritten after their stated maturity date.
Non-accrual loans are those nonperforming and/or impaired loans on which the
Bank does not accrue interest income. Loans are placed on non-accrual status
when principal or interest is in default for a period of 90 days or more unless
the loan is in the process of collection and is well secured so that delinquent
principal and interest would be expected to be satisfied from the collateral.
Nonperforming loans and non-accrual loans are all considered "impaired loans"
under SFAS 114, "Accounting by Creditors for Impairment of a Loan", and SFAS
118, "Accounting by Creditors for Impairment of a Loan - Income Recognition and
Disclosure." At June 30, 1997, total nonperforming and impaired loans amounted
to 9.32% of the aggregate loans at June 30, 1997, compared to 7.12% at the end
of 1996.
The table included on page 6 details information concerning nonperforming
loans, as of June 30, 1997. The amount of interest income that would have been
accrued on the loans on non-accrual status at June 30, 1997, had those loans
remained current, was approximately $20,000.
At June 30, 1997, there were no significant loans other than those included in
the table on page 6, for which information was known that caused management to
have serious doubts as to the ability of borrowers to comply with loan
repayment terms.
The allowance for loan losses totaled $892,322 at June 30, 1997, compared to
the 1996 year end balance of $765,561. The allowance for loan losses
represented 2.15% of loans compared with 1.66% at December 31, 1996. The
allowance for loan losses was 23% of the nonperforming loans at June 30, 1997.
At December 31, 1996, the allowance was 23% of such loans. The total amount of
the allowance for loan losses is based on management's evaluation of the
portfolio, past experience, economic conditions, composition of the portfolio,
collateral location and values, cash flow positions of the borrowers,
delinquencies and other factors deemed relevant. The allowance for loan
losses, in management's opinion, is adequate taking all such considerations
into account.
The loan review system and charge-off policy assist management in identifying
problem loans and credit deterioration earlier than in the past, and continuing
implementation of the loan review system will improve this process further.
Loans charged off in the second quarter of 1997 aggregated $333,298. The
charge offs were part of the Bank's continuing effort to address problem loans
in the loan portfolio and improve the quality of the loan assets. Collection
efforts in the second quarter of 1997 resulted in recoveries of $39,171 on
loans previously charged off.
10
<PAGE> 11
The table below presents management's allocation of the
allowance for loan losses at June 30, 1997.
<TABLE>
<CAPTION>
(in thousands) Allowance Percent*
--------- --------
<S> <C> <C>
Commercial 689 24%
Real estate mortgage 51 59
Consumer 152 17
--- ---
892 100%
=== ===
</TABLE>
*Represents percent of loans in each category as a percent of
total loans
The following table summarizes activity in the allowance for loan losses during
the second quarter of 1997.
<TABLE>
<CAPTION>
Quarter Ended
June 1997
-------------
<S> <C>
Average loans outstanding
during the period $42,496,830
===========
Allowance for loan losses:
Beginning balance 837,756
Provision for credit losses 348,693
Charge-Offs (333,298)
Recoveries 39,171
-----------
Balance at End-of-Period 892,322
===========
Charge-Offs by Category
Commercial (229,758)
Consumer (101,062)
Real-Estate Mortgages (2,478)
-----------
Total charge-offs (333,298)
===========
Recoveries by Category
Commercial 10,874
Consumer 22,519
Real-Estate Mortgages 5,778
-----------
Total recoveries 39,171
===========
Net Loans Charged Off (294,127)
===========
Provision for loan losses as a percent of
average loans 0.82%
Net loans charged off as a percent of
average loans 0.69%
Total loans charged off as a percent of
average loans 0.78%
</TABLE>
11
<PAGE> 12
Deposits
The following is a summary of the average balances and average
rates paid on deposits for the period ending June 30, 1997.
<TABLE>
<CAPTION>
Average Average
Balance Rate
------- ----
<S> <C> <C>
(in thousands)
Non-interest bearing demand deposits $28,757
U.S. Treasury, tax, and loan deposits * 198
Interest bearing demand deposits 6,535 2.07%
Savings deposits 15,134 2.36%
Time deposits
$100,000 or more ** 18,367 3.44%
Other time deposits 14,913 4.86%
-------
Total $83,904
=======
</TABLE>
* Represents non-retail deposits held overnight and remitted to the federal
government the following business day.
** Includes approximately $6,000,000 of a non-interest bearing time deposit
from the U.S. Treasury.
Capital Resources
At June 30, 1997, the ratio of equity capital to average assets of the Bank was
6.28% and in compliance with the Comptroller of Currency requirement of 5.50%.
The risk-based Tier 1 capital ratio at June 30, 1997 was 12.87% and the Bank's
total capital ratio at June 30, 1997, was 14.13%.
As a result of 1997 net income, the Bank is now legally able to pay dividends
to the Corporation, subject to prior approval of the Comptroller of the
Currency. The Bank is prohibited from paying any cash dividends to the
Corporation without prior written consent of the Comptroller of the Currency
until the Comptroller Agreement described in the 10-KSB is terminated. The
Bank has requested and received permission from the Comptroller of the Currency
to pay dividends to the Corporation so that the Corporation can pay the Senior
Note holders and Class A and Class B Preferred Stock holders interest and
dividends due them.
The Corporation in June 1996, requested the holders of its Class A and Class B
Preferred Stock and of its $900,000 of Senior Notes for a waiver of defaults in
payment of interest on the Senior Notes and dividends on the Class A and Class
B Preferred Stock during 1996 as a result of the loan department losses. The
waiver would not forgive any dividends or interest due in 1996 but would allow
the Corporation to make the payment any time in 1997 without penalty. The
Series 1994-1 Preferred Stock is not entitled to receive dividends, but a 4%
dividend is required to be paid on the series 1994-1 Stock before any dividends
may be paid on the Common Stock. In May 1997, the Corporation paid dividends
and interest to Class A and B Preferred Shareholders and Senior Note holders.
The Corporation is currently up to date on all dividend and interest payments.
12
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings. The judgment for wrongful termination, entered
against the Corporation in October 1994, in the amount of $320,000
was reversed in March 1997 by the Michigan Court of Appeals holding
that there was no liability by the Corporation, the Bank's subsidiary,
or any of the individual defendants. The plaintiff has sought leave
of the Michigan Supreme Court to appeal the reversal by the Michigan
Court of Appeals. The Corporation is awaiting final disposition.
ITEM 2. Changes in Securities - none.
ITEM 3 Defaults upon senior securities. Reference is made to the
above in the section on Capital and Resources.
ITEM 4 Submission of matters to vote of security holders.
a) The Corporation's annual meeting of stockholders was held on June
5, 1997.
b) All nominees for director as listed in the Corporation's proxy
statement dated April 24, 1997, were elected. The directors whose
term of office continued after the meeting are also listed in the
proxy statement.
c) A brief description and the results of the matters voted upon at
the meeting follow.
1) Election of the following directors:
Withheld
Nominees For Against Authority
-------------- ------- ------- ---------
Don Davis 220,133 - 116,627
Charles Morton 219,927 - 116,833
Gerald Van Wyke 220,281 - 116,479
Alan Young 220,003 - 116,757
Dennis Silber 220,521 - 116,509
Jamal Shallall 220,083 - 116,677
Georgis Garmo 220,081 - 116,679
ITEM 5. Exhibits and reports on Form 8-K.
Exhibits:
(a)Exhibit 27-Financial Data Schedule
Reports on Form 8-K: None
13
<PAGE> 14
FIRST INDEPENDENCE CORPORATION AND SUBSIDIARY
SIGNATURES
Pursuant to the requirement of the Securities and Exchange Act of 1934,
the registrant has duly caused this to report on Form 10-QSB to be signed on
behalf of the undersigned thereunto duly authorized.
FIRST INDEPENDENCE CORPORATION AND SUBSIDIARY
Registrant
August 15, 1997 /s/ Don Davis
---------------------------------
Don Davis
Chief Executive Officer
August 15, 1997 /s/ Rose Ann Lacy
---------------------------------
Rose Ann Lacy
Chief Financial Officer
Chief Accounting Officer
14
<PAGE> 15
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
27 FINANCIAL DATA SCHEDULE
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 4,312,613
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 10,767,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 20,533,626
<INVESTMENTS-CARRYING> 12,585,921
<INVESTMENTS-MARKET> 20,486,364
<LOANS> 41,423,389
<ALLOWANCE> 892,322
<TOTAL-ASSETS> 93,487,824
<DEPOSITS> 82,656,572
<SHORT-TERM> 4,163,149
<LIABILITIES-OTHER> 1,029,137
<LONG-TERM> 900,000
0
2,749,508
<COMMON> 336,760
<OTHER-SE> 1,652,698
<TOTAL-LIABILITIES-AND-EQUITY> 93,487,824
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<INTEREST-INVEST> 459,273
<INTEREST-OTHER> 202,555
<INTEREST-TOTAL> 1,671,671
<INTEREST-DEPOSIT> 462,053
<INTEREST-EXPENSE> 530,320
<INTEREST-INCOME-NET> 1,141,351
<LOAN-LOSSES> 348,693
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,363,759
<INCOME-PRETAX> (280,158)
<INCOME-PRE-EXTRAORDINARY> (280,158)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (280,158)
<EPS-PRIMARY> (0.86)
<EPS-DILUTED> (0.86)
<YIELD-ACTUAL> 0
<LOANS-NON> 1,303,000
<LOANS-PAST> 1,037,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 1,520,000
<ALLOWANCE-OPEN> 837,756
<CHARGE-OFFS> 333,298
<RECOVERIES> 39,171
<ALLOWANCE-CLOSE> 892,322
<ALLOWANCE-DOMESTIC> 892,322
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
