<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 16, 1996
GEORGE MASON BANKSHARES, INC.
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(Exact Name of Registrant as Specified in Charter)
Virginia 0-13833 54-1303470
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(State or other (Commission File Number) IRS Employer
Jurisdiction of Identification No.)
Incorporation)
11185 Main Street, Fairfax, VA 22030
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (703) 352-1100
Not Applicable
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events
Attached to this Report on Form 8-K as Exhibit 20, and incorporated
herein by reference, is a Press Release of George Mason Bankshares,
Inc. issued on July 16, 1996, announcing earnings for the second
quarter and first half of 1996 (each ending June 30, 1996), the first
periods including the effectiveness (on May 17, 1996) of the merger of
Palmer National Bancorp, Inc. into Mason Holding Corporation, a wholly
owned subsidiary of George Mason Bankshares, Inc.
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
(c) Exhibits (listed according to the number assigned in Item 601
of Regulation S-K).
Exhibit No. Description
- ----------- -----------
20 Press Release dated July 16, 1996
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
GEORGE MASON BANKSHARES, INC.
July 25, 1996 By: /S/ JAMES J. CONSAGRA, JR.
---------------------
James J. Consagra, Jr.
Treasurer
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EXHIBIT INDEX
Exhibit Description
- ------- -----------
20 Press Release dated July 16, 1996
<PAGE> 1
[GEORGE MASON BANKSHARES, INC. LETTERHEAD]
FOR IMMEDIATE RELEASE
CONTACT: JAMES CONSAGRA, TREASURER (703) 502-7170
JULY 16, 1996
GEORGE MASON BANKSHARES, INC.
REPORTS 15.9% INCREASE
IN SECOND QUARTER EARNINGS
The Board of Directors of George Mason Bankshares, Inc. (NASDAQ: GMBS) reported
that net income increased 15.9% for the second quarter of 1996, despite $262
thousand in non-recurring expenses associated with the merger with Palmer
National Bancorp, Inc. Net income totalled $1.62 million or $.32 per share
compared to $1.40 million or $.29 per share for the second quarter of 1995.
Net income for the first six months of 1996 was $3.04 million compared to $2.70
million for the first half of 1995, representing an increase of 12.7%. Earnings
per share for the comparable six month periods of 1996 and 1995 were $.60 and
$.56 respectively.
The improvement in earnings for the second quarter and first six months of 1996
were primarily attributable to higher net interest income and strong growth in
non-interest income. "The improvement in our results, in broad terms, is
attributable to our efforts to emerge as the Greater Washington area's foremost
community bank," said Bernard H. Clineburg, CEO of George Mason Bankshares.
"More specifically, our mortgage operation has become an increasingly important
part of our business, providing an important contribution to earnings."
Increased non-interest expenses for the second quarter partially offset the
improvement in earnings.
Supporting the growth in net interest income was a higher level of average
earnings assets which was partially offset by a decline in the net interest
margin percentage. Non-interest income provided a significant contribution to
year-to-date earnings led by a substantial increase in gains on mortgage loans
held for resale, a result of the activities of George Mason Mortgage
Corporation. Other increases in non-interest income included improvements in
fee income and service charges and an increase in gains on securities sales.
Total assets increased to $772.7 million at June 30, 1996 compared to $612.9
million at June 30, 1995, an increase of 26.1%. Total deposits grew by 19.4% to
$604.5 million compared to $506.4 million on the same date last year. Loans,
net of unearned income, increased by $79.9 million or 31.7% to $332.3 million
at June 30, 1996.
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In support of the Company's growth strategy, non-interest expenses increased by
$1.7 million or 26.8% for the second quarter of 1996. Year-to-date
non-interest expense for 1996 increased to $16.2 million compared to $11.8
million for the same period last year. The single largest component of the
increase in non-interest expenses was related to commissions and salaries
expense at the mortgage company as a result of the previously noted increased
production.
Effective May 17, 1996, Palmer National Bancorp, Inc., the holding company for
Palmer National Bank, merged into Mason Holding Company, a subsidiary of George
Mason Bankshares, Inc. Approximately 925,600 shares of GMBS stock were
exchanged, and the merger was accounted for as a pooling of interests.
Accordingly, all financial data for the current and prior periods has been
restated to reflect the financial position and the results of operations on a
consolidated basis from the earliest period presented. At June 30, 1996 Palmer
National Bank's total assets were $98.9 million; loans, net of unearned income,
were $77.6 million; deposits were $72.7 million; and shareholders' equity was
$8.7 million. "We are very pleased with the progress of our integration of
Palmer National into George Mason Bankshares, we expect to realize additional e
fficiencies while expanding our customer base," said Clineburg. Clineburg added
that he expects the transaction to be accretive (positive to earnings) by the
end of the second year as originally planned.
The Company recently announced a cash dividend of $.11 per share for the second
quarter of 1996, marking the Company's 37th consecutive quarterly dividend.
This dividend represents a 10% increase over the first quarter dividend of $.10
per share.
George Mason Bankshares, Inc. is a multi-bank holding company headquartered in
Fairfax, Virginia. The Company operates 20 banking offices and 5 mortgage
lending offices throughout Virginia, the District of Columbia and Montgomery
County, Maryland.
###
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GEORGE MASON BANKSHARES, INC
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
JUNE 30, 1996 DECEMBER 31, 1995 JUNE 30, 1995
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<S> <C> <C> <C>
ASSETS
Cash and due from banks $33,466 $36,308 $30,145
Federal funds sold 9,000 15,000 21,000
Trading securities 0 5,693 5,514
Securities available-for-sale 253,541 187,581 162,351
Securities held-to-maturity 67,068 68,660 87,874
Mortgage loans held for resale 59,805 55,482 40,988
Loans, net of unearned discount and loan fees 332,304 299,558 252,381
Less: Allowance for loan losses (5,687) (5,529) (5,816)
-----------------------------------------------------------
Loans, net 326,617 294,029 246,565
Bank premises and equipment, net 9,835 9,841 8,706
Accrued income receivable 8,611 4,406 4,800
Other assets 4,662 4,156 4,885
Other real estate 75 109 48
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TOTAL ASSETS $772,680 $681,265 $612,876
===========================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Deposits:
Demand $122,845 $116,699 $101,354
Interest checking 44,925 48,300 46,400
Savings 156,593 146,413 135,758
Time 280,136 243,052 222,912
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Total Deposits 604,499 554,464 506,424
Borrowed funds 102,455 60,747 48,519
Other liabilities 7,040 6,360 4,384
Dividends payable 548 398 379
-----------------------------------------------------------
TOTAL LIABILITIES 714,542 621,969 559,706
SHAREHOLDERS' EQUITY
Preferred stock 0 0 0
Common stock 5,537 5,427 5,369
Surplus 37,882 37,044 34,758
Retained earnings 18,486 16,115 13,619
Treasury stock and unearned ESOP 0 (42) (59)
Unrealized holding gain (loss) on securities available-for-sale (3,767) 752 (517)
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TOTAL SHAREHOLDERS' EQUITY 58,138 59,296 53,170
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $772,680 $681,265 $612,876
===========================================================
BOOK VALUE PER SHARE * $11.63 $12.09 $10.99
===========================================================
ACTUAL SHARES OUTSTANDING * 4,999 4,903 4,837
===========================================================
</TABLE>
* Adjusted for the three-for-two stock split effective January 31, 1996.
<PAGE> 4
GEORGE MASON BANKSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
JUNE 30, 1996 JUNE 30, 1995 JUNE 30, 1996 JUNE 30, 1995
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<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on loans $9,349 $7,403 $18,662 $14,231
Interest on Federal funds sold
and repurchase agreements 92 394 241 579
Interest on securities:
Taxable 4,080 3,575 7,877 6,959
Tax-exempt 281 229 608 456
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TOTAL INTEREST INCOME 13,802 11,601 27,388 22,225
INTEREST EXPENSE
Interest on deposits 5,126 4,450 10,037 8,177
Interest on borrowed funds 745 427 1,413 795
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TOTAL INTEREST EXPENSE 5,871 4,877 11,450 8,972
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NET INTEREST INCOME 7,931 6,724 15,938 13,253
PROVISION FOR LOAN LOSSES 0 (82) 181 (47)
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 7,931 6,806 15,757 13,300
OTHER INCOME
Service charges 759 362 1,414 870
Gain (loss) on sales of securities
available-for-sale 39 115 320 132
Gain on sales of mortgage loans
held for resale 1,193 602 2,286 846
Other 340 377 784 422
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TOTAL OTHER INCOME 2,331 1,456 4,804 2,270
OTHER EXPENSES
Salaries and employee benefits 4,511 3,272 9,249 6,086
Occupancy expenses 753 583 1,515 1,127
Equipment expenses 532 389 1,076 711
Other operating expenses 2,177 2,045 4,377 3,849
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TOTAL OTHER EXPENSES 7,973 6,289 16,217 11,773
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INCOME BEFORE APPLICABLE INCOME TAXES 2,289 1,973 4,344 3,797
INCOME TAXES 667 574 1,303 1,098
---------------------------------------------------------------------------------------
NET INCOME $1,622 $1,399 $3,041 $2,699
========== ========== ========== ==========
EARNINGS PER SHARE * $0.32 $0.29 $0.60 $0.56
========== ========== ========== ==========
CASH DIVIDENDS DECLARED PER SHARE * $0.11 $0.09 $0.21 $0.18
========== ========== ========== ==========
WEIGHTED AVERAGE SHARES OUTSTANDING * 5,138 4,878 5,107 4,833
========== ========== ========== ==========
</TABLE>
* Adjusted for the three-for-two stock split effective January 31, 1996.
<PAGE> 5
GEORGE MASON BANKSHARES INC.,
FINANCIAL HIGHLIGHTS
SECOND QUARTER 1996
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
SUMMARY PAGE 1996 1995 CHANGE % CHANGE
------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FOR THE THREE MONTHS ENDED JUNE30:
NET INCOME $1,622 $1,399 $223 15.9%
EARNINGS PER SHARE 0.32 0.29 0.03 10.3%
RETURN ON AVERAGE ASSETS 0.93% 0.98% -0.05% -5.1%
RETURN ON AVERAGE EQUITY 10.67% 10.48% 0.19% 1.8%
NET INTEREST MARGIN 4.93% 5.09% -0.16% -3.1%
WEIGHTED AVERAGE SHARES OUTSTANDING 5,138 4,878 260 5.3%
FOR THE SIX MONTHS ENDED JUNE 30:
NET INCOME $3,041 $2,699 $342 12.7%
EARNINGS PER SHARE 0.60 0.56 0.04 7.1%
RETURN ON AVERAGE ASSETS 0.90% 0.98% -0.08% -8.2%
RETURN ON AVERAGE EQUITY 10.13% 10.38% -0.25% -2.4%
NET INTEREST MARGIN 5.07% 5.21% -0.14% -2.7%
WEIGHTED AVERAGE SHARES OUTSTANDING 5,107 4,833 274 5.7%
ACTUAL SHARES OUTSTANDING 4,999 4,837 162 3.3%
BOOK VALUE PER SHARE $11.63 $10.99 $0.64 5.8%
PERIOD END TOTALS:
TOTAL ASSETS $772,680 $612,876 $159,804 26.1%
LOANS, (NET OF UNEARNED DISCOUNT AND LOAN FEES)***** 332,304 252,381 79,923 31.7%
MORTGAGE LOANS HELD FOR RESALE 59,805 40,988 18,817 45.9%
DEPOSITS 604,499 506,424 98,075 19.4%
SHAREHOLDERS' EQUITY 58,138 53,170 4,968 9.3%
ALLOWANCE FOR LOAN LOSSES 5,687 5,816 (129) -2.2%
NONPERFORMING ASSETS 3,253 3,842 (589) -15.3%
</TABLE>
****BEFORE RESERVES
<PAGE> 6
GEORGE MASON BANKSHARES, INC.
FINANCIAL HIGHLIGHTS
SECOND QUARTER 1996
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
1996 1995 $ CHANGE % CHANGE
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<S> <C> <C> <C> <C>
EARNINGS:
FOR THE THREE MONTHS ENDED JUNE 30:
NET INTEREST INCOME $7,931 $6,724 $1,207 18.0%
PROVISION FOR LOAN LOSSES 0 (82) 82 -100.0%
GAIN ON SALES OF MORTGAGE LOANS HELD FOR RESALE 1,193 602 591 98.2%
NET GAIN (LOSS) ON SALES OF SECURITIES 39 115 (76) -66.1%
OTHER OPERATING INCOME 1,099 739 360 48.7%
OTHER OPERATING EXPENSES 7,973 6,289 1,684 26.8%
INCOME TAXES 667 574 93 16.2%
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NET INCOME $1,622 $1,399 $223 15.9%
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FOR THE SIX MONTHS ENDED JUNE 30:
NET INTEREST INCOME $15,938 $13,253 $2,685 20.3%
PROVISION FOR LOAN LOSSES 181 (47) 228 -485.1%
GAIN ON SALES OF MORTGAGE LOANS HELD FOR RESALE 2,286 846 1,440 170.2%
NET GAIN (LOSS) ON SALES OF SECURITIES 320 132 188 142.4%
OTHER OPERATING INCOME 2,198 1,292 906 70.1%
OTHER OPERATING EXPENSES 16,217 11,773 4,444 37.7%
INCOME TAXES 1,303 1,098 205 18.7%
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NET INCOME $3,041 $2,699 $342 12.7%
- -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE INFORMATION:
FOR THE THREE MONTHS ENDED JUNE 30:
NET INCOME $0.32 $0.29 $0.03 10.3%
CASH DIVIDENDS DECLARED 0.11 0.09 0.02 22.2%
WEIGHTED AVERAGE SHARES OUTSTANDING 5,138 4,878
FOR THE SIX MONTHS ENDED JUNE 30:
NET INCOME $0.60 $0.56 $0.04 7.1%
CASH DIVIDENDS DECLARED 0.21 0.18 0.03 16.7%
WEIGHTED AVERAGE SHARES OUTSTANDING 5,107 4,833 274 5.7%
ACTUAL SHARES OUTSTANDING 4,999 4,837 162 3.3%
PERIOD END BOOK VALUE $11.63 $10.99 $0.64 5.8%
</TABLE>
<PAGE> 7
GEORGE MASON BANKSHARES, INC.
SECOND QUARTER 1996
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
1996 1995 $ CHANGE % CHANGE
- -----------------------------------------------------------------------------------------------------------------------------------
SELECTED AVERAGE BALANCES (SECOND QUARTER)
<S> <C> <C> <C> <C>
TOTAL ASSETS $698,251 $571,719 $126,532 22.1%
LOANS, (NET OF UNEARNED DISCOUNT AND LOAN FEES)***** 317,789 239,824 77,965 32.5%
MORTGAGE LOANS HELD FOR RESALE 51,975 34,307 17,668 51.5%
SECURITIES AND OTHER INVESTMENTS 281,976 253,778 28,198 11.1%
DEPOSITS 566,211 478,886 87,325 18.2%
SHAREHOLDERS' EQUITY 61,140 53,526 7,614 14.2%
****BEFORE RESERVES
SELECTED AVERAGE BALANCES (YEAR TO DATE)
TOTAL ASSETS $682,868 $553,203 $129,665 23.4%
LOANS, (NET OF UNEARNED DISCOUNT AND LOAN FEES)***** 310,390 241,606 68,784 28.5%
MORTGAGE LOANS HELD FOR RESALE 49,634 23,666 25,968 109.7%
SECURITIES AND OTHER INVESTMENTS 276,044 242,422 33,622 13.9%
DEPOSITS 554,316 461,882 92,434 20.0%
SHAREHOLDERS' EQUITY 60,372 52,454 7,918 15.1%
****BEFORE RESERVES
SELECTED PERIOD END BALANCES (JUNE 30,)
TOTAL ASSETS $772,680 $612,876 $159,804 26.1%
LOANS, (NET OF UNEARNED DISCOUNT AND LOAN FEES)***** 332,304 252,381 79,923 31.7%
MORTGAGE LOANS HELD FOR RESALE 59,805 40,988 18,817 45.9%
ALLOWANCE FOR LOAN LOSSES 5,687 5,816 (129) -2.2%
SECURITIES AND OTHER INVESTMENTS 320,609 255,739 64,870 25.4%
DEPOSITS 604,499 506,424 98,075 19.4%
SHAREHOLDERS' EQUITY 58,138 53,170 4,968 9.3%
****BEFORE RESERVES
SELECTED RATIOS:
FOR THE THREE MONTHS ENDED JUNE 30:
RETURN ON AVERAGE ASSETS (ANNUALIZED) 0.93% 0.98%
RETURN ON AVERAGE EQUITY (ANNUALIZED) 10.67% 10.48%
FOR THE SIX MONTHS ENDED JUNE 30:
RETURN ON AVERAGE ASSETS (ANNUALIZED) 0.90% 0.98%
RETURN ON AVERAGE EQUITY (ANNUALIZED) 10.13% 10.38%
</TABLE>
<PAGE> 8
GEORGE MASON BANKSHARES, INC.
SECOND QUARTER 1996
<TABLE>
<CAPTION>
(Dollars in thousands, except per share data) JUNE 30, JUNE 30,
1996 1995 $ CHANGE % CHANGE
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NON PERFORMING ASSETS AND PAST DUE LOANS
AMOUNTS:
NONACCRUAL LOANS $2,442 $2,215 $227 10.2%
RESTRUCTURED LOANS 736 1,579 (843) -53.4%
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TOTAL NONPERFORMING LOANS 3,178 3,794 (616) -16.2%
- -----------------------------------------------------------------------------------------------------------------------------------
OTHER REAL ESTATE 75 48 27 56.3%
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TOTAL NONPERFORMING ASSETS 3,253 3,842 (589) -15.3%
- -----------------------------------------------------------------------------------------------------------------------------------
PAST DUE LOANS:
NINETY DAYS PAST DUE AND STILL ACCRUING 0 301 (301) -100.0%
TOTAL PAST DUE LOANS 0 301 (301) -100.0%
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL NONPERFORMING ASSETS AND PAST DUE LOANS $3,253 $4,143 ($890) -21.5%
- -----------------------------------------------------------------------------------------------------------------------------------
LOANS, (NET OF UNEARNED DISCOUNT AND LOAN FEES) $332,304 252,381 79,923 31.7%
ALLOWANCE FOR LOAN LOSSES 5,687 5,816 (129) -2.2%
ASSET QUALITY RATIOS:
NONPERFORMING LOANS TO TOTAL LOANS 0.96% 1.50%
NONPERFORMING ASSETS TO TOTAL LOANS PLUS
OTHER REAL ESTATE 0.98% 1.52%
NONPERFORMING ASSETS AND PAST DUE LOANS TO
TOTAL LOANS PLUS OTHER REAL ESTATE 0.98% 1.64%
PAST DUE LOANS TO TOTAL LOANS 0.00% 0.12%
ALLOWANCE FOR LOAN LOSSES TO TOTAL LOANS 1.71% 2.30%
ALLOWANCE FOR LOAN LOSSES TO NONPERFORMING LOANS 178.95% 153.29%
</TABLE>
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GEORGE MASON BANKSHARES, INC.
SECOND QUARTER 1996
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
June 30, June 30,
DEPOSIT MIX: (PERIOD END TOTALS) 1996 1995 $ CHANGE % CHANGE
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
DEMAND DEPOSITS $122,845 $101,354 $21,491 21.2%
INTEREST CHECKING 44,925 46,400 (1,475) -3.2%
MONEY MARKET 98,994 117,237 (18,243) -15.6%
SAVINGS ACCOUNTS 57,599 18,521 39,078 211.0%
CERTIFICATES OF DEPOSIT (LESS THAN $100M) 174,730 144,321 30,409 21.1%
IRAS AND KEOGHS 33,144 29,243 3,901 13.3%
BROKERED DEPOSITS 2,673 198 2,475 1250.0%
CERTIFICATES OF DEPOSIT (GREATER THAN $100M) 69,589 49,150 20,439 41.6%
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TOTAL DEPOSITS $604,499 $506,424 $98,075 19.4%
</TABLE>
