U.S. 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
Commission file number 0-13664
GRANGE NATIONAL BANC CORP.
PENNSYLVANIA 23-2314065
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
198 E. Tioga St., Tunkhannock, Pennsylvania
-------------------------------------------
(Address of principal executive offices)
(717) 836-2100
----------------------------------------------------
(Registrant's telephone number, including area code)
Check whether the issuer (1) 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 periods 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
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practical date: 788,187.
-------
Transitional Small Business Disclosure Format (Check one): Yes ; No X
----- ---
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
PART I. FINANCIAL INFORMATION
ITEM 1. Unaudited Financial Statements
<TABLE>
<CAPTION>
Page
<S> <C> <C>
Consolidated Statements of Financial Position as
of March 31, 2000 and December 31, 1999...................................................2
Consolidated Statements of Income and Comprehensive Income For the
Three Months Ended March 31, 2000 and 1999................................................3
Consolidated Statements of Changes to Stockholder's Equity For the Three Months
Ended March 31, 2000 and 1999.............................................................4
Consolidated Statements of Cash Flows For the Three Months ended
March 31, 2000 and 1999...................................................................5
Notes to Consolidated Financial Statements............................................6 - 7
ITEM 2. Management's Discussion and Analysis of Financial Condition..........................8 - 13
PART II. OTHER INFORMATION:
ITEM 6. Exhibits and Reports on Form 8-K.........................................................14
</TABLE>
1
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
Consolidated Statements of Financial Position, March 31, 2000
and December 31, 1999
<TABLE>
<CAPTION>
2000 1999
(Unaudited) (Audited)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS:
Cash and due from banks....................................................... $ 2,440,177 $ 4,353,347
Interest bearing deposits..................................................... 3,326,254 2,526,347
Investment securities, available for sale (Note 3)............................ 41,106,237 41,417,763
Investment securities, held to maturity
(fair value 2000, $12,414,000; 1999, $12,481,000)........................... 13,182,273 13,217,040
Loans, net of unearned interest............................................... 104,155,613 102,317,290
Less: allowance for loan losses.............................................. 1,114,360 1,092,170
-----------------------------
Loans - net............................................................ 103,041,253 101,255,120
Bank premises and equipment - net............................................. 2,827,963 2,899,382
Other real estate............................................................. 231,601 231,601
Accrued interest and other assets............................................. 3,591,875 3,341,951
Intangible assets............................................................. 115,192 119,863
-----------------------------
TOTAL ASSETS................................................................ $169,862,825 $169,332,414
=============================
LIABILITIES:
Domestic deposits:
Non-interest bearing deposits............................................... $23,879,533 $22,179,696
Interest bearing deposits................................................... 118,151,882 118,400,773
-----------------------------
Total deposits............................................................ 142,031,415 140,580,469
Other borrowed funds.......................................................... 10,574,131 11,786,255
Accrued interest and other liabilities........................................ 796,549 1,003,690
-----------------------------
Total liabilities......................................................... 153,402,095 153,370,414
-----------------------------
STOCKHOLDERS' EQUITY:
Preferred stock authorized 1,000,000 shares of $5 par;
None issued.................................................................
Common stock authorized 5,000,000 shares of $5 par value, 783,809
shares issued and outstanding in 2000 and 1999 (Note 4)..................... 3,919,045 3,919,045
Additional paid-in capital.................................................... 1,516,874 1,516,874
Retained earnings............................................................. 12,293,859 11,675,129
Accumulated other comprehensive income........................................ (1,269,000) (1,149,000)
-----------------------------
Total.......................................................................... 16,460,778 15,962,048
Treasury stock, 2 shares in 2000 and 1999, at cost......................... (48) (48)
-----------------------------
Total stockholders' equity................................................ 16,460,730 15,962,000
-----------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY...................................... $169,862,825 $169,332,414
=============================
</TABLE>
See Notes to Consolidated Financial Statements
2
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
Consolidated Statements of Income and Comprehensive Income (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31, 2000 1999
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Interest Income:
Interest and fees on loans.................................................... $2,156,513 $1,941,038
Interest and dividends
on investment securities.................................................... 850,148 681,214
Interest on deposits in banks................................................. 6,095 56,942
---------------------------
Total interest income................................................. 3,012,756 2,679,194
---------------------------
Interest Expense:
Interest on deposits.......................................................... 1,223,850 1,126,831
Interest on borrowed funds.................................................... 165,889 63,712
---------------------------
Total interest expense................................................ 1,389,739 1,190,543
---------------------------
Net interest income..................................................... 1,623,017 1,488,651
Provision for loan losses................................................. 20,000 90,000
---------------------------
Net interest income after provision for loan losses..................... 1,603,017 1,398,651
---------------------------
Other Income:
Service charges and other income.............................................. 266,305 201,284
Gain (loss) on sale of other real estate...................................... (1,000) 5,979
---------------------------
Total other income.................................................... 265,305 207,263
---------------------------
Other Expenses:
Salaries and employee benefits................................................ 527,522 490,710
Occupancy expense............................................................. 107,232 105,350
Equipment expense............................................................. 89,700 77,409
Other operating expense....................................................... 333,138 252,115
---------------------------
Total other expenses.................................................. 1,057,592 925,584
---------------------------
Income before income taxes...................................................... 810,730 680,330
Provision for income taxes...................................................... 192,000 185,861
---------------------------
Net income...................................................................... $618,730 $494,469
---------------------------
Other comprehensive income, net of tax:
Unrealized gains on securities:
Unrealized holding gain (loss) arising during period....................... ($120,000) ($146,000)
---------------------------
Other comprehensive income.................................................... ($120,000) ($146,000)
Comprehensive income............................................................ $498,730 $348,469
===========================
Earnings per share (Note 4)..................................................... $0.72 $0.58
===========================
Weighted average common shares.................................................. 860,893 850,605
</TABLE>
See Notes to Consolidate Financial Statements
3
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended March 31, 2000 1999
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
STOCKHOLDERS' EQUITY, January 1....................................... $15,962,000 $14,767,316
COMMON STOCK, $5.00 PAR VALUE
Options exercised..................................................... 46,995
ADDITIONAL PAID-IN CAPITAL
Options exercised..................................................... 96,904
RETAINED EARNINGS
Net income............................................................ 618,730 494,469
ACCUMULATED OTHER COMPREHENSIVE INCOME
Other comprehensive income, net of tax................................ (120,000) (146,000)
TREASURY STOCK
Reissuance of common stock (1 share in 2000 and 1999, at cost)........ 24 24
------------------------------
STOCKHOLDERS' EQUITY, March 31........................................ $16,460,754 $15,259,684
==============================
</TABLE>
See Notes to Consolidated Financial Statements
4
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
For the Three Months Ended March 31, 2000 1999
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income ........................................................... $ 618,730 $ 494,469
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization ...................................... 77,250 77,250
Provision for loan losses .......................................... 20,000 90,000
Increase (decrease) in deferred income taxes ....................... (76,000) (71,000)
Changes in operating assets and liabilities:
Increase (decrease) in accrued interest income and other assets ..... (169,253) (171,729)
Increase (decrease) in accrued interest expense and other liabilities (207,141) 56,470
-----------------------------
NET CASH PROVIDED BY
OPERATING ACTIVITIES ............................................... 263,586 475,460
-----------------------------
INVESTING ACTIVITIES:
Purchase bank premises and equipment ................................. (5,831) (39,182)
Decrease (increase) in other real estate ............................. 0 19,991
Purchase of securities "available for sale" .......................... (2,098,287) (3,983,608)
Decrease (increase) in mortgage-backed securities "available for sale" 220,237 (164,101)
Redemptions of securities "available for sale" ....................... 2,069,576 572,597
Purchase of securities "held to maturity" ............................ 0 1,010,495)
Redemptions of securities "held to maturity" ......................... 2,256 2,313,928
Decrease (increase) in mortgage-backed securities "held to maturity" . 32,511 257,506
Net Increase in loans to customers ................................... (1,836,133) (1,615,102)
Net Increase (decrease) in interest bearing deposits in banks ........ (799,907) (4,228,938)
-----------------------------
NET CASH USED IN
INVESTING ACTIVITIES ............................................... (2,415,578) (7,877,404)
-----------------------------
FINANCING ACTIVITIES:
Increase in deposits before interest credited ........................ 774,738 3,721,794
Increase (decrease) in borrowed funds ................................ (1,212,124) 2,603,504
Interest credited to deposits ........................................ 676,208 854,173
Issuance of common stock ............................................. 0 143,899
-----------------------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES ............................................... 238,822 7,323,370
-----------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS .................. (1,913,170) (78,574)
CASH AND CASH EQUIVALENTS, January 1 .................................. 4,353,347 2,615,466
-----------------------------
CASH AND CASH EQUIVALENTS, March 31 ................................... $ 2,440,177 $ 2,536,892
=============================
SUPPLEMENTARY SCHEDULE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest ............................................................ $ 464,134 $ 237,908
Income taxes ........................................................ $ 476,000 $ 108,000
Non-cash investing and financing activities:
Unrealized gains (losses) on securities ............................. $ (120,000) $ (146,000)
</TABLE>
See Notes to Consolidated Financial Statements
5
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BUSINESS COMBINATION AND PRINCIPLES OF COMBINATION:
Grange National Banc Corp. (Company) was organized and incorporated under the
laws of the Commonwealth of Pennsylvania on October 2, 1984, for the purpose of
becoming a bank holding company. On April 30, 1985 the Company acquired the
Grange National Bank of Wyoming County (Bank) pursuant to a plan of
reorganization and merger. The Bank became a wholly owned subsidiary of the
Company, and each outstanding share of Bank common stock was converted into one
share of Company common stock. The accompanying consolidated financial
statements include the accounts of the Company and its wholly owned subsidiary
(Bank) with the reorganization accounted for as a pooling of interests.
2. BASIS OF PRESENTATION:
The accompanying unaudited consolidated financial statements have been prepared
in conformity with the accounting principles and practices reflected in the
annual financial statements, and reflect all adjustments which are normal and
recurring and, in the opinion of management, necessary for a fair presentation
of the results of operations for the interim periods. The results of operations
reported in interim financial statements are not necessarily indicative of
results to be expected for the year.
3. COMPREHENSIVE INCOME:
In 1997, the Financial Accounting Standards Board issued statement No. 130 -
"Reporting Comprehensive Income," which is effective for years beginning after
December 15, 1997. This statement establishes standards for reporting and
display of comprehensive income and its components in a full set of
general-purpose financial statements. The purpose of reporting comprehensive
income is to report a measure of all changes in equity that result from
recognized transactions and other economic events of the period other than
transactions with owners in their capacity as owners. Prior to the issuance of
this statement, some of those changes in equity were displayed in a statement
that reports the results of operations, while others were included directly in a
statement of financial position.
4. STOCK OPTIONS:
In January 1994, the Board adopted an Employee Stock Option Plan in which common
stock options may be granted to all officers and key employees of the Company.
The aggregate number of shares which may be issued upon exercise of the options
under the
6
<PAGE>
plan is 42,843. Options are exercisable up to one-third in the second year after
the date of grant, up to two-thirds in the third year after the date of grant
and up to 100% in the fourth year after the date of grant, with options expiring
at the end of ten years after the date of grant.
The Board of Directors also adopted a Stock Option Plan for non-employee
Directors which will be available to all non-employee members of the Board of
Directors. The aggregate number of shares which may be issued upon exercise of
the options under the Director's plan is 42,843 shares and are exercisable in
part from time to time beginning one year after the date of grant and expiring
ten years thereafter. The Plan provides for adjustments to the number of options
to compensate for stock dividends and splits. Accordingly all effected figures
have been adjusted to reflect stock dividends. April 1, 1994 and 1997, options
to purchase 2,142 shares of common stock were automatically granted to each
non-employee Director under this plan expiring April 1, 2004. On April 1, 2000,
options to purchase 1,071 shares were granted to each non-employee Director, as
the final installment of options under this stock option plan.
The Board of Directors adopted an additional Stock Option Plan (the "Plan") in
November 1995 covering the employees and directors. The Plan authorizes the
grant of options to purchase not more than 117,818 shares of Common Stock under
the Plan. Options granted under the Plan are intended to be either incentive
stock options or nonstatutory stock options. As of April 30, 1999 options for
80,996 shares of Common Stock having various exercise prices were outstanding,
17,042 shares have been exercised, and 17,780 shares were available for future
option grants under the Plan. Of the 100,038 shares of Common Stock outstanding
for options, 77,803 shares of Common Stock were issued as incentive stock
options. The remaining shares outstanding for options were granted to each
non-employee director equally as nonstatutory stock options. Pursuant to Section
422 of the Internal Revenue Code, shareholder approval is required for the
incentive stock options to qualify for favorable tax treatment. Exercise prices
of options granted under all plans are current prices at time of grant.
PREFERRED STOCK:
The Company authorized 1,000,000 of preferred stock at $5 par value. At December
31, 1999 and March 31, 2000, no shares were issued nor outstanding.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION:
Our net income for the three months ending March 31, 2000 totaled $619,000 which
is 25% higher than the $494,000 of net income for the same period last year. Net
interest income for the three months ending March 31, 2000 increased by $134,000
to $1,623,000 compared to $1,489,000 for the same period in 1999, an increase of
9%. Interest income during the same time increased by $334,000 or 12% compared
to 1999, and interest expense increased as well by $199,000 or 17% compared to
1999.
The increase in interest income was due to interest on loans which increased
$216,000 or 11% compared to the same time last year. Interest income from
investment securities increased by $169,000 or 25% compared to the same time
last year. The Federal Reserve began raising interest rates in the middle of
1999, and we have raised our loan rates some but intense competition has kept us
from raising them as much as the Federal Reserve has. This also increased the
cost of our deposits. The New York prime rate has gone from 7.75% at the end of
June 1999 to 9.00% at the end of March 2000, but our spread to prime on new
loans has narrowed. Since we increased our purchases of longer term municipal
bonds and mortgage- backed bonds last year, to increase the yield of the bond
portfolio, the market value of those bonds has declined due to the rise in
interest rates. The municipal bonds currently being purchased, mostly have
maturities of between eight and ten years, and are classified as "available for
sale". Interest on deposits in banks decreased by $51,000 from $57,000 to $6,000
due to lower balances.
The increase in interest expense is due to rising interest rates for
certificates of deposit, and the increase in the balances of certificates of
deposit and other borrowed funds, for the first quarter of 2000 as compared to
the first quarter of 1999. The average total sources to fund earning assets
increased by $18,420,000, from $142,824,000 to $161,247,000 in 2000, while the
average interest rate increased from 3.34% to 3.45%, respectively.
The increase in deposits continues to provide funds for loans and liquidity.
Loan demand during the first quarter was somewhat mild as loans increased
$1,839,000 or 2% from $102,317,000 at December 31, 1999 to $104,156,000 at March
31, 2000. Loan demand appears to be picking up as the second quarter begins.
Balances of investment securities decreased during the first quarter by $346,000
since December 31, 1999. Interest bearing deposits at banks increased by
$800,000 to $3,326,000 from $2,526,000 due to deposits flowing in and bonds
being called or maturing. Deposits growth was very low during the first quarter,
increasing only $1,451,000, most of which was used to reduce borrowings incurred
for Y2K contingencies.
The provision for loan loss during the three months ending March 31, 2000 was
$20,000 compared to $90,000 for the same period in 1999. Last year during the
first quarter we were concerned about a large loan defaulting and we boosted the
provision. We did not incur a loss on that loan as we worked it out. This year
nonperforming loans are down and we are actually
8
<PAGE>
experienced more recoveries than charge-offs during the first quarter. We
believe the allowance for loan losses is about where it should be, and expect to
only need to put in enough to maintain the allowance at about 1% of loans. The
allowance for loan losses was $1,114,000 and $1,092,000 at March 31, 2000 and
December 31, 1999, respectively. This represents 1.07% and 1.01% of total loans,
506% and 975% of non-performing loans, and 246% and 317% of non- performing
assets, respectively. Management performs a quarterly analysis of the Bank's
potential loan losses on a "worst case" basis. A loan review process is
performed by an independent loan review officer on a continuing basis. This
information is closely reviewed by the Board of Directors and used to evaluate
the adequacy of the loan loss reserve in order to provide coverage for
identifiable losses, provide coverage for unexpected losses, and to keep the
size of the reserves in proportion to the growing size of the loan portfolio.
The following sets forth loans past due 90 days or more on which interest has
continued to be accrued for March 31, 2000 and December 31, 1999.
March 2000 December 1999
---------- -------------
(In thousands)
Real estate mortgages $129 $0
Commercial 16
Installment 17 9
---- --
Total $162 $9
==== ==
Non-accrual loans decreased from $103,000 at December 31, 1999 to $58,000 at
March 31, 2000. The overall quality remains very good, and management expects
non-performing assets to remain at substantially the same levels as a proportion
of loans.
Investments in securities was nearly unchanged, decreasing by $346,000 or less
than 1% from December 31, 1999 to March 31, 2000. The average rate earned on
available for sale, held to maturity and deposits in banks were 6.56%, 6.53% and
3.90% for the three months ended March 31, 2000, as compared to 6.27%, 6.64% and
5.57% for the three months ended March 31, 1999. As of March 31, 2000, the
amortized value of the Bank's investments classified as held to maturity
exceeded their fair value by $767,000, and the amortized value of investments
classified as available for sale exceeded their fair value by $2,038,000. This
is reflected as an decrease in the Bank's equity of approximately $1,269,000,
net of deferred tax effects.
Higher interest rates at March 31, 2000 account for the greater unrealized
losses on the available for sale securities reflected on the balance sheet.
Rates are expected to continue to rise gradually during 2000. This will decrease
the value of our securities classified as available for sale. As we extend the
length of the securities we purchase, interest rate changes will have greater
impact on the fair value of those securities. This interest rate risk is offset
by higher yields on the securities. We are purchasing moderate to long
maturities, generally eight to twelve years for fixed rate securities. We have a
plan in place to sell certain securities depending upon how fast interest rates
should rise. This will limit losses in the investment portfolio, and enable us
to take advantage of the higher rates.
9
<PAGE>
We are still purchasing only high quality investments to minimize credit risk to
the value of our investments. There have been no adverse credit valuations on
any of our investments. Although investment opportunities exist which will
produce higher yields, they generally contain higher credit risk.
Salaries and employee benefits have increased by $37,000 or 8% from $491,000 to
$528,000 and occupancy expense increased $2,000 or 2% from $105,000 to $107,000.
Equipment expense increased $13,000 or 17% from $77,000 to $90,000, and other
operating expenses increased $81,000 or 32% from $252,000 to $333,000. Increases
for other operating expenses included advertising expenses, legal and
professional, "Business Manager" program and charitable contributions.
Monthly we perform an interest rate and liquidity analysis to monitor the Bank's
interest rate sensitivity gap and liquidity needs. These reports are reviewed by
the Board of Directors and used to formulate ways to improve the Bank's interest
rate gap. We place a great emphasis on adjustable rate loan products, such as
variable rate home equity loans and annually adjustable mortgage loans as well
as adjustable rate and short term investments, in order to minimize interest
rate risk.
Since 1991 the Comptroller of the Currency has required all national banks to
meet certain "Risk Based Capital" standards. These standards weight certain
assets based on the risk of the asset, and also includes certain off-balance
sheet items. The table below sets forth the Bank's Tier 1 and Tier 2 capital,
risk adjusted assets (including off-balance sheet items) and the Bank's
risk-based capital ratios under the guidelines, for March 31, 2000 and December
31, 1999.
<TABLE>
<CAPTION>]
(In thousands, except ratios) 2000 1999
<S> <C> <C>
Tier I capital:
Shareholders' equity................................... $ 17,615 $16,911
Tier II capital:
Loan loss reserve...................................... 1,114 1,136
-------- -------
Total Qualifying Capital.................................... $ 18,729 $18,047
======== =======
Risk-adjusted assets (including off balance sheet items)......... $101,176 $99,658
Tier I Capital Ratio (4.00% required)............................ 17.41% 16.97%
Total Capital Ratio (8.00% required)............................. 18.51% 18.11%
</TABLE>
10
<PAGE>
Year 2000 Impact
The final dates for possible "Year 2000" concerns were February 29, 2000 (Leap
Day) and March 31, 2000 (the end of the first quarter). We did not have any
computer hardware or software problems with either of these dates, nor were we
impacted by any possible problems with any vendors, suppliers or correspondent
banks. As we previously reported, the year end change over was also pleasantly
uneventful.
11
<PAGE>
GRANGE NATIONAL BANC CORP. AND SUBSIDIARY
Average Balances, Interest Income/Expense and Rates
<TABLE>
<CAPTION>
Three months ended, March 31, 2000 March 31, 1999
(1) Interest Average (1) Interest Average
Average Income/ Interest Average Income/ Interest
(Dollars in thousands) Balance Expense Rate Balance Expense Rate
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INTEREST EARNING ASSETS:
Loans:
Mortgages................................. $ 58,587 $1,222 8.34% $ 46,950 $ 988 8.42%
Consumer.................................. 10,902 258 9.47 10,233 233 9.11
Commercial................................ 33,778 731 8.66 34,959 747 8.55
-------------------- -------------------
Total loans............................. 103,267 2,211 8.56 92,142 1,968 8.54
-------------------- -------------------
Securities available for sale:
U.S. Treasury securities.................. 4,854 72 5.93 5,392 79 5.86
U.S. government agencies.................. 25,412 391 6.15 15,755 255 6.47
Municipal bonds........................... 12,369 220 6.95 8,446 140 6.63
Other securities.......................... 1,258 42 13.35 662
-------------------- -------------------
Total available for sale.............. 44,163 725 6.56 30,255 474 6.27
-------------------- -------------------
Securities held to maturity:
U.S. government agencies.................. 5,005 81 6.47 10,246 173 6.75
Municipal bonds........................... 2,414 42 7.03 3,015 51 6.77
Other securities.......................... 5,783 92 6.36 3,074 47 6.12
-------------------- -------------------
Total held to maturity.................. 13,202 215 6.53 16,335 271 6.64
-------------------- -------------------
Deposits in banks.......................... 615 6 3.90 4,092 57 5.57
-------------------- -------------------
TOTAL..................................... $161,247 3,157 7.83 $142,824 2,770 7.76
========------------ ========-----------
INTEREST BEARING LIABILITIES:
Deposits:
NOW and super-NOW......................... $15,564 80 2.06 $15,349 77 2.01
Savings and money market.................. 30,233 184 2.43 30,791 192 2.49
Certificates of deposit................... 71,384 957 5.36 64,794 856 5.28
Other time deposits....................... 200 3 6.00 200 2 4.00
-------------------- -------------------
Total deposits.......................... 117,381 1,224 4.17 111,134 1,127 4.06
Other borrowed funds....................... 12,533 166 5.30 5,688 64 4.50
-------------------- -------------------
TOTAL................................. 129,914 1,390 4.28 116,822 1,191 4.08
Non-interest bearing funds, net (2)......... 31,333 26,002
-------------------- -------------------
TOTAL SOURCES TO FUND
EARNING ASSETS.............................. $161,247 1,390 3.45 $142,824 1,191 3.34
========------------ ========-----------
NET INTEREST/YIELD.......................... $1,767 4.38% $1,579 4.42%
====== ======
</TABLE>
(1) Average balances are daily averages. (2) Demand deposits, stockholders'
equity and other non-interest bearing liabilities less non-interest earning
assets. Non-accrual loans are reflected in the loan balances, but contributing
no interest income.
NOTE - Tax exempt interest income has been converted to a tax equivalent basis
at the U.S. federal income tax rare of 34%.
See Notes to Consolidated Financial Statements
12
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
(ii) Statement re: computation of earnings per share:
Primary earnings per share is computed by dividing net income
by the weighted average number of shares of common stock and
common stock equivalents outstanding during the quarter. Stock
options are considered common stock equivalents and are
included in the computation of the number of shares
outstanding using the treasury stock method. The number of
shares used to calculate earnings per share for the periods
presented are as indicated in each period.
During the current fiscal quarter, there have been no events of a nature
required to be filed on Form 8-K.
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.
GRANGE NATIONAL BANC CORP.
------------------------------------
(Registrant)
Date May 15, 2000 /s/ Thomas A. McCullough
------------------ -----------------------------------
Thomas A. McCullough
President
Chief Executive Officer
Date May 15, 2000 /s/ Philip O. Farr
------------------- ------------------------------------
Philip O. Farr
Vice President
Chief Financial Officer
Chief Accounting Officer
13
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from our
March 31, 1999 10-QSB and is qualified in its entirety by reference to
such financial statement.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 0
<INT-BEARING-DEPOSITS> 3,326
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 41,106
<INVESTMENTS-CARRYING> 13,182
<INVESTMENTS-MARKET> 12,414
<LOANS> 104,097
<ALLOWANCE> 1,114
<TOTAL-ASSETS> 169,863
<DEPOSITS> 142,031
<SHORT-TERM> 3,574
<LIABILITIES-OTHER> 797
<LONG-TERM> 7,000
0
0
<COMMON> 5,436
<OTHER-SE> 11,025
<TOTAL-LIABILITIES-AND-EQUITY> 169,863
<INTEREST-LOAN> 2,157
<INTEREST-INVEST> 580
<INTEREST-OTHER> 6
<INTEREST-TOTAL> 3,013
<INTEREST-DEPOSIT> 1,224
<INTEREST-EXPENSE> 1,390
<INTEREST-INCOME-NET> 1,623
<LOAN-LOSSES> 20
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,058
<INCOME-PRETAX> 811
<INCOME-PRE-EXTRAORDINARY> 811
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 619
<EPS-BASIC> 0.72
<EPS-DILUTED> 0.72
<YIELD-ACTUAL> 4.38
<LOANS-NON> 58
<LOANS-PAST> 162
<LOANS-TROUBLED> 106
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,092
<CHARGE-OFFS> 2
<RECOVERIES> 4
<ALLOWANCE-CLOSE> 1,114
<ALLOWANCE-DOMESTIC> 1,114
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
