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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
----------
Quarter ended March 31, 1996 Commission file number 0-14403
BRUNSWICK BANCORP
-----------------
(Exact Name of Registrant as Specified in its Charter)
----------
NEW JERSEY 22-2610694
---------- ----------
(State of Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization Identification Number)
NEW BRUNSWICK, NEW JERSEY 08901
------------------------- -----
Address of principal executive offices) (Zip Code)
(908) 247-3900
--------------
(Registrant's Telephone Number Including Area Code)
NOT APPLICABLE
--------------
(Former Name, Former Address and Former Fiscal Year
if Changed Since Last Report)
COMMON STOCK, PAR VALUE $2.00 721,920 SHARES
----------------------------- --------------
(Class of Stock) (Outstanding at March 31, 1996
----------
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 periods that
the registrant was required to file such report), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X NO
----- -----
<PAGE> 2
BRUNSWICK BANCORP AND SUBSIDIARIES
I N D E X
<TABLE>
<CAPTION>
P A G E
-------
<S> <C>
PART I - FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements (Unaudited):
Consolidated Balance Sheets
March 31, 1996 and December 31, 1995 1
Consolidated Statements of Income
Three Months Ended March 31, 1996, 1995 and 1994 2
Consolidated Statements of Stockholders' Equity
Three Months Ended March 31, 1996, 1995 and 1994 3
Consolidated Statements of Cash Flows
Three Months Ended March 31, 1996, 1995 and 1994 4
Notes to Consolidated Financial Statements 5-6
Item 2. Management's Discussion and Analysis of Financial
Conditions and Results of Operations 7-8
PART II - OTHER INFORMATION
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K 9
Signatures 10
</TABLE>
<PAGE> 3
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
UNAUDITED
<TABLE>
<CAPTION>
MAR 31 DEC 31
1996 1995
---- ----
<S> <C> <C>
ASSETS:
Cash and due from banks $ 5,439,334 $ 6,348,014
Federal funds sold 25,000,000 21,000,000
Investment securities 14,042,242 14,129,902
Loans 48,213,848 46,408,294
Less allowance for credit losses 939,374 867,189
---------- ----------
Net loans 47,274,474 45,541,105
Premises and equipment 828,793 769,788
Other real estate owned 4,019,323 3,613,007
Accrued interest receivable and other assets 866,216 1,035,620
---------- ----------
NET ASSETS $97,470,382 $92,437,436
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Deposits:
Demand deposits $26,225,320 $24,290,027
NOW accounts 18,058,127 13,663,887
Savings deposits 14,472,196 14,412,413
Time deposits 19,309,725 20,958,897
---------- ----------
Total deposits 78,065,368 73,325,224
Borrowed funds 378,242 368,247
Accrued expenses and other liabilities 995,061 853,885
---------- ----------
Total liabilities 79,438,671 74,547,356
---------- ----------
Stockholders' equity:
Common stock, par value $2.00:
Authorized 3,000,000 shares;
issued 721,920 shares 1,443,840 1,443,840
Surplus 4,284,804 4,284,804
Retained earnings 12,303,067 12,161,436
---------- ----------
Total stockholders' equity 18,031,711 17,890,080
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $97,470,382 $92,437,436
========== ==========
</TABLE>
1
<PAGE> 4
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED MARCH 31, 1996, 1995 AND 1994
UNAUDITED
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
INTEREST INCOME:
Interest and fees on loans $1,129,913 $1,254,617 $1,013,451
Interest on investment securities:
Taxable 232,397 343,633 216,853
Exempt from Federal income tax 3,031 3,892 4,687
Interest on Federal funds sold 295,025 249,756 197,285
Interest on deposits with bank - - 516
--------- --------- ---------
Total interest income 1,660,366 1,851,898 1,432,792
--------- --------- ---------
INTEREST EXPENSE:
Interest on deposits 482,625 372,853 357,321
Interest on borrowed funds 4,200 5,342 3,074
--------- --------- ---------
Total interest expense 486,825 378,195 360,395
--------- --------- ---------
Net interest income 1,173,541 1,473,703 1,072,397
Provision for credit losses 75,000 175,000 150,000
--------- --------- ---------
Net interest income after
provision for credit losses 1,098,541 1,298,703 922,397
--------- --------- ---------
NON-INTEREST INCOME:
Service fees 168,033 165,620 149,948
Other non-interest income 24,035 - -
--------- --------- ---------
Total non-interest income 192,068 165,620 149,948
--------- --------- ---------
NON-INTEREST EXPENSES:
Salaries and wages 442,654 353,792 332,924
Employee benefits 110,283 79,044 75,320
Occupancy 165,029 156,928 143,808
Furniture and equipment 35,771 33,263 42,360
Other non-interest expenses 281,354 423,458 235,948
--------- --------- ---------
Total non-interest expenses 1,035,091 1,046,485 830,360
--------- --------- ---------
Income before income taxes 255,518 417,838 241,985
Income tax expense 113,887 194,973 99,293
--------- --------- ---------
NET INCOME $ 141,631 $ 222,865 $ 142,692
========= ========= =========
NET INCOME PER SHARE $ .20 $ .31 $ .20
========= ========= =========
</TABLE>
2
<PAGE> 5
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
THREE MONTHS ENDED MARCH 31, 1996, 1995 AND 1994
UNAUDITED
<TABLE>
<CAPTION>
COMMON RETAINED
STOCK SURPLUS EARNINGS TOTAL
----- ------- -------- -----
<S> <C> <C> <C> <C>
Balance
Dec. 31, 1993 $1,003,252 $1,420,982 $13,342,147 $15,766,381
Net income - - 142,692 142,692
--------- --------- ---------- ----------
Balance
March 31, 1994 $1,003,252 $1,420,982 $13,484,839 $15,909,073
========= ========= ========== ==========
Balance
Dec. 31, 1994 $1,203,540 $2,722,854 $12,812,629 $16,739,023
Net income - - 222,865 222,865
--------- --------- ---------- ----------
Balance
March 31, 1995 $1,203,540 $2,722,854 $13,035,494 $16,961,888
========= ========= ========== ==========
Balance
Dec. 31, 1995 $1,443,840 $4,284,804 $12,161,436 $17,890,080
Net income - - 141,631 141,631
--------- --------- ---------- ----------
Balance
March 31, 1996 $1,443,840 $4,284,804 $12,303,067 $18,031,711
========= ========= ========== ==========
</TABLE>
3
<PAGE> 6
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1996, 1995 AND 1994
UNAUDITED
<TABLE>
<CAPTION>
1996 1995 1994
----- ----- ----
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net income $ 141,631 $ 222,865 $ 142,692
Adjustments to reconcile net
income to cash provided by
operating activities:
Provision for credit losses 75,000 175,000 150,000
Depreciation and amortization 24,972 23,902 27,124
Net accretion of securities
discounts ( 13,808) ( 175,965) ( 116,557)
(Increase) decrease in interest
receivable and other assets 169,404 99,069 ( 195,423)
(Increase) decrease in interest
payable and other liabilities 141,176 165,301 73,252
--------- ---------- ----------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 538,375 510,172 81,088
--------- ---------- ----------
INVESTING ACTIVITIES:
Net (increase) decrease in
Federal funds sold ( 4,000,000) 10,200,000 3,500,000
Proceeds from maturities of
investment securities 7,000,000 - 6,000,000
Return of capital on invest-
ment securities 66,468 40,742 646,051
Purchase of investment securities ( 6,965,000) - ( 3,123,750)
Net (increase) decrease in loans ( 2,214,685) 107,274 ( 1,368,172)
Capital acquisitions ( 83,977) - ( 23,220)
---------- ---------- ----------
NET CASH PROVIDED BY
INVESTING ACTIVITIES ( 6,197,194) 10,348,016 5,630,909
---------- ---------- ----------
FINANCING ACTIVITIES:
Net increase (decrease) in
demand deposits 1,935,293 2,159,002 ( 1,300,581)
Net increase (decrease) in
NOW accounts 4,394,240 ( 5,466,582) ( 2,158,753)
Net increase (decrease) in
savings deposits 59,783 87,108 452,007
Net increase (decrease) in
time deposits ( 1,649,172) ( 7,919,570) ( 4,779,674)
Net increase (decrease) in
borrowed funds 9,995 ( 438,750) ( 48,596)
---------- ---------- ----------
NET CASH USED BY FINANCING
ACTIVITIES 4,750,139 ( 11,578,792) ( 7,835,597)
---------- ---------- ----------
Increase (decrease) in cash and
cash equivalents ( 908,680) ( 720,604) ( 2,123,600)
Cash and Cash equivalents at
January 1 6,348,014 4,072,796 7,671,794
---------- ---------- ----------
Cash and Cash equivalents at
March 31 $ 5,439,334 $ 3,352,192 $ 5,548,194
========== ========== ==========
</TABLE>
4
<PAGE> 7
BRUNSWICK BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1996
UNAUDITED
NOTE 1
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information, and with the instructions to Form 10-Q and Rule
10-01 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, the
information presented includes all normal and recurring adjustments considered
necessary for a fair presentation of the interim period results.
NOTE 2
INVESTMENT SECURITIES
The following is a comparative summary of the book values and estimated market
values of investment securities:
<TABLE>
<CAPTION>
MARCH 31, 1996
BOOK VALUE MARKET VALUE
---------- ------------
<S> <C> <C>
U.S. Treasury $11,985,116 $11,962,530
U.S. Government Agencies 524,266 907,599
States and political subdivisions 140,264 140,264
Other securities 1,392,596 1,441,575
---------- ----------
$14,042,242 $14,451,968
========== ==========
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1995
BOOK VALUE MARKET VALUE
---------- ------------
<S> <C> <C>
U.S. Treasury $ 5,014,099 $ 5,041,250
U.S. Government Agencies 7,572,316 8,038,199
States and political subdivisions 151,564 151,564
Other securities 1,391,923 1,449,505
---------- ----------
$14,129,902 $14,680,518
========== ==========
</TABLE>
5
<PAGE> 8
BRUNSWICK BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1996
UNAUDITED
NOTE 3
NET LOANS
The composition of net loans is as follows:
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31
1996 1995
----------- -----------
<S> <C> <C>
Commercial loans $21,357,187 $19,233,053
Real estate loans 25,816,710 26,109,107
Consumer loans 1,122,096 1,120,594
---------- ----------
48,295,993 46,462,754
Less:
Allowance for credit losses 939,374 867,189
Unearned income 82,145 54,460
---------- ----------
$47,274,474 $45,541,105
========== ==========
</TABLE>
NOTE 4
PREMISES AND EQUIPMENT
The major components of premises and equipment are as follows:
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31
1996 1995
----------- -----------
<S> <C> <C>
Land $ 300,705 $ 300,705
Buildings 562,049 562,049
Leasehold improvements 89,071 284,456
Equipment 674,678 635,739
---------- ----------
1,626,503 1,782,949
Less accumulated depreciation
and amortization 797,710 1,013,161
---------- ----------
$ 828,793 $ 769,788
========== ==========
</TABLE>
6
<PAGE> 9
BRUNSWICK BANCORP AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
MARCH 31, 1996
The most significant change in the Corporation's Balance Sheet since December
31, 1995 is the increase in deposits of approximately $4,700,000. Most of this
increase occurred in Public Funds NOW accounts.
As a result of this increase in deposits, Federal funds sold increased by
$4,000,000.
Also noteworthy is an increase of approximately $72,000 in the allowance for
credit losses which resulted mainly from $75,000 in credit loss provisions. At
March 31, 1996, the allowance for credit losses represented 1.9% of total loans
and 14.7% of past due and nonaccrual loans.
The results of operations for the first quarters of 1996, compared to the same
period of 1995, show an decrease in income before taxes of approximately
$162,000. The main reason for this decrease is a $300,000 decrease in net
interest income offset by a decrease in the provision for credit losses of
$100,000. The decrease in net interest income is analyzed in detail on page 8.
The $24,000 of other non-interest income reported for the first quarter of the
current year represents rental income on properties acquired through
foreclosure net of applicable expenses. During the first quarter of 1995,
expenses exceeded rental income and the resulting net expenses is included in
other non-interest expenses for that period.
Salaries, wages and employee benefits increased by $89,000 because of increases
in base salaries and wages and additions to staff. Employee benefits increased
by $31,000 mainly because of $30,000 in contributions to a recently implemented
deferred compensation plan.
Other non-interest expenses decreased by $142,000. The two largest components
of this decrease are a decrease in advertising expense of $69,000 and a
decrease in our FDIC assessment of $42,000.
Because of conservatism and the resulting asset quality, the Corporation's
capital position continues to be one of its strong points. At March 31, 1996
and December 31, 1995, the risk-based capital ratios were 33.2% and 34.8%, both
of which are well above the minimum regulatory guideline.
In Management's opinion, the Corporation's liquidity position is strong, based
on its high level of core deposits, the stability of its other funding sources
and the support provided by its capital base.
7
<PAGE> 10
BRUNSWICK BANCORP AND SUBSIDIARIES
ANALYSIS OF CHANGES IN NET INTEREST INCOME
(IN THOUSANDS)
<TABLE>
<CAPTION>
Increase (Decrease) Due to Changes in
Volume Rates Total
------ ----- -----
<S> <C> <C> <C>
Three Months Ended March 31, 1996
Versus
Three Months Ended March 31, 1995
- ---------------------------------
Interest income on:
Loans $ 4 ($ 128) ($ 124)
Investment securities ( 103) ( 9) ( 112)
Federal funds sold 66 ( 21) 45
---- ---- ----
Total interest income ( 33) ( 158) ( 191)
---- ---- ----
Interest expense on:
Deposits 24 86 110
Borrowed funds ( 3) 2 ( 1)
---- ---- ----
Total interest expense 21 88 109
---- ---- ----
Net interest income ($ 54) ($ 246) ($ 300)
==== ==== ====
</TABLE>
8
<PAGE> 11
BRUNSWICK BANCORP AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
The Corporation filed no Form 8-K during the three month period ended March 31,
1996.
9
<PAGE> 12
BRUNSWICK BANCORP AND SUBSIDIARIES
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 duly authorized.
BRUNSWICK BANCORP AND SUBSIDIARIES
5/6/96 /s/ Carmen J. Gumina
--------------- -------------------------
Date Carmen J. Gumina
President
5/6/96 /s/ Thomas Fornale
--------------- -------------------------
Date Thomas Fornale
Treasurer
10
<PAGE> 13
EXHIBIT INDEX
Exhibit 27 - Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 5,439,334
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 25,000,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 14,042,242
<INVESTMENTS-MARKET> 14,451,968
<LOANS> 48,213,848
<ALLOWANCE> 939,374
<TOTAL-ASSETS> 97,470,382
<DEPOSITS> 78,065,368
<SHORT-TERM> 378,242
<LIABILITIES-OTHER> 995,061
<LONG-TERM> 0
0
0
<COMMON> 1,443,840
<OTHER-SE> 16,587,871
<TOTAL-LIABILITIES-AND-EQUITY> 97,470,382
<INTEREST-LOAN> 1,129,913
<INTEREST-INVEST> 235,428
<INTEREST-OTHER> 295,025
<INTEREST-TOTAL> 1,660,366
<INTEREST-DEPOSIT> 482,625
<INTEREST-EXPENSE> 486,825
<INTEREST-INCOME-NET> 1,173,541
<LOAN-LOSSES> 75,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,035,091
<INCOME-PRETAX> 255,518
<INCOME-PRE-EXTRAORDINARY> 141,631
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 141,631
<EPS-PRIMARY> .20
<EPS-DILUTED> .20
<YIELD-ACTUAL> 0
<LOANS-NON> 2,871,109
<LOANS-PAST> 1,655,469
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 867,189
<CHARGE-OFFS> 3,509
<RECOVERIES> 694
<ALLOWANCE-CLOSE> 939,374
<ALLOWANCE-DOMESTIC> 939,374
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
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