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Previous: INTERMEDIATE MUNICIPAL TRUST/, 485BPOS, 1998-07-27 |
Next: CIRCUIT SYSTEMS INC, 10-K, 1998-07-27 |
<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 June 30, 1998 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)
(732) 247-5800
(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 June 30, 1998)
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
P A G E
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited):
Consolidated Balance Sheets
June 30, 1998 and December 31, 1997 1
Consolidated Statements of Income
Six Months Ended June 30, 1998, 1997 and 1996 2
Consolidated Statements of Income
Quarters Ended June 30, 1998, 1997 and 1996 3
Consolidated Statements of Stockholders' Equity
Six Months Ended June 30, 1998, 1997 and 1996 4
Consolidated Statements of Cash Flows
Six Months Ended June 30, 1998, 1997 and 1996 5
Notes to Consolidated Financial Statements 6-7
Item 2. Management's Discussion and Analysis of Financial
Conditions and Results of Operations 8-9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
<PAGE> 3
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
UNAUDITED
<TABLE>
<CAPTION>
JUNE 30 DEC 31
1998 1997
---- ----
ASSETS:
<S> <C> <C>
Cash and due from banks $ 7,898,507 $ 4,933,343
Federal funds sold 32,700,000 26,600,000
Securities held to maturity 12,211,171 15,120,064
Loans receivable, net 49,893,831 52,705,619
Premises and equipment 1,527,328 1,252,328
Foreclosed real estate 124,337 60,080
Other assets 970,801 968,815
------------- -------------
TOTAL ASSETS $ 105,325,975 $ 101,640,249
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Deposits:
Demand deposits $ 29,813,109 $ 25,177,070
NOW accounts 25,056,243 18,447,438
Savings deposits 12,126,288 12,706,999
Time deposits 16,703,297 24,426,444
------------- -------------
Total deposits 83,698,937 80,757,951
Borrowed funds 526,751 511,649
Accrued expenses and other liabilities 620,447 545,074
------------- -------------
Total liabilities 84,846,135 81,814,674
------------- -------------
Stockholders' equity:
Common stock, par value $2.00:
Authorized 3,000,000 shares;
issued 721,920 shares 1,443,840 1,443,840
Additional paid-in capital 4,284,804 4,284,804
Retained earnings 14,838,590 14,168,828
Treasury stock at cost (87,394) (71,897)
------------- -------------
Total stockholders' equity 20,479,840 19,825,575
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 105,325,975 $ 101,640,249
============= =============
</TABLE>
1
<PAGE> 4
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
SIX MONTHS ENDED JUNE 30, 1998, 1997 AND 1996
UNAUDITED
<TABLE>
<CAPTION>
1998 1997 1996
---- ---- ----
INTEREST INCOME:
<S> <C> <C> <C>
Interest and fees on loans $2,722,512 $2,827,851 $2,510,764
Interest on investment securities:
Taxable 370,516 519,398 436,321
Exempt from Federal income tax 1,918 3,955 5,837
Interest on Federal funds sold 827,239 451,353 563,321
---------- ---------- ----------
Total interest income 3,922,185 3,802,557 3,516,243
---------- ---------- ----------
INTEREST EXPENSE:
Interest on deposits 979,800 967,928 967,166
Interest on borrowed funds 6,534 7,018 6,593
---------- ---------- ----------
Total interest expense 986,334 974,946 973,759
---------- ---------- ----------
Net interest income 2,935,851 2,827,611 2,542,484
Provision for credit losses 150,000 360,000 210,000
---------- ---------- ----------
Net interest income after
provision for credit losses 2,785,851 2,467,611 2,332,484
---------- ---------- ----------
NON-INTEREST INCOME:
Service fees 414,822 425,561 349,712
Other non-interest income 11,394 -- 34,651
---------- ---------- ----------
Total non-interest income 426,216 425,561 384,363
---------- ---------- ----------
NON-INTEREST EXPENSES:
Salaries and wages 831,348 823,641 891,709
Employee benefits 249,344 227,407 223,475
Occupancy 288,013 322,781 341,630
Furniture and equipment 110,387 94,306 78,821
Other non-interest expenses 605,629 609,745 592,237
---------- ---------- ----------
Total non-interest expenses 2,084,721 2,077,880 2,127,872
---------- ---------- ----------
Income before income taxes 1,127,346 815,292 588,975
Income tax expense 457,584 357,419 251,636
---------- ---------- ----------
NET INCOME $ 669,762 $ 457,873 $ 337,339
========== ========== ==========
NET INCOME PER SHARE $ .93 $ .63 $ .47
========== ========== ==========
</TABLE>
2
<PAGE> 5
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
QUARTERS ENDED JUNE 30, 1998, 1997 AND 1996
UNAUDITED
<TABLE>
<CAPTION>
1998 1997 1996
---- ---- ----
INTEREST INCOME:
<S> <C> <C> <C>
Interest and fees on loans $1,330,461 $1,482,187 $1,380,851
Interest on investment securities:
Taxable 177,049 296,838 203,924
Exempt from Federal income tax 827 1,855 2,806
Interest on Federal funds sold 462,781 222,209 268,296
---------- ---------- ----------
Total interest income 1,971,118 2,003,089 1,855,877
---------- ---------- ----------
INTEREST EXPENSE:
Interest on deposits 508,409 484,747 484,541
Interest on borrowed funds 2,732 3,586 2,393
---------- ---------- ----------
Total interest expense 511,141 488,333 486,934
---------- ---------- ----------
Net interest income 1,459,977 1,514,756 1,368,943
Provision for credit losses 75,000 190,000 135,000
---------- ---------- ----------
Net interest income after
provision for credit losses 1,384,977 1,324,756 1,233,943
---------- ---------- ----------
NON-INTEREST INCOME:
Service fees 213,873 236,609 181,679
Other non-interest income 7,314 -- 10,616
---------- ---------- ----------
Total non-interest income 221,187 236,609 192,295
---------- ---------- ----------
NON-INTEREST EXPENSES:
Salaries and wages 416,993 424,062 449,055
Employee benefits 123,783 117,867 113,192
Occupancy 141,469 168,344 176,601
Furniture and equipment 69,942 53,817 43,050
Other non-interest expenses 290,975 319,565 310,883
---------- ---------- ----------
Total non-interest expenses 1,043,162 1,083,655 1,092,781
---------- ---------- ----------
Income before income taxes 563,002 477,710 333,457
Income tax expense 245,684 200,939 137,749
---------- ---------- ----------
NET INCOME $ 317,318 $ 276,771 $ 195,708
========== ========== ==========
NET INCOME PER SHARE $ .44 $ .36 $ .27
========== ========== ==========
</TABLE>
3
<PAGE> 6
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1998, 1997 AND 1996
UNAUDITED
<TABLE>
<CAPTION>
COMMON RETAINED TREASURY
STOCK SURPLUS EARNINGS STOCK TOTAL
Balance
<S> <C> <C> <C> <C> <C>
December 31, 1995 $ 1,443,840 $ 4,284,804 $ 12,161,436 $ -- $ 17,890,080
Net income -- -- 337,339 -- 337,339
------------ ------------ ------------ ------------ ------------
Balance
June 30, 1996 $ 1,443,840 $ 4,284,804 $ 12,498,775 $ -- $ 18,227,419
============ ============ ============ ============ ============
Balance
December 31, 1996 $ 1,443,840 $ 4,284,804 $ 12,924,286 $ -- $ 18,652,930
Net income -- -- 457,873 -- 457,873
------------ ------------ ------------ ------------ ------------
Balance
June 30, 1997 $ 1,443,840 $ 4,284,804 $ 13,382,159 $ -- $ 19,110,803
============ ============ ============ ============ ============
Balance
December 31, 1997 $ 1,443,840 $ 4,284,804 $ 14,168,828 $ (71,897) $ 19,825,575
Net income -- -- 669,762 -- 669,762
Purchase of
treasury stock -- -- -- (15,497) (15,497)
------------ ------------ ------------ ------------ ------------
Balance
June 30, 1998 $ 1,443,840 $ 4,284,804 $ 14,838,590 $ (87,394) $ 20,479,840
============ ============ ============ ============ ============
</TABLE>
4
<PAGE> 7
BRUNSWICK BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1998, 1997 AND 1996
UNAUDITED
<TABLE>
<CAPTION>
1998 1997 1996
---- ---- ----
OPERATING ACTIVITIES:
<S> <C> <C> <C>
Net income $ 669,762 $ 457,873 $ 337,339
Adjustments to reconcile net
income to cash provided by
operating activities:
Provision for credit losses 150,000 360,000 210,000
Depreciation and amortization 68,894 71,388 53,775
Net accretion of securities
discounts (172,497) (24,583) (37,106)
(Increase) decrease in other
assets (1,986) (419,984) 20,340
Increase (decrease) in accrued
expenses and other liabilities 75,373 63,071 (35,340)
------------ ------------ ------------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 789,546 507,765 549,008
------------ ------------ ------------
INVESTING ACTIVITIES:
Net (increase) decrease in
Federal funds sold (6,100,000) (5,100,000) (900,000)
Maturities of investment
securities 10,009,840 12,000,000 7,000,000
Principal repayments on invest-
ment securities 151,420 83,847 142,638
Purchases of investment
securities (7,079,870) (11,012,300) (6,965,000)
Net (increase) decrease in loans
receivable 2,597,531 (1,564,447) (6,002,429)
Acquisitions of premises and
equipment (343,894) (139,138) (256,400)
------------ ------------ ------------
NET CASH PROVIDED BY
INVESTING ACTIVITIES (764,973) (5,732,038) (6,981,191)
------------ ------------ ------------
FINANCING ACTIVITIES:
Net increase (decrease) in:
Demand deposits 4,636,039 (18,751) 478,821
NOW accounts 6,608,805 1,123,531 3,670,309
Savings deposits (580,711) (750,680) (408,924)
Time deposits (7,723,147) 2,394,706 854,319
Borrowed funds 15,102 203,485 165,739
Purchase of treasury stock (15,497) -- --
------------ ------------ ------------
NET CASH PROVIDED BY (USED
IN) FINANCING ACTIVITIES 2,940,591 2,952,291 4,760,264
------------ ------------ ------------
Increase (decrease) in cash and cash
equivalents 2,965,164 (2,271,982) (1,671,919)
Cash and Cash equivalents at
January 1 4,933,343 9,190,838 6,348,014
------------ ------------ ------------
Cash and Cash equivalents at
June 30 $ 7,898,507 $ 6,918,856 $ 4,676,095
============ ============ ============
</TABLE>
5
<PAGE> 8
BRUNSWICK BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
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>
JUNE 30, 1998
BOOK VALUE MARKET VALUE
<S> <C> <C>
U.S. Government Agencies $10,134,691 $10,600,700
States and political subdivisions 27,826 27,826
Other securities 2,048,654 2,067,755
----------- -----------
$12,211,171 $12,696,281
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1997
BOOK VALUE MARKET VALUE
<S> <C> <C>
U.S. Government Agencies $13,168,184 $13,630,617
States and political subdivisions 54,572 54,572
Other securities 1,897,308 1,923,330
----------- -----------
$15,120,064 $15,608,519
=========== ===========
</TABLE>
6
<PAGE> 9
BRUNSWICK BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
UNAUDITED
NOTE 3
NET LOANS
The composition of net loans is as follows:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1998 1997
----------- -----------
<S> <C> <C>
Commercial loans $17,140,678 $19,891,202
Real estate loans 32,566,970 32,467,152
Consumer loans 1,324,043 1,328,652
----------- -----------
51,031,691 53,687,006
Less:
Allowance for credit losses 980,019 820,254
Unearned income 157,841 161,133
----------- -----------
$49,893,831 $52,705,619
=========== ===========
</TABLE>
NOTE 4
PREMISES AND EQUIPMENT
The major components of premises and equipment are as
follows:
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
1998 1997
---------- ----------
<S> <C> <C>
Land $ 834,372 $ 537,927
Buildings 562,049 562,049
Leasehold improvements 70,137 70,137
Equipment 1,060,483 1,058,097
---------- ----------
2,527,041 2,228,210
Less accumulated depreciation
and amortization 999,713 975,882
---------- ----------
$1,527,328 $1,252,328
========== ==========
</TABLE>
7
<PAGE> 10
BRUNSWICK BANCORP AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
JUNE 30, 1998
The most significant changes in the Corporation's Balance Sheet since December
31, 1997 are summarized as follows:
Investment securities and loans decreased by approximately $2,900,000 and
$2,800,000, respectively. The funds made available by these decreases were
invested in Federal funds which, for the most part, explains the $6,100,000
increase in Federal funds sold.
On the liability side of the balance sheet, time deposits decreased by
$7,700,000. However, demand deposits and NOW accounts increased by $4,600,000
and $6,600,000, respectively. These increases more than offset the decrease in
time deposits and resulted in an increase in total deposits of approximately
$2,900,000.
Also noteworthy is an increase of approximately $160,000 in the allowance for
credit losses which resulted mainly from $150,000 in credit loss provisions. At
June 30, 1998 the allowance for credit losses represented 1.9% of total loans
and 119% of loans past due 90 days or more and nonaccrual loans.
The results of operations for the first half of 1998, compared to the same
period of 1997, show an increase in income before taxes of approximately
$312,000. The main reasons for this increase are a $198,000 increase in net
interest income and a decrease in the provision for credit losses of $210,000.
The increase in net interest income is analyzed in detail on page 9.
Non-interest income and expense balances were comparable to those amounts
reported for the first half of 1997.
The Corporation's capital position continues to be one of its strong points. At
June 30, 1998 our total risk-based capital ratio was 32.5% which is over four
times the regulatory requirement.
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.
8
<PAGE> 11
BRUNSWICK BANCORP AND SUBSIDIARIES
ANALYSIS OF CHANGES IN NET INTEREST INCOME
(IN THOUSANDS)
<TABLE>
<CAPTION>
Increase (Decrease) Due to Changes in
Volume Rates Total
------ ----- -----
Six Months Ended June 30, 1998
Versus
Six Months Ended June 30, 1997
Interest income on:
<S> <C> <C> <C>
Loans $(137) $ 32 $(105)
Investment securities (114) (37) (151)
Federal funds sold 353 23 376
----- ----- -----
Total interest income 102 18 120
----- ----- -----
Interest expense on:
Deposits 31 (19) 12
Borrowed funds (1) 1 --
----- ----- -----
Total interest expense 30 (18) 12
----- ----- -----
Net interest income $ 72 $ 36 $ 108
===== ===== =====
Quarter Ended June 30, 1998
Versus
Quarter Ended June 30, 1997
Interest income on:
Loans $ (71) $ (81) $(152)
Investment securities (28) (93) (121)
Federal funds sold 4 237 241
----- ----- -----
Total interest income (95) 63 (32)
----- ----- -----
Interest expense on:
Deposits 24 (1) 23
Borrowed funds -- -- --
----- ----- -----
Total interest expense 24 (1) 23
----- ----- -----
Net interest income $(119) $ 64 $ (55)
===== ===== =====
</TABLE>
9
<PAGE> 12
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 six month period
ended June 30, 1998.
10
<PAGE> 13
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
7/15/98 Carmen J. Gumina
Date Carmen J. Gumina
President
7/15/98 Thomas Fornale
Date Thomas Fornale
Treasurer
11
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 7,898,507
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 32,700,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 12,211,171
<INVESTMENTS-MARKET> 12,696,281
<LOANS> 50,873,850
<ALLOWANCE> 980,019
<TOTAL-ASSETS> 105,325,975
<DEPOSITS> 83,698,937
<SHORT-TERM> 526,751
<LIABILITIES-OTHER> 620,447
<LONG-TERM> 0
0
0
<COMMON> 1,443,840
<OTHER-SE> 19,036,000
<TOTAL-LIABILITIES-AND-EQUITY> 105,325,975
<INTEREST-LOAN> 2,722,512
<INTEREST-INVEST> 372,434
<INTEREST-OTHER> 827,239
<INTEREST-TOTAL> 3,922,185
<INTEREST-DEPOSIT> 979,800
<INTEREST-EXPENSE> 986,334
<INTEREST-INCOME-NET> 2,935,851
<LOAN-LOSSES> 150,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2,584,721
<INCOME-PRETAX> 1,127,346
<INCOME-PRE-EXTRAORDINARY> 669,762
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 669,762
<EPS-PRIMARY> .93
<EPS-DILUTED> .93
<YIELD-ACTUAL> 0
<LOANS-NON> 595,918
<LOANS-PAST> 229,753
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 820,254
<CHARGE-OFFS> 1,372
<RECOVERIES> 11,137
<ALLOWANCE-CLOSE> 983,019
<ALLOWANCE-DOMESTIC> 980,019
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
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