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Previous: PBHG FUNDS INC /, 485APOS, 2000-04-06 |
Next: WHITE MOUNTAINS INSURANCE GROUP LTD, 8-K, 2000-04-06 |
<PAGE>
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): April 6, 2000
Greater Bay Bancorp
(Exact name of registrant as specified in its charter)
California 77-0387041
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
Commission file number: 0-25034
2860 West Bayshore Road
Palo Alto, California 94303
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (650) 813-8200
<PAGE>
Item 5. Other Events.
On December 14, 1999, Greater Bay Bancorp (the "Registrant") signed a
definitive agreement for a merger with Coast Bancorp ("Coast"), as a result of
which Coast Commercial Bank will become a wholly owned subsidiary of the
Registrant. On January 26, 2000, the Registrant signed a definitive agreement
with Bank of Santa Clara ("BSC") and GBB Merger Corp. providing for the merger
of GBB Merger Corp. with and into BSC, as a result of which BSC will become a
wholly owned subsidiary of the Registrant. On March 21, 2000, the Registrant
signed a definitive agreement with Bank of Petaluma ("BOP") and DKSS Corp.
providing for the merger of DKSS Corp. with and into BOP, as a result of which
BOP will become a wholly owned subsidiary of the Registrant.
The purpose of this Current Report on Form 8-K is to report the pro forma
financial information relating to these proposed mergers.
Pro Forma Financial Information
Included as Exhibit 99.1 of this Current Report on Form 8-K is unaudited
pro forma condensed combined financial information. The Unaudited Pro Forma
Condensed Combined Balance Sheet as of December 31, 1999 combines the historical
consolidated balance sheets of the Registrant, Coast, BSC and BOP, as if each of
these mergers had been effective on December 31, 1999, after giving effect to
certain adjustments. These adjustments are based on estimates. The Unaudited Pro
Forma Condensed Combined Statements of Operations for the years ended December
31, 1999, 1998 and 1997 present the combined results of operations of the
Registrant, Coast, BSC and BOP as if the mergers had been effective at the
beginning of each period. No assurance can be given when and if the proposed
mergers with Coast, BSC and BOP will be consummated.
The unaudited pro forma condensed combined financial information and
accompanying notes reflect the application of the pooling of interests method of
accounting for the mergers. Under this method of accounting, the recorded
assets, liabilities, shareholders' equity, income and expenses of the
Registrant, Coast, BSC and BOP are combined and reflected at their historical
amounts.
The pro forma combined figures shown in the unaudited pro forma condensed
combined financial information are simply arithmetical combinations of the
Registrant's, Coast's, BSC's and BOP's separate financial results; you should
not assume that the Registrant, Coast, BSC and BOP would have achieved the pro
forma combined results if they had actually been combined during the periods
presented.
The combined company expects to achieve merger benefits in the form of
operating cost savings. The pro forma earnings, which do not reflect any direct
costs or potential savings which are expected to result from the consolidation
of the operations of the Registrant, Coast, BSC and BOP are not indicative of
the results of future operations. No assurances can be given with respect to the
ultimate level of expense savings.
2
<PAGE>
Pro Forma Earnings with Operating Efficiencies
The unaudited pro forma condensed combined financial information contained
in Exhibit 99.1 indicates that, for the year ended December 31, 1999, the
Registrant's diluted net earnings per share (before merger and other related
nonrecurring costs and extraordinary items) would have been $2.24, a decline of
$0.06 from the reported earnings before the mergers with Coast, BSC and BOP.
However, these pro forma earnings per share do not reflect the operating
efficiencies that the Registrant has realized in all of its previous mergers. On
average, the Registrant has realized operating efficiencies from its prior
mergers in excess of 15% of the operating expenses of the acquired institutions.
The following table details the impact of applying the Registrant's historical
percentage of operating efficiencies attained on a pro forma basis to
December 31, 1999 earnings (in thousands, except per share data):
<TABLE>
<CAPTION>
Operating Net Diluted
Expenses Income (1) EPS (1)
----------------- --------------- -------------
<S> <C> <C> <C>
Pro-Forma Net Income Before
Operating Efficiencies $113,074 $46,195 $2.24
Operating Expenses:
Coast 13,372 13,372
BSC 14,294 14,294
BOP 6,690 6,690
-------- -------
Total 34,356 34,356
Greater Bay Anticipated Merger & Acquisition
Operating Efficiencies 18.45% 18.45%
Estimated Operating Efficiencies, Gross 6,340 6,340
Estimated Operating Efficiencies, Net of Tax 3,680 3,680
-------- -------
Adjusted Pro-Forma Net Income After
Operating Efficiencies $109,394 $49,875 $2.39
======== =======
</TABLE>
(1) - Before merger and other related nonrecurring costs and extraordinary
items.
No assurance can be given that these operating efficiencies will be
achieved. Information contained under this caption constitutes "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
which involve risks and uncertainties. The Registrant's actual results may
differ significantly from the results discussed in these forward-looking
statements. Factors that might cause such a difference include but are not
limited to difficulties in integrating the business of the newly acquired
institutions, the timing relating to achieving the operating efficiencies,
economic conditions, competition in the geographic and business areas in which
the Registrant conducts its operations and government regulation.
3
<PAGE>
Item 7. Financial Statements and Exhibits.
Exhibits
- --------
99.1 Unaudited Pro Forma Condensed Combined Balance Sheet as of December 31,
1999 and Unaudited Pro Forma Condensed Combined Statements of Operations
for the years ended December 31, 1999, 1998 and 1997
4
<PAGE>
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.
Greater Bay Bancorp
(Registrant)
Dated: April 6, 2000 By: /s/ Linda M. Iannone
--------------------
Linda M. Iannone
Senior Vice President and General Counsel
5
<PAGE>
EXHIBIT 99.1
Unaudited Pro Forma Condensed Combined Balance Sheet
As of December 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Historical Historical
Greater Coast Greater Bay & Coast
Bay Bancorp Adjustments (1) Bancorp Combined
--- ------- --------------- ----------------
<S> <C> <C> <C> <C>
Assets
Cash and due from banks $ 107,591 $ 18,295 $ - $ 125,886
Federal funds sold 200,550 15,000 - 215,550
Other short-term securities 30,257 - - 30,257
Securities available-for-sale 332,133 112,764 - 444,897
Securities held-to-maturity and other 163,036 - - 163,036
Total loans, net 1,880,756 204,586 - 2,085,342
Property, premises and equipment 23,878 1,994 - 25,872
Interest receivable and other
assets 107,887 17,369 400 125,656
-----------------------------------------------------------------
Total assets $ 2,846,088 $ 370,008 $ 400 $ 3,216,496
=================================================================
Liabilities
Total Deposits $ 2,506,386 $ 300,613 $ - $ 2,806,999
Other borrowings 69,100 31,500 - 100,600
Subordinated debt - - - -
Other liabilities 47,007 4,856 3,800 55,663
Trust Preferred Securities 50,000 - - 50,000
-----------------------------------------------------------------
Total liabilities 2,672,493 336,969 3,800 3,013,262
-----------------------------------------------------------------
Shareholders' equity 173,595 33,039 (3,400) 203,234
-----------------------------------------------------------------
Total liabilities and shareholders' equity $ 2,846,088 $ 370,008 $ 400 $ 3,216,496
=================================================================
Historical Greater Bay & Historical
Bank of Bank of Santa Bank of
Santa Clara Adjustments (2) Clara Combined Petaluma
----------- --------------- -------------- --------
<S> <C> <C> <C> <C>
Assets
Cash and due from banks $ 11,244 $ - $ 118,835 $ 9,795
Federal funds sold - - 200,550 3,300
Other short-term securities - - 30,257 297
Securities available-for-sale - - 332,133 48,840
Securities held-to-maturity and
other 88,017 - 251,053 6,725
Total loans, net 212,770 - 2,093,526 118,312
Property, premises and
equipment 10,086 - 33,964 1,640
Interest receivable and other
assets 4,817 1,000 113,704 5,790
------------------------------------------------------------------
Total assets $ 326,934 $ 1,000 $ 3,174,022 $ 194,699
==================================================================
Liabilities
Total Deposits $ 293,698 $ - $ 2,800,084 $ 162,190
Other borrowings - - 69,100 16,452
Subordinated debt - - -
Other liabilities 1,867 4,400 53,274 1,164
Trust Preferred Securities - - 50,000 -
------------------------------------------------------------------
Total liabilities 295,565 4,400 2,972,458 179,806
------------------------------------------------------------------
Shareholders' equity 31,369 (3,400) 201,564 14,893
------------------------------------------------------------------
Total liabilities and shareholders' equity $ 326,934 $ 1,000 $ 3,174,022 $ 194,699
==================================================================
Historical
Coast Bancorp,
Greater Bay & Bank of Santa Clara &
Bank of Petaluma Bank of Petaluma
Adjustments (3) Combined Combined
--------------- -------- --------
<S> <C> <C> <C>
Assets
Cash and due from banks $ - $ 117,386 $ 39,334
Federal funds sold - 203,850 18,300
Other short-term securities - 30,554 297
Securities available-for-sale - 380,973 161,604
Securities held-to-maturity and
other - 169,761 94,742
Total loans, net - 1,999,068 535,668
Property, premises and
equipment - 25,518 13,720
Interest receivable and other
assets 500 114,177 27,976
------------------------------------------------------
Total assets $ 500 $ 3,041,287 $ 891,641
======================================================
Liabilities
Total Deposits $ - $ 2,668,576 $ 756,501
Other borrowings - 85,552 47,952
Subordinated debt - -
Other liabilities 3,300 51,471 7,887
Trust Preferred Securities - 50,000 0
------------------------------------------------------
Total liabilities 3,300 2,855,599 812,340
------------------------------------------------------
Shareholders' equity (2,800) 185,688 79,301
------------------------------------------------------
Total liabilities and shareholders' equity $ 500 $ 3,041,287 $ 891,641
======================================================
Greater Bay, Coast
Bancorp, Bank of
Santa Clara & Bank
of Petaluma
Adjustments (1, 2 & 3) Combined
---------------------- ---------
<S> <C> <C>
Assets
Cash and due from banks $ - $ 146,925
Federal funds sold - 218,850
Other short-term securities - 30,554
Securities available-for-sale - 493,737
Securities held-to-maturity and
other - 257,778
Total loans, net - 2,416,424
Property, premises and
equipment - 37,598
Interest receivable and other
assets 1,900 137,763
------------------------------------------------
Total assets $ 1,900 $ 3,739,629
================================================
Liabilities
Total Deposits 3,262,887
Other borrowings - 117,052
Subordinated debt -
Other liabilities 11,500 66,394
Trust Preferred Securities - 50,000
------------------------------------------------
Total liabilities 11,500 3,496,333
------------------------------------------------
Shareholders' equity (9,600) 243,296
------------------------------------------------
Total liabilities and shareholders' equity $ 1,900 $ 3,739,629
================================================
</TABLE>
(1) The table above reflects all nonrecurring Greater Bay and Coast Bancorp
estimated merger-related costs as of December 31, 1999. The nonrecurring
Greater Bay and Coast Bancorp estimated merger-related costs are not
included on the unaudited pro forma condensed combined statement of
operations but are included on the unaudited pro forma condensed combined
balance sheet as a reduction to shareholders' equity, net of a $2.0 million
tax benefit. These costs will be charged to expense immediately following
the consummation of the merger.
(2) The table above reflects all nonrecurring Greater Bay and Bank of Santa
Clara estimated merger-related costs as of December 31, 1999. The
nonrecurring Greater Bay and Bank of Santa Clara estimated merger-related
costs are not included on the unaudited pro forma condensed combined
statement of operations but are included on the unaudited pro forma
condensed combined balance sheet as a reduction to shareholders' equity,
net of a $2.1 million tax benefit. These costs will be charged to expense
immediately following the consummation of the merger.
(3) The table above reflects all nonrecurring Greater Bay and Bank of Petaluma
estimated merger-related costs as of December 31, 1999. The nonrecurring
Greater Bay and Bank of Petaluma estimated merger-related costs are not
included on the unaudited pro forma condensed combined statement of
operations but are included on the unaudited pro forma condensed combined
balance sheet as a reduction to shareholders' equity, net of a $1.7 million
tax benefit. These costs will be charged to expense immediately following
the consummation of the merger.
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended December 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Historical Historical
Greater Coast Greater Bay & Coast
Bay Bancorp Adjustments (2) Bancorp Combined
--- ------- --------------- ----------------
<S> <C> <C> <C> <C>
Interest on loans $ 149,883 $ 19,403 $ 169,286
Interest on investment securities 27,675 7,013 34,688
Other interest income 12,740 885 13,625
---------- --------- -------------- -----------
Total interest income 190,298 27,301 217,599
Interest on deposits 68,049 6,179 74,228
Other interest expense 8,508 1,094 9,602
---------- --------- -------------- -----------
Net interest income 113,741 20,028 133,769
Provision for loans losses 13,064 - 13,064
---------- --------- -------------- -----------
Net interest income after provision for loan
losses 100,677 20,028 120,705
Other income 33,306 4,670 37,976
Operating expenses 79,212 13,372 92,584
---------- --------- -------------- -----------
Income before provision for income taxes and
merger and other related nonrecurring
costs and extraordinary items 54,771 11,326 66,097
Provision for income taxes 17,659 4,387 22,046
---------- --------- -------------- -----------
Income before merger and other related
nonrecurring costs, net of tax 37,112 6,939 44,051
Merger and other related nonrecurring costs,
net of tax (6,486) - (6,486)
---------- --------- -------------- -----------
Income before extraordinary items 30,626 6,939 37,565
Extraordinary item (88) - (88)
---------- --------- -------------- -----------
Net income $ 30,538 $ 6,939 37,477
========== ========= ============== ===========
Net income per share - basic (1) $ 2.45 $ 1.45 $ 2.39
========== ========= ============== ===========
Average common shares outstanding 13,310,000 4,792,000 (1,557,000) 16,545,000
========== ========= ============== ===========
Net income per share - diluted (1) $ 2.30 $ 1.41 $ 2.26
========== ========= ============== ===========
Average common and common
equivalent shares outstanding 14,189,000 4,910,000 (1,596,000) 17,503,000
========== ========= ============== ===========
<CAPTION>
Historical Greater Bay & Historical
Bank of Bank of Santa Bank of
Santa Clara Adjustments (3) Clara Combined Petaluma
----------- --------------- -------------- ---------
<S> <C> <C> <C> <C>
Interest on loans $ 18,384 $ 168,267 $ 9,810
Interest on investment securities 5,200 32,875 3,746
Other interest income 591 13,331 117
---------- --------------- ----------- ----------
Total interest income 24,175 214,473 13,673
Interest on deposits 6,213 74,262 4,404
Other interest expense - 8,508 641
---------- --------------- ----------- ----------
Net interest income 17,962 131,703 8,628
Provision for loans losses 675 13,739 300
---------- --------------- ----------- ----------
Net interest income after provision for loan
losses 17,287 117,964 8,328
Other income 3,808 37,114 1,195
Operating expenses 14,294 93,506 6,196
---------- --------------- ----------- ----------
Income before provision for income taxes and
merger and other related nonrecurring
costs and extraordinary items 6,801 61,572 3,327
Provision for income taxes 2,398 20,057 1,023
---------- --------------- ----------- ----------
Income before merger and other related
nonrecurring costs, net of tax 4,403 41,515 2,304
Merger and other related nonrecurring costs,
net of tax - (6,486) -
---------- --------------- ----------- ----------
Income before extraordinary items 4,403 35,029 2,304
Extraordinary item - (88) -
---------- --------------- ----------- ----------
Net income $ 4,403 $ 34,941 $ 2,304
========== =============== =========== ==========
Net income per share - basic (1) $ 1.91 $ 2.41 $ 1.61
========== =============== =========== ==========
Average common shares outstanding 2,310,000 (301,000) 15,319,000 1,428,000
========== =============== =========== ==========
Net income per share - diluted (1) $ 1.86 $ 2.27 $ 1.55
========== =============== =========== ==========
Average common and common
equivalent shares outstanding 2,369,000 (308,000) 16,250,000 1,491,000
========== =============== =========== ==========
<CAPTION>
Historical
Coast Bancorp,
Greater Bay & Bank of Santa Clara
Bank of Petaluma and Bank of
Adjustments (4) Combined Petaluma Combined
--------------- -------- -----------------
<S> <C> <C> <C>
Interest on loans $ 159,693 $ 47,597
Interest on investment securities 31,421 15,959
Other interest income 12,857 1,593
--------------- ---------- ----------
Total interest income 203,971 65,149
Interest on deposits 72,453 16,796
Other interest expense 9,149 1,735
--------------- ---------- ----------
Net interest income 122,369 46,618
Provision for loans losses 13,364 975
--------------- ---------- ----------
Net interest income after provision for loan
losses 109,005 45,643
Other income 34,501 9,673
Operating expenses 85,408 33,862
--------------- ---------- ----------
Income before provision for income taxes and
merger and other related nonrecurring
costs and extraordinary items 58,098 21,454
Provision for income taxes 18,682 7,808
--------------- ---------- ----------
Income before merger and other related
nonrecurring costs, net of tax 39,416 13,646
Merger and other related nonrecurring costs,
net of tax (6,486) -
--------------- ---------- ----------
Income before extraordinary items 32,930 13,646
Extraordinary item (88) -
--------------- ---------- ----------
Net income $ 32,842 $ 13,646
=============== ========== ==========
Net income per share - basic (1) $ 2.44 $ 1.60
=============== ========== ==========
Average common shares outstanding (450,000) 14,288,000 8,530,000
=============== ========== ==========
Net income per share - diluted (1) $ 2.29 $ 1.56
=============== ========== ==========
Average common and common
equivalent shares outstanding (470,000) 15,210,000 8,770,000
=============== ========== ==========
<CAPTION>
Greater Bay, Coast
Bancorp, Bank of Santa
Clara & Bank of
Adjustments (2, 3 & 4) Petaluma Combined
---------------------- -----------------
<S> <C> <C>
Interest on loans $ - $ 197,480
Interest on investment securities - 43,634
Other interest income - 14,333
--------------- ---------------
Total interest income - 255,447
Interest on deposits - 84,845
Other interest expense - 10,243
--------------- ---------------
Net interest income - 160,359
Provision for loans losses - 14,039
--------------- ---------------
Net interest income after provision for loan
losses - 146,320
Other income - 42,979
Operating expenses - 113,074
--------------- ---------------
Income before provision for income taxes and
merger and other related nonrecurring
costs and extraordinary items - 76,225
Provision for income taxes - 25,467
--------------- ---------------
Income before merger and other related
nonrecurring costs, net of tax - 50,758
Merger and other related nonrecurring costs,
net of tax - (6,486)
--------------- ---------------
Income before extraordinary items - 44,272
Extraordinary item - (88)
--------------- ---------------
Net income $ - $ 44,184
=============== ===============
Net income per share - basic (1) $ 2.37
=============== ===============
Average common shares outstanding (2,308,000) 19,532,000
=============== ===============
Net income per share - diluted (1) $ 2.24
=============== ===============
Average common and common
equivalent shares outstanding (2,374,000) 20,585,000
=============== ===============
</TABLE>
(1) Before merger and other related nonrecurring costs and extraordinary items
(2) Calculated as the historical Greater Bay weighted average shares plus the
historical Coast Bancorp weighted average shares adjusted for the assumed
conversion ratio of 0.675.
(3) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Santa Clara weighted average shares adjusted for the
assumed conversion ratio of 0.870.
(4) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Petaluma weighted average shares adjusted for the
assumed conversion ratio of 0.685.
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended December 31, 1998
(In thousands)
<TABLE>
<CAPTION>
Historical Historical
Greater Coast
Bay Bancorp
--- -------
<S> <C> <C>
Interest on loans $ 111,361 $ 16,891
Interest on investment securities 22,740 5,848
Other interest income 11,805 1,388
---------- ----------
Total interest income 145,906 24,127
Interest on deposits 50,563 5,589
Other interest expense 8,255 1,174
---------- ----------
Net interest income 87,088 17,364
Provision for loans losses 7,159 300
---------- ----------
Net interest income after provision for loan losses 79,929 17,064
Other income 11,370 5,987
Operating expenses 56,405 12,482
---------- ----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 34,894 10,569
Provision for income taxes 11,666 4,408
---------- ----------
Income before merger and other related nonrecurring costs, net of tax 23,228 6,161
Merger and other related nonrecurring costs, net of tax (1,674) -
---------- ----------
Net income $ 21,554 $ 6,161
========== ==========
Net income per share - basic (1) $ 1.75 $ 1.28
========== ==========
Average common shares outstanding 13,091,000 4,803,000
========== ==========
Net income per share - diluted (1) $ 1.63 $ 1.25
========== ==========
Average common and common equivalent shares outstanding 14,047,000 4,936,000
========== ==========
<CAPTION>
Greater Bay & Coast
Adjustments (2) Bancorp Combined
--------------- ------------------
<S> <C> <C>
Interest on loans $ 128,252
Interest on investment securities 28,588
Other interest income 13,193
---------- ----------
Total interest income 170,033
Interest on deposits 56,152
Other interest expense 9,429
---------- ----------
Net interest income 104,452
Provision for loans losses 7,459
---------- ----------
Net interest income after provision for loan losses 96,993
Other income 17,357
Operating expenses 68,887
---------- ----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 45,463
Provision for income taxes 16,074
---------- ----------
Income before merger and other related nonrecurring costs, net of tax 29,389
Merger and other related nonrecurring costs, net of tax (1,674)
---------- ----------
Net income $ 27,715
========== ==========
Net income per share - basic (1) $ 1.78
========== ==========
Average common shares outstanding (1,561,000) 16,333,000
========== ==========
Net income per share - diluted (1) $ 1.67
========== ==========
Average common and common equivalent shares outstanding (1,604,000) 17,379,000
========== ==========
<CAPTION>
Historical
Bank of
Santa Clara Adjustments (3)
----------- --------------
<S> <C> <C>
Interest on loans $ 18,145
Interest on investment securities 3,836
Other interest income 456
--------- ----------
Total interest income 22,437
Interest on deposits 6,247
Other interest expense -
--------- ----------
Net interest income 16,190
Provision for loans losses 600
--------- ----------
Net interest income after provision for loan losses 15,590
Other income 3,398
Operating expenses 13,014
--------- ----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 5,974
Provision for income taxes 2,018
--------- ----------
Income before merger and other related nonrecurring costs, net of tax 3,956
Merger and other related nonrecurring costs, net of tax -
--------- ----------
Net income $ 3,956
========= ==========
Net income per share - basic (1) $ 1.73
========= ==========
Average common shares outstanding 2,284,000 (297,000)
========= ==========
Net income per share - diluted (1) $ 1.69
========= ==========
Average common and common equivalent shares outstanding 2,336,000 (304,000)
========= ==========
<CAPTION>
Greater Bay & Historical
Bank of Santa Bank of
Clara Combined Petaluma
------------- --------
<S> <C> <C>
Interest on loans $ 129,506 $ 9,145
Interest on investment securities 26,576 3,426
Other interest income 12,261 173
---------- ---------
Total interest income 168,343 12,744
Interest on deposits 56,810 4,373
Other interest expense 8,255 564
---------- ---------
Net interest income 103,278 7,807
Provision for loans losses 7,759 220
---------- ---------
Net interest income after provision for loan losses 95,519 7,587
Other income 14,768 1,186
Operating expenses 69,419 5,645
---------- ---------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 40,868 3,128
Provision for income taxes 13,684 1,012
---------- ---------
Income before merger and other related nonrecurring costs, net of tax 27,184 2,116
Merger and other related nonrecurring costs, net of tax (1,674) -
---------- ---------
Net income $ 25,510 $ 2,116
========== =========
Net income per share - basic (1) $ 1.78 $ 1.54
========== =========
Average common shares outstanding 15,078,000 1,370,000
========== =========
Net income per share - diluted (1) $ 1.67 $ 1.45
========== =========
Average common and common equivalent shares outstanding 16,079,000 1,464,000
========== =========
<CAPTION>
Greater Bay &
Bank of Petaluma
Adjustments (4) Combined
-------------- --------
<S> <C> <C>
Interest on loans $ 120,506
Interest on investment securities 26,166
Other interest income 11,978
---------- ----------
Total interest income 158,650
Interest on deposits 54,936
Other interest expense 8,819
---------- ----------
Net interest income 94,895
Provision for loans losses 7,379
---------- ----------
Net interest income after provision for loan losses 87,516
Other income 12,556
Operating expenses 62,050
---------- ----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 38,022
Provision for income taxes 12,678
---------- ----------
Income before merger and other related nonrecurring costs, net of tax 25,344
Merger and other related nonrecurring costs, net of tax (1,674)
---------- ----------
Net income $ 23,670
========== ==========
Net income per share - basic (1) $ 1.78
========== ==========
Average common shares outstanding (432,000) 14,029,000
========== ==========
Net income per share - diluted (1) $ 1.66
========== ==========
Average common and common equivalent shares outstanding (461,000) 15,050,000
========== ==========
Bank of Santa Clara
and Bank of Petaluma
Combined Adjustments (2,3 & 4)
-------- --------------------
<S> <C> <C>
Interest on loans $ 44,181
Interest on investment securities 13,110
Other interest income 2,017
--------- ----------
Total interest income 59,308
Interest on deposits 16,209
Other interest expense 1,738
--------- ----------
Net interest income 41,361
Provision for loans losses 1,120
--------- ----------
Net interest income after provision for loan losses 40,241
Other income 10,571
Operating expenses 31,141
--------- ----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 19,671
Provision for income taxes 7,438
--------- ----------
Income before merger and other related nonrecurring costs, net of tax 12,233
Merger and other related nonrecurring costs, net of tax -
--------- ----------
Net income 12,233
========= ==========
Net income per share - basic (1) $ 1.45
========= ==========
Average common shares outstanding 8,457,000 (2,290,000)
========= ==========
Net income per share - diluted (1) $ 1.40
========= ==========
Average common and common equivalent shares outstanding 8,736,000 (2,369,000)
========= ==========
<CAPTION>
Greater Bay, Coast
Bancorp, Bank of
Santa Clara & Bank of
Petaluma Combined
-----------------
<S> <C>
Interest on loans $ 155,542
Interest on investment securities 35,850
Other interest income 13,822
----------
Total interest income 205,214
Interest on deposits 66,772
Other interest expense 9,993
----------
Net interest income 128,449
Provision for loans losses 8,279
----------
Net interest income after provision for loan losses 120,170
Other income 21,941
Operating expenses 87,546
----------
Income before provision for income taxes and
merger and other related nonrecurring costs and extraordinary items 54,565
Provision for income taxes 19,104
----------
Income before merger and other related nonrecurring costs, net of tax 35,461
Merger and other related nonrecurring costs, net of tax (1,674)
----------
Net income $ 33,787
==========
Net income per share - basic (1) $ 1.82
==========
Average common shares outstanding 19,258,000
==========
Net income per share - diluted (1) $ 1.72
==========
Average common and common equivalent shares outstanding 20,414,000
==========
</TABLE>
(1) Before merger and other related nonrecurring costs and extraordinary items.
(2) Calculated as the historical Greater Bay weighted average shares plus the
historical Coast Bancorp weighted average shares adjusted for the assumed
conversion ratio of 0.675.
(3) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Santa Clara weighted average shares adjusted for the
assumed conversion ratio of 0.870.
(4) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Petaluma weighted average shares adjusted for the assumed
conversion ratio of 0.685.
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended December 31, 1997
(In thousands)
<TABLE>
<CAPTION>
Historical Historical
Greater Coast Greater Bay & Coast
Bay Bancorp Adjustments (2) Bancorp Combined
--- ------- --------------- -------------------
<S> <C> <C> <C> <C>
Interest on loans $ 91,138 $ 14,514 $ 105,652
Interest on investment securities 12,028 5,052 17,080
Other interest income 10,292 1,244 11,536
-------------- ----------- ------------- ----------------
Total interest income 113,458 20,810 134,268
Interest on deposits 38,981 4,116 43,097
Other interest expense 3,544 1,511 5,055
-------------- ----------- ------------- ----------------
Net interest income 70,933 15,183 86,116
Provision for loans losses 7,541 450 7,991
-------------- ----------- ------------- ----------------
Net interest income after provision for loan losses 63,392 14,733 78,125
Other income 10,377 4,929 15,306
Operating expenses 46,490 11,006 57,496
-------------- ----------- ------------- ----------------
Income before provision for income taxes and merger
and other related nonrecurring costs and extraordinary
items 27,279 8,656 35,935
Provision for income taxes 9,798 3,501 13,299
-------------- ----------- ------------- ----------------
Net income before merger and other related nonrecurring costs,
net of tax 17,481 5,155 22,636
Merger and other related nonrecurring costs, net of tax (2,282) - (2,282)
-------------- ----------- ------------- ----------------
Net income $ 15,199 $ 5,155 $ 20,354
============== =========== ============= ================
Net income per share - basic (1) $ 1.30 $ 1.06 $ 1.36
============== =========== ============= ================
Average common shares outstanding 12,252,000 4,853,000 (1,577,000) 15,528,000
============== =========== ============= ================
Net income per share - diluted (1) $ 1.23 $ 1.05 $ 1.29
============== =========== ============= ================
Average common and common equivalent shares
outstanding 13,028,000 4,931,000 (1,603,000) 16,356,000
============== =========== ============= ================
</TABLE>
<TABLE>
<CAPTION>
Historical Greater Bay & Historical
Bank of Bank of Santa Bank of
Santa Clara Adjustments (3) Clara Combined Petaluma
------------ --------------- -------------- ------------
<S> <C> <C> <C> <C>
Interest on loans $ 16,463 $ 107,601 $ 7,696
Interest on investment securities 3,953 15,981 3,019
Other interest income 306 10,598 77
------------ -------------- -------------- ------------
Total interest income 20,722 134,180 10,792
Interest on deposits 5,909 44,890 3,681
Other interest expense - 3,544 567
------------ -------------- -------------- ------------
Net interest income 14,813 85,746 6,544
Provision for loans losses 800 8,341 340
------------ -------------- -------------- ------------
Net interest income after provision for loan losses 14,013 77,405 6,204
Other income 2,988 13,365 1,047
Operating expenses 12,019 58,509 5,049
------------ -------------- -------------- ------------
Income before provision for income taxes and merger
and other related nonrecurring costs and extraordinary
items 4,982 32,261 2,202
Provision for income taxes 1,618 11,416 726
------------ -------------- -------------- ------------
Net income before merger and other related nonrecurring costs,
net of tax 3,364 20,845 1,476
Merger and other related nonrecurring costs, net of tax - (2,282) -
------------ -------------- -------------- ------------
Net income $ 3,364 $ 18,563 $ 1,476
============ ============== ============== ============
Net income per share - basic (1) $ 1.48 $ 1.36 $ 1.14
============ ============== ============== ============
Average common shares outstanding 2,276,000 (296,000) 14,232,000 1,296,000
============ ============== ============== ============
Net income per share - diluted (1) $ 1.45 $ 1.29 $ 1.06
============ ============== ============== ============
Average common and common equivalent shares
outstanding 2,321,000 (301,000) 15,048,000 1,393,000
============ ============== ============== ============
</TABLE>
<TABLE>
<CAPTION>
Greater Bay,
Historical Coast
Coast Bancorp, Bancorp,
Greater Bay Bank of Bank of Santa
& Bank Santa Clara Clara &
Bank of and Bank Bank of
Petaluma of Petaluma Adjustments Petaluma
Adjustments (3) Combined Combined (2, 3 & 4) Combined
---------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
Interest on loans $ 98,834 $ 38,673 $ 129,811
Interest on investment securities 15,047 12,024 24,052
Other interest income 10,369 1,627 11,919
-------------- -------------- -------------- -------------- -------------
Total interest income 124,250 52,324 165,782
Interest on deposits 42,662 13,706 52,687
Other interest expense 4,111 2,078 5,622
-------------- -------------- -------------- -------------- -------------
Net interest income 77,477 36,540 107,473
Provision for loans losses 7,881 1,590 9,131
-------------- -------------- -------------- -------------- -------------
Net interest income after provision for
loan losses 69,596 34,950 98,342
Other income 11,424 8,964 19,341
Operating expenses 51,539 28,074 74,564
-------------- -------------- -------------- -------------- -------------
Income before provision for income taxes and
merger and other related nonrecurring costs
and extraordinary items 29,481 15,840 43,119
Provision for income taxes 10,524 5,845 15,643
-------------- -------------- -------------- -------------- -------------
Net income before merger and other related
nonrecurring costs, net of tax 18,957 9,995 27,476
Merger and other related nonrecurring costs,
net of tax (2,282) - (2,282)
-------------- -------------- -------------- -------------- -------------
Net income $ 16,675 9,995 $ 25,194
============== ============== ============== ============== =============
Net income per share - basic (1) $ 1.33 $ 1.19 $ 1.41
============== ============== ============== ============== =============
Average common shares outstanding (408,000) 13,140,000 8,425,000 (2,281,000) 18,396,000
============== ============== ============== ============== =============
Net income per share - diluted (1) $ 1.25 $ 1.16 $ 1.34
============== ============== ============== ============== =============
Average common and common equivalent shares
outstanding (439,000) 13,982,000 8,645,000 (2,343,000) 19,330,000
============== ============== ============== ============== =============
</TABLE>
(1) Before merger and other related nonrecurring costs and extraordinary items
(2) Calculated as the historical Greater Bay weighted average shares plus the
historical Coast Bancorp weighted average shares adjusted for the assumed
conversion ratio of 0.675.
(3) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Santa Clara weighted average shares adjusted for the
assumed conversion ratio of 0.870.
(4) Calculated as the historical Greater Bay weighted average shares plus the
historical Bank of Petaluma weighted average shares adjusted for the assumed
conversion ratio of 0.685.
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