UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
-----------------------------
OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
------------- -------------
Commission file number 000-20163
--------------------------
FIRST PHILSON FINANCIAL CORPORATION
- -----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 25-1511866
- ------------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
534 Main Street, Berlin, PA 15530
- -----------------------------------------------------------------
(Address of principal executive offices) (Zip code)
(814) 267-4666
- -----------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- -----------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report)
Check whether the registrant (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 period
that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90
days.
(1) Yes X No (2) Yes X No
----- ----- ----- -----
As of November 4, 1996, there were 435,600 shares outstanding of
the issuer's common stock.
1
<PAGE>
First Philson Financial Corporation
INDEX TO QUARTERLY REPORT ON FORM 10-Q
Page
------
Part I - Financial Information
Item 1. Financial Statements
Consolidated Balance Sheet (Unaudited)
as of September 30, 1996 and December 31,
1995 3
Consolidated Statement of Income
(Unaudited) for the Three Months and Nine
Months Ended September 30, 1996 and 1995 4
Consolidated Statement of Cash Flows
(Unaudited) for the Nine Months Ended
September 30, 1996 and 1995 5
Notes to Consolidated Financial Statements
(Unaudited) 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7 - 13
Part II - Other Information 14
Item 1. Legal Proceedings
2. Changes in Securities
3. Defaults Upon Senior Securities
4. Submission of Matters to a Vote of Security Holders
5. Other Information
6. Exhibits and Reports on Form 8-K
Signatures 15
2
<PAGE>
<TABLE>
First Philson Financial Corporation
CONSOLIDATED BALANCE SHEET (UNAUDITED)
<CAPTION>
September 30, December 31,
1996 1995
--------------- ---------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 8,682,993 $ 6,587,061
Federal funds sold 4,100,000 8,800,000
Securities available for sale 456,675 -
Investment securities held to
maturity(approximate market
values of $82,380,109 and
$88,771,879) 82,722,631 88,142,581
Total loans 100,266,772 92,631,963
Less allowance for loan losses 2,935,195 2,882,015
--------------- ---------------
Net loans 97,331,577 89,749,948
Premises and equipment, net 2,319,759 2,452,330
Accrued interest receivable 1,961,897 1,921,088
Other assets 1,275,453 1,265,660
--------------- ---------------
TOTAL ASSETS $198,850,985 $198,918,668
=============== ===============
LIABILITIES
Deposits:
Noninterest-bearing demand $ 20,539,768 $ 20,181,499
Interest-bearing demand 26,054,246 23,657,013
Savings 36,420,704 35,902,742
Money market 12,235,482 12,758,546
Time 79,745,938 78,358,459
--------------- ---------------
Total Deposits 174,996,138 170,858,259
Securities sold under
agreements to repurchase 645,408 7,361,419
U. S. Treasury demand notes 1,474,819 283,319
Accrued interest payable 560,974 590,306
Other liabilities 487,228 491,188
--------------- ---------------
TOTAL LIABILITIES 178,164,567 179,584,491
--------------- ---------------
STOCKHOLDERS' EQUITY
Common stock ($10 par value,
500,000 shares authorized,
435,600 shares issued and
outstanding) 4,356,000 4,356,000
Capital surplus 2,354,000 2,354,000
Retained earnings 13,972,573 12,624,177
Net unrealized gain on
securities 3,845 -
--------------- ---------------
TOTAL STOCKHOLDERS' EQUITY 20,686,418 19,334,177
--------------- ---------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $198,850,985 $198,918,668
=============== ===============
See accompanying notes to the consolidated financial statements.
</TABLE>
3
<PAGE>
<TABLE>
First Philson Financial Corporation
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
<CAPTION>
Three Months Ended September 30,
1996 1995
--------------- ---------------
<S> <C> <C>
INTEREST AND DIVIDEND INCOME
Interest and fees on loans $ 2,181,854 $ 2,108,214
Interest-bearing deposits in
other banks - 2,069
Interest on federal funds sold 92,520 180,993
Investment securities:
Taxable interest 1,073,600 1,036,170
Tax exempt interest 165,779 176,235
--------------- ---------------
Total interest and dividend
income 3,513,753 3,503,681
--------------- ---------------
INTEREST EXPENSE
Interest on deposits 1,462,045 1,512,023
Interest on borrowed funds 13,586 68,138
--------------- ---------------
Total interest expense 1,475,631 1,580,161
--------------- ---------------
NET INTEREST INCOME 2,038,122 1,923,520
Provision for loan losses - -
--------------- ---------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 2,038,122 1,923,520
--------------- ---------------
OTHER INCOME
Service charges on deposit
accounts 147,898 136,738
Other income 108,323 81,305
--------------- ---------------
Total other income 256,221 218,043
--------------- ---------------
OTHER EXPENSE
Salaries and employee benefits 757,514 759,869
Premises and equipment expense 265,929 215,446
Deposit insurance premiums 500 (11,035)
Other expense 470,626 441,111
--------------- ---------------
Total other expense 1,494,569 1,405,391
--------------- ---------------
Income before income taxes 799,774 736,172
Income tax expense 206,700 185,300
--------------- ---------------
NET INCOME $ 593,074 $ 550,872
=============== ===============
EARNINGS PER SHARE $ 1.36 $ 1.26
CASH DIVIDENDS PER SHARE $ .30 $ .20
WEIGHTED AVERAGE SHARES OUTSTANDING 435,600 435,600
Nine Months Ended September 30,
1996 1995
--------------- ---------------
INTEREST AND DIVIDEND INCOME
Interest and fees on loans $ 6,440,176 $ 6,127,090
Interest-bearing deposits in
other banks - 6,158
Interest on federal funds sold 265,410 548,926
Investment securities:
Taxable interest 3,307,349 2,893,094
Tax exempt interest 486,286 527,171
--------------- ---------------
Total interest and dividend
income 10,499,221 10,102,439
--------------- ---------------
INTEREST EXPENSE
Interest on deposits 4,387,509 4,433,941
Interest on borrowed funds 114,090 194,413
--------------- ---------------
Total interest expense 4,501,599 4,628,354
--------------- ---------------
NET INTEREST INCOME 5,997,622 5,474,085
Provision for loan losses - -
--------------- ---------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 5,997,622 5,474,085
--------------- ---------------
OTHER INCOME
Service charges on deposit
accounts 395,702 387,326
Other income 294,492 274,987
--------------- ---------------
Total other income 690,194 662,313
--------------- ---------------
OTHER EXPENSE
Salaries and employee benefits 2,285,641 2,290,898
Premises and equipment expense 726,325 654,070
Deposit insurance premiums 1,500 201,235
Other expense 1,320,214 1,264,729
--------------- ---------------
Total other expense 4,333,680 4,410,932
--------------- ---------------
Income before income taxes 2,354,136 1,725,466
Income tax expense 613,700 375,400
--------------- ---------------
NET INCOME $ 1,740,436 $ 1,350,066
=============== ===============
EARNINGS PER SHARE $ 4.00 $ 3.10
CASH DIVIDENDS PER SHARE $ .90 $ .60
WEIGHTED AVERAGE SHARES OUTSTANDING 435,600 435,600
See accompanying notes to the consolidated financial statements.
</TABLE>
4
<PAGE>
<TABLE>
First Philson Financial Corporation
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
Nine Months Ended September 30,
1996 1995
--------------- ---------------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 1,740,436 $ 1,350,066
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation, amortization
and accretion, net 245,318 435,273
Increase in accrued interest
receivable (40,809) (361,698)
Increase (decrease) in accrued
interest payable (29,332) 120,876
Other, net (78,080) (142,165)
--------------- ---------------
Net cash provided by
operating activities 1,837,533 1,402,352
--------------- ---------------
INVESTING ACTIVITIES
Net decrease in interest-bearing
deposits in other banks - 175,138
Purchase of securities available
for sale (450,849) -
Proceeds from maturity of
investment securities held to
maturity 22,532,450 19,335,396
Purchase of investment securities
held to maturity (17,125,631) (18,237,984)
Net increase in loans (7,585,204) (2,897,577)
Purchase of premises and
equipment, net (96,043) (45,870)
Other, net 62,348 7,326
--------------- ---------------
Net cash used for investing
activities (2,662,929) (1,663,571)
--------------- ---------------
FINANCING ACTIVITIES
Net increase in deposits 4,137,879 2,836,568
Increase (decrease) in
securities sold under
agreements to repurchase (6,716,011) 1,971,732
Increase in U.S. Treasury
demand notes 1,191,500 1,068,599
Cash dividends paid (392,040) (261,360)
--------------- ---------------
Net cash provided by(used
for)financing activities (1,778,672) 5,615,539
--------------- ---------------
Increase (decrease) in cash
and cash equivalents (2,604,068) 5,354,320
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 15,387,061 12,661,149
--------------- ---------------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $12,782,993 $18,015,469
=============== ===============
See accompanying notes to the consolidated financial statements.
</TABLE>
5
<PAGE>
First Philson Financial Corporation
Notes to Consolidated Financial Statements (Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
- ---------------------
The consolidated financial statements include the accounts of
First Philson Financial Corporation (the "Company") and its
wholly-owned subsidiary First Philson Bank, National Association
(the "Bank"). All significant intercompany balances and
transactions have been eliminated in the consolidation.
The accompanying unaudited consolidated financial statements have
been prepared in accordance with the instructions to Form 10-Q
and therefore, do not necessarily include all information that
would be included in audited financial statements. The
information furnished reflects all adjustments which are, in the
opinion of Management, necessary for a fair statement of the
results of operations. All such adjustments are of a normal
recurring nature. The results of operations for the interim
periods are not necessarily indicative of the results to be
expected for the full year.
Reclassification of Comparative Amounts
- ---------------------------------------
Certain comparative amounts for the previous period have been
reclassified to conform to the current period classifications.
6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Financial Condition
Total assets at September 30, 1996 decreased by $67,683 from that
reported at December 31,1995. Decreases in federal funds sold of
$4,700,000 and investment securities and securities available for
sale of $4,963,275, funded the increases in cash and due from
banks of $2,095,932 and net loans of $7,581,629.
The decrease in investment securities resulted from declines in
U.S. Government agencies and Corporate notes of $2,972,899 and
$5,345,921, respectively, due to maturities and calls, while U.S.
Treasury notes and State and Political securities increased by
$1,906,423 and $1,193,747, respectively. The Company also
purchased several equity securities which have been classified as
available for sale.
The increase in net loans resulted primarily from increases in
mortgage loans of $4,704,203 and commercial loans of $3,817,920.
The increase in mortgage loans occurred essentially in fixed rate
home equity, residential, and commercial real estate loans. The
increase in commercial loans was primarily in non-taxable loans.
As in 1995, Management is continuing its concentration on
consumer and small business lending. This has permitted the
Company to meet the needs of the communities for which it serves.
The increase in total deposits of $4,137,879 and U.S. Treasury
demand notes of $1,191,500 was offset by a decrease in securities
sold under agreements to repurchase of $6,716,011. The increase
in deposits was primarily due to increases in interest-bearing
demand of $2,397,233 and time deposits of $1,387,479. The
decrease in securities sold under agreements to repurchase is
primarily due to the loss of a repurchase customer.
The increase in equity capital was attributed to net earnings of
$1,740,436 and net unrealized gains on available for sale
securities of $3,845, less dividend payments totalling $392,040.
7
<PAGE>
Results of Operations
Comparison of Nine Months Ended September 30, 1996 and 1995.
The Company's net income increased by $390,370 from 1995 when
comparing the first nine months of 1995 to 1996. Effecting net
income positively was an increase in interest income of $396,782
and decreases in interest expense of $126,755 and other expense
of $77,252. Negative effects to net income were primarily due to
an increase in income taxes of $238,300.
Net interest income for 1996 increased $523,537 from 1995 due to
an increase in interest income and a decrease in interest
expense. The increase in interest income resulted from increases
in interest and fees on loans of $313,086 and interest on
investment securities of $373,370, offset by a decrease in
interest on federal funds sold of $283,516. The increase in
interest and fees on loans was attributable to an increase in the
average outstanding balance of mortgage loans, primarily in fixed
rate residential mortgages, home equity, and commercial real
estate loans. The increase in interest on investment securities
was attributable to equal increases in the average outstanding
balance and net yield of held to maturity securities. The
decrease in interest on federal funds sold is due to decreases in
both the average outstanding balance and net yield. The decrease
in interest expense resulted primarily from a decrease in the
cost of all interest-bearing liabilities.
Because of Management's efforts, the Bank experienced lower non-
performing loans and charge offs, while increasing the loan
growth. Fewer charge offs and continuing recoveries of loan
losses resulted in a net recovery position for 1996 and 1995.
Because of improved loan quality and loan monitoring, Management
did not feel a loan loss provision was necessary in either
period.
Other expenses decreased from 1995 to 1996, primarily due to a
decrease in deposit insurance premiums of $199,735. Deposit
insurance premiums decreased from 1995 as the result of the Bank
having the highest classification for deposit premium purposes
resulting in the statutory $500 minimum per quarter being
assessed in 1996.
The increase in income taxes for 1996 was due to an increase in
pretax income of $628,670 from 1995 and the utilization of an
alternative minimum tax credit in 1995. The effective tax rates
were 21.76% for 1995 and 26.07% for 1996.
8
<PAGE>
Results of Operations
Comparison of Three Months Ended September 30, 1996 and 1995.
The Company's net income increased by $42,202 for the third
quarter of 1996, as compared to net income for the third quarter
of 1995. Effecting net income positively was an increase in
interest income of $10,072 and a decrease in interest expense of
$104,530. Negative effects to net income consisted of increases
in other expense of $89,178 and income taxes of $21,400.
Net interest income for the third quarter of 1996 increased
$114,602 as compared to the third quarter of 1995 from an
increase in interest income and a decrease in interest expense.
The increase in interest income resulted primarily from increases
in interest and fees on loans of $73,640 and interest on
investment securities of $26,974, offset by a decrease in
interest on federal funds sold of $88,473. The increase in
interest and fees on loans from the third quarter of 1995 to the
third quarter of 1996 is attributable to an increase in the
average outstanding balance of mortgage loans, primarily in fixed
rate residential mortgages, home equity, and commercial real
estate loans. The increase in interest in investments from the
third quarter of 1995 to the third quarter of 1996 is due to
investing in higher yielding held to maturity securities. The
decrease in interest on federal funds sold is due to decreases
in both the average outstanding balance and net yield. The
decrease in interest expense resulted from decreases in the both
the cost and average outstanding balance of interest-bearing
liabilities. The decrease in the cost of interest-bearing
liabilities is attributable to time deposits, while the decrease
in the average outstanding balance is attributable to securities
sold under agreements to repurchase.
Other expenses increased for the third quarter of 1996 as
compared to that of 1995. The increase was due to increases in
premises and equipment expense of $50,483 and other expense of
$29,515. The increase in premises and equipment was primarily
due to repairs and maintenance at several offices during the
third quarter of 1996. The increase in other expense resulted
from a combination of increases and decreases in numerous expense
categories with no one significant increase or decrease in any
other expense category.
The increase in income taxes for the third quarter of 1996 as
compared to the third quarter of 1995 was due to an increase in
pretax income of $63,602 and the utilization of an alternative
minimum tax credit in 1995. The effective tax rates were 25.17%
for 1995 and 25.85% for 1996.
9
<PAGE>
Liquidity
To ensure that the Bank can satisfy customer credit needs for
current and future commitments and depository withdrawal
requirements, the Bank manages the liquidity position by ensuring
that there are adequate short-term funding sources available for
those needs. Liquid assets consist of cash and due from banks,
federal funds sold and investment securities maturing in one year
or less. The following table shows these liquidity sources,
minus short-term borrowings as of September 30, 1996 and December
31, 1995, (dollars in thousands):
<TABLE>
<CAPTION>
September 30, December 31,
Liquidity Source 1996 1995
=============================== --------------- ---------------
<S> <C> <C>
Cash and due from banks $ 8,683 $ 6,587
Federal funds sold 4,100 8,800
Investment securities maturing
in one year or less 19,450 22,027
--------------- ---------------
Total 32,233 37,414
Less short-term borrowings 2,120 7,645
--------------- ---------------
Net liquidity position $ 30,113 $ 29,769
=============== ===============
As a percent of total assets 15.14% 14.97%
=============== ===============
</TABLE>
Management feels that the liquidity position is strong and
adequate to cover any potential customer withdrawals and credit
needs.
Capital Resources
Capital management is an ongoing process that consists of
providing equity for both current and future financial
positioning. The Company manages its capital to execute its
strategic business plans and support its growth and investments.
During the first nine months of 1996, the Company increased its
capital base by $1,352,241 or 6.99%, primarily through retained
earnings. For the first nine months of 1995, capital increased
by $1,088,706 or 6.12%.
Bank regulatory agencies have capital adequacy and risk-based
capital adequacy guidelines by which they monitor the capital
adequacy of financial institutions and holding companies. The
Company has complied with the regulatory requirements and expects
to remain in compliance in the future.
The first measure is risk-based capital which measures the
relationship between capital, segregated between Tier 1 and Tier
2 capital, and risk-weighted assets, as defined. Tier 1 capital
generally consists of stockholders' equity, non-cumulative
perpetual preferred stock and minority interest in consolidated
subsidiaries. Tier 2 capital includes the allowance for loan
losses up to 1.25% of risk-weighted assets, cumulative preferred
stock, term subordinated debt and other hybrid capital
instruments. Total capital
10
<PAGE>
is reduced by such items as goodwill and other certain intangible
assets. Additionally, Tier 2 capital cannot exceed 50% of the
minimum capital requirements, which is 8% for 1996. Risk-weighted
assets are derived by applying certain predetermined percentages,
ranging from 0 to 100% to on-balance sheet assets and off-
balance sheet items based upon their defined measure of credit
risk. Core equity capital, which must be at least 50% of the
total risk-based capital, was 93.54% of this requirement at
September 30, 1996.
The secured measure is the leverage capital ratio which evaluates
capital adequacy based upon Tier 1 capital in relation to
quarterly average assets, adjusted for the allowance for loan
losses, goodwill and certain other intangible assets. The
minimum leverage capital ratio for the highest-rated institutions
is 3%, with all other institutions expected to maintain higher
ratios.
Furthermore, pursuant to the Federal Deposit Insurance
Corporation Improvement Act of 1991 (FDICIA), the Federal Banking
Regulators have set minimum risk-based capital ratios for a well
capitalized banking institution at 6% Tier 1 capital, 10% total
capital and 5% leverage capital ratio. The Company has exceeded
all these capital ratios and expects to exceed these ratios in
the future to continue to be classified as a well capitalized
bank.
Management has calculated and monitored the following risk-based
and leverage capital ratios in order to assess compliance with
these regulatory guidelines for the Company at September 30, 1996
and December 31, 1995, (dollars in thousands):
<TABLE>
<CAPTION>
September 30, December 31,
CONSOLIDATED 1996 1995
=============================== --------------- ---------------
<S> <C> <C>
Tier 1 Capital $ 20,682 $ 19,334
Tier 2 Capital 1,428 1,417
--------------- ---------------
Total Risk-Based Capital $ 22,110 $ 20,751
=============== ===============
Risk-Based Capital Ratio 19.61% 18.55%
(Risk-based capital to risk-weighted assets)
Leverage Capital Ratio 10.48% 9.65%
(Tier 1 capital to quarterly average assets)
</TABLE>
Management is not aware of any current recommendations by
regulatory authorities which, if implemented, would have a
material effect on the Company's liquidity, capital resources or
operations other than what has been disclosed.
11
<PAGE>
<TABLE>
<CAPTION>
September 30, December 31,
SIGNIFICANT RATIOS 1996 1995
=============================== --------------- ---------------
<S> <C> <C>
Return on Average Assets
(Annualized) 1.17% 0.99%
Return on Average Equity
(Annualized) 11.58% 10.44%
Dividend Payout Ratio 22.53% 20.17%
</TABLE>
NON-PERFORMING ASSETS AND RISK ELEMENTS
Reviews of the loan portfolio are conducted by an internal
committee quarterly and annually by an outside consultant. The
results of the outside consultant are then compared to the
internal reviews with detailed explanations of differences, if
any. Commercial loans and residential mortgages are placed on a
non-accrual status when principal and interest become 90 days
past due. Delinquent loans are reviewed monthly by senior
management and the Loan Committee of the Board. Generally, all
consumer loans and commercial loans less than $100,000 and not
secured by real estate, will be charged off at 90 days past due,
while all loans secured by real estate and in the process of
foreclosure will be charged off at 180 days past due. All
commercial loans greater than $100,000 and not secured by real
estate, will be subject to the conditions of the action plan
between the Bank and the customer to correct the default.
A loan remains on a non-accrual status until principal and
interest become current and a consistent track record of payments
is established, or it is determined to be uncollectible and is
charged off against the allowance for loan losses. A loan would
be classified as restructured when the terms have been modified,
because of deterioration in the financial position of the
borrowers, to provide for a reduction of either interest or
principal. It is Management's opinion that the Bank did not have
any loans that met the definition of a restructured loan as of
September 30, 1996 and December 31, 1995.
In 1995, the Company adopted Statement of Financial Accounting
Standards No. 114, "Accounting by Creditors for Impairment of a
Loan," as amended by Statement No. 118. It is Management's
opinion that the Bank did not have any loans that met the
definition of an impaired loan as of September 30, 1996 and
December 31, 1995.
The table below presents information concerning non-performing
loans and assets.
12
<PAGE>
<TABLE>
NON-PERFORMING LOANS AND OTHER NON-PERFORMING ASSETS
(Dollars in thousands)
<CAPTION>
September 30, December 31,
1996 1995
--------------- ---------------
<S> <C> <C>
Loans on non-accrual status $ 11 $ 102
Restructured loans - -
Impaired loans - -
Loans past due 90 days or more 12 52
--------------- ---------------
Total non-performing loans 23 154
Other real estate 1 31
Repossessed assets - -
--------------- ---------------
Total non-performing assets $ 24 $ 185
=============== ===============
Non-performing loans as a percent
of total loans 0.02% 0.17%
Non-performing assets as a percent
of total loans 0.02% 0.20%
Non-performing assets as a percent
of total assets 0.01% 0.09%
</TABLE>
13
<PAGE>
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings
NONE
Item 2 - Changes in Securities
NONE
Item 3 - Defaults upon Senior Securities
NONE
Item 4 - Submission of Matters to a Vote of Security Holders
NONE
Item 5 - Other Information
NONE
Item 6 - Exhibits and Reports on Form 8-K
No reports have been filed for 1996.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
FIRST PHILSON FINANCIAL CORPORATION
---------------------------------------
(Registrant)
Date November 12, 1996 By /s/ George W. Hay
-------------------------- ---------------------------
George W. Hay
President and Chief
Executive Officer
By /s/ Theodore Deskevich
---------------------------
Theodore Deskevich
Executive Vice President and
Chief Financial Officer
15
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 8,683
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,100
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 457
<INVESTMENTS-CARRYING> 82,722
<INVESTMENTS-MARKET> 82,380
<LOANS> 100,267
<ALLOWANCE> 2,935
<TOTAL-ASSETS> 198,851
<DEPOSITS> 174,996
<SHORT-TERM> 2,120
<LIABILITIES-OTHER> 1,048
<LONG-TERM> 0
0
0
<COMMON> 4,356
<OTHER-SE> 16,330
<TOTAL-LIABILITIES-AND-EQUITY> 198,851
<INTEREST-LOAN> 6,440
<INTEREST-INVEST> 3,794
<INTEREST-OTHER> 265
<INTEREST-TOTAL> 10,499
<INTEREST-DEPOSIT> 4,387
<INTEREST-EXPENSE> 4,501
<INTEREST-INCOME-NET> 5,998
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,334
<INCOME-PRETAX> 2,354
<INCOME-PRE-EXTRAORDINARY> 2,354
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,740
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<YIELD-ACTUAL> 0
<LOANS-NON> 11
<LOANS-PAST> 12
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,882
<CHARGE-OFFS> 241
<RECOVERIES> 294
<ALLOWANCE-CLOSE> 2,935
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
