<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
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 0-15169
Loyola Capital Corporation
________________________________________________________________________________
Exact Name of Registrant as Specified in its Charter
Maryland #52-14779656
_____________________________________ _____________________________________
State of Incorporation I.R.S. Employer Identification No.
1300 N. Charles St., Baltimore, Maryland 21201-5705
________________________________________ ___________________________________
Address of Principal Executive Offices Zip Code
Registrant's telephone number, including area code is (410) 787-3100
_______________________________________________________________________________
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report
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 and 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 ninety days.
Yes ____X____ No _________
On April 28, 1995, 8,107,750 shares of the Registrant's Common Stock, $.10
par value, were outstanding.
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
10-Q Quarterly Report
Quarter Ended March 31, 1995
INDEX
Page No.
--------
Part I - Financial Information
Item 1. Financial Statements:
Unaudited Consolidated Statements of Financial Condition
as of March 31, 1995 and December 31, 1994 3
Unaudited Consolidated Statements of Income for the three
months ended March 31, 1995 and 1994 4-5
Unaudited Consolidated Statements of Cash Flows for the
three months ended March 31, 1995 and 1994 6-7
Unaudited Note to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 9-14
Part II - Other Information 15
Exhibit 11 - Calculation of Earnings Per Share 16
Signatures 17
2
<PAGE>
Part I - Financial Information
ITEM 1. FINANCIAL STATEMENTS
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
---------- ------------
(IN THOUSANDS)
<S> <C> <C>
ASSETS
Cash and demand deposits $ 19,959 24,426
Money market investments 34,423 3,286
Investment securities, fair value $60,697
in 1995 and $114,709 in 1994 62,424 117,907
Mortgage-backed securities, fair value $210,890
in 1995 and $207,521 in 1994 224,832 229,429
Loans held for sale 34,236 31,006
Loans receivable, net 2,008,181 1,952,272
Investments in real estate, net 24,634 26,374
Federal Home Loan Bank of Atlanta stock, at cost 36,642 37,418
Property and equipment 24,021 24,707
Prepaid expenses and other assets 17,691 19,933
Deferred income taxes 6,442 6,078
---------- ------------
$2,493,485 2,472,836
---------- ------------
---------- ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits $1,485,926 1,469,925
Notes payable and other borrowings 769,193 777,577
Mortgage escrow accounts 40,216 27,918
Drafts payable 12,516 16,908
Federal and state income taxes 4,527 2,876
Accrued expenses and other liabilities 8,828 8,538
---------- ------------
Total liabilities 2,321,206 2,303,742
---------- ------------
STOCKHOLDERS' EQUITY:
Preferred stock, $.10 par value, 15,000,000
shares authorized, none issued -- --
Common stock, $.10 par value, 35,000,000
shares authorized, 8,107,750 shares issued
and outstanding in 1995 and 8,091,699 shares
in 1994 811 809
Additional paid-in capital 44,206 44,118
Retained income, substantially restricted 127,262 124,167
---------- ------------
Total stockholders' equity 172,279 169,094
---------- ------------
$2,493,485 2,472,836
---------- ------------
---------- ------------
</TABLE>
See accompanying note to consolidated financial statements.
3
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------
1995 1994
------- -------
(IN THOUSANDS EXCEPT
PER-SHARE DATA)
<S> <C> <C>
INTEREST INCOME
Loans receivable $39,909 32,550
Mortgage-backed securities 3,457 3,700
Investments 2,331 2,886
------- -------
Total interest income 45,697 39,136
------- -------
INTEREST EXPENSE
Deposits 16,335 13,546
Notes payable and other borrowings 11,609 8,857
------- -------
Total interest expense 27,944 22,403
------- -------
NET INTEREST INCOME 17,753 16,733
PROVISION FOR LOAN LOSSES 201 180
------- -------
Net interest income after
provision for loan losses 17,552 16,553
------- -------
NONINTEREST INCOME
Service fees on loans 1,611 1,539
Service fees on deposits 321 221
Insurance commissions 537 486
Gain (loss) on sales of loans, net (62) 403
Other 282 219
------- -------
Total noninterest income 2,689 2,868
------- -------
NONINTEREST EXPENSE
Salaries and employee benefits 6,501 6,359
Rent and other occupancy 1,257 1,160
Advertising 578 491
Data processing 1,609 1,628
Equipment 439 433
Federal deposit insurance and fees 934 919
(Income) loss on investments in real estate, net (351) 229
Other 2,462 2,395
------- -------
Total noninterest expense 13,429 13,614
------- -------
INCOME BEFORE INCOME TAXES 6,812 5,807
INCOME TAXES 2,744 2,317
------- -------
NET INCOME $ 4,068 3,490
------- -------
------- -------
</TABLE>
(continued)
4
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------
1995 1994
------- -------
(IN THOUSANDS EXCEPT
PER-SHARE DATA)
<S> <C> <C>
NET INCOME PER SHARE
Primary $ .47 .41
Average shares primary 8,663 8,597
Fully diluted $ .47 .40
Average shares fully diluted 8,704 8,633
</TABLE>
See accompanying note to consolidated financial statements.
5
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------
1995 1994
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 4,068 3,490
Adjustments to reconcile net income to net
cash provided by operating activities:
Loans originated for sale, net (56,851) (165,339)
Purchase of loans acquired for sale (23,871) (112,813)
Sales of loans originated for sale 77,430 317,629
Amortization of unearned loan fees (457) (591)
Depreciation and amortization 1,042 1,032
Deferred income taxes (364) (357)
Equity in net income of real estate joint ventures (735) (779)
Net increase (decrease) in accrued interest payable on deposits (51) 54
Provision for losses on loans and investments in real estate 497 1,068
Gain on sales of loans 62 (403)
Gain on sale of real estate owned (128) (219)
Net increase (decrease) in accrued expenses and other
liabilities 290 (334)
Net increase in federal and state income taxes payable 1,651 2,631
Other, net 2,533 2,246
--------- ---------
Net cash provided by operating activities 5,116 47,315
--------- ---------
INVESTING ACTIVITIES:
Loan originations (104,060) (100,460)
Loan fees deferred 374 1,404
Purchases of loans and participations in loans (22,318) --
Principal repayments on loans 73,343 110,177
Purchases of investment securities and Federal Home
Loan Bank stock (3,926) --
Redemptions of investment securities and Federal Home
Loan Bank stock 59,782 58,196
Purchases of mortgage-backed securities -- (23)
Repayments of mortgage-backed securities 4,230 2,100
Net (increase) decrease in investments in and advances to real
estate joint ventures (888) 598
Net decrease in other real estate 666 1,714
Purchase of equipment (356) (718)
--------- ---------
Net cash provided by investing activities 6,847 72,988
--------- ---------
</TABLE>
(continued)
6
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------
1995 1994
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
FINANCING ACTIVITIES:
Net increase (decrease) in deposits 16,052 (18,665)
Net increase (decrease) in short-term borrowings (original
maturities less than three months) 4,348 (81,376)
Proceeds from advances from Federal Home Loan Bank
of Atlanta 944,492 104,193
Repayment of advances from Federal Home Loan Bank
of Atlanta (961,600) (114,200)
Net increase in mortgage escrow accounts 12,298 12,186
Payment of dividends on common stock (972) (805)
Proceeds from exercise of stock options 89 39
--------- ---------
Net cash provided (used) by financing activities 14,707 (98,628)
--------- ---------
Increase in cash and cash equivalents 26,670 21,675
Cash and cash equivalents at beginning of year 27,712 94,000
--------- ---------
Cash and cash equivalents at end of quarter $ 54,382 115,675
--------- ---------
--------- ---------
</TABLE>
See accompanying note to consolidated financial statements.
7
<PAGE>
LOYOLA CAPITAL CORPORATION AND SUBSIDIARIES
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995 and 1994
(Unaudited)
(1) Basis of Presentation
In the opinion of management of Loyola Capital Corporation (the
"Corporation"), the unaudited Consolidated Financial Statements contain all
adjustments (comprising only normal recurring accruals) necessary for a fair
presentation of the statements of financial condition, income and cash flows
for the periods presented (the "Statements"). The Statements have been
prepared using the accounting policies described in the 1994 Annual Report to
Stockholders.
Cash equivalents for purposes of the Consolidated Statements of Cash
Flows includes money market investments. Cash payments for income taxes were
$1.5 million and $129,000 for the three months ended March 31, 1995 and 1994,
respectively. Interest paid on deposits and borrowings was $27.7 million and
$23.0 million for the three months ended March 31, 1995 and 1994,
respectively. Loans transferred to real estate acquired through foreclosures
were $609,000 and $1.7 million for the three months ended March 31, 1995 and
1994, respectively. Loans originated to finance the sale of investments in
real estate were $2.7 million and $2.4 million for the three months ended
March 31, 1995 and 1994, respectively.
Primary net income per common share has been computed based on the
weighted average number of shares of common stock and common stock
equivalents outstanding during the three months ended March 31, 1995 and
1994. Fully diluted net income per common share is based on the average
shares outstanding during the three months ended March 31, 1995 and 1994,
adjusted for the dilutive effect of stock options, which are considered
common stock equivalents in the calculation of net income per common share.
The consolidated results of operations for the three months ended March
31, 1995 are not necessarily indicative of the results that may be expected
for the entire year. Certain amounts in the 1994 financial statements have
been reclassified to conform with the 1995 presentation.
The market values of investment securities and mortgage-backed
securities are shown in the Consolidated Statements of Financial Condition.
Gross unrealized gains and losses on such securities were as follows:
<TABLE>
<CAPTION>
March 31, 1995 December 31, 1994
------------------------- -------------------------
Gross Gross Gross Gross
Unrealized Unrealized Unrealized Unrealized
Gains Losses Gains Losses
---------- ---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Investment securities $25 1,752 18 3,216
Mortgage-backed securities -- 13,942 -- 21,908
</TABLE>
The Corporation adopted Financial Accounting Standards Board Statement
of Financial Accounting Standards No. 114 "Accounting by Creditors for
Impairment of a Loan" ("Statement 114"), as amended by Statement 118
"Accounting by Creditors for Impairment of a Loan - Income Recognition and
Disclosures" (collectively referred to as "Statement 114") effective January
1, 1995. As of January 1, 1995 and March 31, 1995, the Corporation did not
have any loans which are considered to be impaired as defined in Statement 114.
8
<PAGE>
Item 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Net Interest Income
Net interest income increased 6.1% during the quarter ended March 31,
1995 when compared with the quarter ended March 31, 1994. The following
table presents changes in interest income and interest expense attributable
to changes in interest rates and changes in the volume of interest-earning
assets and interest-bearing liabilities for the periods indicated.
<TABLE>
<CAPTION>
Three Months Ended
March 31, 1995
Compared to March 31, 1994
---------------------------
Increase (Decrease)
---------------------------
Due to Due to
Volume Rate Net
------- ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
INTEREST INCOME:
Loans receivable and mortgage-
backed securities $ 6,065 1,051 7,116
Investments (1,539) 984 (555)
------- ------ ------
Total interest-earnings assets 4,526 2,035 6,561
------- ------ ------
INTEREST EXPENSE:
Deposits 633 2,156 2,789
Notes payable and other
borrowings 987 1,765 2,752
------- ------ ------
Total interest-bearing
liabilities 1,620 3,921 5,541
------- ------ ------
Net interest income $ 2,906 (1,886) 1,020
------- ------ ------
------- ------ ------
</TABLE>
The increase in net interest income for the quarter ended March 31, 1995
was due primarily to the increased size of the mortgage and consumer loan
portfolios which was partially offset by the decline in the Corporation's
interest rate spread. Also contributing to this increase was the
redeployment of assets from lower-yielding investments and mortgage-backed
securities to higher-yielding mortgage and consumer loans. The decline in
the Corporation's interest rate spread for the three months ended March 31,
1995 was due primarily to rising market interest rates which impact deposit
and short-term borrowing rates more quickly than mortgage rates.
The average balances of interest-earning assets and interest-bearing
liabilities increased during the quarter ended March 31, 1995 when compared
to the same period for the prior year. These increases reflect management's
decision to expand the level of interest-earning assets thus leveraging the
capital position of the Corporation's principal subsidiary, Loyola F.S.B.
(the "Bank").
9
<PAGE>
The following table sets forth information regarding the dollar amount
of revenue from interest-earning assets and the resulting yields, as well as
the interest expense associated with interest-bearing liabilities for the
three month periods ended March 31. The table also reflects the interest
rate spread and the net interest margin on the Corporation's interest-earning
assets and the ratio of average interest-earning assets to average
interest-bearing liabilities.
<TABLE>
<CAPTION>
Three Months Ended March 31,
------------------------------------------------------------------------------
1995 1994
----------------------------------- ------------------------------------
Average Yield/ Average Yield/
Balance Interest Rate Balance Interest Rate
---------- ---------- -------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS)
WEIGHTED AVERAGE YIELD ON:
Loans receivable and mortgage-
backed securities $2,231,668 43,366 7.80% $1,946,287 36,250 7.47%
Investments 165,471 2,331 5.71 294,231 2,886 3.98
---------- ---------- ---------- ----------
All interest-earning assets $2,397,139 45,697 7.65 $2,240,518 39,136 7.01
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
WEIGHTED AVERAGE RATES PAID ON:
Deposits $1,508,450 16,335 4.39 $1,441,570 13,546 3.81
Notes payable and other
borrowings 783,228 11,609 6.01 709,154 8,857 5.07
---------- ---------- ---------- ----------
All interest-bearing liabilities $2,291,678 27,944 4.95 $2,150,724 22,403 4.22
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Interest rate spread 2.70 2.79
Net interest margin 2.93 2.96
Ratio of average interest-earning
assets to average interest-
bearing liabilities 1.05x 1.04x
</TABLE>
ASSET QUALITY
The provision for losses on loans and investments in real estate is
determined based on management's judgment concerning the inherent risks and
quality of the loan portfolio. Management considers a range of factors in its
regular review of asset quality. Such factors include historical loss
experience, the present and prospective financial condition of borrowers, the
estimated value of underlying collateral, geographical and industry
concentrations, economic conditions, delinquency experience and the status of
nonperforming assets. The adequacy of the allowances for losses on loans and
investments in real estate is determined through an asset classification
process performed on a quarterly basis. This process involves a consistent
detailed analysis of the loan and real estate portfolios and the related
allowances for losses. Management believes that based on these analyses, the
allowances for losses on loans and investments in real estate are adequate at
March 31, 1995.
10
<PAGE>
The following is a summary of the Corporation's nonperforming assets as
of the dates indicated:
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
--------- ------------
(IN THOUSANDS)
<S> <C> <C>
Nonaccrual loans $ 6,311 7,682
Real estate acquired through foreclosure 19,465 20,601
Repossessed autos and boats 402 581
--------- ------------
$26,178 28,864
--------- ------------
--------- ------------
</TABLE>
Real estate acquired through foreclosure decreased $1.1 million during
the three months ended March 31, 1995 primarily due to sales of lots and
condominium units in various projects. Repossessed autos and boats decreased
due to improved quality and continued aggressive collection procedures.
The following table presents the Corporation's allowances for losses on
loans and investments in real estate acquired through foreclosure as of the
dates indicated:
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
--------- ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Consumer and commercial loans $10,531 10,560
Construction and mortgage loans 3,265 3,173
Real estate acquired through foreclosure 8,466 9,008
--------- ------------
$22,262 22,741
--------- ------------
--------- ------------
Ratio of allowances for losses to nonperforming assets 85.0% 78.8
</TABLE>
PROVISION FOR LOAN LOSSES
The following table sets forth the activity in the allowance for loan
losses for the periods indicated:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------
1995 1994
--------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Balance at beginning of period $13,733 14,625
--------- ---------
Charge-offs 672 1,216
Recoveries (534) (663)
--------- ---------
Net charge-offs 138 553
--------- ---------
Provision for loan losses 201 180
--------- ---------
Balance at end of period $13,796 14,252
--------- ---------
--------- ---------
</TABLE>
11
<PAGE>
The provision for loan losses increased $21,000 for the three months
ended March 31, 1995 when compared to the same period for the prior year.
Charge-offs net of recoveries decreased $415,000 for the three months ended
March 31, 1995 when compared with the same period in 1994.
The decrease in net charge-offs was due primarily to a $303,000
year-to-date reduction in net charge-offs of consumer loans. This decrease
was due to continued aggressive collection and recovery procedures.
NONINTEREST INCOME
When compared with the same period in 1994, noninterest income decreased
$179,000 for the three months ended March 31, 1995 primarily due to a
decrease of $465,000 in gains on sales of loans. This decrease is the result
of a decline in the volume of loans sold on a servicing-released basis as the
Corporation experienced significantly lower loan origination volumes.
NONINTEREST EXPENSES
Noninterest expenses decreased $185,000 for the quarter ended March 31,
1995 when compared with the same period in 1994. This decrease was due
primarily to a $570,000 reduction in the provision for losses on real estate
acquired via foreclosure. This reduction was due to a lower level of such
foreclosed assets and improving market conditions for certain properties.
Salaries and employee benefits increased $142,000 for the quarter ended
March 31, 1995 when compared with the same period in 1994. This increase was
due to lower loan origination volumes, which result in a higher ratio of
salaries and benefits charged to expense rather than being deferred and
expensed over the life of the related loans.
Rent and other occupancy costs increased $97,000 in the quarter ended
March 31, 1995 when compared with the same period in 1994 primarily due to
occupancy costs related to branch locations acquired from the Resolution
Trust Corporation in late 1994.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
Money market investments increased from $3.3 million at December 31,
1994 to $34.4 million at March 31, 1995, while investment securities
decreased $55.5 million (47.0%). These changes were due to the reinvestment
of a portion of matured treasury securities into overnight federal funds and
the redeployment of funds to higher-yielding mortgage and consumer loans.
Loans receivable increased $55.9 million (2.9%) at March 31, 1995
compared to December 31, 1994. This increase was due mainly to a greatly
reduced level of loan refinancings resulting from rising interest rates. In
addition, the rise in interest rates produced a higher volume of
adjustable-rate mortgage originations, which are retained in the loan
portfolio. The above factors combined to more than offset the effect of the
decrease in originations of fixed-rate mortgage loans.
12
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
As a federal thrift institution, the Bank is required by its primary
regulator, the Office of Thrift Supervision ("OTS"), to maintain daily
average balances of liquid assets equal to 5% of net withdrawable accounts
and borrowings payable in one year or less. The Bank's liquidity ratio
averaged 5.0% for March, 1995, and 4.0% for December, 1994. The Bank's
liquidity ratio declined below the required 5% in December, 1994 due to
certain U.S. Treasury securities which had been pledged as collateral on
reverse repurchase agreements, thus disqualifying such investments from the
liquidity calculation. This shortfall was restored in January, 1995.
The Bank's principal sources of funds are deposits, loan payments, sales
of loans, advances from the Federal Home Loan Bank of Atlanta, reverse
repurchase agreements and income from operations.
OTS regulations require that thrift institutions maintain the following
minimum capital levels: (a) tangible capital of 1.5% of adjusted total
assets, (b) core capital of 3% of adjusted total assets, and (c) risk-based
capital of 8.0% of total risk-weighted assets.
The tangible capital ratio seeks to measure the adequacy of capital to
assets without giving credit for the value of most intangible assets which
can be carried on the balance sheet of a thrift institution. The core
capital ratio also tests the strength of capital to assets but gives credit
for certain intangible assets. The risk-based capital requirement involves
weighting assets, commitments and obligations for credit and other risk
factors so that thrift institutions with higher risks of loss will be
required to maintain more capital than those with less risky operations. A
transitional rule which requires that an increasing percentage of certain
assets be eliminated from the calculations has the effect of making the
ratios progressively more difficult to achieve.
In August, 1993, the OTS adopted a final rule for calculating an interest
rate risk ("IRR") component of risk-based capital. The new rule became
effective January 1, 1994, however, the IRR capital deduction discussed below
has been waived until the OTS publishes guidelines under which institutions
may appeal such a deduction. The OTS began calculating the IRR component
quarterly for each institution starting in 1994.
To estimate IRR, the OTS computes each institution's net portfolio value
("NPV") in the present interest rate environment versus NPVs derived after
applying parallel rate shifts of plus and minus 200 basis points. If there
is a measured decline in NPV greater than 2% of the estimated market value of
the institution's assets at each of the three most recent quarter ends, then
an institution will be required to deduct an IRR component in calculating its
risk-based capital. This component is equal to one-half of the difference
between its measured IRR and 2%, multiplied by the market value of its assets.
Based upon the latest available quarterly proforma computations of NPV
by the OTS in 1994, the Bank's measured IRR exceeded 2% of the estimated
market value of its assets at September 30 and December 31, 1994. If the
measured IRR exceeds 2% for the next quarter, the Bank's risk-based capital
ratio would be reduced at June 30, 1995. Such reduction is not expected to
affect the Bank's ability to meet its minimum capital requirements. However,
it could affect the Bank's capital category discussed below.
The prompt corrective action regulations of the Federal Deposit
Insurance Corporation Improvement Act of 1991 ("FDICIA") define specific
capital categories based on an institution's capital ratios. The capital
categories, in declining order, are "well capitalized," "adequately
capitalized," "undercapitalized," "significantly undercapitalized," and
"critically undercapitalized." Institutions categorized as
"undercapitalized" or worse are subject to certain defined restrictions. To
be considered "well capitalized," an institution must generally have a
leverage ratio of at least 5%, a tier one risk-based capital ratio of at
least 6%, and a total risk-based capital ratio of at least 10%. The Bank is
in the "well capitalized" category at March 31, 1995 based upon its capital
ratios noted below.
13
<PAGE>
The table below presents the Bank's regulatory capital position at March
31, 1995 relative to its various minimum regulatory capital requirements
applicable at that date and on a fully phased-in basis.
<TABLE>
<CAPTION>
Fully Phased-In
Actual at Using March 31, 1995
March 31, 1995 Balances
------------------------- ------------------------
Percent of Percent of
Regulatory Regulatory
Amount Assets Amount Assets
---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Tangible capital $ 147,914 5.96% 141,310 5.71%
Tangible capital regulatory
requirement 37,208 1.50 37,096 1.50
---------- ---------- ---------- ----------
Excess $ 110,706 4.46% 104,214 4.21%
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Leverage (core) capital $ 147,914 5.96% 141,310 5.71%
Leverage (core) capital
regulatory requirement 74,416 3.00 74,192 3.00
---------- ---------- ---------- ----------
Excess $ 73,498 2.96% 67,118 2.71%
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Regulatory assets $2,480,523 2,473,057
---------- ----------
---------- ----------
Risk-based capital $ 159,381 10.24% 152,777 9.86%
Current risk-based capital
regulatory requirement 124,531 8.00 123,933 8.00
---------- ---------- ---------- ----------
Excess $34,850 2.24% 28,844 1.86%
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Risk-weighted assets $1,556,633 1,549,167
---------- ----------
---------- ----------
</TABLE>
The Bank's excess risk-based capital increased as of March 31, 1995 when
compared with December 31, 1994 primarily due to net income for the three
months ended March 31, 1995 which was partially offset by an increase of
$39.2 million in risk-weighted assets.
The primary reason for the decrease in capital on a fully phased-in
basis is the phase-out from capital of the Bank's investment in real estate
held for development and sale and investments in and advances to real estate
joint ventures.
14
<PAGE>
Part II
Other Information
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
a. None
b. None
Item 3. Defaults Upon Senior Securities.
a. None
b. 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.
a. None
b. The Registrant filed a Current Report on Form 8-K on May 5, 1995
to report that it had entered into a binding letter agreement
and related stock option agreement with Crestar Financial
Corporation ("Crestar") under which the outstanding Common Stock
of the Registrant would be exchanged for .69 shares of Crestar
Common Stock (the "Acquisition"). The Acquisition is subject to
the execution of a definitive agreement between the two
institutions as well as approval by regulators and the
Registrant's stockholders.
15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Loyola Capital Corporation
________________________________________
(Registrant)
Date May 12, 1995 By James V. McAveney
---------------------- -------------------------------------
James V. McAveney
Executive Vice President, Chief
Financial Officer and Treasurer
Date May 12, 1995 By Dennis P. Neville
---------------------- -------------------------------------
Dennis P. Neville
Senior Vice President and Controller
16
<PAGE>
Exhibit 11
Calculation of Earnings Per Share
(In Thousands, Except Per-Share Data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------------------------
1995 1994
--------------------- ---------------------
Fully Fully
Primary Diluted Primary Diluted
------- ------- ------- -------
<S> <C> <C> <C> <C>
Weighted average shares
outstanding:
Common stock 8,100 8,100 8,048 8,048
Stock options 563 604 549 585
------- ------- ------- -------
Total 8,663 8,704 8,597 8,633
------- ------- ------- -------
------- ------- ------- -------
Net income $4,068 4,068 3,490 3,490
------- ------- ------- -------
------- ------- ------- -------
Net income per share $ 0.47 0.47 0.41 0.40
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
17
