<PAGE> 1
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(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, 1998
-------------------------------------------------
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 0-22008
---------------
MISSISSIPPI VALLEY BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MISSOURI 43-1336298
- --------------------------------------------------- -------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
700 Corporate Park Drive, St. Louis, Missouri 63105
- --------------------------------------------------- -------------------------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (314) 268-2580
-------------------------
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past
90 days. Yes X No .
------- -------
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE
ISSUER'S CLASSES OF COMMON STOCK, AS OF APRIL 15, 1998:
Common Stock, $1.00 par value 9,550,412
----------------------------- --------------------
Class Number of Shares
<PAGE> 2
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING
SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
<TABLE>
INDEX
-----
<CAPTION>
Page No.
--------
<S> <C>
PART I. FINANCIAL INFORMATION
-------------------------
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets --
March 31, 1998 and December 31, 1997 3
Condensed Consolidated Statements of
Income -- Quarters Ended March 31, 1998
and March 31, 1997 4
Consolidated Statements of Changes in
Shareholders' Equity -- Three Months
Ended March 31, 1998 and March 31, 1997 5
Condensed Consolidated Statements of
Cash Flows -- Three Months Ended
March 31, 1998 and March 31, 1997 6
Notes to Condensed Consolidated
Financial Statements 7
ITEM 2. Management's Discussion and Analysis
of Results of Operations and
Financial Condition 8-14
PART II. OTHER INFORMATION
-------------------------
ITEM 6. Exhibits and Reports on Form 8-K 15
SIGNATURE 16
- ---------
EXHIBIT INDEX 17
- -------------
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
- ------------------------------
<TABLE>
ITEM 1. FINANCIAL STATEMENTS
- --------- --------------------
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
-------------------------------------
<CAPTION>
March 31, December 31,
1998 1997
(Derived from
(Unaudited) Audited Statements)
----------- -------------------
(dollars in thousands)
<S> <C> <C>
ASSETS
- ------
Cash and due from banks $ 25,333 $ 28,532
Federal funds sold 46,650 18,910
Held to maturity securities
(fair value of $53,610 and
$59,649, respectively) 52,208 58,148
Available for sale securities 282,654 317,768
Trading account securities 10 1,251
Loans, net of
unearned income 869,652 847,091
Allowance for possible loan losses 15,302 14,892
---------- ----------
Net loans 854,350 832,199
Premises and equipment 14,160 13,482
Other assets 51,703 29,628
---------- ----------
TOTAL ASSETS $1,327,068 $1,299,918
========== ==========
LIABILITIES
- -----------
Deposits:
Non-interest bearing $ 100,325 $ 109,949
Interest bearing 1,015,044 1,016,613
---------- ----------
Total deposits 1,115,369 1,126,562
Securities sold under agreements
to repurchase 31,066 32,700
Other short-term borrowings 32,211 21,495
Guaranteed preferred beneficial interests
in subordinated debentures 14,950 14,950
Other liabilities 36,796 11,104
---------- ----------
TOTAL LIABILITIES 1,230,392 1,206,811
---------- ----------
SHAREHOLDERS' EQUITY
- --------------------
Common stock-par value $1
Authorized 15,000,000 shares,
issued and outstanding 9,549,212 in
1998 and 9,519,212 in 1997 9,549 9,519
Capital surplus 17,196 17,561
Retained earnings 67,217 63,541
Accumulated other comprehensive
income, net of tax 2,714 2,486
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 96,676 93,107
---------- ----------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $1,327,068 $1,299,918
========== ==========
See accompanying notes.
</TABLE>
3
<PAGE> 4
<TABLE>
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
-------------------------------------------
(UNAUDITED)
<CAPTION>
Three Months Ended
March 31,
--------------------------------
1998 1997
-------- --------
<S> <C> <C>
Interest income:
Interest and fees on loans $18,842 $15,920
Held to maturity securities:
Taxable 750 844
Tax-exempt 152 141
Available for sale securities 5,231 3,426
Other 177 169
------- -------
TOTAL INTEREST INCOME 25,152 20,500
------- -------
Interest expense:
Deposits 12,202 9,813
Short-term borrowings 1,005 798
Long-term borrowings 288 140
------- -------
TOTAL INTEREST EXPENSE 13,495 10,751
------- -------
NET INTEREST INCOME 11,657 9,749
Provision for possible loan losses 900 900
------- -------
NET INTEREST INCOME AFTER
PROVISION FOR POSSIBLE LOAN LOSSES 10,757 8,849
------- -------
Other income:
Service charges 470 441
Securities gains/(losses), net on:
Sales of held to maturity securities
Sales of available for sale securities 172 108
Trading profits and commissions 422 206
Other 655 509
------- -------
1,719 1,264
------- -------
Other expenses:
Employee compensation and
other benefits 3,002 2,427
Net occupancy 312 288
Equipment 310 294
Advertising 237 167
Other 1,696 1,706
------- -------
5,557 4,882
------- -------
INCOME BEFORE INCOME TAXES 6,919 5,231
Income taxes 2,479 1,888
------- -------
NET INCOME $ 4,440 $ 3,343
======= =======
Earnings per common share:
Basic $ .47 $ .37
Diluted $ .45 $ .35
See accompanying notes.
</TABLE>
4
<PAGE> 5
<TABLE>
MISSISSIPPI VALLEY BANCHSHARES, INC.
------------------------------------
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
----------------------------------------------------------
(UNAUDITED)
<CAPTION>
Unrealized Gain, Total
Common Stock (Loss) on Share-
------------ Capital Retained Available for holders' Comprehensive
Shares Amount Surplus Earnings Sale Securities Equity Income
-------- -------- --------- ---------- ------------------ -------- ---------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE AT JANUARY 1, 1997 9,033,912 $9,034 $15,235 $51,159 $ 521 $75,949
Net income 3,343 3,343 $ 3,343
Issuance of common
stock 1,600 2 10 12
Cash dividends on:
common stock (633) (633)
Other comprehensive income
(loss), net of tax
Unrealized loss,
on available
for sale securities (1,733) (1,733) (1,733)
--------- ------ ------- ------- ------- ------- -------
BALANCE AT MARCH 31, 1997 9,035,512 $9,036 $15,245 $53,869 $(1,212) $76,938
========= ====== ======= ======= ======= =======
Comprehensive Income $ 1,610
=======
BALANCE AT JANUARY 1, 1998 9,519,212 $9,519 $17,561 $63,541 $ 2,486 $93,107
Net income 4,440 4,440 $ 4,440
Issuance of common
stock 57,000 57 447 504
Treasury stock purchased (27,000) (27) (812) (839)
Cash dividends on:
common stock (764) (764)
Other comprehensive income,
net of tax
Unrealized gain,
on available
for sale securities 228 228 228
--------- ------ ------- ------- ------- ------- -------
BALANCE AT MARCH 31, 1998 9,549,212 $9,549 $17,196 $67,217 $ 2,714 $96,676
========= ====== ======= ======= ======= =======
Comprehensive Income $ 4,668
=======
See accompanying notes.
</TABLE>
5
<PAGE> 6
<TABLE>
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(UNAUDITED)
<CAPTION>
Three Months Ended
March 31,
--------------------------------
1998 1997
-------- --------
(dollars in thousands)
<S> <C> <C>
OPERATING ACTIVITIES
- --------------------
Net income $ 4,440 $ 3,343
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for possible loan losses 900 900
Provision for depreciation and amortization 417 329
Accretion of discounts and amortization of
premiums on securities 85 (335)
Realized securities gains, net (172) (108)
Net decrease (increase) in trading account securities 1,241 (283)
Increase in interest receivable (181) (620)
Increase (decrease) in interest payable (1) 321
Other, net 3,524 (776)
-------- --------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 10,253 2,771
-------- --------
INVESTING ACTIVITIES
- --------------------
Proceeds from maturities of held to maturity securities 6,000 6,000
Purchases of held to maturity securities (2,033)
Purchases of available for sale securities (22,897) (53,901)
Proceeds from maturities of available for sale securities 64,000
Proceeds from sales and paydowns of
available for sale securities 58,388 1,704
Purchases of premises and equipment (942) (559)
Increase in loans outstanding, net (23,051) (35,875)
-------- --------
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES 17,498 (20,664)
-------- --------
FINANCING ACTIVITIES
- --------------------
Net decrease in deposits (11,193) (12,791)
Net increase in repurchase agreements
and other short-term borrowings 9,082 18,472
Proceeds from sale of common stock 504 12
Purchase of treasury stock (839)
Proceeds from sale of subordinated debentures 14,950
Cash dividends (764) (633)
-------- --------
NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES (3,210) 20,010
-------- --------
INCREASE IN CASH
AND CASH EQUIVALENTS 24,541 2,117
Cash and cash equivalents at beginning of period 47,442 30,951
-------- --------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 71,983 $ 33,068
======== ========
See accompanying notes.
</TABLE>
6
<PAGE> 7
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
1. The condensed consolidated financial statements include the accounts of
Mississippi Valley Bancshares, Inc. (the "Company") and its wholly-owned
subsidiary, Southwest Bank of St. Louis (the "Bank"). Significant
intercompany accounts and transactions have been eliminated in consolidation.
The results of operations for the interim periods shown in this report are
not necessarily indicative of results to be expected for the entire year. In
the opinion of management, the information contained herein reflects all
adjustments necessary to make the results of operations for the interim
periods a fair statement of such operations. All such adjustments are of a
normal recurring nature.
2. In 1997, the Financial Accounting Standards Board (FASB) issued SFAS
No. 130, Reporting Comprehensive Income, that established standards for the
------------------------------
reporting and display of comprehensive income and its components. This
Statement requires that an enterprise (a) classify items of other
comprehensive income by their nature in a financial statement and (b) display
the accumulated balance of other comprehensive income separately in the equity
section of the balance sheet. This Statement is effective for 1998 and
requires reclassification of financial statements for prior periods as well.
Following is a summary of other comprehensive income components and related
income tax effects:
<TABLE>
<CAPTION>
For the Three Months Ended March 31, 1998
-----------------------------------------
Before-Tax Tax Net-of-Tax
Amount Expense Amount
---------- ------- ----------
(dollars in thousands)
<S> <C> <C> <C>
Unrealized gains on available
for sale securities $523 $183 $340
Less: reclassification adjustment
for gains realized in net
income 172 60 112
---- ---- ----
Net unrealized gains 351 123 228
---- ---- ----
Other comprehensive income $351 $123 $228
==== ==== ====
<CAPTION>
For the Three Months Ended March 31, 1997
-----------------------------------------
Tax
Before-Tax Expense Net-of-Tax
Amount (Benefit) Amount
---------- --------- ----------
(dollars in thousands)
<S> <C> <C> <C>
Unrealized gains (losses) on
available for sale securities $(2,558) $(895) $(1,663)
Less: reclassification adjustment
for gains realized in net
income 108 38 70
------- ----- -------
Net unrealized loss (2,666) (933) (1,733)
------- ----- -------
Other comprehensive
income (loss) $(2,666) $(933) $(1,733)
======= ===== =======
</TABLE>
7
<PAGE> 8
ITEM 2.
- -------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
-----------------------------------------------
OF OPERATIONS AND FINANCIAL CONDITION
-------------------------------------
The following discussion should be read in conjunction with the
attached condensed consolidated financial statements and notes thereto, and
with the Company's audited financial statements and notes thereto for the
year ended December 31, 1997.
SUMMARY OF EARNINGS
- -------------------
Consolidated net income for the first quarter of 1998 was $4,440,000,
up $1,097,000 or 32.8% from the $3,343,000 earned during the first quarter of
1997. On a per share basis, net income was $.45, up 28.6% from $.35 in the
same period of the prior year. The improved performance was due primarily to
higher net interest income.
For the quarter, the Company's return on average assets was 1.37%,
compared to 1.27% in the first quarter of 1997. The Company's return on
equity was 18.39%, up from 17.19% in the first three months of 1997. Total
assets at March 31, 1998 were $1.327 billion, total loans were $870 million
and deposits were $1.115 billion at the Company's five banking locations. At
March 31, 1998, total equity capital was $96.7 million, or 7.28% of assets,
up from $76.9 million at the end of 1997.
NET INTEREST INCOME
- -------------------
The following discussion and tables set forth the composition of
average interest-earning assets and interest-bearing liabilities along with
accompanying interest income, expense, yields and rates, on a tax-equivalent
basis. The tax-equivalent adjustments were approximately $68,000 and
$62,000, for the three months ended March 31, 1998 and 1997, respectively.
Net interest income on a tax equivalent basis, divided by average
interest-earning assets, represents the Company's net interest margin.
Three months ended March 31, 1998 and 1997
- ------------------------------------------
Total tax-equivalent interest income for the three months ended March
31, 1998 was $25,220,000, up $4,658,000 as compared to the same period in
1997. The $125 million increase in the volume of average loans outstanding
combined with the $115 million increase in investment securities were
primarily responsible for the increased interest earnings. Overall changes
in asset yields had no significant impact on total interest earnings.
Overall asset yields were 8.12% in the first quarter of 1998, down slightly
from 8.20% in the same period in 1997. Funding most of the Company's asset
growth was a $188 million net increase in average deposits. Money market
deposits grew $281 million while certificates of deposit declined $95 million
compared to the first three months of 1997. Short and long term borrowings,
non-interest bearing deposits and
8
<PAGE> 9
shareholders' equity provided the remainder of the funding used to support
the comparative average asset growth in the first three months of 1998.
Total interest expense for the first quarter of 1998 was $13,495,000,
up $2,744,000 from $10,751,000 in the first quarter of 1997. The greater
money market deposits and higher rates paid on those deposits were primarily
responsible for the increased interest expense. Reducing the impact of the
money market accounts were the lower level of average time deposits. Overall
rates paid on total interest-bearing liabilities rose to 4.97% from 4.91% in
the first quarter of 1997.
Total tax-equivalent net interest income increased $1,914,000 as
interest income growth exceeded that of interest expense. The Company's net
interest margin was 3.77% in the first quarter of 1998, down from 3.90% in
the same period in 1997 due to the combination of reduced asset yields earned
and higher liability rates paid.
9
<PAGE> 10
<TABLE>
AVERAGE, BALANCES, INTEREST AND RATES
<CAPTION>
THREE MONTHS ENDED MARCH 31,
-----------------------------------------------------------------------------------
1998 1997
---------------------------------------- ---------------------------------------
INTEREST INTEREST
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/
BALANCE EXPENSE RATE BALANCE EXPENSE RATE
----------- ----------- -------- ------------- ----------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest-earning assets:
Loans<F1><F2>
Taxable $ 850,403 $18,842 8.97% $ 724,908 $15,920 8.89%
Tax-exempt<F3>
Held to maturity securities
Taxable 47,530 750 6.36 50,135 844 6.83
Tax-exempt<F3> 8,538 220 10.32 7,541 203 10.75
Available for sale securities 337,041 5,231 6.26 220,035 3,426 6.28
Trading account securities 867 15 7.23 711 14 8.16
Federal Funds sold and other
short-term investments 11,722 162 5.60 11,938 155 5.28
---------- ------- ---------- -------
Total interest-earning
assets $1,256,101 25,220 8.12% 1,015,268 20,562 8.20%
------- -------
Noninterest-earning assets:
Cash and due from banks 23,900 24,484
Bank premises and equipment 13,848 11,844
Other assets 21,724 14,003
Allowance for possible loan
losses (15,019) (12,642)
---------- ----------
Total assets $1,300,554 $1,052,957
========== ==========
LIABILITIES AND SHAREHOLDERS'
EQUITY
Interest-bearing liabilities:
NOW accounts $ 23,887 $ 101 1.72% $ 22,509 $ 95 1.71%
Money market accounts 587,055 6,907 4.77 305,563 3,151 4.18
Savings deposits 23,501 172 2.97 23,192 170 2.97
Time deposits of $100,000 or
more 33,819 449 5.39 39,349 530 5.47
Other time deposits 338,016 4,573 5.49 427,788 5,867 5.56
---------- ------- ---------- -------
Total interest-bearing
deposits 1,006,278 12,202 4.92 818,401 9,813 4.86
Federal funds purchased,
repurchase agreements and
other short-term borrowings 79,928 1,005 5.08 62,991 798 5.11
Convertible debentures 2,700 54 8.00
Capital trust debentures 14,950 288 7.70 4,485 86 7.68
---------- ------- ---------- -------
Total interest-bearing
liabilities 1,101,156 13,495 4.97% 888,577 10,751 4.91%
------- -------
Noninterest-bearing liabilities:
Demand deposits 98,050 83,712
Other liabilities 4,794 2,900
Shareholders' equity 96,554 77,768
---------- ----------
Total liabilities and
shareholders' equity $1,300,554 $1,052,957
========== ==========
Net interest income $11,725 $ 9,811
======= =======
Net interest margin 3.77% 3.90%
===== =====
<FN>
- --------------------
<F1> For purposes of these computations, nonaccrual loans are included in
the average loan amounts outstanding. Interest on nonaccrual loans is
recorded when received.
<F2> Interest income on loans includes loan fees, which were not material to
any period presented.
<F3> Information is presented on a tax-equivalent basis assuming a tax rate
of 35%. The tax-equivalent adjustments were approximately $68,000 and
$62,000 for the three months ended March 31, 1998 and 1997,
respectively.
</TABLE>
10
<PAGE> 11
The following table indicates, on a tax-equivalent basis, the changes in
interest income and interest expense which are attributable to changes in
average volume and changes in average rates, in comparison with the same
period in the preceding year. The change in interest due to the combined
rate-volume variance has been allocated to rate and volume changes in
proportion to the absolute dollar amounts of the changes in each.
<TABLE>
CHANGES IN INTEREST INCOME AND EXPENSE VOLUME AND RATE VARIANCES
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 1998
COMPARED TO
MARCH 31, 1997
--------------------------------------------------
INCREASE (DECREASE) ATTRIBUTABLE TO CHANGE IN:
--------------------------------------------------
YIELD/ NET
VOLUME RATE CHANGE
-------- ------ --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
INTEREST EARNED ON:
Loans<F1><F2> $ 2,778 $ 144 $ 2,922
Held to maturity securities:
Taxable (41) (53) (94)
Tax-exempt<F1> 25 (8) 17
Available for sale securities 1,816 (11) 1,805
Trading account securities 3 (2) 1
Federal funds sold and other short-
term investments (3) 10 7
------- ----- -------
Total interest income 4,578 80 4,658
------- ----- -------
INTEREST PAID ON:
NOW accounts 5 1 6
Money market accounts 3,256 500 3,756
Savings 2 2
Time deposits of $100,000 or more (73) (8) (81)
Other time deposits (1,221) (73) (1,294)
Federal funds purchased, repurchase
agreements and other short-term
borrowings 192 15 207
Long-term borrowings 74 74 148
------- ----- -------
Total interest expense 2,235 509 2,744
------- ----- -------
Net interest income $ 2,343 $(429) $ 1,914
======= ===== =======
<FN>
- --------------------
<F1> Information is presented on a tax-equivalent basis assuming a tax rate
of 35%. The approximate tax equivalent adjustment was $68,000 and
$62,000 for the three months ended March 31, 1998 and 1997.
<F2> Average balances included nonaccrual loans.
</TABLE>
11
<PAGE> 12
PROVISION FOR POSSIBLE LOAN LOSSES
- ----------------------------------
The provision for possible loan losses for the first quarter of 1998 was
$900,000, same as for the same period last year. The annualized ratio of net
charge-offs to average loans for the first three months of 1998 was .23%,
down from the first quarter last year. Net loan charge-offs were $490,000
and $532,000 for the first quarter of 1998 and 1997, respectively.
The allowance for possible loan losses was $15.3 million or 1.76% of loans
outstanding at March 31, 1998. This compared to $14.9 million at the end of
1997 and $13.0 million, or 1.70% of loans at March 31, 1997. In management's
judgement, the allowance for possible loan losses is considered adeqate to
absorb potential losses in the loan portfolio.
The following table summarizes, for the periods indicated, activity in the
allowance for possible loan losses:
<TABLE>
Summary of Loan Loss Experience and Related Information
-------------------------------------------------------
<CAPTION>
Three Months
Ended March 31,
--------------------------------
1998 1997
-------- --------
(dollars in thousands)
<S> <C> <C>
Allowance for possible loan losses
(beginning of period) $ 14,892 $ 12,624
Loans charged off (718) (655)
Recoveries of loans previously
charged off 228 123
-------- --------
Net loans charged off (490) (532)
-------- --------
Provision for possible loan losses 900 900
-------- --------
Allowance for possible loan losses
(end of period) $ 15,302 $ 12,992
======== ========
Loans outstanding:
Average $850,403 $724,908
End of period 869,652 776,362
Ratio of allowance for possible
loan losses to loans outstanding:
Average 1.80% 1.79%
End of period 1.76% 1.70%
Ratio of net charge-offs to
average loans outstanding, annualized: .23 .29
</TABLE>
12
<PAGE> 13
The following table summarizes nonperforming assets at the dates indicated:
<TABLE>
<CAPTION>
March 31, December 31, March 31,
1998 1997 1997
--------- ------------ ---------
(dollars in thousands)
<S> <C> <C> <C>
Nonaccrual loans $ 3,003 $ 2,079 $ 7,752
Loans past due 90 days or more
Restructured loans 131 112 168
-------- -------- --------
Total nonperforming loans 3,134 2,191 7,920
Other real estate 340 1,421 716
-------- -------- --------
Total nonperforming assets $ 3,474 $ 3,612 $ 8,636
======== ======== ========
Loans, net of unearned discount $869,652 $847,091 $766,362
Allowance for possible loan
losses to loans 1.76% 1.76% 1.70%
Nonperforming loans to loans .36 .26 1.03
Allowance for possible loan losses
to nonperforming loans 488.26 679.69 164.04
Nonperforming assets to loans
and foreclosed assets .40 .43 1.13
</TABLE>
NONINTEREST INCOME
- ------------------
For the first quarter of 1998 total noninterest income was $1,719,000, up
from $1,264,000 in the same period in 1997. Net realized securities gains of
$172,000 in 1998 were up from net gains of $108,000 in the first quarter of
1997. Mark-to-market adjustments, as well as realized losses on
interest-rate derivative trading activities reduced 1997 trading profits and
commissions by approximately $195,000. Similar levels of write-downs and
losses were not experienced in 1998. Larger investment department security
sales commissions, additional service charges on deposit accounts and greater
operating lease income further advanced total non-interest income in the
first three months of 1998.
NONINTEREST EXPENSE
- -------------------
Total noninterest expense for the first quarter of 1998 was $5,557,000, up
$675,000 from $4,882,000 in the first three months of 1997. Additional
personnel and merit increases were primarily responsible for the increased
compensation and benefit costs in the first three months of 1998. Overall
company growth in general also increased total other noninterest expense
above prior year levels.
13
<PAGE> 14
CAPITAL MANAGEMENT AND RESOURCES
- --------------------------------
As of March 31, 1998, the Company's total shareholders' equity was
$96.7 million. New capital was provided by the Company's first quarter net
earnings and by the exercise of stock options. Offsetting the Company's
capital accumulation were the payments of cash dividends on common stock and
the repurchase of 27,000 shares of common stock in connection with the
Company's stock repurchase plan.
During the first quarter of 1997 the Company formed MVBI Capital Trust
("MVBI Capital"), a statutory business trust. The Company owns all the
common stock of MVBI Capital. MVBI Capital sold 598,000 preferred
securities, having a liquidation amount of $25 per security, for a total of
$14,950,000. The distributions payable on the preferred securities will
float with the 3-month Treasury plus 2.25%. All accounts of MVBI Capital are
included in the consolidated financial statements of the Company. The
preferred securities are considered long-term borrowings and entitled
"Guaranteed preferred beneficial interests in subordinated debentures" for
financial reporting purposes. For risk-based capital guidelines the amount
is considered to be Tier 1 capital.
The analysis of capital is dependent upon a number of factors including
asset quality, earnings strength, liquidity, economic conditions and
combinations thereof. The two primary criteria currently in effect are the
risk-based capital guidelines and the minimum capital to total assets or
leverage ratio requirement.
These regulatory guidelines require that Tier 1 capital equal or exceed
4.00% of risk-weighted assets, and that the risk-based capital ratio equal or
exceed 8.00%. As of March 31, 1998 and December 31, 1997 the Company's Tier
1 capital was 11.67% and 11.98% of risk-weighted assets, and total risk-based
capital was 12.92% and 13.23% of risk-weighted assets, respectively.
The minimum acceptable ratio of Tier 1 capital to total assets, or
leverage ratio, has been established at 3.00%. As of March 31, 1998 and
December 31, 1997, the Company's leverage ratio was 8.37% and 8.04%,
respectively.
Management believes that a strong capital position provided by a mix
of equity and long-term debt is essential. It provides safety and security
for depositors, and enhances Company value for shareholders by providing
opportunities for growth with the selective use of leverage.
14
<PAGE> 15
PART II. OTHER INFORMATION
- ----------------------------
ITEM 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) For a list of Exhibits, see "EXHIBIT INDEX"
appearing elsewhere herein.
(b) Reports on Form 8-K: NONE
15
<PAGE> 16
SIGNATURE
---------
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 therunto duly authorized.
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
(Registrant)
Date: May 12, 1998 / s / Paul M. Strieker
------------ --------------------------------------------------
Paul M. Strieker, Executive Vice President,
Controller and Chief Financial Officer and
Assistant Secretary (on behalf of the Registrant
and as Principal Financial and Accounting Officer)
16
<PAGE> 17
MISSISSIPPI VALLEY BANCSHARES, INC.
EXHIBIT INDEX
FORM 10-Q
For the quarterly period ended March 31, 1998
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
------- ----------------------
<C> <S>
3 (i) Amendment to the Articles
of Incorporation
3 (ii) Amendment to the By-Laws
11 Computation of Earnings
per Common Share
</TABLE>
17
<PAGE> 1
Exhibit No. 3(i)
AMENDMENT OF ARTICLES OF INCORPORATION
--------------------------------------
OF
--
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
HONORABLE REBECCA MCDOWELL COOK
SECRETARY OF STATE
STATE OF MISSOURI
JEFFERSON CITY, MISSOURI 65101
Pursuant to the provisions of The General and Business Corporation Law
of Missouri, the undersigned Corporation certifies the following:
SECTION 1
---------
The present name of the Corporation is Mississippi Valley Bancshares,
Inc., which is the name under which it was originally organized.
SECTION 2
---------
An amendment to the Corporation's Articles of Incorporation was adopted
by the shareholders on April 15, 1998.
SECTION 3
---------
Article 3 Section A of the Articles of Incorporation is amended to read
as follows:
A. Classes and Number of Shares.
The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 20,100,000 shares
consisting of 20,000,000 shares of Common Stock, par value $1.00
per share and 100,000 shares of Preferred Stock, par value $1.00
per share.
SECTION 4
---------
All of the 9,547,812 shares outstanding were entitled to vote on the
foregoing amendment; 8,457,167 shares voted for said amendment, 36,350 shares
voted against said amendment, 34,661 shares abstained from voting and
1,019,634 shares did not vote.
<PAGE> 2
SECTION 5
---------
The Amendment did change the number or par value of authorized shares
having a par value to $20,100,000.
SECTION 6
---------
The Amendment did not provide for any exchange, reclassification, or
cancellation of issued shares, or a reduction of the number of authorized
shares of any class below the value of issued shares of that class.
IN WITNESS WHEREOF, the undersigned, President, has executed this
instrument and its Secretary has affixed its corporate seal hereto and
attested said seal on the 20th day of April, 1998.
----
MISSISSIPPI VALLEY BANCSHARES, INC.
(Corporate Seal) By /s/ Andrew N. Baur
---------------------------------
Andrew N. Baur, Chairman
and Chief Executive Officer
Attest:
/s/ Carol B. Dolenz
- ---------------------------------- FILED AND CERTIFICATE
Carol B. Dolenz, Secretary I S S U E D
APR 22 1998
STATE OF MISSOURI ) /s/ Rebecca McDonnell Cook
)SS SECRETARY OF STATE
CITY OF ST. LOUIS )
I, L.S. Massey, a Notary Public, do hereby certify that on the 20th day
----------- ----
of April, 1998 personally appeared before me Andrew N. Baur who, being by me
first duly sworn, declared that he is the Chairman and Chief Executive
Officer of Mississippi Valley Bancshares, Inc., that he signed the foregoing
document as President of the Corporation, and that the statements therein
contained are true.
/s/ L.S. Massey
-----------------------------------
Notary Public
My commission expires: July 16, 2001
-2-
<PAGE> 1
Exhibit No. 3(ii)
RESTATED
BY-LAWS
OF
MISSISSIPPI VALLEY BANCSHARES, INC.
(Restated on April 15, 1998)
ARTICLE I
---------
Offices
The principal office of the corporation shall be located at such place
either within or without the State of Missouri as the Board of Directors may
from time to time designate. The corporation may have such other offices,
either within or without the State of Missouri, as the business of the
corporation may require from time to time.
The location of the registered office of the corporation and the name of
the corporation's registered agent in the State of Missouri shall be as
determined from time to time by the Board of Directors and as filed in the
manner provided by law.
ARTICLE II
----------
Shareholders
Section 1. Annual Meeting: The annual meeting of the shareholders shall
-------------------------
be held at a date and time in April each year, to be chosen by the Board of
Directors, for the purpose of electing directors and for the transaction of
such other business as may come before the meeting.
Section 2. Special Meetings: Special meetings of the shareholders may
----------------------------
be called at any time by the Chairman of the Board of Directors (if any), by
the President, by the Board of Directors or by the holders of not less than
one-fifth of all the outstanding shares of the corporation entitled to vote
at such meeting, by giving notice thereof in the manner hereafter provided.
Section 3. Place of Meeting: The Board of Directors may designate
----------------------------
any place, either within or without the State of Missouri, as the place of
meeting for any annual meeting of the shareholders or for any special meeting
of the shareholders called by the Board of Directors. The shareholders may
designate any place, either within or without the State of Missouri, as the
place of any meeting called by the shareholders. If no designation is made,
or if a special meeting be otherwise called, the place of meeting shall be
the principal office of the corporation.
Section 4. Notice of Meetings: Written or printed notice stating the
------------------------------
place, day and hour of the meeting and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not
less than ten nor more than fifty days before the date of the meeting, either
personally or by mail, by or at the direction of the Chairman of the Board
(if
<PAGE> 2
any), the President, the Secretary, or the persons calling the meeting, to
each shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States
mail addressed to the shareholder at his address as it appears on the records
of the corporation, with postage thereon prepaid.
Section 5. Closing of Transfer Books or Fixing of Record Date: The
--------------------------------------------------------------
Board of Directors of the corporation may close its stock transfer books for
a period not exceeding fifty days preceding the date of any meeting of
shareholders, or the date for the payment of any dividend or for the
allotment of rights, or the date when any change, exchange or conversion of
shares shall be effective; or, in lieu of closing the stock transfer books,
may fix in advance a date, not exceeding fifty days preceding the date of any
meeting of shareholders, or the date for the payment of any dividend, or for
the allotment of rights, or the date when any change, exchange or conversion
of shares shall be effective, as the record date for the determination of
shareholders entitled to notice of, and to vote at, any such meeting and any
adjournment thereof, or entitled to receive payment of any such dividend or
any such allotment of rights, or to exercise rights in respect of any such
change, exchange or conversion of shares; and only the shareholders of record
on such date of closing the transfer books, or on the record date so fixed,
shall be the shareholders entitled to notice of, and to vote at, such
meeting, and any adjournment thereof, or to receive payment of such dividend,
or to receive such allotment of rights, or to exercise such rights, in the
event of an exchange, change or conversion of shares, as the case may be,
notwithstanding any transfer of shares on the books of the corporation after
the date of closing of the transfer books or the record date fixed as
aforesaid. If the Board of Directors shall not have closed the transfer
books or set a record date for the determination of its stockholders entitled
to notice of, and to vote as hereinabove provided, only the shareholders who
are shareholders of record at the close of business on the 20th day preceding
the date of the meeting shall be entitled to notice of, and to vote at, the
meeting, and any adjournment thereof, except as otherwise provided by
statute.
Section 6. Voting Lists: At least ten days before each meeting of
------------------------
shareholders, the officer or agent having charge of the transfer book for
shares of the corporation shall make a complete list of the shareholders
entitled to vote at such meeting, arranged in alphabetical order with the
address of and the number of shares held by each, which list, for a period of
ten days prior to such meeting, shall be kept on file at the registered
office of the corporation and shall be subject to inspection by any
shareholder at any time during usual business hours. Such list shall also be
produced and kept open at the time and place of the meeting and shall be
subject to the inspection of any shareholder during the whole time of the
meeting. The original share ledger or transfer book, or a duplicate thereof
kept in the State of Missouri, shall be prima facie evidence as to who are
the shareholders entitled to examine such list or share ledger or transfer
book or to vote at any meeting of shareholders.
Section 7. Quorum: A majority of the outstanding shares of the
------------------
corporation, entitled to vote at any meeting, represented in person or by
proxy, shall constitute a quorum at any meeting of the shareholders;
provided, that if less than a majority of the outstanding shares entitled to
vote are represented at said meeting, a majority of the shares so represented
may adjourn the meeting, from time to time, without further notice, to a
specified date not longer
-2-
<PAGE> 3
than ninety days after such adjournment. Every decision of a majority of
such quorum shall be valid as a corporate act unless a larger vote is
required by law.
Section 8. Proxies: At all meetings of shareholders, a shareholder may
-------------------
vote by proxy executed in writing by the shareholder or by his duly
authorized attorney-in-fact. Such proxy shall be filed with the Secretary of
the corporation before or at the time of the meeting. No proxy shall be
valid after eleven months from the date of its execution, unless otherwise
provided in the proxy.
Section 9. Voting of Shares: Except as hereinafter provided, each
----------------------------
outstanding share of capital stock entitled to vote shall be entitled to one
vote upon each matter submitted to a vote at a meeting of shareholders.
Section 10. Voting of Shares by Certain Holders: Shares standing in
------------------------------------------------
the name of another corporation, domestic or foreign, may be voted by such
officer, agent, or proxy as the by-laws of such corporation may prescribe,
or, in the absence of such provision, as the Board of Directors of such
corporation may determine.
Shares standing in the name of a deceased person may be voted by his
administrator or executor, either in person or by proxy. Shares standing in
the name of a guardian, curator, or trustee may be voted by such fiduciary,
either in person or by proxy, but no guardian, curator, or trustee shall be
entitled, as such fiduciary, to vote shares held by him without a transfer of
such shares into his name.
Shares standing in the name of a receiver may be voted by such receiver,
and shares held by or under the control of a receiver may be voted by such
receiver without the transfer thereof into his name if authority so to do be
contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee,
and thereafter the pledgee shall be entitled to vote the shares so
transferred.
Section 11. No Cumulative Vote: Shareholders of the Corporation shall
-------------------------------
not have the right to cumulative voting in the election of Directors.
Section 12. Actions of Shareholders Without a Meeting: Any action
------------------------------------------------------
required or permitted to be taken at a meeting of the shareholders of the
corporation may be taken without a meeting if consents in writing, setting
forth the action so taken, shall be signed by all the shareholders entitled
to vote with respect to the subject matter thereof. Such consents shall have
the same force and effect as a unanimous vote of the shareholders at a
meeting duly held and may be stated as such in any certificate or document
filed under the laws of Missouri pertaining to business corporations. The
Secretary shall file such consents with the minutes of the meetings of the
shareholders.
-3-
<PAGE> 4
Section 13. Inapplicability of Control Share Acquisition Statute:
-----------------------------------------------------------------
Section 351.407 of The General and Business Corporation Law of Missouri, as
amended, sometimes known as the Missouri "control share acquisition" statute,
(Sec.351.407, RSMo 1986) shall not apply to "control share acquisitions" of
shares of this Corporation, as such term is defined in The General and
Business Corporation Law of Missouri.
ARTICLE III
-----------
Directors
Section 1. General Powers: The property, business and affairs of the
--------------------------
Corporation shall be controlled and managed by its Board of Directors.
Section 2. Number, Tenure and Qualifications: The number of directors
---------------------------------------------
to constitute the board of directors of the corporation shall be as set forth
in the Articles of Incorporation. If the Articles of Incorporation provide
for a board of directors of at least three, and permit the number of
directors to be changed from time to time as provided in the by-laws, the
shareholders or the Board of Directors may at any time, and from time to
time, change the number of directors to constitute the Board of Directors (to
any number not less than three nor more than any maximum number permitted by
the Articles of Incorporation) by adopting a resolution fixing the new number
of directors to constitute the Board of Directors, provided that any notice
of such change required by law is duly given.
The term of office of each director shall be three years, and as nearly
as practicable, taking into account increases or decreases in the number of
directors constituting the Board of Directors, one-third of the Board of
Directors shall be elected each year at the annual meeting, the directors so
elected filling the place of retiring directors. In the event of a change in
the number of directors, the resolution effectuating such change shall
specify the years in which the terms of the directorships thereby created
shall first expire. Vacancies occurring in the Board of Directors, including
vacancies due to an increase in the number of directors, may be filled by the
directors then in office. Any director may succeed himself or herself.
Each director shall hold office for the term for which he is elected and
until his successor shall have been elected and qualified; and may be removed
in the manner provided by law.
No person may be elected to serve as a member of the Board of Directors
of the corporation if such person's seventieth birthday will occur within one
year after the date of such election. The term as a director of each member
of the Board of Directors shall automatically terminate on the date of the
first annual meeting of shareholders of the corporation that occurs after the
seventieth birthday of such director, whether or not such director's term of
office would otherwise expire on the date of such annual meeting. A person
may, however, serve as an advisory director of the corporation after his or
her seventieth birthday.
Section 3. Regular Meetings: A regular or annual meeting of the Board
----------------------------
of Directors shall be held without other notice than this by-law, immediately
after, and at the same place, as the annual meeting of the shareholders. The
Board of Directors may provide, by resolution, the
-4-
<PAGE> 5
time and place, either within or without the State of Missouri, for the
holding of additional regular meetings without other notice than the giving
of notice of such resolution to all directors.
Section 4. Special Meetings: Special Meetings of the Board of
----------------------------
Directors may be called by or at the request of the Chairman of the Board (if
any), the President or any one or more of the directors, by giving notice
thereof in the manner hereinafter provided. The person or persons calling
such meeting may fix any place either within or without the State of Missouri
as the place for holding such special meeting.
Section 5. Notice: Notice of any special meeting, stating the place,
------------------
date and time of the meeting shall be given at least three days previously
thereto by written notice delivered to each director either personally or by
mail or telegram to his residence or usual place of business; provided,
however, that if the designated meeting place is without the State of
Missouri, an additional three days' notice shall be given. If mailed, such
notice shall be deemed to be delivered when deposited in the United States
mail properly addressed, with postage thereon prepaid; provided, that if the
place of mailing is without the State of Missouri, the notice shall be deemed
to be delivered on the second business day after such deposit. If notice be
given by telegram, such notice shall be deemed to be delivered when the
telegram is delivered to the telegraph company. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
Board of Directors need be specified in the notice of such meeting.
Section 6. Quorum: A majority of the full Board of Directors from time
------------------
to time constituted shall constitute a quorum for the transaction of business
at any meeting of the Board of Directors, provided that if less than a
majority of the directors are present at said meeting, a majority of the
directors present may adjourn the meeting from time to time to a specified
date not longer than 30 days from the last adjournment without further
notice.
Section 7. Manner of Acting: The act of the majority of the directors
----------------------------
present at a meeting of the directors at which a quorum is present shall be
the act of the Board of Directors. Members of the Board of Directors, or of
any committee designated by the Board of Directors, may participate in a
meeting of the Board or committee by means of conference telephone or similar
communications equipment whereby all persons participating in the meeting can
hear each other, and participation in a meeting in this manner shall
constitute presence in person at such meeting.
Section 8. Vacancies: Vacancies on the Board of Directors and newly
---------------------
created directorships resulting from an increase in the number of directors
may be filled by a majority of the directors then in office, though less than
a quorum, until the election of directors at the next annual meeting of the
shareholders.
Section 9. Actions of Board of Directors Without A Meeting: Any action
-----------------------------------------------------------
which is required to be or may be taken at a meeting of the Board of
Directors or any committee thereof may be taken without a meeting if consents
in writing, setting forth the action so taken, are signed by all of the
directors or committee members, as the case may be. The consents shall have
the same force and effect as a unanimous vote at a meeting duly held, and may
be stated as such in any certificate or document under the laws of Missouri
pertaining to business
-5-
<PAGE> 6
corporations. The secretary shall file the consents with the minutes of the
meetings of the board of directors or committee, as the case may be.
Section 10. Committees: The Board of Directors by resolution adopted
-----------------------
by a majority of the whole Board may designate two or more directors to
constitute a committee of the Board of Directors, which committee shall meet
at frequent or regular intervals as determined by resolutions from time to
time adopted by the Board, and shall have and exercise, to the extent
provided in such resolutions, all of the authority of the Board of Directors
in the management of the Corporation; provided, however, that: (i) such
committee shall report all of its decisions and actions to the Board of
Directors at the next meeting of the Board of Directors thereafter occurring;
(ii) each such committee shall at all times be subject to the general
supervision and control of the Board of Directors; (iii) members of any such
committee may be removed, and new members appointed, at any time by the
majority vote of the whole Board; (iv) only the full Board may approve an
amendment to the Articles of Incorporation, a merger, a consolidation, the
sale of all or substantially all the assets of the Corporation, or the
dissolution of the Corporation; and (v) the designation of any such committee
and the delegation thereto of the authority herein provided shall not operate
to relieve the Board of Directors, or any member thereof, of any
responsibility imposed upon such Board, or upon any individual member
thereof, by law. A quorum of a committee of the Board of Directors shall be
a majority of the full number of directors constituting the committee, and
the act of at least a majority of the full number of directors constituting
such committee shall be the act of the committee.
Section 11. Advisory Directors: The Board of Directors may from time
-------------------------------
to time appoint advisory directors, who shall serve at the pleasure of the
Board of Directors.
Advisory directors shall have no voting power and no legal authority,
responsibility or liability as directors or officers of the corporation, and
shall not be counted in determining the presence of a quorum.
Unless otherwise determined by the Board of Directors, advisory
directors shall be invited to attend all meetings of the Board of Directors
and of such committees, if any, as the Board may determine. Advisory
directors may be paid fees determined by the Board of Directors for
attendance at meetings of the Board and any committees on which they serve.
Advisory directors shall be indemnified by the corporation to the same
extent as they would be entitled to indemnity if they were directors of the
corporation.
ARTICLE IV
----------
Officers
Section 1. Number: The officers of the corporation shall be a
------------------
President, who shall be chosen from the members of the Board of Directors, a
Secretary, and such other officers as may be elected in accordance with the
provisions of this Article. The Board of Directors, by resolution, may also
elect as officers a Chairman of the Board, a Treasurer, one or more Vice
-6-
<PAGE> 7
Presidents, and one or more Assistant Treasurers and Assistant Secretaries.
Any two or more offices may be held by the same person.
All officers and other agents of the corporation, as between themselves
and the corporation, shall have such authority and perform such duties in the
management of the property and affairs of the corporation as may be provided
herein, or, in the absence of such provision, as may be determined by
resolution of the Board of Directors.
Section 2. Election and Term of Office: The officers of the
---------------------------------------
corporation shall be elected annually by the Board of Directors at the first
meeting of the Board of Directors held after each annual meeting of
shareholders. If the election of officers shall not be held at such meeting,
such election shall be held as soon thereafter as conveniently may be.
Vacancies may be filled or new offices created and filled at any meeting of
the Board of Directors. Each officer shall hold office until his successor
shall have been duly elected and shall have qualified or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.
Section 3. Removal: Any officer or agent elected or appointed by the
-------------------
Board of Directors may be removed by the Board of Directors with or without
cause, but such removal shall be without prejudice to the contract rights, if
any, of the person so removed. Removal shall be effected automatically by
the election of a successor to such office or position.
Section 4. Vacancies: A vacancy in any office may be filled by the
---------------------
Board of Directors for the unexpired portion of the term.
Section 5. Chief Executive Officer: The powers of the chief executive
-----------------------------------
officer of the corporation shall be vested in the President, unless the
Chairman of the Board has previously been designated by the Board of
Directors to be the chief executive officer of the corporation or to have the
powers of the chief executive officer co-extensively with the President, and
such designation has been filed in writing with the Secretary of State and
such notice attested to by the Secretary of the corporation. If the powers
of the chief executive officer shall be vested solely in the Chairman of the
Board, the President shall be subordinate only to the Chairman of the Board
and shall be the chief operating officer of the corporation and shall be in
charge of, and exercise general supervisory control over, all operating
phases and departments of the corporation.
The President shall preside at all meetings of the shareholders and of
the Board of Directors, unless there shall be a Chairman of the Board, in
which case the President shall preside in the absence or with the consent of
the Chairman of the Board.
The chief executive officer of the corporation may execute, either alone
or with any other proper officer thereunto authorized by the Board of
Directors, certificates for shares of the corporation, deeds, mortgages,
bonds, notes, contracts, or any other instruments for and in the name of the
corporation, except in cases where the execution thereof shall be expressly
delegated by the Board of Directors or by these by-laws to some other officer
or agent of the corporation or shall be required by law to be otherwise
executed. The chief executive officer shall also, unless the Board otherwise
provides, be ex officio a member of all standing committees. In
-7-
<PAGE> 8
general, the chief executive officer shall perform all duties usually vested
in the chief executive officer of a corporation and such other duties as may
be prescribed from time to time by the Board of Directors.
Section 6. Vice President: If one or more Vice Presidents shall be
--------------------------
elected, and if one of such Vice Presidents be designated by the Board as
Executive Vice President, such Executive Vice President, in the absence of
the President, or in the event of his inability or refusal to act, shall
perform the duties of the President, and when so acting, shall have all the
powers of, and be subject to all the restrictions upon, the President. If
there shall be no Executive Vice President or if there shall be an Executive
Vice President and he shall be absent, then the Vice President who shall have
been first elected by the Board of Directors at the last annual meeting of
the Board (and the order of the names of such Vice Presidents, as they appear
in the minutes of such Annual Meeting of the Board, shall be conclusive as to
which Vice President shall have been first elected), shall perform the duties
of the President in the event of the latter's absence, inability or refusal
to act. The Vice Presidents shall perform such other duties as from time to
time may be assigned to them by the chief executive officer or the Board of
Directors or the Executive Committee.
Section 7. The Treasurer: If required by the Board of Directors, the
-------------------------
Treasurer shall give a bond for the faithful discharge of his duties in such
sum and with such surety or sureties as the Board of Directors shall
determine. He shall have charge and custody of and be responsible for all
funds and securities of the corporation; receive and give receipts for moneys
due and payable to the corporation from any source whatsoever, and deposit
all such moneys in the name of the corporation in such banks, trust companies
or other depositories as shall be selected in accordance with the provisions
of Article V of these by-laws; keep or cause to be kept all books of account
and accounting records of the corporation; and in general perform all the
duties incident to the office of Treasurer and such other duties as from time
to time may be assigned to him by the President or the Board of Directors or
the Executive Committee.
Section 8. The Secretary: The Secretary shall keep the minutes of the
-------------------------
shareholders' and the Board of Directors' meetings in one or more books
provided for that purpose; see that all notices are duly given in accordance
with the provisions of these by-laws or as required by law; be custodian of
the corporate records and of the seal of the corporation and see that the
seal of the corporation is affixed to all certificates for shares prior to
the issue thereof and to all documents, the execution of which on behalf of
the corporation under its seal is duly authorized in accordance with the
provisions of these by-laws; keep a register of the post office address of
each shareholder which shall be furnished to the Secretary by such
shareholder; sign with the President, or a Vice President, certificates for
shares of the corporation, the issue of which shall have been authorized by
resolution of the Board of Directors; have general charge of the stock
transfer books of the corporation; and in general perform all duties incident
to the office of Secretary and such other duties as from time to time may be
assigned to him by the President or the Board of Directors or by the
Executive Committee.
Section 9. Assistant Treasurers and Assistant Secretaries: The
----------------------------------------------------------
Assistant Treasurers shall respectively, if required by the Board of
Directors, give bonds for the faithful discharge of their duties in such sums
and with such sureties as the Board of Directors shall determine. The
-8-
<PAGE> 9
Assistant Treasurers and Assistant Secretaries shall perform the duties of
the Treasurer and Secretary respectively, in their absence, and shall perform
such other duties as shall be assigned to them by the Treasurer or the
Secretary, respectively, or by the President or the Board of Directors or the
Executive Committee.
Section 10. Salaries: The salaries of the officers shall be fixed from
---------------------
time to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.
ARTICLE V
---------
Contracts, Loans, Checks and Deposits
Section 1. Contracts: The Board of Directors may authorize any officer
---------------------
or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the corporation, and
such authority may be general or confined to specific instances.
Section 2. Loans: No loans shall be contracted on behalf of the
-----------------
corporation and no evidences of indebtedness shall be issued in its name
unless authorized by a resolution of the Board of Directors. Such authority
may be general or confined to specific instances.
Section 3. Checks, Notes, etc.: All checks or other orders for the
-------------------------------
payment of money, and all notes or other evidences of indebtedness issued in
the name of the corporation, shall be signed by the chief executive officer
or by such officer or officers, agent or agents of the corporation and in
such manner as shall from time to time be determined by resolution of the
Board of Directors. Funds not otherwise employed shall be deposited from
time to time to the credit of the corporation in such banks, trust companies
or other depositories as the Board of Directors may select.
ARTICLE VI
----------
Certificates for Shares and Their Transfer
Section 1. Certificates for Shares: Certificates representing shares
-----------------------------------
of the corporation shall be in such form as may be determined by the Board of
Directors. Such certificates shall be signed by the President or Vice
President and by the Secretary, Treasurer or an Assistant Secretary or
Treasurer, and shall be sealed with the seal of the corporation. All
certificates for shares shall be consecutively numbered. The name of the
person owning the shares represented thereby with the number of shares and
date of issue shall be entered on the books of the corporation. All
certificates surrendered to the corporation for transfer shall be cancelled
and no new certificate shall be issued until the former certificate for a
like number of shares shall have been surrendered and cancelled except that
in case of a lost, destroyed or mutilated certificate a new one may be issued
therefor upon such terms and indemnity to the corporation as the Board of
Directors may prescribe.
-9-
<PAGE> 10
Section 2. Transfers of Shares: Transfers of shares of the corporation
-------------------------------
shall be made only on the books of the corporation by the registered holder
thereof or by his attorney thereunto authorized by power of attorney duly
executed and filed with the Secretary of the corporation. The person in
whose name shares stand on the books of the corporation shall be deemed the
owner thereof for all purposes as regards the corporation.
ARTICLE VII
-----------
Fiscal Year
The first fiscal year of the corporation shall be determined by the
filing of the first Federal income tax return of the corporation.
Thereafter, each fiscal year shall end on the same date until changed by
resolution of the Board of Directors.
ARTICLE VIII
------------
Dividends
The Board of Directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and
upon the terms and conditions provided by law and its Articles of
Incorporation.
ARTICLE IX
----------
Seal
The Board of Directors may elect to adopt a corporate seal, which (if
one is adopted) shall be in the form of a circle and shall have inscribed
thereon the name of the corporation and the words "Corporate Seal" and
"Missouri".
ARTICLE X
---------
Indemnification
Section 1. Mandatory Indemnification of Directors and Officers: The
---------------------------------------------------------------
corporation shall indemnify any person who was or is a party or is threatened
to be made a party to or is involved in any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, including an action by or in the right of the corporation, by
reason of the fact that he is or was a director or officer of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, to the fullest possible extent
permitted by law, against all expenses, including attorneys' fees, judgments,
fines and amounts paid in settlement actually and reasonably incurred or
suffered by him in connection with such action, suit or proceeding.
-10-
<PAGE> 11
Section 2. Indemnification of Other Employees or Agents: The
--------------------------------------------------------
corporation may in its discretion, in specific cases, extend the
indemnification provided in Section 1 of this Article in full or in part to
any person who was or is a party or is threatened to be made a party to or is
involved in any threatened, pending or completed action, suit or proceeding
by reason of the fact that he is or was an employee or agent of the
corporation other than a director or officer of the corporation. However, to
the extent that any employee or agent of the corporation has been successful
on the merits or otherwise in defense of any such action, suit or proceeding,
or in defense of any claim, issue or matter therein, he shall be indemnified
against expenses, including attorneys' fees, actually and reasonably incurred
by him in connection with the action, suit or proceeding.
Section 3. Limitations on Indemnification: No indemnity pursuant to
------------------------------------------
this Article shall be paid by the corporation:
(1) To the extent the director or officer is indemnified
pursuant to any policy of Directors and Officers Liability Insurance
purchased and maintained by the corporation or otherwise;
(2) In respect to remuneration paid to a person otherwise
entitled to be indemnified hereunder if it shall be determined by a
final judgment or other final adjudication that such remuneration was
in violation of law;
(3) On account of any suit in which judgment is rendered against
a person otherwise entitled to be indemnified hereunder for an
accounting of profits made from the purchase or sale by such person of
securities of the corporation pursuant to the provisions of Section
16(b) of the Securities Exchange Act of 1934 and amendments thereto or
similar provisions of any federal, state or local statutory law;
(4) On account of conduct which is finally adjudged to have been
knowingly fraudulent, deliberately dishonest or willful misconduct; or
(5) If a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
Section 4. Defense of Claim: (a) As a condition of any indemnification
----------------------------
payable under this Article (unless otherwise required by law), the
corporation shall be entitled to participate in any such action, suit or
proceeding at its own expense, and except as otherwise provided below, to the
extent that it may wish to do so, the corporation jointly with any other
indemnifying parties will be entitled to assume the defense thereof, with
counsel satisfactory to the person entitled to indemnification (the
"Indemnified Party"). After notice from the corporation to the Indemnified
Party of its election so to assume the defense thereof, the corporation will
not be liable to the Indemnified Party under this Article for any legal or
other expenses subsequently incurred by the Indemnified Party in connection
with the defense thereof other than reasonable costs of investigation or as
otherwise provided below. The Indemnified Party shall have the right to
employ his counsel in such action, suit on proceeding, but the fees and
expenses of such counsel incurred after notice from the corporation of its
assumption of the
-11-
<PAGE> 12
defense thereof shall be at the expense of the Indemnified Party unless (i)
the employment of counsel by the Indemnified Party has been authorized by the
corporation, (ii) the Indemnified Party shall have reasonably concluded that
there may be a conflict of interest between the corporation and the
Indemnified Party in the conduct of the defense of such action or (iii) the
corporation shall not in fact have employed counsel to assume the defense of
such action, in each of which cases the fees and expenses of counsel shall be
at the expense of the corporation. The corporation shall not be entitled to
assume the defense of any action, suit or proceeding brought by or on behalf
of the corporation or as to which the director shall have made the conclusion
provided for in (ii) above.
(b) The corporation shall not be liable to indemnify any person under
this Article for any amounts paid in settlement of any action or claim
effected without its written consent, or for any amounts paid in excess of
any proposed settlement with respect to which the Indemnified Party prevents
settlement by unreasonably withholding his consent.
Section 5. Repayment of Expenses: The payment by the corporation of any
--------------------------------
expenses incurred in defending any action, suit or proceeding in advance of
the final disposition of the action, suit or proceeding shall be made only
upon receipt of an undertaking by or on behalf of the Indemnified Party to
repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the corporation for such expenses as provided
in this Article.
Section 6. Non-Exclusivity; Continuation: The indemnification provided
----------------------------------------
by this Article shall not be deemed exclusive of any other rights to which
those seeking indemnification may be entitled under the Articles of
Incorporation or any duly adopted amendment thereof, or any other by-law,
agreement, vote of shareholders or disinterested directors or otherwise, both
as to action in his official capacity and as to action in another capacity
while holding such office, and shall continue as to a person who has ceased
to be a director, officer, employee or agent and shall inure to the benefit
of the heirs, executors and administrators of such a person. No amendment to
these by-laws shall impair any right to indemnification which a person would
otherwise have in the absence of such amendment and which arises out of
events occurring prior to such amendment.
Section 7. Insurance: The corporation may purchase and maintain
---------------------
insurance on behalf of any person who is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or arising out
of his status as such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of this Article.
Section 8. Definitions: (a) For the purpose of this Article,
-----------------------
references to "the corporation" include all constituent corporations absorbed
in a consolidation or merger as well as this corporation, so that any person
who is or was a director, officer, employee or agent of such a constituent
corporation or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust
-12-
<PAGE> 13
or other enterprise shall stand in the same position under the provisions of
this Article with respect to this corporation as he would if he had served
this corporation in the same capacity.
(b) For purposes of this Article, the term "other enterprise" shall
include employee benefit plans; the term "fines" shall include any excise
taxes assessed on a person with respect to an employee benefit plan; and the
term "serving at the request of the corporation" shall include any service as
a director, officer, employee or agent of the corporation which imposes
duties on, or involves services by, such director, officer, employee or agent
with respect to an employee benefit plan, its participants or beneficiaries.
ARTICLE XI
----------
Waiver of Notice
Whenever any notice whatever is required to be given under the
provisions of these by-laws or the Articles of Incorporation or any law, a
written waiver thereof in writing, signed by the person or persons entitled
to such notice, whether before or after the time stated therein, shall be
deemed equivalent to the giving of such notice.
Attendance at any meeting shall constitute a waiver of notice of the
meeting except where such attendance is for the express purpose of objecting
to the transaction of any business because the meeting is not lawfully called
or convened.
ARTICLE XII
-----------
Amendments
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by the affirmative vote of the holders of record representing not
less than two-thirds of all of the then outstanding shares of capital stock
of this corporation then entitled to vote generally in the election of
directors, voting together as a single class, or by a resolution adopted by
the vote of a majority of the entire Board of Directors.
/s/ Carol B. Dolenz
-----------------------
Secretary
-13-
<PAGE> 1
EXHIBIT NO. 11
------------------
COMPUTATION OF EARNINGS PER
---------------------------
COMMON SHARE
------------
Basic earnings per share is computed by dividing net income by the
weighted average common shares outstanding.
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------------
1998 1997
---------- ----------
(dollars in thousands, except per share data)
<S> <C> <C>
BASIC:
Average common shares outstanding 9,541,949 9,034,676
========== ==========
Net income $ 4,440 $ 3,343
========== ==========
Basic earnings per common share $ .47 $ .37
========== ==========
</TABLE>
Diluted earnings per share gives effect to the weighted average shares
outstanding, average dilutive common share equivalents and shares which would
have resulted from conversion of outstanding convertible debentures and to
the related reduction in interest expense on an after-tax basis.
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------------
1998 1997
---------- ----------
(dollars in thousands, except per share data)
<S> <C> <C>
DILUTED:
Average common shares outstanding 9,541,949 9,034,676
Average common stock equivalents of
options outstanding-based on the
treasury stock method using market price 339,079 163,614
Convertible debenture common stock equivalents 475,200
---------- ----------
9,881,028 9,673,490
========== ==========
Net income $ 4,440 $ 3,343
Plus: Convertible debenture interest,
net of federal income tax effect 35
---------- ----------
$ 4,440 $ 3,378
========== ==========
Diluted earnings per common share $ .45 $ .35
========== ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 25,333
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 46,650
<TRADING-ASSETS> 10
<INVESTMENTS-HELD-FOR-SALE> 282,654
<INVESTMENTS-CARRYING> 52,208
<INVESTMENTS-MARKET> 53,610
<LOANS> 869,652
<ALLOWANCE> 15,302
<TOTAL-ASSETS> 1,327,068
<DEPOSITS> 1,115,369
<SHORT-TERM> 63,277
<LIABILITIES-OTHER> 36,796
<LONG-TERM> 14,950
0
0
<COMMON> 9,549
<OTHER-SE> 87,127
<TOTAL-LIABILITIES-AND-EQUITY> 1,327,068
<INTEREST-LOAN> 18,842
<INTEREST-INVEST> 6,133
<INTEREST-OTHER> 177
<INTEREST-TOTAL> 25,152
<INTEREST-DEPOSIT> 12,202
<INTEREST-EXPENSE> 13,495
<INTEREST-INCOME-NET> 11,657
<LOAN-LOSSES> 900
<SECURITIES-GAINS> 172
<EXPENSE-OTHER> 5,557
<INCOME-PRETAX> 6,919
<INCOME-PRE-EXTRAORDINARY> 4,440
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,440
<EPS-PRIMARY> .47
<EPS-DILUTED> .45
<YIELD-ACTUAL> 3.77
<LOANS-NON> 3,003
<LOANS-PAST> 0
<LOANS-TROUBLED> 131
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 14,892
<CHARGE-OFFS> 718
<RECOVERIES> 228
<ALLOWANCE-CLOSE> 15,302
<ALLOWANCE-DOMESTIC> 10,283
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 5,019
</TABLE>
