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Previous: MISSISSIPPI VALLEY BANCSHARES INC, 10-Q, 2000-05-11 |
Next: VINTAGE PETROLEUM INC, 8-K, 2000-05-11 |
<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, 2000
-----------------------------------------------
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.)
13205 Manchester Road, St. Louis, Missouri 63131
- -------------------------------------------- -------------------------------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (314) 543-3512
-------------------
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 28, 2000:
Common Stock, $1.00 par value 9,352,662
- -------------------------------------------- -------------------------------
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.
<TABLE>
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
INDEX
-----
<CAPTION>
Page No.
--------
<S> <C>
PART I. FINANCIAL INFORMATION
---------------------
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets --
March 31, 2000 and December 31, 1999 3
Condensed Consolidated Statements of
Income -- Quarters Ended March 31, 2000
and March 31, 1999 4
Consolidated Statements of Changes in
Shareholders' Equity -- Three Months
Ended March 31, 2000 and March 31, 1999 5
Condensed Consolidated Statements of
Cash Flows -- Three Months Ended
March 31, 2000 and March 31, 1999 6
Notes to Condensed Consolidated
Financial Statements 7-8
ITEM 2. Management's Discussion and Analysis
of Results of Operations and
Financial Condition 9-15
PART II. OTHER INFORMATION
-----------------
ITEM 6. Exhibits and Reports on Form 8-K 16
SIGNATURE 17
- ---------
EXHIBIT INDEX 18
- -------------
</TABLE>
2
<PAGE> 3
<TABLE>
PART I. FINANCIAL INFORMATION
- ------------------------------
ITEM 1. FINANCIAL STATEMENTS
- ---------------- --------------------
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
-------------------------------------
<CAPTION>
March 31, December 31,
2000 1999
(Derived from
(Unaudited) Unaudited Statements)
----------- ---------------------
(dollars in thousands)
<S> <C> <C>
ASSETS
- ------
Cash and due from banks $ 30,044 $ 29,551
Federal funds sold 370 55,100
Held to maturity securities
(fair value of $89,703 and
$59,115, respectively) 89,892 59,116
Available for sale securities 264,181 257,899
Trading account securities 796
Loans, net of
unearned income 1,154,291 1,104,498
Allowance for possible loan losses 22,570 21,649
-------------- --------------
Net loans 1,131,721 1,082,849
Premises and equipment 39,830 37,658
Other assets 36,255 38,976
-------------- --------------
TOTAL ASSETS $1,593,089 $1,561,149
============== ==============
LIABILITIES
- -----------
Deposits:
Non-interest bearing $ 126,991 $ 129,818
Interest bearing 1,202,779 1,185,898
-------------- --------------
Total deposits 1,329,770 1,315,716
Securities sold under agreements
to repurchase 33,196 35,049
Other short-term borrowings 80,382 70,590
Guaranteed preferred beneficial interests
in subordinated debentures 14,950 14,950
Other liabilities 16,687 12,278
-------------- --------------
TOTAL LIABILITIES 1,474,985 1,448,583
-------------- --------------
SHAREHOLDERS' EQUITY
- --------------------
Common stock-par value $1
Authorized 20,000,000 shares,
issued 9,755,562 in 2000
and 9,661,262 in 1999 9,755 9,661
Capital surplus 21,741 20,272
Retained earnings 101,853 96,874
Accumulated other comprehensive income (2,342) (2,245)
Treasury stock, at cost, 402,900 shares
at March 31, 2000 and 364,900 shares
at December 31, 1999 (12,903) (11,996)
-------------- --------------
TOTAL SHAREHOLDERS' EQUITY 118,104 112,566
-------------- --------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $1,593,089 $1,561,149
============== ==============
See accompanying notes.
</TABLE>
3
<PAGE> 4
<TABLE>
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
-------------------------------------------
(UNAUDITED)
<CAPTION>
Three Months Ended
March 31,
-----------------------------------
2000 1999
----------- -----------
<S> <C> <C>
Interest income:
Interest and fees on loans $25,024 $20,126
Held to maturity securities:
Taxable 1,222 480
Tax-exempt 125 144
Available for sale securities 4,344 5,274
Other 311 82
----------- -----------
TOTAL INTEREST INCOME 31,026 26,106
----------- -----------
Interest expense:
Deposits 14,615 11,746
Short-term borrowings 1,506 750
Long-term borrowings 280 256
----------- -----------
TOTAL INTEREST EXPENSE 16,401 12,752
----------- -----------
NET INTEREST INCOME 14,625 13,354
Provision for possible loan losses 769 1,749
----------- -----------
NET INTEREST INCOME AFTER
PROVISION FOR POSSIBLE LOAN LOSSES 13,856 11,605
----------- -----------
Other income:
Service charges 523 542
Securities gains/(losses), net on:
Sales of available for sale securities 919 (830)
Trading profits and commissions 621 3,050
Other 1,160 799
----------- -----------
3,223 3,561
----------- -----------
Other expenses:
Employee compensation and
other benefits 3,693 3,242
Net occupancy 612 356
Equipment 610 352
Advertising 426 280
Other 2,365 2,188
----------- -----------
7,706 6,418
----------- -----------
INCOME BEFORE INCOME TAXES 9,373 8,748
Income taxes 3,460 3,259
----------- -----------
NET INCOME $ 5,913 $ 5,489
=========== ===========
Earnings per common share:
Basic $ .63 $ .58
Diluted $ .63 $ .57
See accompanying notes.
</TABLE>
4
<PAGE> 5
<TABLE>
MISSISSIPPI VALLEY BANCSHARES, INC.
-----------------------------------
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
----------------------------------------------------------
YEAR TO DATE MARCH 31, 2000 AND 1999
(UNAUDITED)
(Dollars in Thousands)
<CAPTION>
Accumu-
lated
Other
Compre- Total
Common Stock hensive Share- Compre-
------------ Capital Retained Income Treasury holders' hensive
Shares Amount Surplus Earnings (Loss) Stock Equity Income
--------- ------ ------- -------- ------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999
Balance at Jan. 1, 1999 9,631,312 $9,631 $19,627 $ 79,003 $ 6,265 $ (4,748) $109,778 $
Net Income 5,489 5,489 5,489
Issuance of common stock 11,500 12 212 224
Treasury Stock Purchased (2,427) (2,427)
Cash dividends on:
common stock (855) (855)
Other comprehensive income,
net of tax
Unrealized loss on available
for sale securities (3,787) (3,787) (3,787)
--------- ------ ------- -------- -------- --------- --------- --------
Balance at March 31,
1999 9,642,812 $9,643 $19,839 $ 83,637 $ 2,478 $ (7,175) $108,422
========= ====== ======= ======== ======== ========= =========
Comprehensive Income $ 1,702
========
2000
Balance at Jan. 1, 2000 9,661,262 $9,661 $20,272 $ 96,874 $(2,245) $(11,996) $112,566 $
Net Income 5,913 5,913 5,913
Issuance of common stock 94,300 94 1,469 1,563
Treasury stock purchased (907) (907)
Cash dividends on:
common stock (934) (934)
Other comprehensive
income, net of tax
Unrealized loss on available
for sale securities (97) (97) (97)
--------- ------ ------- -------- -------- --------- --------- --------
Balance at March 31,
2000 9,755,562 $9,755 $21,741 $101,853 $(2,342) $(12,903) $118,104
========= ====== ======= ======== ======== ========= =========
Comprehensive Income $5,816
========
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,
------------------------------------
2000 1999
------------ ------------
(dollars in thousands)
<S> <C> <C>
OPERATING ACTIVITIES
- --------------------
Net income $ 5,913 $ 5,489
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for possible loan losses 769 1,749
Provision for depreciation and amortization 857 577
Accretion of discounts and amortization of
premiums on securities (664) (90)
Realized securities (gains) and losses, net (919) 830
Net increase in trading account securities (796) (945)
(Increase) decrease in interest receivable (626) 687
Increase in interest payable 334 119
Other, net 7,628 (6,944)
------------ ------------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 12,496 1,472
------------ ------------
INVESTING ACTIVITIES
- --------------------
Proceeds from maturities of held to maturity securities 400 --
Purchases of held to maturity securities (31,054) --
Purchases of available for sale securities (95,147) (49,986)
Proceeds from maturities of available for sale securities 53,000 2,000
Proceeds from sales and paydowns of
available for sale securities 37,176 120,483
Purchases of premises and equipment (2,762) (3,223)
Increase in loans outstanding, net (49,641) (76,810)
------------ ------------
NET CASH USED IN
INVESTING ACTIVITIES (88,028) (7,536)
------------ ------------
FINANCING ACTIVITIES
- --------------------
Net increase in deposits 14,054 3,767
Net increase in repurchase agreements
and other short-term borrowings 7,939 912
Proceeds from sale of common stock 1,143 224
Purchase of treasury stock (907) (2,427)
Cash dividends (934) (855)
------------ ------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 21,295 1,621
------------ ------------
DECREASE IN CASH
AND CASH EQUIVALENTS (54,237) (4,443)
Cash and cash equivalents at beginning of period 84,651 27,017
------------ ------------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 30,414 $ 22,574
============ ============
See accompanying notes.
</TABLE>
6
<PAGE> 7
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
1. Basis of Presentation
The condensed consolidated financial statements include the accounts of
Mississippi Valley Bancshares, Inc. (the "Company") and its wholly-owned
subsidiaries, Southwest Bank of St. Louis, Southwest Bank, Belleville (the
"Banks"), MVBI Capital Trust and Mississippi Valley Capital Company, a
venture capital subsidiary. 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.
For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's annual report on Form 10-K
for the year ended December 31, 1999.
2. Comprehensive Income
Following is a summary of other comprehensive income components and
related income tax effects:
<TABLE>
<CAPTION>
For the Three Months Ended March 31, 2000
-----------------------------------------
Before-Tax Tax Net-of-Tax
Amount Expense Amount
---------- ------- ----------
(dollars in thousands)
<S> <C> <C> <C>
Unrealized gains on available
for sale securities $ 770 $ 270 $ 500
Less: reclassification adjustment
for gains realized in net
income 919 322 597
------- ------- -------
Net unrealized losses (149) (52) (97)
------- ------- -------
Other comprehensive income $ (149) $ (52) $ (97)
======= ======= =======
<CAPTION>
For the Three Months Ended March 31, 1999
-----------------------------------------
Before-Tax Tax Net-of-Tax
Amount Expense Amount
---------- ------- ----------
(dollars in thousands)
<S> <C> <C> <C>
Unrealized losses on
available for sale securities $(6,656) $(2,329) $(4,327)
Less: reclassification adjustment
for losses realized in net
income (830) (290) (540)
------- ------- -------
Net unrealized losses (5,826) (2,039) (3,787)
------- ------- -------
Other comprehensive
income (loss) $(5,826) $(2,039) $(3,787)
======= ======= =======
</TABLE>
7
<PAGE> 8
3. Earnings per 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,
--------------------------------------------
2000 1999
-------------- --------------
(dollars in thousands, except per share data)
<S> <C> <C>
BASIC:
Average common shares outstanding 9,326,560 9,495,556
============== ==============
Net income $ 5,913 $ 5,489
============== ==============
Basic earnings per common share $ .63 $ .58
============== ==============
Diluted earnings per share gives effect to the weighted average shares
outstanding and average dilutive common share equivalents outstanding.
<CAPTION>
Three Months Ended
March 31,
--------------------------------------------
2000 1999
-------------- --------------
(dollars in thousands, except per share data)
<S> <C> <C>
DILUTED:
Average common shares outstanding 9,326,560 9,495,556
Average common stock equivalents of
options outstanding-based on the
treasury stock method using market price 58,004 152,022
-------------- --------------
9,384,564 9,647,578
============== ==============
Net income $ 5,913 $ 5,489
============== ==============
Diluted earnings per common share $ .63 $ .57
============== ==============
</TABLE>
8
<PAGE> 9
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, 1999.
SUMMARY OF EARNINGS
- -------------------
Consolidated net income for the first quarter of 2000 was $5,913,000, up
$424,000 or 7.7% from the $5,489,000 earned during the first quarter of 1999.
On a per share basis, net income was $.63, up 10.5% from $.57 in the same
period of the prior year. The improved performance was generated primarily by
increased net interest income and a reduced provision for possible loan
losses. Loan growth of $50 million in the first quarter of 2000 compared
with $77 million in the same period in 1999. Net loan recoveries of $152,000
in the first quarter of 2000 limited the loan loss provision to $769,000
compared with $1,749,000 in 1999.
For the quarter, the Company's return on average assets was 1.50%, down
from 1.56% in the first quarter of 1999. The Company's return on equity was
20.28%, up from 19.62% in the first three months of 1999. Total assets at
March 31, 2000 were $1.593 billion, total loans were $1.154 billion and
deposits were $1.330 billion at the Company's seven bank locations. At March
31, 2000, total equity capital was $118.1 million or 7.41% of assets.
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 $73,000 and
$63,000, for the three months ended March 31, 2000 and 1999, 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, 2000 and 1999
- ------------------------------------------
Total tax-equivalent interest income for the three months ended March 31,
2000 was $31,098,000, up $4,929,000 compared to the same period in 1999. The
$176 million increase in the volume of average loans outstanding and higher
yields earned on loans and securities were primarily responsible for the
increased interest earnings. Overall asset yields were 8.37% in the first
quarter of 2000, up from 7.81% in the same period in 1999. Funding the
Company's asset growth were increased time deposits of $104 million and
increased short term borrowings of $44 million.
9
<PAGE> 10
Total interest expense for the first quarter of 2000 was $16,400,000, up
$3,648,000 from $12,752,000 in the first quarter of 1999. Higher rates were
paid on nearly all interest bearing liabilities in the first quarter of 2000
compared to 1999. Overall rates paid on total interest bearing liabilities
rose to 5.00% from 4.39% in the first quarter of 1999.
Total tax-equivalent net interest income increased $1,281,000. The
Company's net interest margin declined slightly to 3.95% from 3.99% in the
first quarter of 1999, as the increase in rates paid exceeded the increase in
asset yields earned.
10
<PAGE> 11
<TABLE>
AVERAGE BALANCES, INTEREST AND RATES
<CAPTION>
THREE MONTHS ENDED MARCH 31,
------------------------------------------------------------------------------
2000 1999
-------------------------------------- -------------------------------------
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 $1,120,648 $24,989 8.96% $ 946,504 $20,126 8.61%
Tax-exempt<F3> 2,000 54 10.95
Held to maturity securities
Taxable 76,460 1,222 6.40 30,712 480 6.27
Tax-exempt<F3> 7,088 178 10.08 8,117 207 10.20
Available for sale securities 265,525 4,344 6.56 363,726 5,274 5.83
Trading account securities 1,408 24 6.75 576 10 7.02
Federal Funds sold and other short-
term investments 19,614 287 5.88 6,141 72 4.78
------------ --------- ------------ ---------
Total interest-earning assets $1,492,743 31,098 8.37% $1,355,776 26,169 7.81%
--------- ---------
Noninterest-earning assets:
Cash and due from banks 29,996 23,799
Bank premises and equipment 38,741 22,451
Other assets 32,212 23,524
Allowance for possible loan losses (21,850) (18,436)
------------ ------------
Total assets $1,571,842 $1,407,114
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
NOW accounts $ 26,928 $ 75 1.12% $ 27,270 $ 93 1.38%
Money market accounts 706,199 8,752 4.98 715,533 7,399 4.19
Savings deposits 28,017 207 2.98 25,668 188 2.97
Time deposits of $100,000 or more 52,919 706 5.36 36,318 440 4.91
Other time deposits 376,522 4,876 5.21 288,970 3,626 5.09
------------ --------- ------------ ---------
Total interest-bearing deposits 1,190,585 14,616 4.94 1,093,759 11,746 4.36
Federal funds purchased, repurchase
agreements and other short-term
borrowings 114,534 1,505 5.28 70,316 750 4.33
Capital trust debentures 14,950 279 7.48 14,950 256 6.84
------------ --------- ------------ ---------
Total interest-bearing
liabilities 1,320,069 16,400 5.00% 1,179,025 12,752 4.39%
--------- ---------
Noninterest-bearing liabilities:
Demand deposits 127,397 112,369
Other liabilities 7,725 3,831
Shareholders' equity 116,651 111,889
------------ ------------
Total liabilities and
shareholders' equity $1,571,842 $1,407,114
============ ============
Net interest income $14,698 $13,417
========= =========
Net interest margin 3.95% 3.99%
======== ========
<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 $73,000 and
$63,000 for the three months ended March 31, 2000 and 1999, respectively.
</TABLE>
11
<PAGE> 12
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>
<CAPTION>
CHANGES IN INTEREST INCOME AND EXPENSE, VOLUME AND RATE VARIANCES
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 2000
COMPARED TO
MARCH 31, 1999
------------------------------------------------
INCREASE (DECREASE) ATTRIBUTABLE TO CHANGE IN:
------------------------------------------------
YIELD/ NET
VOLUME RATE CHANGE
------------ ----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
INTEREST EARNED ON:
Loans<F1><F2> $ 4,015 $ 902 $4,917
Held to maturity securities:
Taxable 732 10 742
Tax-exempt<F1> (27) (2) (29)
Available for sale securities (1,540) 610 (930)
Trading account securities 14 14
Federal funds sold and other short-
term investments 194 21 215
------------ ----------- -----------
Total interest income 3,388 1,541 4,929
------------ ----------- -----------
INTEREST PAID ON:
NOW accounts (1) (17) (18)
Money market accounts (95) 1,448 1,353
Savings 18 1 19
Time deposits of $100,000 or more 221 45 266
Other time deposits 1,160 90 1,250
Federal funds purchased, repurchase
agreements and other short-term
borrowings 599 156 755
Long-term borrowings 23 23
------------ ----------- -----------
Total interest expense 1,902 1,746 3,648
------------ ----------- -----------
Net interest income $ 1,486 $ (205) $1,281
============ =========== ===========
<FN>
- -------------------------------------
<F1> Information is presented on a tax-equivalent basis assuming a tax rate of
35%. The approximate tax-equivalent adjustment was $73,000 and $63,000
for the three months ended March 31, 2000 and 1999.
<F2> Average balances included nonaccrual loans.
</TABLE>
12
<PAGE> 13
PROVISION FOR POSSIBLE LOAN LOSSES
- ----------------------------------
The provision for possible loan losses for the first quarter of 2000 was
$769,000, down from $1,749,000 for the same period in 1999. Loan growth of
$77 million and net loan charge offs of $216,000 in the first quarter of 1999
necessitated a greater provision expense than in the first three months of
2000 when loans rose $50 million and the Company experienced net loan
recoveries of $152,000.
The allowance for possible loan losses was $22,570,000 or 1.96% of loans
outstanding at March 31, 2000. This compared to $21,649,000 at the end of
1999 and $19,677,000 at March 31, 1999, each also 1.96% of loans outstanding.
In management's judgement, the allowance for possible loan losses is
considered adequate 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,
--------------------------------
2000 1999
-------------- --------------
(dollars in thousands)
<S> <C> <C>
Allowance for possible loan losses
(beginning of period) $ 21,649 $ 18,144
Loans charged off (632) (467)
Recoveries of loans previously
charged off 784 251
-------------- --------------
Net loans (charged off) recoveries 152 (216)
-------------- --------------
Provision for possible loan losses 769 1,749
-------------- --------------
Allowance for possible loan losses
(end of period) $ 22,570 $ 19,677
============== ==============
Loans outstanding:
Average $1,122,648 $ 946,504
End of period 1,154,291 1,002,555
Ratio of allowance for possible
loan losses to loans outstanding:
Average 2.01% 2.08%
End of period 1.96% 1.96%
Ratio of net charge-offs to
average loans outstanding, annualized: not meaningful .09
</TABLE>
13
<PAGE> 14
The following table summarizes nonperforming assets at the dates
indicated:
<TABLE>
<CAPTION>
March 31, December 31, March 31,
2000 1999 1999
-------------- -------------- --------------
(dollars in thousands)
<S> <C> <C> <C>
Nonaccrual loans $ 1,723 $ 2,756 $ 1,078
Loans past due 90 days or more 5 371 33
Restructured loans 171 90 108
-------------- -------------- --------------
Total nonperforming loans 1,899 3,217 1,219
Other real estate 10 10 160
-------------- -------------- --------------
Total nonperforming assets $ 1,909 $ 3,227 $ 1,379
============== ============== ==============
Loans, net of unearned discount $1,154,291 $1,104,498 $1,002,555
Allowance for possible loan
losses to loans 1.96% 1.96% 1.96%
Nonperforming loans to loans .16 .29 .12
Allowance for possible loan losses
to nonperforming loans 1,188.52 672.96 1,614.19
Nonperforming assets to loans
and foreclosed assets .17 .29 .14
</TABLE>
NONINTEREST INCOME
- ------------------
For the first quarter of 2000 total noninterest income was $3,223,000,
down from $3,561,000 in the same period in 1999. The Company had no hedging
activities in 2000 compared with trading profits of $2,696,000 on hedging
activities in the first quarter of 1999. The Company sold various securities
to reduce the risk of higher interest rates in each year. In 2000 these
sales generated gains of $919,000 compared with losses of $830,000 in the
first quarter of 1999. Merchant credit card income and operating lease
income were also up in 2000 compared with 1999.
NONINTEREST EXPENSE
- -------------------
Total noninterest expense for the first quarter of 2000 was $7,706,000,
up $1,288,000 from $6,418,000 in the first three months of 1999. Overall
Company growth, merit increases and greater benefit expenses were partially
responsible for the increased overhead costs. Increased advertising,
occupancy and equipment costs and other operating expenses, due in large part
to the operating costs for the new Des Peres bank office and Company
headquarters which opened in late 1999, also advanced total noninterest
expense costs for 2000 above prior year levels.
14
<PAGE> 15
CAPITAL MANAGEMENT AND RESOURCES
- --------------------------------
As of March 31, 2000, the Company's total shareholders' equity was $118.1
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 38,000 shares of common stock in connection with the
Company's stock repurchase plan.
The Company formed MVBI Capital Trust ("MVBI Capital"), a statutory
business trust in 1997. 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%. 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, 2000 and December 31, 1999 the Company's Tier
1 capital was 10.98% and 10.97% of risk-weighted assets, and total risk-based
capital was 12.24% and 12.23% 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, 2000 and
December 31, 1999, the Company's leverage ratio was 8.60% and 8.40%,
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.
15
<PAGE> 16
PART II. OTHER INFORMATION
- ----------------------------
ITEM 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits: NONE
(b) Reports on Form 8-K: NONE
16
<PAGE> 17
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 thereunto duly authorized.
MISSISSIPPI VALLEY BANCSHARES, INC.
-------------------------------------
(Registrant)
Date: May 11, 2000
----------------- /s/ Paul M. Strieker
---------------------------------
Paul M. Strieker, Executive Vice
President, Controller and Chief
Financial Officer (on behalf of
the Registrant and as Principal
Financial and Accounting Officer)
17
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