<PAGE>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM 10-Q
/X/ Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1995
OR
/ / Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to
---------------------------
COMMISSION FILE NUMBER 33-14391
--------------------------
BANCALABAMA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of
incorporation or organization)
63-0945419
(I.R.S. Employer Identification No.)
P.O. BOX 293
HUNTSVILLE, ALABAMA
(Address of principal executive offices)
35804
(Zip Code)
(205)533-5548
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name, former address and former fiscal year of registrant, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities 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 / /
The number of shares outstanding of each of the issuer's classes of common
stock was 613,122 shares of common stock, par value $1.00, at June 30, 1995.
<PAGE>
<PAGE> 2
BANCALABAMA, INC., AND SUBSIDIARY
FORM 10-Q
INDEX
PAGE
PART I. FINANCIAL INFORMATION NUMBER
------
Item 1. Financial Statements
Consolidated Balance Sheets as of
June 30, 1995 and December 31, 1994 3
Consolidated Statements of Operations
for the Six Months Ended June 30,
1995 and 1994 5
Consolidated Statements of Operations
for the Three Months Ended June 30,
1995 and 1994 6
Consolidated Statements of Cash Flows
for the Six Months Ended June 30,
1995 and 1994 7
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 2. Change in Securities 15
Item 3. Defaults Upon Senior Securities 15
Item 4. Submission of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
<PAGE>
<PAGE> 3
BANCALABAMA, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, 1995 December 31, 1994
------------- -----------------
ASSETS
<S> <C> <C>
Cash and Due From Banks $ 4,730,296 $ 5,096,029
----------- -----------
Earning Assets
Federal Funds Sold $ 6,416,000 $ -
Securities Available-for-Sale, at market
value, cost of $13,890,072 and $9,087,706
in 1995 and 1994, respectively 13,758,787 8,410,358
Loans, net of unearned interest 53,705,729 47,211,802
Less: Allowance for loan losses (602,364) (505,125)
----------- -----------
Net Loans $53,103,365 $46,706,677
----------- -----------
Total Earning Assets $73,278,152 $55,117,035
Bank Premises and Equipment, net 3,569,412 3,464,015
Accrued Interest Receivable 812,363 649,987
Other Real Estate and Other Loan Assets 309,165 81,805
Deferred Income Tax Benefit 102,000 207,000
Other Assets 629,956 694,663
----------- -----------
Total Assets $83,431,344 $65,310,534
=========== ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE> 4
BANCALABAMA, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, 1995 December 31, 1994
------------- -----------------
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Deposits and Interest Bearing Liabilities
Demand deposits - regular $11,712,491 $ 9,973,389
Demand deposits - interest bearing 29,637,127 22,241,500
Savings deposits 2,706,369 2,514,937
Time deposits, $100,000 and over 8,313,315 3,482,370
Other time deposits 23,927,823 17,933,744
----------- -----------
Total Deposits $76,297,125 $56,145,940
Federal Funds Purchased - 2,980,000
Long-Term Debt 896,298 931,581
----------- -----------
Total Deposits and Interest Bearing Liabilities $77,193,423 $60,057,521
Accrued Expenses and Other Liabilities 500,351 267,765
----------- -----------
Total Liabilities $77,693,774 $60,325,286
----------- -----------
Stockholders' Equity
Preferred Stock, par value $1.00 per share,
500,000 authorized, none issued and outstanding $ - $ -
Common Stock, par value $1.00 per share, 2,000,000
authorized and 613,122 shares issued and outstanding 613,122 613,122
Additional Paid-in-Capital 5,434,025 5,434,025
Unrealized Loss on Securities Available-for-Sale (131,285) (677,348)
Accumulated Deficit (178,292) (384,551)
------------ -----------
Total Stockholders' Equity $ 5,737,570 $ 4,985,248
----------- -----------
Total Liabilities and Stockholders' Equity $83,431,344 $65,310,534
=========== ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE> 5
BANCALABAMA, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<TABLE>
<CAPTION>
1995 1994
---------- ----------
<S> <C> <C>
Revenue from Earning Assets
Interest income and fees earned on loans $2,797,322 $1,964,488
Interest earned on securities 349,231 281,821
Interest earned on federal funds sold 83,761 12,657
---------- ----------
Total Revenue from Earning Assets $3,230,314 $2,258,966
Interest Expense
Interest on deposits $1,325,258 $ 737,091
Interest on federal funds purchased 3,384 11,467
Interest on long-term debt 44,754 37,360
---------- ----------
Total Interest Expense $1,373,396 $ 785,918
---------- ----------
Net Interest Income $1,856,918 $1,473,048
Provision for Loan Losses 150,000 75,000
---------- ----------
Net Interest Income After Provision for Loan Losses $1,706,918 $1,398,048
Noninterest Revenue
Service charges, net of refunds $ 406,915 $ 392,684
Gains on sales of other real estate and other loan assets, net 33,696 2,054
Gain on sales of loans 17,398 6,945
(Loss) Gain on sales of securities, net (11,029) 5,007
Other noninterest revenue 32,984 21,017
---------- ----------
Total Noninterest Revenue $ 479,964 $ 427,707
Noninterest Expense
Salaries and employee benefits $ 831,877 $ 850,782
Occupancy expenses 220,915 212,650
Other noninterest expenses 820,731 677,490
---------- ----------
Total Noninterest Expense $1,873,523 $1,740,922
---------- ----------
Income before Provision for Income Taxes $ 313,359 $ 84,833
Provision for Income Taxes 107,100 4,200
---------- ----------
Net Income $ 206,259 $ 80,633
========== ==========
Earnings per share $0.34 $0.13
========== ==========
Weighted average shares outstanding 613,122 613,122
========== ==========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE> 6
BANCALABAMA, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<TABLE>
<CAPTION>
1995 1994
---------- ----------
<S> <C> <C>
Revenue from Earning Assets
Interest income and fees earned on loans $1,485,779 $1,030,396
Interest earned on securities 194,419 127,723
Interest earned on federal funds sold 49,015 7,307
---------- ----------
Total Revenue from Earning Assets $1,729,213 $1,165,426
Interest Expense
Interest on deposits $ 725,461 $ 389,154
Interest on federal funds purchased 680 2,677
Interest on long-term debt 22,542 19,895
---------- ----------
Total Interest Expense $ 748,683 $ 411,726
---------- ----------
Net Interest Income $ 980,530 $ 753,700
Provision for Loan Losses 60,000 30,000
---------- ----------
Net Interest Income After Provision for Loan Losses $ 920,530 $ 723,700
Noninterest Revenue
Service charges, net of refunds $ 204,981 $ 198,723
Loss on sales of other real estate and other loan assets, net (6,734) (1,370)
Gain on sales of loans 17,398 -
Gain (Loss) on sales of securities, net 81 (3,825)
Other noninterest revenue 15,118 12,272
---------- -----------
Total Noninterest Revenue $ 230,844 $ 205,800
Noninterest Expense
Salaries and employee benefits $ 416,414 $ 427,906
Occupancy expenses 111,280 109,464
Other noninterest expenses 424,324 342,461
---------- ----------
Total Noninterest Expense $ 952,018 $ 879,831
---------- ----------
Income before Provision for Income Taxes $ 199,356 $ 49,669
Provision for Income Taxes 55,000 2,100
---------- ----------
Net Income $ 144,356 $ 47,569
========== ==========
Earnings per share $0.24 $0.08
========== ==========
Weighted average shares outstanding 613,122 613,122
========== ==========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE> 7
BANCALABAMA, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<TABLE>
<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net Income $ 206,259 $ 80,633
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 152,323 149,255
Provision for loan losses 150,000 75,000
Gain on sales of other real estate and other loan assets, net (33,696) (8,999)
Gain on sales of loans (17,398) (6,945)
Loss (gain) on sales of securities, net 11,029 (5,007)
Decrease (increase) in assets:
Accrued interest receivable (162,376) 23,544
Deferred income tax benefit 105,000 -
Other assets 64,707 (143,911)
Increase in liabilities:
Accrued expenses and other liabilities 232,586 146,773
----------- -----------
Net cash provided by operating activities $ 708,434 $ 310,343
Cash flows from investing activities:
Proceeds from the sales of securities $ 4,835,984 $ 5,072,258
Proceeds from the maturities of securities - 500,000
Proceeds from the sales of loans 492,213 -
Proceeds from the sales of other real estate and
other loan assets, net 206,188 57,837
Purchases of securities (9,649,379) (4,297,250)
Loans made to customers in excess of principal
collected on loans (7,421,355) (3,996,568)
Purchases of bank premises and equipment (257,720) (4,301)
----------- -----------
Net cash used in investing activities $(11,794,069) $(2,668,024)
Cash flows from financing activities:
Net proceeds from certificates of deposit $ 10,825,024 $ 3,796,769
Increase in demand deposits and savings accounts 9,326,161 305,193
Decrease in federal funds purchased (2,980,000) (1,250,000)
Increase in federal funds sold (6,416,000) (235,000)
Principal payments on long-term debt (35,283) (43,948)
------------ -----------
Net cash provided by financing activities $ 10,719,902 $ 2,573,014
------------ -----------
Net (Decrease) Increase in Cash and Cash Equivalents $ (365,733) $ 215,333
Cash and Cash Equivalents - Beginning of Period 5,096,029 3,792,692
------------ -----------
Cash and Cash Equivalents - End of Period $ 4,730,296 $ 4,008,025
============ ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE> 8
BANCALABAMA, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 1995
(Unaudited)
Note 1 - Summary of Significant Accounting Policies
In the opinion of Management, the accompanying unaudited consolidated
financial statements contain all adjustments necessary for the fair
presentation of the Company's financial position and results of operations.
Except for revisions to certain items as reflected in Note 3, the accounting
policies followed by the Company are set forth in Note 1 of the Company's
financial statements contained in the Annual Report to stockholders for the
year ended December 31, 1994, which should be read in conjunction with these
interim financial statements.
Certain prior period amounts have been reclassified to conform with the
June 30, 1995 presentation.
Note 2
The results of operations for the three months and six months ended June
30, 1995 and 1994 are not necessarily indicative of the results to be expected
for the full year or any other interim period.
Note 3 - Loans and Allowances for Loan Losses
Effective January 1, 1995, the Company adopted Statement of Financial Account-
ing Standards ("SFAS") No. 114, "Accounting by Creditors for Impairment of a
Loan." SFAS No. 114 requires certain impaired loans be measured at the
present value of expected future cash flows discounted at the loan's effec-
tive interest rate or, if more practical, at the loan's observable market
price or the fair value of the collateral if the loan is collateral dependent.
The effect of the discounting is considered as a reserve which is a part of
the allowance for loan losses. As a part of implementing SFAS No. 114,
Management identified and reviewed impaired loans to determine if an
additional reserve was required. Based upon the Company's loan classification
and grading program, no additional reserves were required at the time of
adoption of SFAS No. 114 or at June 30, 1995. Therefore, the implementation
of SFAS No. 114 did not have an impact on the Company's financial position or
results of operations.
The total recorded investment in impaired loans at June 30, 1995 was approxi-
mately $480,000, of which approximately $157,000 was on a nonaccrual basis.
At June 30, 1995 there was a related allowance for loan losses for the
impaired loans of approximately $96,000 included in the total allowance for
loan losses. A change in the allowance for loan losses related to impaired
loans is recorded under the bad debt expense method whereby changes in the
carrying value of impaired loans are considered as an adjustment to the
provision for loan losses. The average recorded balance of impaired loans
during the first six months of 1995 was approximately $626,000. The Company
recognizes interest income on impaired loans on an accrual basis, except for
nonaccrual loans which are recognized on a cash basis. For the six months
ended June 30, 1995, the Company recognized interest income on impaired loans
totalling approximately $33,700 and received interest payments totalling
approximately $41,300 on impaired loans. For the quarter ended June 30, 1995,
the Company recognized interest income on impaired loans totalling
<PAGE>
<PAGE> 9
approximately $21,400 and received interest payments totalling approximately
$34,300 on impaired loans.
A summary of the allowance for loan losses for the six months ended June 30,
1995 and 1994 follows:
1995 1994
---------- ----------
Balance at beginning of year $505,125 $595,860
Provision for loan losses 150,000 75,000
Loans charged-off (78,316) (134,072)
Recoveries of loans
previously charged-off 25,555 43,945
-------- --------
Balance at June 30 $602,364 $580,733
======== ========
<PAGE>
<PAGE> 10
BANCALABAMA, INC., AND SUBSIDIARY
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
For the first six months of 1995, the Company reported net income of
$206,259, or $.34 per share, compared to net income of $80,633, or $.13 per
share, for the first six months of 1994. For the quarter ended June 30,
1995, the Company reported net income of $144,356, or $.24 per share,
compared to net income of $47,569, or $.08 per share, for the quarter ended
June 30, 1994.
The increase in net income for the first six months of 1995, as compared
to 1994, is primarily attributable to increases in net interest income. These
improvements were partially offset by increases in noninterest expense, the
provision for income taxes, and the provision for loan losses.
Net interest income increased by 26.1% to $1,856,918 for the first
six months of 1995, compared to $1,473,048 for the first six months of 1994.
This increase resulted primarily from higher interest income and fees earned
on loans. The increase was mainly offset by higher interest expense on
deposits.
The increase in interest income is partly attributable to the balance
of loans increasing 13.8% during the first six months of 1995 and 26.6% since
June 30, 1994. In addition, the Bank's base lending rate increased from 6.0%
during the first quarter of 1994 to 9.0% during the first quarter of 1995.
Total deposits increased 35.9% during the first six months of 1995
and 37.5% since June 30, 1994. The increase in deposits is primarily the
result of Management's efforts to attract additional deposits to the Bank
through expanding relationships with existing customers and establishing
relationships with new customers. Competitive rates were offered on interest
bearing deposits, resulting in the large increase in time deposits. The Bank
also offered new and innovative deposit products which attracted the
attention of depositors and contributed to the increase in deposits during
the first six months of 1995. This increase in deposits, as well as the
overall increase in interest rates since the beginning of 1994, has resulted
in an increase in interest expense as compared to the prior year. Included
in the balance of deposits at June 30, 1995 is approximately $7.6 million of
short-term balances which Management anticipates will be withdrawn during the
third quarter of 1995.
An increase in deposits during the first six months of 1995 has
resulted in greater liquidity, which has been used to fund the increase in
loans discussed above, as well as to purchase securities and increase federal
funds sold. The balance of the securities portfolio has increased
approximately 64% during the first six months of 1995 as a result of these
purchases and a $546,063 reduction in the unrealized loss on securities
available-for-sale. The improved liquidity from the increase in deposits has
also been used to eliminate the balance of federal funds purchased during the
first quarter of 1995 and increase the amount of federal funds sold. The
increase in interest income from securities and federal funds sold, coupled
with a reduction in interest expense on federal funds purchased, has
contributed to the increase in net interest income.
<PAGE>
<PAGE> 11
Overall, the increase in loans during the prior year, funded from the
increase in deposits, coupled with an increase in interest rates, has
resulted in an improved interest rate spread and increased net interest
income and margin.
Net interest income for the second quarter of 1995 was $980,530
compared to $753,700 for the second quarter of 1994. This represents a
$226,830, or 30.1% increase. The changes in net interest income for the
second quarter are comparable to the changes in net interest income for the
first six months from year-to-year.
Noninterest revenue increased 12.2% during the first six months of
1995, compared to the first six months of 1994, primarily due to net gains on
sales of other real estate and other loan assets. This increase resulted
substantially from the sale of one parcel of other real estate. Other
noninterest revenue, generated by the Bank's financial services subsidiary,
increased $11,967, or 56.9%, compared to the first six months of 1994. The
Bank sold the guaranteed portion of two Small Business Administration-
guaranteed loans during the second quarter of 1995 resulting in a gain of
$17,398, compared to one loan sale with a gain of $6,945 during the first six
months of 1994. These improvements were offset by a net loss on securities
totalling $11,029 for the first six months of 1995, compared to a net gain of
$5,007 for the first six months of 1994. The net loss in 1995 was substanti-
ally from the sale during the first quarter of one security maturing in 1995.
Sales proceeds were reinvested in a higher-yielding, longer-term security.
This reinvestment has resulted in the recovery of this loss in approximately
six months and a higher yield over the term of the acquired security.
The overall increase in noninterest revenue for the second quarter
of 1995, from the second quarter of 1994, is comparable to the changes pre-
sented for the six-month period from year-to-year. However, the components
of the increase were different. A gain on sales of loans totalling $17,398
occurred during the second quarter of 1995. There was no similar gain during
during the second quarter of 1994. There was an insignificant net gain on
sales of securities amounting to $81 during the second quarter of 1995,
compared to a net loss on sales of securities of $3,825 during the second
quarter of 1994. Net losses on sales of other real estate and other loan
assets during the second quarter of 1995 and 1994 amounted to $6,734 and
$1,370, respectively, which reduced total noninterest revenue during each
quarter. Other noninterest revenue from the Bank's financial services
subsidiary increased 23.2% from the second quarter of 1994 to the second
quarter of 1995.
Noninterest expense increased 7.6% during the first six months of
1995, compared to the first six months of 1994. Other noninterest expenses
increased $143,241, or 21.1%, in the first six months of 1995, compared to
the first six months of 1994. This increase is partially a result of
Management's efforts to improve the performance of the Bank through marketing
efforts and the processing expenses related to the higher volume of activity
from the growth of the Bank. Additional expenses have been incurred in
connection with non-performing loans and deposits. Occupancy expenses
increased 3.9% during the first six months of 1995, compared to the first six
months of 1994, while salaries and employee benefits decreased $18,905, or
2.2%, for the same periods. The changes in noninterest expense for the
second quarter of 1995, compared to the second quarter of 1994, are
comparable to the changes presented for the six-month period from year-to-
year.
<PAGE>
<PAGE> 12
The Company recorded a provision for incomes taxes of $107,100 for
the first six months of 1995. The Company previously adopted Statement of
Financial Accounting Standards ("SFAS") No. 109. SFAS No. 109 allows for the
utilization of a net operating loss carryforward by recording of future
benefits prior to the period they are realized. This resulted in the Company
recording income tax benefits and a related deferred income tax receivable
during the previous two years. As the Company's net operating loss was
utilized in these calculations, it was necessary to record a provision for
income taxes beginning in the first quarter of 1995.
FINANCIAL CONDITION
The total assets of the Company increased $18.1 million, or 27.7%,
during the first six months of 1995, from $65.3 million at December 31, 1994,
to $83.4 million at June 30, 1995. This increase was attributable to earning
assets which grew $18.2 million, or 33.0%, from December 31, 1994 to June 30,
1995.
Gross loans increased $6.5 million, or 13.8%, since December 31,
1994. Additional funds from the increase in deposits were used to purchase
securities, with the remainder being invested in federal funds sold. At June
30, 1995, federal funds sold totalled to $6,416,000. The securities
portfolio increased $5.3 million during the first six months of 1995,
primarily through the purchase of additional securities. The unrealized loss
on securities available-for-sale decreased $546,063 during the first six
months of 1995 to a balance of $131,285 at June 30, 1995.
The amortized cost and estimated market values of securities
available-for-sale as of June 30, 1995 were as follows:
<TABLE>
<CAPTION>
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
U.S. Treasury Securities and
obigations of U.S. Government
corporations and agencies $13,487,930 $97,538 $(229,068) $13,356,400
Obligations of states and
political subdivisions 12,420 1,843 - 14,263
Mortgage-backed securities 389,722 - (1,598) 388,124
----------- ------- ---------- -----------
$13,890,072 $99,381 $(230,666) $13,758,787
=========== ======= ========== ===========
</TABLE>
The overall amount of nonearning assets at June 30, 1995 was
comparable to the December 31, 1994 balance. Other real estate and other
loan assets increased $227,360 primarily as a result of the transfer of one
property from a non-accrual loan, which the Bank obtained through
foreclosure. The balance of cash and due from banks decreased at June 30,
1995 as compared to the December 31, 1994 amount. These balances will
fluctuate based upon the cash needs of the Bank which are directly related to
the deposit account activity of its customers.
<PAGE>
<PAGE> 13
The total deposits and interest bearing liabilities increased by
$17.1 million, or 28.5%, since December 31, 1994. As previously discussed,
total deposits have increased 35.9% during the first six months of 1995.
This increase is largely the result of business development efforts, a
competitive interest rate structure and new products. This increase includes
approximately $7.6 million of short-term balances which Management
anticipates will be withdrawn during the third quarter of 1995. The balance
of federal funds purchased of $2,980,000 at December 31, 1994, was eliminated
at June 30, 1995.
NON-PERFORMING ASSETS
Non-performing assets include non-accrual loans, accruing loans
contractually past due 90 days or more, restructured loans, other real estate
and repossessed assets. Non-performing assets increased during the first six
months of 1995 from a December 31, 1994 balance of $629,800 to a June 30,
1995 balance of $853,500. This increase resulted primarily from loans which
were past due at June 30, 1995. The Bank is working with the borrowers to
obtain payment or satisfactory renewals. Management cannot determine the
amount of loss, if any, that may be sustained as a result of these credits.
The increase in non-performing assets was offset by the pay-off of a $200,000
non-accrual loan during the second quarter of 1995 which was classified as
non-accrual at March 31, 1995. The following table sets forth non-performing
assets of the Company:
<TABLE>
<CAPTION>
($ in Thousands) June 30, 1995 March 31, 1995 December 31, 1994
------------- -------------- -----------------
<S> <C> <C> <C>
Accruing loans past due 90 days or more $368,100 $ 55,000 $250,000
Non-Accrual loans 176,200 362,000 298,000
Restructured loans -(1) -(1) -(1)
Other real estate and repossessed assets 309,200 196,300 81,800
-------- ------- --------
Total Non-Performing Assets $853,500 $613,300 $629,800
======== ======== ========
- -----------------------
(1) Excludes restructured loans which were renegotiated at market
interest rates.
</TABLE>
As of June 30, 1995, the allowance for loan losses was $602,364, or
1.12% of total loans, compared to $578,189, or 1.22% of total loans, at March
31, 1995, and $505,125, or 1.07% of total loans, at December 31, 1994. In
the first six months of 1995, the Company made additional provisions to the
allowance for loan losses totalling $150,000, compared to a provision of
$75,000 for the first six months of 1994. Charge-offs for the first six
months of 1995 totalled $78,000, compared to charge-offs of $134,000 for the
first six months of 1994. Recoveries for the first six months of 1995
totalled $25,000, compared to recoveries of $44,000 for the first six months
of 1994.
<PAGE>
<PAGE> 14
The Company provided $60,000 to the allowance for loan losses in the
second quarter of 1995, compared to a provision of $30,000 in the second
quarter of 1994. Charge-offs for the second quarter of 1995 totalled
$41,000, compared to charge-offs which totalled $23,000 for the second
quarter of 1994. Recoveries for the second quarter of 1995 totalled $5,000,
compared to recoveries of $32,000 for the second quarter of 1994.
Effective January 1, 1995, the Company adopted SFAS No. 114,
"Accounting by Creditors for Impairment of a Loan." SFAS No. 114 requires
certain impaired loans be measured at the present value of expected future
cash flows discounted at the loan's effective interest rate or, if more
practical, at the loan's observable market price or the fair value of the
collateral if the loan is collateral dependent. The effect of the
discounting is considered as a reserve which is a part of the allowance for
loan losses. As a part of implementing SFAS No. 114, Management identified
and reviewed impaired loans to determine if an additional reserve was
required. Based upon the Company's loan classification and grading program,
no additional reserves were required at the time of adoption of SFAS No. 114
or at June 30, 1995. Therefore, the implementation of SFAS No. 114 did not
have an impact on the Company's financial position or results of operations.
LIQUIDITY AND CAPITAL RESOURCES
The Company continues to maintain adequate liquidity at June 30, 1995.
The Company's capital at June 30, 1995, was $5,737,570, or 6.88% of total
assets.
Bank holding companies are required to maintain certain levels of capital
that are a function of the level of risk of the Company's portfolio of assets,
including off-balance sheet exposures, in accordance with risk-based capital
guidelines approved by the Federal Reserve Board. The following chart
summarizes the applicable bank regulatory capital requirements and the Bank's
capital ratios at June 30, 1995:
Bank Regulatory Minimum Regulatory BankAlabama at
Capital Requirements Requirement June 30, 1995
- -------------------- ------------------ --------------
Tier 1 capital to risk-adjusted assets 4.00% 8.30%
Total risk-based capital to risk-adjusted 8.00% 9.20%
assets
Tier 1 capital as a % of average total 4.00% 7.60%
assets
The Bank's capital exceeds the minimum risk-based guidelines adopted
by the Federal Reserve Board.
<PAGE>
<PAGE> 15
BANCALABAMA, INC., AND SUBSIDIARY
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None.
Item 2. CHANGES IN SECURITIES
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On April 11, 1995, the Annual Meeting of the Shareholders of
BancAlabama, Inc., was held. The matter voted on at the
meeting was the ratification of auditors. Browder &
Associates, P.C., were ratified as the Company's independent
public accountants for the fiscal year ended December 31,
1995, by the following vote:
FOR AGAINST WITHHELD ABSTENTION TOTAL
------- ------- -------- ---------- ------
461,277 -0- 151,645 200 613,122
Item 5. OTHER INFORMATION
None.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
See Exhibit Index included herein on page 16.
(b) Reports on Form 8-K.
The Registrant did not file any Current Reports on
Form 8-K during the quarter ended June 30, 1995.
<PAGE>
<PAGE> 16
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibit Description and Form 10-Q
Number Page or Method of Filing
<S> <C>
3.1 Registrant's Certificate of Incorporation, as amended - A
3.2 Amendment to Registrant's Certificate of Incorporation - F
3.3 Amended and Restated Bylaws of Registrant - A
10.1 Registrant's 1989 Incentive Stock Option Plan - B*
10.2 Registrant's 1989 Nonstatutory Stock Option Plan - C*
10.3 Nonstatutory Stock Option Agreement dated January 22, 1990, granting
William R. Collins an option to purchase 20,000 shares of the
Registrant's Common Stock - C*
10.4 Incentive Stock Option Agreement dated January 22, 1990, granting
William R. Collins an option to purchase 40,000 shares of the
Registrant's Common Stock - C*
10.5 Incentive Stock Option Agreement dated January 22, 1990, granting
Jean D. Snead an option to purchase 10,000 shares of the Registrant's
Common Stock - C*
10.6 Incentive Stock Option Agreement dated September 14,1992, granting
Robert F. Harwell, Jr., an option to purchase 10,000 shares of the
Registrant's Common Stock - D*
10.7 Nonstatutory Stock Option Agreement dated December 16, 1993, granting
Michael J. Williams, an option to purchase an aggregate of 10,000
shares of the Registrant's Common Stock - E*
10.8 Addendum to Registrant's 1989 Incentive Stock Option Plan - F*
10.9 Amendment Number One to Registrant's 1989 Nonstatutory Stock Option
Plan - F*
10.10 Cancellation of Incentive Stock Options Agreement between Registrant
and William R. Collins cancelling the Incentive Stock Option
Agreement dated January 22, 1990 - F*
10.11 Cancellation of Incentive Stock Options Agreement between Registrant
and Jean D. Snead cancelling the Incentive Stock Option Agreement
dated January 22, 1990 - F*
10.12 Cancellation of Incentive Stock Options Agreement between Registrant
and Robert F. Harwell, Jr., cancelling the Incentive Stock Option
Agreement dated September 14, 1992 - F*
10.13 Nonstatutory Stock Option Agreement dated February 1, 1994, granting
William R. Collins an option to purchase 40,000 shares of the
Registrant's Common Stock - F*
<PAGE>
<PAGE> 17
10.14 Nonstatutory Stock Option Agreement dated February 1, 1994, granting
Jean D. Snead an option to purchase 10,000 shares of the Registrant's
Common Stock - F*
10.15 Nonstatutory Stock Option Agreement dated February 1, 1994, granting
Robert F. Harwell, Jr., an option to purchase 10,000 shares of the
Registrant's Common Stock - F*
10.16 Amendment No. 1 to the Nonstatutory Stock Option Agreement with
William R. Collins dated January 22, 1990, reducing the exercise
price of such option from $11.75 per share to $10.00 per share - F*
27.1 Financial Data Schedule - page 19
</TABLE>
- -----------------------
A Incorporated by reference to exhibits filed with the
Registrant's Registration Statement on Form S-1 under the
Securities Act of 1933, File No. 33-14391.
B Incorporated by reference to exhibits filed with the
Registrant's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1989, under the Securities Exchange Act of
1934.
C Incorporated by reference to exhibits filed with the
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1989, under the Securities Exchange Act
of 1934.
D Incorporated by reference to exhibits filed with the
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992, under the Securities Exchange Act
of 1934.
E Incorporated by reference to exhibits filed with the
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1993, under the Securities Exchange Act
of 1934.
F Incorporated by reference to exhibits filed with the
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1994, under the Securities Exchange Act
of 1934.
* Denotes management contract or compensatory plan or
arrangement required to be filed as an exhibit to this
report.
<PAGE>
<PAGE> 18
BANCALABAMA, INC., AND SUBSIDIARY
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BANCALABAMA, INC.
DATE: August 10, 1995 By: William R. Collins
-----------------------------------
William R. Collins
Chief Executive Officer
DATE: August 10, 1995 By: Michael J. Williams
-----------------------------------
Michael J. Williams
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This Schedule contains summary financial information extracted from the
the Form 10-Q for the quarterly period ended June 30, 1995 and interim
financial statements, and is qualified in its entirety by reference to such
financial information.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 4,730,296
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 6,416,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 13,890,072
<INVESTMENTS-MARKET> 13,758,787
<LOANS> 53,705,729
<ALLOWANCE> 602,364
<TOTAL-ASSETS> 83,431,344
<DEPOSITS> 76,297,125
<SHORT-TERM> 0
<LIABILITIES-OTHER> 500,351
<LONG-TERM> 896,298
<COMMON> 613,122
0
0
<OTHER-SE> 5,124,448
<TOTAL-LIABILITIES-AND-EQUITY> 83,431,344
<INTEREST-LOAN> 2,797,322
<INTEREST-INVEST> 349,231
<INTEREST-OTHER> 83,761
<INTEREST-TOTAL> 3,230,314
<INTEREST-DEPOSIT> 1,325,258
<INTEREST-EXPENSE> 1,373,396
<INTEREST-INCOME-NET> 1,856,918
<LOAN-LOSSES> 150,000
<SECURITIES-GAINS> (11,029)
<EXPENSE-OTHER> 1,873,523
<INCOME-PRETAX> 313,359
<INCOME-PRE-EXTRAORDINARY> 313,359
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 206,259
<EPS-PRIMARY> .34
<EPS-DILUTED> .34
<YIELD-ACTUAL> 5.94
<LOANS-NON> 176,200
<LOANS-PAST> 368,100
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 106,800
<ALLOWANCE-OPEN> 505,125
<CHARGE-OFFS> 78,000
<RECOVERIES> 25,000
<ALLOWANCE-CLOSE> 602,364
<ALLOWANCE-DOMESTIC> 602,364
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
