<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended March 31, 2000
Commission file number 2-76555
ELDORADO BANCSHARES, INC.
-------------------------
(Exact name of registrant as specified in its charter)
Delaware 33-0720548
-------- ----------
(State or other jurisdiction of (I.R.S. Employer or
incorporation or organization) Identification No.)
24012 Calle de la Plata, Suite 340, Laguna Hills, California 92653
- ------------------------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
(949) 699-4344
--------------
(Issuer's telephone number)
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 [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, $.01 par value 14,391,227 shares outstanding on May 14, 2000
<PAGE>
ELDORADO BANCSHARES, INC.
U.S. SECURITIES AND EXCHANGE COMMISSION
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Page
<S> <C>
Part I - Financial Information
Item 1. Financial Statements
Condensed Consolidated Statements of Condition -
March 31, 2000 and December 31, 1999 3
Condensed Consolidated Statements of Operations -
For the three months ended March 31, 2000 and 1999 5
Condensed Consolidated Statements of Cash Flows - For the three
months ended March 31, 2000 and 1999 6
Notes to the Condensed Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
Item 3. Quantitative and Qualitative Disclosures about Market Risk 25
Part II - Other Financial Information
Item 5. Other Information 28
Item 6. Exhibits and Reports on Form 8-K 28
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ELDORADO BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
<TABLE>
<CAPTION>
March 31,
2000 December 31,
(Unaudited) 1999
----------- -----------
(in thousands)
<S> <C> <C>
ASSETS
Cash and due from banks $ 116,314 $ 122,839
Federal funds sold 5,870 ---
Securities 367,323 325,066
Loans and leases, net 672,120 662,764
Premises and equipment, net 10,504 10,423
Foreclosed real estate 828 563
Intangibles arising from acquisitions 57,857 58,830
Net assets of discontinued operations 91,169 140,719
Accrued interest receivable and other assets 46,176 45,036
----------- -----------
Total assets $ 1,368,161 $ 1,366,240
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Noninterest-bearing deposits $ 305,824 $ 261,121
Interest-bearing deposits 786,590 797,335
----------- -----------
Total deposits 1,092,414 1,058,456
Borrowings 117,281 149,640
Subordinated debentures 27,657 27,657
Accrued expenses and other liabilities 12,167 12,869
----------- -----------
Total liabilities 1,249,519 1,248,622
----------- -----------
Shareholders' equity:
Common stock and additional paid in capital
$.01 par value, 35,000,000 shares authorized,
14,391,227 issued and outstanding as of March 31, 2000 and
December 31, 1999 109,443 109,443
Retained earnings 17,966 16,525
Unearned compensation (1,040) (1,360)
Accumulated other comprehensive loss (7,727) (6,990)
----------- -----------
Total shareholders' equity 118,642 117,618
----------- -----------
Total liabilities and shareholders' equity $ 1,368,161 $ 1,366,240
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE>
ELDORADO BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------------
2000 1999
------------ ------------------
(in thousands, except per share amounts)
<S> <C> <C>
Interest and fee income on loans and leases $ 16,505 $ 15,497
Interest and dividend income on securities 5,518 3,379
Interest income on Federal funds sold 1,345 274
Interest on funds allocated to discontinued operations 715 2,415
------------ ------------
Total interest income 24,083 21,565
------------ ------------
Interest on deposits 7,551 7,535
Interest on borrowings 2,226 365
Interest on subordinated debentures 821 813
------------ ------------
Total interest expense 10,598 8,713
------------ ------------
Net interest income 13,485 12,852
Provision for credit losses 1,209 780
------------ ------------
Net interest income after provision for credit losses 12,276 12,072
------------ ------------
Service charges on deposit accounts 1,704 1,625
Other income 1,988 2,034
------------ ------------
Total non-interest income 3,692 3,659
------------ ------------
Salaries and employee benefits 5,790 5,604
Premises and equipment 1,536 1,634
Amortization of intangibles 974 1,024
Other expenses 4,669 4,281
------------ ------------
Total non-interest expense 12,969 12,543
------------ ------------
Income from continuing operations before taxes 2,999 3,188
Income tax provision 1,557 1,731
------------ ------------
Income from continuing operations 1,442 1,457
Loss from discontinued operations - (65)
------------ ------------
Net income $ 1,442 $ 1,392
============ ============
Net income available to common shareholders $ 1,442 $ 1,076
============ ============
Earnings per basic common share:
Income from continuing operations $0.10 $0.09
Loss from discontinued operations - -
------------ ------------
Net income $0.10 $0.09
------------ ------------
Earnings per diluted common share:
Income from continuing operations $0.10 $0.09
Loss from discontinued operations - -
------------ ------------
Net income $0.10 $0.09
------------ ------------
</TABLE>
See notes to condensed consolidated financial statements
4
<PAGE>
ELDORADO BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
2000 1999
------------ ---------------
(in thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $1,442 $1,392
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for credit losses 1,209 780
Depreciation and amortization 1,516 1,915
Gain on sale of securities - (264)
Mortgage loans originated for sale - (374,440)
Proceeds from sales of mortgage loans and servicing - 458,219
Gain on sale of mortgage loans and servicing - (3,120)
Net increase (decrease) in other assets and liabilities 46,482 3,600
------------ -----------
Net cash provided by operating activities 50,649 88,082
------------ -----------
INVESTING ACTIVITIES:
Loans originated net of principal repayments (10,565) (10,884)
Decrease (increase) in securities (42,257) 27,669
Increase in Federal funds sold (5,870) (4,850)
Purchases of premises and equipment (81) (302)
------------ -----------
Net cash provided by (used in) investing activities (58,773) 11,633
------------ -----------
FINANCING ACTIVITIES:
Increase (decrease) in deposits 33,958 (123,652)
Decrease in borrowings (32,359) (424)
Payment of preferred dividends - (316)
------------ -----------
Net cash provided by (used in) financing activities 1,599 (124,392)
------------ -----------
Decrease in cash for the period (6,525) (24,677)
Cash due from banks:
Beginning of period 122,839 124,403
------------ -----------
End of period $ 116,314 $ 99,726
============ ===========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest expense $10,598 $ 8,713
Income taxes - $ 165
</TABLE>
See notes to condensed consolidated financial statements
5
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BASIS OF PRESENTATION
The accompanying financial information for Eldorado Bancshares, Inc.
(the "Company") has been prepared in accordance with the Securities and Exchange
Commission rules and regulations for quarterly reporting and therefore does not
necessarily include all information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles. The interim financial data is unaudited; however, in the
opinion of management, the interim data includes all adjustments, consisting
only of normal recurring adjustments, necessary for a fair statement of the
results for the interim periods. The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that effect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those estimates. Results
for the three-month period ended March 31, 2000 are not necessarily indicative
of results which may be expected for any other interim period or for the year as
a whole. The information contained in this report should be read in conjunction
with the Annual Report on Form 10-K for the year ended December 31, 1999 and in
particular the footnotes to the audited consolidated financial statements
included therewith.
In October 1999, the Company adopted a plan to discontinue the
operations of the mortgage banking division. Accordingly, the operating results
and net assets of this division have been segregated retroactively from
continuing operations and reported separately in the condensed consolidated
financial statements.
RISKS AND UNCERTAINTIES
In the normal course of its business, the Company encounters two
significant types of risk: economic and regulatory. Economic risk is comprised
of three components - interest rate risk, credit risk and market risk. The
Company is subject to interest rate risk to the degree that its interest-bearing
liabilities mature and reprice at different speeds, or on a different basis,
than its interest-earning assets. Credit risk is the risk of default on the
Company's loan portfolio that results from the borrower's inability or
unwillingness to make contractually required payments. Market risk results from
changes in the value of assets and liabilities which may impact, favorably or
unfavorably, the realizability of those assets and liabilities.
The Company is subject to the regulations of various governmental
agencies. These regulations can and do change significantly from period to
period. The Company is also subject to periodic examinations by the regulatory
agencies, which may subject it to changes in asset valuations, in amounts of
required loss allowances and in operating restrictions resulting from judgments
by the regulators based on information available to them at the time of their
examination.
EARNINGS PER COMMON SHARE
The number of common shares outstanding at March 31, 2000 was
14,391,227. Earnings per basic common share is computed by dividing net
income available to common shareholders by the weighted average number of
common shares outstanding during the period. Earnings per diluted common
share gives effect to all potential issuances of common stock that would have
caused earnings per basic share to be lower, as if the issuances had already
occurred.
The weighted average number of common shares used to compute earnings
per basic share were 14,391,227 and 12,015,428 for the quarter ended March 31,
2000 and 1999, respectively. The average number of common shares used to compute
earnings per diluted share was 14,391,227 and 12,333,657 for the quarter ended
March 31, 2000 and 1999, respectively.
6
<PAGE>
COMPREHENSIVE INCOME
The Company's total comprehensive income was as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------------
2000 1999
------------ ------------
(in thousands)
<S> <C> <C>
Net income $1,442 $1,392
Unrealized holding loss, net of (737) (623)
tax, on securities available for
sale
------------ ------------
Total comprehensive income $ 705 769
============ ============
</TABLE>
OPERATING SEGMENTS
Upon the discontinuance of the mortgage banking division, the Company's
business consists of one segment - commercial banking. The Company does not have
revenues derived from foreign operations and is not reliant on revenues from a
single major customer.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
INTRODUCTION
This information should be read in conjunction with the condensed
consolidated financial statements and the notes thereto included in Item 1 of
this Quarterly Report on Form 10-Q and the audited consolidated financial
statements and notes thereto and Management's Discussion and Analysis of
Financial Condition and Results of Operations for the year ended December 31,
1999 contained in the 1999 Annual Report on Form 10-K.
Except for the historical information contained herein, the
following discussion contains forward looking statements that involve risks
and uncertainties. The Company's actual results could differ materially from
those discussed here. Factors that could cause or contribute to such
differences include, but are not specifically limited to, changes in
regulatory climate, shifts in interest rate environment, change in economic
conditions of various markets the Company serves, as well as the other risks
detailed in this section, and in the sections entitled Results of Operations,
Financial Condition, Capital, Liquidity and Market Risk, and those discussed
in the 1999 Annual Report on Form 10-K, including without limitation those
sections entitled Risk Factors, Supervision and Regulation, Capital Resources
and Liquidity.
Contained within this document are various measures of financial
performance that have been calculated excluding the amortization of intangibles
arising from acquisitions. These measures are identified as "excluding
intangible amortization" and have been provided to assist the reader in
evaluating the performance of the Company. This presentation is not defined by
generally accepted accounting principles; however, management believes it to be
beneficial to gaining an understanding of the Company's financial performance in
comparison to its peer group.
Prior to September 1995, the predecessor to the Company, SDN Bancorp,
Inc. ("SDN"), owned a single bank, San Dieguito National Bank ("San Dieguito"),
with approximately $56 million in assets. At that time, San Dieguito was
categorized as "critically undercapitalized" by federal regulators. In September
1995, SDN and San Dieguito were recapitalized by Dartmouth Capital Group, L.P.
("DCG"), a bank holding company organized by Robert Keller, the Company's
current President and Chief Executive Officer. Following the recapitalization,
Mr. Keller assumed control of SDN and San Dieguito, installed new management
and began implementing policies and improve the their asset quality and
operating performance.
Since September 1995, the Company has acquired four banks in California
with combined assets of approximately $1.0 billion. The following table
summarizes certain data regarding those acquisitions, including the asset size
of the acquired bank as of the end of the quarter immediately preceding the
acquisition.
<TABLE>
<CAPTION>
PRINCIPAL COUNTY ASSETS
ACQUIRED BANK ACQUISITION DATE OF ACQUIRED BANK ACQUIRED
- -------------------------------- ------------------------------- ------------------------ -----------------
(in millions)
<S> <C> <C> <C>
Liberty National Bank March 31, 1996 Orange $146
Commerce Security Bank September 30, 1996 Sacramento 229
Eldorado Bank June 6, 1997 Orange 404
Antelope Valley Bank January 22, 1999 Los Angeles 212
</TABLE>
Other than the Antelope Valley Bank transaction, each acquisition was
accounted for using the purchase method of accounting for business combinations.
Effective June 30, 1997, the Company consolidated into Eldorado Bank the
respective operations of San Dieguito, Liberty National Bank and Commerce
Security Bank. Antelope Valley Bank continues to operate as a separate banking
subsidiary of the Company.
8
<PAGE>
Through its two operating subsidiaries, Eldorado Bank and Antelope
Valley Bank (collectively referred to as the "Banks"), the Company offers a
broad range of commercial banking products and services to small and
medium-sized businesses and personal banking products and services to
individual customers from 24 full service offices located primarily in
Southern California and the Sacramento area of Northern California.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
OVERVIEW
Net income from continuing operations was $1.4 million for the first
quarter ended March 31, 2000, or $0.10 per diluted share. For the year ago
period, net income from continuing operations was $1.5 million, or $0.09 per
diluted share. The related return on average assets for the first quarter of
2000 and the first quarter of 1999 was .42 percent and .46 percent,
respectively. The return on average common equity for the first quarter of 2000
was 4.96 percent. For the same period a year ago, the return on average common
equity was 5.35 percent.
In the fourth quarter of 1999, the Company discontinued the operations
of the mortgage banking division. Accordingly, the operating results and net
assets of this division have been segregated retroactively from continuing
operations and are reported separately. The net loss from discontinued
operations for the first quarter of 1999 was $65,000 and had a nil effect on
earnings per share. There has been no change in the estimate that was recorded
in the fourth quarter of 1999 for disposal costs and losses.
<TABLE>
<CAPTION>
Three Months ended March 31,
----------------------------
2000 1999
---- ----
<S> <C> <C>
Income from continuing operations, before income taxes and
amortization of intangibles $3,973 $ 4,212
Income taxes 1,557 1,731
------ -------
Net operating income 2,416 2,481
Amortization of intangibles 974 1,024
------ -------
Net income from continuing operations 1,442 1,457
Net loss from discontinued operations -- (65)
------ -------
Net income $1,442 $ 1,392
====== =======
Earnings per common share from net operating income
Basic $ 0.17 $ 0.18
Diluted $ 0.17 $ 0.17
</TABLE>
Net operating income, which excludes the effect of discontinued
operations and the amortization of intangibles, was $2.4 million for the
first quarter of 2000, or $0.17 per diluted share. For the year ago period,
net operating income was $2.5 million, or $0.17 per diluted share. Revenues
from net interest income and service charges and fees increased $930,000, or
6 percent from the first quarter of 1999; however, the combination of higher
operating expenses and credit loss provision, together with the absence of
gains from securities transactions, off set the increase in revenues.
NET INTEREST INCOME AND NET INTEREST MARGIN
For the first quarter of 2000, net interest income was $13.5
million, up 5 percent from the same period last year. Net interest income was
$12.9 million for the first quarter of 1999. The increase in net interest
income is attributable to an increase in avearage yield on loans and
securities outstanding.
The net interest margin for the first quarter of 2000 was 4.54 percent,
compared with 4.65 percent for the year ago period. The decline in the net
interest margin is principally due to a higher proportion of lower-yielding
interest-earning assets. The average yield on interest-earning assets increased
to 8.14 percent for the first quarter of 2000 from 7.81 percent for the first
quarter of 1999. The average cost of interest-bearing liabilities, however also
increased to 4.43 percent for the first quarter of 2000. A year ago, the average
cost of interest-bearing liabilities was 4.13 percent.
9
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended March 31,
--------------------------------------------------------------------------------
2000 1999
---------------------------------------- ---------------------------------------
Interest Average Interest Average
Average Income or Yield or Average Income or Yield or
Balance Expense Cost Balance Expense Cost
----------- ----------- ------------ ----------- ----------- -----------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Assets:
Loans and leases $ 677,255 $16,505 9.80% $ 651,070 $15,497 9.52%
Securities 354,270 5,518 6.26% 246,703 3,379 5.55%
Federal funds sold 51,144 715 5.62% 29,252 274 3.80%
Funds allocated to discontinued operations 106,635 1,345 5.07% 177,494 2,415 5.44%
----------- ----------- ----- ----------- ----------- -----
Total interest-earning assets 1,189,304 24,083 8.14% 1,104,519 21,565 7.81%
Cash due from banks 67,086 60,364
Other assets 107,669 111,036
----------- -----------
Total assets 1,364,059 1,275,919
=========== ===========
Liabilities and shareholders' equity:
Interest-bearing deposits 791,726 7,551 3.84% 793,516 7,535 3.85%
Borrowings 142,125 2,226 6.27% 33,926 365 4.36%
Subordinated debt 27,657 821 11.87% 27,657 813 11.92%
----------- ----------- ------ ----------- ----------- ------
Total interest-bearing liabilities 956,508 10,598 4.43% 855,099 8,713 4.13%
Noninterest-bearing deposits 270,236 279,711
Other liabilities 16,026 20,561
----------- -----------
Total liabilities 1,247,770 1,155,371
Shareholders' equity 116,289 120,548
----------- -----------
Total liabilities and shareholders' equity $1,364,059 $1,275,919
=========== ===========
Net interest income $13,485 $12,852
Net yield on interest-earning assets 4.54% 4.65%
</TABLE>
10
<PAGE>
The following table sets forth changes in interest income and interest expense
attributable to changes in rates and changes in volume of the various
components. Changes due to a combination of rate and volume are presented under
the column titled "Mix. "
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------------------------------------
1999 compared to 1998
----------------------------------------------------------
Net
Change Rate Volume Mix
------------ ------------- ------------ ------------
(in thousands)
<S> <C> <C> <C> <C>
Loans and leases $ 1,008 $ 456 $ 623 $ (71)
Securities 2,139 441 1,465 233
Federal funds sold 441 133 208 100
Funds allocated to discontinued operations (1,070) (164) (964) 58
------------ ------------- ------------ ------------
Total interest income 2,518 866 1,332 320
------------ ------------- ------------ ------------
Interest-bearing deposits 16 (20) (17) 53
Borrowings 1,861 162 1,179 520
Subordinated debt 8 (3) - 11
------------ ------------- ------------ ------------
Total interest expense 1,885 139 1,162 584
------------ ------------- ------------ ------------
Net interest income $ 633 $ 727 $ 170 $(264)
============ ============= ============ ============
</TABLE>
PROVISION FOR CREDIT LOSSES
The Company maintains an allowance for potential credit losses. A
provision for credit losses is charged to operations for an amount sufficient to
maintain the allowance for credit losses at a level determined adequate for each
Bank. The provision for credit losses for the first quarter ended March 31, 2000
was $1.2 million, compared with $780,000 for the year ago period. As a
multiple of net charge-offs for the corresponding periods, the provision for
credit losses represented .94 times net charge-offs for the first quarter of
2000 compared with 1.03 times net charge-offs for the first quarter of 1999.
NON-INTEREST INCOME
The following table presents for the periods indicated the major
categories of non-interest income.
<TABLE>
<CAPTION>
Three Months ended March 31,
----------------------------
2000 1999
---- ----
(in thousands)
<S> <C> <C>
Service charges on deposit accounts $1,704 $1,625
SBA servicing 519 596
Other 1,469 1,174
-------- --------
Service charges and fees 3,692 3,395
Securities transactions - 264
-------- --------
Non-interest income $3,692 $3,659
======== ========
</TABLE>
Service charges and fees increased 9 percent to $3.7 million for the
first quarter of 2000 from $3.4 million for the first quarter of 1999. Gains
from the sales of securities totaled $264,000 for the first quarter last year.
There were no securities transactions for the first quarter of 2000.
NON-INTEREST EXPENSE
The following table presents for the periods indicated the major
categories of non-interest expenses.
11
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
2000 1999
---- ----
(in thousands)
<S> <C> <C>
Salaries and benefits $ 5,790 $ 5,604
Premises and equipment 1,536 1,634
Other expenses 4,669 4,206
-------- -------
Operating expenses 11,995 11,444
Amortization of intangibles 974 1,024
Foreclosed real estate - 75
-------- -------
Non-interest expense $12,969 $12,543
======== ========
</TABLE>
Operating expenses increased to $12.0 million for the first quarter of 2000 from
$11.4 million for the first quarter of 1999. The efficiency ratio for the first
quarter of 2000 was 69.8 percent, down from 70.4 percent for the same period a
year ago.
PROVISION FOR INCOME TAXES
The provision for income taxes for the first quarter ended March 31,
2000 was $1.6 million and represented an effective tax rate of 51.9 percent. For
the same period a year ago, the provision for income taxes was $1.7 million and
represented an effective tax rate of 54.9 percent. The effective tax rate is
higher than the combined federal and state statutory rate of 42.0 percent
principally because the amortization of intangibles is not deductible for income
tax purposes.
FINANCIAL CONDITION AS OF MARCH 31, 2000 AND DECEMBER 31, 1999
At March 31, 2000, the Company had total assets of $1.4 billion. At
year-end, total assets also were $1.4 billion. Although loans and securities
increased since the end of the year, this increase was offset by a decline in
the amount of net assets from discontinued operations.
LOANS AND LEASES
The following table presents for the periods indicated the major
categories of loans.
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
------------- ----------------
<S> <C> <C>
Commercial loans and lines $120,042 $123,170
Commerical mortgages 230,257 228,662
Residential construction 73,950 62,823
Lease financing 70,903 80,472
Installment loans 159,448 156,356
Residential mortgages 16,097 14,971
Home equity loans and lines 20,764 16,892
Unearned discount and deferred fees (9,133) (10,297)
------------- ------------
Total loans 682,328 673,049
Allowance for credit losses (10,208) (10,285)
------------- ------------
Loans and leases, net $672,120 $662,764
============= ============
</TABLE>
For regulatory reporting purposes and the table above, commercial
loans that are secured in whole or part by real estate are categorized as
commercial mortgage loans. The Company believes such categorization
overstates the Company's emphasis on real estate lending because, for
example, all SBA loans are secured by real estate and are categorized as
commercial mortgage loans. As of March 31, 2000 SBA loans totaled $85.9
million.
12
<PAGE>
The following table shows the maturities of loans and leases as of
March 31, 2000 based on remaining scheduled repayments of principal. Demand
or other loans having no stated maturity and no stated schedule of repayments
are reported as due in one year or less.
<TABLE>
<CAPTION>
March 31,
2000
------------------
(in thousands)
<S> <C>
Aggregate maturities of loans and leases which are due:
Three months or less $310,095
Over three months through 12 months 58,598
Over one year through three years 104,808
Over three years through five years 132,875
Over five years 85,085
------------------
$691,461
==================
</TABLE>
NONPERFORMING ASSETS
The following table shows the total aggregate principal amount of
nonaccrual and other nonperforming loans (accruing loans on which interest or
principal is past due 90 days or more).
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
------------ ------------
(in thousands)
<S> <C> <C>
Nonaccrual, not restructured $10,924 $ 7,984
90 days or more past due and accruing 59 50
Restructured loans 3,420 3,513
------------ ------------
Total nonperforming loans and leases 14,403 11,547
Foreclosed real estate 828 563
------------ ------------
Total nonperforming assets $15,231 $12,111
============ ============
Selected ratios:
Nonperforming loans to loans 2.11% 1.72%
Nonperforming assets to assets 1.11% 0.89%
</TABLE>
13
<PAGE>
Nonperforming loans totaled $14.4 million at March 31, 2000, up from
$11.5 million at year-end. The increase is attributable to the small-equipment
lease portfolio. Nonperforming loans, except for loans past due 90 days or more
and still accruing, are designated as impaired loans.
Management is not aware of any loan that had not been placed on
nonaccrual status as of March 31, 2000 for which there was a serious doubt as to
the ability of the borrower to comply with present loan repayment terms.
ALLOWANCE FOR CREDIT LOSSES
The allowance for credit losses was $10.2 million at March 31, 2000
compared with $10.3 million at December 31, 1999. Net charge-offs for the first
quarter of 2000 were $1.3 million and the provision charged to operations was
$1.2 million. A year ago, the allowance for credit losses was $9.2 million at
March 31, 1999. Net charge-offs for the first quarter of 1999 were $756,000 and
the provision charged to operations was $780,000.
The table below summarizes average loans and leases, loans and leases,
nonperforming loans and leases and changes in the allowance for possible credit
losses.
<TABLE>
<CAPTION>
As of and for the Quarter ended
--------------------------------------------
March 31, December 31, March 31,
2000 1999 1999
----------- ----------- -----------
(in thousands)
<S> <C> <C> <C>
Average loans and leases $677,255 $671,486 $651,070
Loans and leases 682,328 673,049 651,605
Nonperforming loans and leases 14,403 11,547 13,235
Allowance for credit losses:
Balance at beginning of period $10,285 $ 9,245 $9,160
----------- ----------- -----------
Commercial 922 16 33
Leases 1,097 1,523 633
Real estate 139 357 330
Installment 590 594 681
----------- ----------- -----------
Loans charged off during period 1,848 2,490 1,677
----------- ----------- -----------
Commercial 110 329 126
Leases 112 187 90
Real estate 10 112 418
Installment 330 212 287
----------- ----------- -----------
Recoveries during period 562 840 921
----------- ----------- -----------
Net loans charged off during period 1,286 1,650 756
----------- ----------- -----------
Provision for credit losses 1,209 2,690 780
----------- ----------- -----------
Balance at end of period $10,208 $10,285 $9,184
=========== =========== ===========
Selected ratios:
Net charge-offs (annualized) to average 0.76% 0.98% 0.47%
loans and leases
Provision for credit losses (annualized) 0.71 1.60 0.49
to average loans and leases
Allowance at end of period to loans and 1.55 1.53 1.41
leases outstanding at end of period
Allowance as percentage of nonperforming 99.26 111.25 69.39
loans and leases
</TABLE>
14
<PAGE>
The following table indicates management's allocation of the allowance
as of the dates indicated:
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
--------- -------------
(dollars in thousands)
<S> <C> <C> <C> <C>
Commercial financial and agricultural $ 7,027 68.8% $ 6,960 67.7%
Real estate and construction 1,403 13.7 1,611 15.7
Consumer 1,052 10.3 941 9.1
Unallocated 726 7.2 773 7.5
------- ------- ------- ------
Allowance for possible credit losses $10,208 100.0% $10,285 100.0%
======= ====== ======= ======
</TABLE>
In allocating the Company's allowance for possible credit losses,
management has considered the credit risk in the various loan categories in its
portfolio. While the Company has made a reasonable effort to allocate the
allowance to specific categories of loans, management believes that any
allocation of the allowance for possible credit losses into loan categories
lends an appearance of exactness which does not exist, in that the allowance for
possible credit losses is utilized as a single unallocated allowance available
for losses on all types of loans and leases, and actual losses in loan
categories may vary from the amounts allocated to such categories.
SECURITIES
Securities available for sale totaled $367.3 million at March 31,
2000 compared with $325.1 million at the end of 1999. The securities
portfolio primarily consists of bonds, notes and mortgaged-backed securities
issued by US Government agencies. The amortized costs and estimated market
values of the securities follows:
<TABLE>
<CAPTION>
March 31, 2000
-------------------------------------------------------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gain Loss Value
------------- ------------- ------------- ------------
(in thousands)
<S> <C> <C> <C> <C>
U.S. Treasury $ 14,498 $ - $ (44) $ 14,454
U.S. Government agencies 110,725 13 (4,220) 106,518
State and municipal securities 49,166 129 (1,919) 47,376
Mortgage-backed securities 191,544 26 (6,746) 184,824
Corporate bonds and equities 14,573 - (422) 14,151
------------- ------------- ------------- ------------
Total $380,506 $168 $(13,351) $367,323
============= ============= ============= ============
</TABLE>
15
<PAGE>
The following table shows the maturities of securities at March 31,
2000.
<TABLE>
<CAPTION>
March 31, 2000
-------------------
<S> <C>
Aggregate maturities of securities available for sale which are due:
Within one year $ 21,987
After one year but within three years 66,278
After three years but within 15 years 108,188
After 15 years 170,870
-------------------
$367,323
===================
</TABLE>
DEPOSITS
Deposits were $1.092 billion at March 31, 2000, compared with $1.058
billion at December 31, 1999. Noninterest-bearing deposits represented 28
percent of total deposits at the end of the first quarter of 2000. At the end
of 1999, noninterest-bearing deposits represented 25 percent of total
deposits. Time deposits of $100,000 or more continue to represent a small
proportion of total deposits. At March 31, 2000, time deposits of $100,000 or
more represented 10 percent of total deposits, compared to 9 percent at the
end of 1999.
The following table presents the average balances and weighted average
rate paid on deposits:
<TABLE>
<CAPTION>
Three Months Ended March 31,
------------------------------------------------------------
2000 1999
---------------------------- -----------------------------
Average Average Average Average
Balance Rate Balance Rate
(dollars in thousands)
<S> <C> <C> <C> <C>
Noninterest-bearing $270,236 - $279,711 -
Interest-bearing 791,726 3.84% 793,516 3.85%
------------ -------------
Total $1,061,962 2.84% $1,073,227 2.85%
============ =============
</TABLE>
16
<PAGE>
The following table shows the maturities of time certificates of
deposits of $100,000 or more at:
<TABLE>
<CAPTION>
March 31, 2000 December 31, 1999
------------------ -------------------
(in thousands)
<S> <C> <C>
Due in three months or less $ 39,837 $36,273
Due in over three months through twelve months 58,515 49,962
Due in over twelve months 4,908 4,324
------------------ -------------------
Total $103,260 $90,559
================== ===================
</TABLE>
BORROWINGS
Borrowings totaled $117.3 million at March 31, 2000, compared with
$149.6 million at December 31, 1999.
CAPITAL
Current regulatory capital standards generally require banks and
holding companies to maintain a ratio of Tier 1 capital (consisting
principally of common equity) to adjusted total assets ("Leverage Ratio") of
at least 3 percent, a ratio of Tier 1 Capital to risk-weighted assets of at
least 4 percent ("Tier 1 Capital Ratio"), and a ratio of total capital (which
includes Tier 1 capital plus certain forms of subordinated debt, a portion of
the allowance for credit losses and preferred stock) to risk-weighted assets
("Total Capital Ratio") of at least 8 percent. Risk-weighted assets are
calculated by multiplying the balance in each category of assets according to
a risk factor which ranges from zero for cash assets and certain government
obligations to 100 percent for some types of loans and adding the products
together.
The Company and its subsidiary banks were well capitalized at March 31,
2000 for federal regulatory purposes. At March 31, 2000, the Company and
subsidiary banks had a Leverage ratio, Tier 1 capital ratio and Total capital
ratio as follows:
<TABLE>
<CAPTION>
Antelope
Eldorado Bank Valley Bank Company
------------- ----------- --------
<S> <C> <C> <C>
Leverage ratio 6.40% 9.69% 7.36%
Tier 1 capital ratio 10.13% 12.84% 11.29%
Total capital ratio 11.35% 13.98% 12.49%
</TABLE>
On May 1, 2000, the Company announced that its Board of Directors had
authorized the Company to repurchase up to 1,000,000 shares of its common stock.
The purchases may be made from time to time in open market and privately
negotiated transactions. The purpose of the common stock repurchases is to
redeploy a portion of the Company's capital that formerly was used to support
the wholesale mortgage lending business.
LIQUIDITY
The Company relies on deposits as its principal source of funds and,
therefore, must be in a position to service depositors' needs as they arise.
Management attempts to maintain a loan-to-deposit ratio of not greater than
80 percent and a liquidity ratio (liquid assets, including cash and due from
banks, Federal funds sold and securities, to deposits) of approximately 20
percent. The average loan-to-deposit ratio was 63.8 percent for the quarter
ended March 31, 2000. The average liquidity ratio was 44.5 percent for the
quarter ended March 31, 2000. At year-end 1999, the loan-to-deposit ratio was
63.6 percent and the liquidity ratio was 52.4 percent. While fluctuations in
the balances of a few large depositors cause temporary increases and
decreases in liquidity from time to time, the Company has not experienced
difficulty in dealing with such fluctuations from existing liquidity sources.
Should the level of liquid assets (primary liquidity) not meet the
liquidity needs of the Company, other available sources of liquid assets
(secondary liquidity), including the purchase of Federal funds, sale of
securities under agreements to repurchase, sale of loans, window borrowing from
the Federal Reserve
17
<PAGE>
Bank and, borrowings from the FHLB, could be utilized. The Company has relied
primarily upon the purchase of Federal funds and the sale of securities under
agreements to repurchase for secondary sources of liquidity. At March 31, 2000,
the Company had $100.0 million of unused borrowing capacity under FHLB advances.
In order to borrow from the Federal Reserve, the Company would be required to
physically deliver to the Federal Reserve collateral consisting of marketable
Government securities. At March 31, 2000, the Company has no such collateral at
the Federal Reserve.
ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURE ABOUT MARKET RISK
In Management's opinion there has not been a material change in the
Company's market risk profile during the quarter ended March 31, 2000. Market
risk is the risk of loss in a financial instrument arising from adverse changes
in market prices and rates, foreign currency exchange rates, commodity prices
and equity prices. The Company's market risk arises primarily from interest rate
risk inherent in its lending and deposit taking activities. To that end,
management actively monitors and manages its interest rate risk exposure. The
Company does not have any market risk sensitive instruments acquired for trading
purposes. The Company manages its interest rate sensitivity by matching the
repricing opportunities on its earning assets to those on its funding
liabilities. Management uses various asset/liability strategies to manage the
repricing characteristics of its assets and liabilities to ensure that exposure
to interest rate fluctuations is limited within Company guidelines of acceptable
levels of risk-taking. Hedging strategies, including the terms and pricing of
loans and deposits, and managing the deployment of its securities are used to
reduce mismatches in interest rate repricing opportunities of portfolio assets
and their funding sources.
When appropriate, management may utilize off balance sheet instruments
such as interest rate floors, caps and swaps to hedge its interest rate
position. A Board of Directors approved hedging policy statement governs use of
these instruments. As of March 31, 2000, the Company had not utilized any
interest rate swap or other such financial derivative to alter its interest rate
risk profile.
One way to measure the impact that future changes in interest rates
will have on net interest income is through a cumulative gap measure. The gap
represents the net position of assets and liabilities subject to repricing in
specified time periods. Generally, a liability sensitive gap position indicates
that there would be a net positive impact on the net interest margin of the
Company for the period measured in a declining interest rate environment since
the Company's liabilities would reprice to lower market rates before its assets
would. A net negative impact would result from an increasing interest rate
environment. Conversely, an asset sensitive gap indicates that there would be a
net positive impact on the net interest margin in a rising interest rate
environment since the Company's assets would reprice to higher market interest
rates before its liabilities would, while a net negative impact would result
from a declining rate environment.
The following table sets forth the distribution of repricing
opportunities of the Company's interest-earning assets and interest-bearing
liabilities, the interest rate sensitivity gap (i.e., interest rate sensitive
assets less interest rate sensitive liabilities), cumulative interest-earning
assets and interest-bearing liabilities, the cumulative interest rate
sensitivity gap, the ratio of cumulative interest-earning assets to cumulative
interest-bearing liabilities and the cumulative gap as a percentage of total
assets and total interest-earning assets as of March 31, 2000. The table also
sets forth the time periods during which interest-earning assets and
interest-bearing liabilities will mature or may reprice in accordance with their
contractual terms. The interest rate relationships between the repriceable
assets and repriceable liabilities are not necessarily constant and may be
affected by many factors, including the behavior of customers in response to
changes in interest rates. This table should, therefore, be used only as a guide
as to the possible effect changes in interest rates might have on the net
margins of the Company.
18
<PAGE>
<TABLE>
<CAPTION>
AS OF MARCH 31, 2000
-------------------------------------------------------------------------------------------
Amounts Maturing or Repricing In
-------------------------------------------------------------------------------------------
Over 3
Months Over 1
3 Months to 12 Year to Over Non-
Or Less Months 5 Years 5 Years Sensitive(1) Total
--------------- -------------- ------------- ------------- -----------------------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and due from banks $ - $ - $ - $ - $116,314 $ 116,314
Federal funds sold 5,870 - - - - 5,870
Securities 12,442 9,417 93,475 251,951 38 367,323
Loans and leases 300,962 58,598 237,683 85,085 - 682,328
Other assets (2) - - - - 196,326 196,326
--------------- -------------- ------------- ------------- -------------- -------------
Total assets 319,274 68,015 331,158 337,036 312,678 1,368,161
=============== ============== ============= ============= ============== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits - - - - 305,824 305,824
Interest-bearing deposits 633,758 141,570 11,262 - - 786,590
Borrowings 22,281 65,000 30,000 - - 117,281
Subordinated debentures - - - 27,657 - 27,657
Other liabilities - - - - 12,167 12,167
Shareholders' equity - - - - 118,642 118,642
--------------- -------------- ------------- ------------- -------------- -------------
Total liabilities &
shareholders' equity $656,039 $206,570 $ 41,262 $ 27,657 $436,633 $1,368,161
=============== ============== ============= ============= ============== =============
Period gap ($336,765) ($138,555) $289,896 $309,379 ($123,955)
Cumulative gap ($336,765) ($475,320) ($185,424) $123,955
Cumulative interest-earning
assets to cumulative interest-
bearing liabilities 0.49 0.45 0.79 1.13
Cumulative gap as a percent of:
Total assets -24.61% -34.74% -13.55% 9.06%
Interest-earning assets -31.91% -45.03% -17.57% 11.74%
</TABLE>
- ---------------------------------------
(1) Assets or liabilities which are not interest rate-sensitive.
(2) Allowance for possible credit losses of $10.2 million as of March 31, 2000
is included in other assets.
At March 31, 2000, the Company had $475.3 million more in interest rate
sensitive liabilities than interest rate sensitive assets repricing within one
year. If rates were to fall during this period, interest expense would decline
by a greater amount than interest income and net income would increase.
Conversely, if rates were to rise, the reverse would apply, and the Company's
net income would decrease.
Since interest rate changes do not affect all categories of assets
and liabilities equally or simultaneously, a cumulative gap analysis alone
cannot be used to evaluate the Company's interest rate sensitivity position.
To supplement traditional gap analysis, the Company performs simulation
modeling to estimate the potential effects of changing interest rates. The
process allows the Company to explore the complex relationships within the
gap over time and various interest rate environments. Based upon the
Company's interest rate shock simulations, net interest income is expected to
decrease approximately 1.5 percent with a 200 basis point instantaneous
increase to interest rates and increase approximately 1.3 percent with a 200
basis point instantaneous decrease in rates. Management has a target of
minimizing the decline in net interest income to no more than 4.0 percent
given a 200 basis point instantaneous decrease in rates.
The preceding sensitivity analysis does not represent a forecast and
should not be relied upon as being indicative of expected operating results.
These hypothetical estimates are based upon numerous
19
<PAGE>
assumptions, including the nature and timing of interest rate levels including
the shape of the yield curve prepayments on loans and securities, changes in
deposit levels, pricing decisions on loans and deposits, reinvestment and
replacement of asset and liability cashflows and others. While assumptions are
developed based upon current economic and local market conditions, the Company
cannot make any assurances as to the predictive nature of these assumptions
including how customer preferences or competitor influences might change.
Also, as market conditions vary from those assumed in the sensitivity
analysis, actual results will also differ because of prepayment and refinancing
levels likely deviating from those assumed, the varying impact of interest rate
change caps or floors on adjustable rate loans, depositor withdrawals and
product preference changes, and other internal and external variables.
Furthermore, the sensitivity analysis does not reflect actions that management
might take in responding to or anticipating changes in interest rates.
Management has taken several steps to reduce the positive gap of the
Company by lengthening the maturities in its investment portfolio and
originating more fixed-rate assets that mature or reprice in balance with its
interest bearing liabilities. Management will continue to maintain a balance
between its interest earning assets and interest bearing liabilities in order to
minimize the impact on net interest income due to changes in market rates.
20
<PAGE>
PART II - OTHER FINANCIAL INFORMATION
ITEM 5. OTHER INFORMATION
On May 1, 2000, the Company announced that its Board of Directors had
authorized the Company to repurchase up to 1,000,000 shares of its common stock.
The purchases may be made from time to time in open market and privately
negotiated transactions.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
EXHIBITS:
EXHIBIT NO. EXHIBIT
3.1 Amended and Restated Certificate of Incorporation (filed as
Exhibit 3.3 to the Company's Registration Statement on Form S-1
(file no. 333-61589) and incorporated by reference herein)
3.2 By-laws of the Company (filed as Exhibit 10.2 to the Company's
Quarterly Report on Form 10-QSB for the quarter ended September
30, 1996 and incorporated by reference herein)
4.1 Form of Specimen Stock Certificate (incorporated by reference to
the Company's Form 8-A filed with the Commission on
January 29, 1999)
10.3 Indenture between the Company and Wilmington Trust Company,
dated as of July 15, 1998 (incorporated by reference to the
Company's Current Report on Form 8-K filed with the Commission
on August 7, 1998)
10.4 Form of Junior Subordinated Debenture (incorporated by reference
to the Company's Registration Statement on Form S-4
(File no. 333-51179))
10.5 Form of Series A Capital Securities Guarantee (incorporated by
reference to the Company's Registration Statement on Form S-4
(File no. 333-51179))
10.6 Form of Subordinated Capital Income Security, Series A
(incorporated by reference to the Company's Registration Statement
on Form S-4 (File no. 333-51179))
10.7 Employment Agreement by and between the Company and Robert P.
Keller (incorporated by reference to the Company's Quarterly Report
on Form 10-Q for the Quarter Ended September 30, 1997)
10.8 Employment Agreement by and between Eldorado Bank and Catherine C.
Clampitt (incorporated by reference to the Company's Registration
Statement on Form S-1 (File no. 333-61589))
10.9 Employment Agreement by and between Eldorado Bank and Richard
Korsgaard (incorporated by reference to the Company's Registration
Statement on Form S-1 (File no. 333-61589))
10.10 Amendment Number One to Employment Agreement by and between
Eldorado Bank and Richard Korsgaard (incorporated by reference
to the Company's Registration Statement on Form S-1
(File no. 333-61589))
10.11 Form of Severance Agreement between the Company and certain
executive officers (incorporated by reference to the Company's
Registration Statement on Form S-1 (File no. 333-61589))
21
<PAGE>
10.12 Form of Amended and Restated Series B Warrant held by Madison
Dearborn and Olympus (incorporated by reference to the Company's
Registration Statement on Form S-1 (File no. 333-61589))
10.13 Amended and Restated Shareholder Agreement by and among Eldorado
Bancshares, Inc., Madison Dearborn Capital Partners II, L.P.,
Olympus Growth Fund II, L.P., Olympus Executive Fund, L.P.,
Dartmouth Capital Group, L.P., Dartmouth Capital Group, Inc.
and Robert P. Keller
27 Financial Data Schedule
REPORTS ON FORM 8-K:
Report on Form 8-K dated April 17, 2000: this filing provided notice of
the Company's Annual Meeting of Shareholders to be held on Tuesday, May 16,
2000.
22
<PAGE>
ELDORADO BANCSHARES, INC. AND SUBSIDIARIES
U.S. SECURITIES AND EXCHANGE COMMISSION FORM 10-Q
SIGNATURES
Pursuant to the requirements of the U.S. Securities Exchange Act of 1934, ELBI
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
ELDORADO BANCSHARES, INC.
DATE: May 15, 2000 By: /s/ Robert P. Keller
--------------------------------------
Robert P. Keller
President and Chief Executive Officer
DATE: May 15, 2000 By: /s/ Romolo C. Santarosa
--------------------------------------
Romolo C. Santarosa
Senior Vice President,
Chief Financial Officer and Treasurer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 116,314
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 5,870
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 367,323
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 682,328
<ALLOWANCE> (10,208)
<TOTAL-ASSETS> 1,368,161
<DEPOSITS> 1,092,414
<SHORT-TERM> 117,281
<LIABILITIES-OTHER> 12,167
<LONG-TERM> 27,657
0
0
<COMMON> 109,443
<OTHER-SE> 9,199
<TOTAL-LIABILITIES-AND-EQUITY> 1,368,161
<INTEREST-LOAN> 16,505
<INTEREST-INVEST> 6,863
<INTEREST-OTHER> 715
<INTEREST-TOTAL> 24,083
<INTEREST-DEPOSIT> 7,551
<INTEREST-EXPENSE> 3,047
<INTEREST-INCOME-NET> 13,485
<LOAN-LOSSES> 1,209
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 14,526
<INCOME-PRETAX> 2,999
<INCOME-PRE-EXTRAORDINARY> 2,999
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,442
<EPS-BASIC> 0.10
<EPS-DILUTED> 0.10
<YIELD-ACTUAL> 4.54
<LOANS-NON> 10,924
<LOANS-PAST> 59
<LOANS-TROUBLED> 3,420
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
