<PAGE> 1
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 Quarter Ended Commission File Number
March 31, 1996 0-16421
PROVIDENT BANKSHARES CORPORATION
--------------------------------
(Exact Name of Registrant as Specified in its Charter)
Maryland 52-1518642
- -------------------------------- ----------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification
Number)
114 East Lexington Street; Baltimore, Maryland 21202
-----------------------------------------------------
(Address of Principal Executive Offices)
(410) 281-7000
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
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 the latest practicable date:
Common Stock, par value $1.00 per share, 8,017,190 shares outstanding at
March 29, 1996.
1
<PAGE> 2
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
TABLE OF CONTENTS
-----------------
PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statement of Financial Condition--
March 31, 1996 and 1995 and December 31, 1995 3
Consolidated Statement of Income--
Three Months Ended March 31, 1996 and 1995 4
Consolidated Statement of Cash Flows--
Three Months Ended March 31, 1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II - OTHER INFORMATION 14
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES 15
Exhibit Index 16
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
CONSOLIDATED STATEMENT OF CONDITION
Provident Bankshares Corporation and Subsidiaries
<TABLE>
<CAPTION>
MARCH 31 December 31 March 31
(dollars in thousands) 1996 1995 1995
- --------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C>
Cash and Due From Banks $ 52,956 $ 49,891 $ 45,739
Short-Term Investments 4,859 2,710 1,843
Mortgage Loans Held for Sale 68,810 86,326 29,438
Securities Available for Sale 953,060 1,017,697 417,403
Investment Securities (Market Value $32,825, $31,018 and
$434,842 at March 31, 1996, December 31, 1995, and
March 31, 1995, respectively) 33,359 31,420 435,725
Loans:
Consumer 866,025 778,467 524,330
Commercial Business 215,381 205,876 183,023
Real Estate -- Construction 88,192 77,896 60,827
Real Estate -- Mortgage 273,479 270,549 553,923
- --------------------------------------------------------------------------------------------------------------------------
Total Loans 1,443,077 1,332,788 1,322,103
Less: Allowance for Loan Losses 21,556 21,462 20,800
- --------------------------------------------------------------------------------------------------------------------------
Net Loans 1,421,521 1,311,326 1,301,303
- --------------------------------------------------------------------------------------------------------------------------
Premises and Equipment, Net 33,037 33,059 29,881
Accrued Interest Receivable 17,174 16,778 15,116
Investment Securities Sold Not Delivered 53,830 -- --
Other Assets 24,930 13,754 28,471
- --------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $2,663,536 $2,562,961 $2,304,919
- --------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Deposits:
Noninterest-Bearing $ 141,847 $ 132,479 $ 108,965
Interest-Bearing 1,505,227 1,436,860 1,370,793
- --------------------------------------------------------------------------------------------------------------------------
TOTAL DEPOSITS 1,647,074 1,569,339 1,479,758
- --------------------------------------------------------------------------------------------------------------------------
Short-Term Borrowings 500,637 517,641 429,020
Long-Term Debt 252,812 267,865 214,200
Investment Securities Purchased Not Received 59,397 -- --
Other Liabilities 22,305 23,708 24,123
- --------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 2,482,225 2,378,553 2,147,101
- --------------------------------------------------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY
Common Stock (Par Value $1.00) Authorized 30,000,000 Shares,
Issued 8,243,556, 8,125,403 and 7,973,955 Shares at March 31, 1996,
December 31, 1995 and March 31, 1995, respectively 8,244 8,125 7,604
Capital Surplus 81,485 78,951 67,616
Retained Earnings 96,983 93,031 90,440
Net Unrealized Gain (Loss) on Debt Securities (2,911) 6,791 (5,352)
Treasury Stock at Cost -- 228,066 Shares at March 31, 1996,
December 31, 1995 and March 31, 1995 (2,490) (2,490) (2,490)
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY 181,311 184,408 157,818
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $2,663,536 $2,562,961 $2,304,919
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 4
CONSOLIDATED STATEMENT OF INCOME
Provident Bankshares Corporation and Subsidiaries
<TABLE>
<CAPTION>
Three Months Ended
March 31,
- ---------------------------------------------------------------------------------------------------
(in thousands, except per share data) 1996 1995
- ---------------------------------------------------------------------------------------------------
INTEREST INCOME
<S> <C> <C>
Interest and Fees on Loans $ 29,461 $ 26,268
Interest on Securities 16,746 14,908
Tax-Advantaged Interest 752 439
Interest on Short-Term Investments 37 73
- ---------------------------------------------------------------------------------------------------
TOTAL INTEREST INCOME 46,996 41,688
- ---------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest on Deposits 15,069 12,873
Interest on Short-Term Borrowings 6,501 6,435
Interest on Long-Term Debt 3,736 2,612
- ---------------------------------------------------------------------------------------------------
TOTAL INTEREST EXPENSE 25,306 21,920
- ---------------------------------------------------------------------------------------------------
Net Interest Income 21,690 19,768
Less: Provision for Loan Losses 5,400 --
- ---------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 16,290 19,768
- ---------------------------------------------------------------------------------------------------
NON-INTEREST INCOME
Service Charges on Deposit Accounts 3,615 2,362
Mortgage Banking Activities 3,300 2,109
Commissions and Fees 753 661
Net Securities Gains 5,070 --
Other Non-Interest Income 1,104 462
- ---------------------------------------------------------------------------------------------------
TOTAL NON-INTEREST INCOME 13,842 5,594
- ---------------------------------------------------------------------------------------------------
NON-INTEREST EXPENSE
Salaries and Employee Benefits 12,123 10,105
Occupancy Expense, Net 2,015 1,851
Furniture and Equipment Expense 1,502 1,258
External Processing Fees 2,288 1,661
Other Non-Interest Expense 3,955 4,905
- ---------------------------------------------------------------------------------------------------
TOTAL NON-INTEREST EXPENSE 21,883 19,780
- ---------------------------------------------------------------------------------------------------
INCOME BEFORE TAXES 8,249 5,582
Income Tax Expense 2,944 1,872
- ---------------------------------------------------------------------------------------------------
NET INCOME $ 5,305 $ 3,710
===================================================================================================
NET INCOME PER SHARE $ 0.64 $ 0.46
===================================================================================================
</TABLE>
4
<PAGE> 5
CONSOLIDATED STATEMENT OF CASH FLOWS
Provident Bankshares Corporation and Subsidiaries
<TABLE>
<CAPTION>
Three Months Ended March 31
- ------------------------------------------------------------------------------------------------------------
(in thousands) 1996 1995
- ------------------------------------------------------------------------------------------------------------
OPERATING ACTIVITIES:
<S> <C> <C>
Net Income $ 5,305 $ 3,710
Adjustments to Reconcile Net Income to
Net Cash Provided (Used) by Operating Activities:
Depreciation and Amortization 1,485 1,372
Provision for Loan Losses 5,400 --
Provision for Deferred Income Tax Benefit (293) (243)
Realized Net Securities Gains (5,070) --
Loans Originated or
Acquired and Held for Sale (166,970) (61,212)
Proceeds from Sales of Loans 185,056 77,436
Gain on Sales of Loans (570) (116)
Other Operating Activities (2,824) 8,394
- ------------------------------------------------------------------------------------------------------------
Total Adjustments 16,214 25,631
- ------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 21,519 29,341
- ------------------------------------------------------------------------------------------------------------
Investing Activities:
Principal Collections and Maturities of Securities Available for Sale 54,077 21,754
Principal Collections and Maturities of Securities Held to Maturity 1,545 9,137
Proceeds on Sales of Securities Available for Sale 165,949 --
Purchases of Securities Held to Maturity (3,500) (2,641)
Purchases of Securities Available for Sale (166,446) (15,080)
Loan Originations and Purchases
Less Principal Collections (113,679) (49,468)
Purchases of Premises and Equipment (1,229) (1,425)
- ------------------------------------------------------------------------------------------------------------
NET CASH USED BY INVESTING ACTIVITIES (63,283) (37,723)
- ------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES:
Net Increase in Deposits 77,735 31,181
Net Decrease in Short-Term Borrowings (17,004) (50,230)
Proceeds from Long-Term Debt 25,000 27,000
Payments and Maturities of Long-Term Debt (40,053) --
Issuance of Common Stock 2,653 1,486
Cash Dividends on Common Stock (1,353) (847)
- ------------------------------------------------------------------------------------------------------------
Net Cash Provided by Financing Activities 46,978 8,590
- ------------------------------------------------------------------------------------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS 5,214 208
Cash and Cash Equivalents at Beginning of Year 52,601 47,374
- ------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 57,815 $ 47,582
- ------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DISCLOSURES
- ------------------------------------------------------------------------------------------------------------
Interest Paid, Net of Amount Capitalized $ 14,648 $ 10,295
Income Taxes Paid 2,060 78
</TABLE>
5
<PAGE> 6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
MARCH 31, 1996
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and Rule 10-01 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of only normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three month period ended March 31, 1996 are not necessarily
indicative of the results that may be expected for the year ending December 31,
1996. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Corporation's Annual Report on Form 10-K
for the year ended December 31, 1995 as filed with the Securities and Exchange
Commission on March 18, 1996.
NOTE B - EARNINGS PER SHARE
Net income per share is based on the number of weighted average common
shares outstanding for the period (8,336,631 shares) which includes common stock
equivalents resulting from outstanding stock options. The results for the first
quarter of 1995 have been given retroactive treatment to the stock dividend of
May 12, 1995 to the beginning of 1995. Exclusive of the retroactive restatement
for the stock dividend, earnings per share would have been $.48 for the three
months ended March 31, 1995. For the three months ended March 31, 1996,
dividends of $.17 per common share were declared and paid.
6
<PAGE> 7
NOTE C - INVESTMENT SECURITIES
Effective December 31, 1993 the Corporation adopted Statement of Financial
Accounting Standards No. 115 "Accounting for Certain Investments in Debt and
Equity Securities" ("SFAS No. 115"). Under SFAS No. 115, the investment
portfolio is divided among three categories: investment securities, securities
available for sale and trading account securities. Debt securities that the
Corporation has the intent and ability to hold to maturity are included in
investment securities and, accordingly, are carried at cost adjusted for
amortization of premiums and accretion of discounts using the interest method.
Available for sale securities are reported at fair value with any unrealized
appreciation or depreciation in value reported directly as a separate component
of stockholders' equity as an unrealized gain or loss on debt securities which
is reflected net of applicable taxes, and therefore, has no effect on the
reported earnings of the Corporation.
7
<PAGE> 8
The aggregate amortized cost and market values of the investment
securities portfolio at March 31 were as follows:
<TABLE>
<CAPTION>
MARCH 31, 1996
------------------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED MARKET
(in thousands) COST GAINS LOSSES VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SECURITIES HELD TO MATURITY
U.S. Treasury and Government
Agencies and Corporations $ 15,391 $ 35 $ -- $ 15,426
Mortgage-Backed Securities 17,968 -- 569 17,399
- ----------------------------------------------------------------------------------------------------
Total Securities Held to Maturity 33,359 35 569 32,825
- ----------------------------------------------------------------------------------------------------
SECURITIES AVAILABLE FOR SALE
U.S. Treasury and Government
Agencies and Corporations 27,187 499 458 27,228
Mortgage-Backed Securities 861,635 4,968 10,074 856,529
Municipal Securities 11,551 296 119 11,728
Other Debt Securities 57,593 773 791 57,575
- ----------------------------------------------------------------------------------------------------
Total Securities Available for Sale 957,966 6,536 11,442 953,060
- ----------------------------------------------------------------------------------------------------
Total Investment Securities Portfolio $ 991,325 $ 6,571 $ 12,011 $ 985,885
====================================================================================================
</TABLE>
<TABLE>
<CAPTION>
March 31, 1995
------------------------------------------------------------
Gross Gross
Amortized Unrealized Unrealized Market
(in thousands) Cost Gains Losses Value
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SECURITIES HELD TO MATURITY
U.S. Treasury and Government
Agencies and Corporations $ 11,960 $ -- $ -- $ 11,960
Mortgage-Backed Securities 415,288 2,680 3,509 414,459
Municipal Securities 8,477 138 192 8,423
- ----------------------------------------------------------------------------------------------------
Total Securities Held to Maturity 435,725 2,818 3,701 434,842
- ----------------------------------------------------------------------------------------------------
SECURITIES AVAILABLE FOR SALE
U.S. Treasury and Government
Agencies and Corporations 33,618 233 685 33,166
Mortgage-Backed Securities 274,389 1,578 2,207 273,760
Other Debt Securities 109,848 671 42 110,477
- ----------------------------------------------------------------------------------------------------
Total Securities Available for Sale 417,855 2,482 2,934 417,403
- ----------------------------------------------------------------------------------------------------
Total Investment Securities Portfolio $ 853,580 $ 5,300 $ 6,635 $ 852,245
====================================================================================================
</TABLE>
At March 31, 1996 a net unrealized loss of $2.9 million was reflected as
a separate component of Stockholders' Equity in the Consolidated Statement of
Condition as compared to a total net unrealized gain of $6.8 million on
Securities Available for Sale at December 31, 1995. For details
regarding investment securities at December 31, 1995, refer to Note 3 of the
Consolidated Financial Statements incorporated in the Corporation's 10-K filed
March 18, 1996.
8
<PAGE> 9
NOTE D - MORTGAGE SERVICING RIGHTS
The Corporation adopted the provisions of Statement of Financial Accounting
Standards No. 122 "Accounting for Mortgage Servicing Rights" (SFAS No. 122")
effective January 1, 1996. SFAS No. 122 requires that a portion of the cost of
originating a mortgage loan be allocated to the mortgage servicing right based
on its fair value of the servicing rights. The Corporation used the market
prices under comparable servicing sales contracts to determine the fair value of
the servicing rights created during the first quarter. SFAS No. 122 precludes
retroactive application to previously reported periods. Accordingly, amounts for
the three months ended March 31, 1995 were accounted for under the original SFAS
No. 65. Therefore, results for the first three months of 1996 are not comparable
to the results for the first three months of 1995.
Originated loan servicing rights, net of accumulated amortization and
impairment at March 31, 1996 were as follows:
<TABLE>
<CAPTION>
Mortgage
Servicing
Rights
- -------------------------------------------------------------------------
<S> <C>
Balance at January 1, 1996 $ --
Additions 1,064
Amortization 74
Sales of Servicing Rights --
- -------------------------------------------------------------------------
Balance at March 31, 1996 $ 990
- -------------------------------------------------------------------------
</TABLE>
9
<PAGE> 10
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
--------------------------------------------------
OPERATIONS AND FINANCIAL CONDITION
----------------------------------
PROVIDENT BANKSHARES CORPORATION AND SUBSIDIARIES
FINANCIAL REVIEW
- ----------------
EARNINGS SUMMARY
- ----------------
Provident recorded a 43% increase in net income over the same period a year
ago. Net income for the quarter ended March 31, 1996 was $5.3 million, or $.64
per share, compared to $3.7 million or $.46 per share, for the first quarter of
the prior year. The higher earnings in 1996 were mainly due to consumer loan
growth and increased fee income. Consumer loans outstanding grew $318 million as
total loans increased 7% to $1.44 billion. Total loans would have been higher
except for $281 million in residential mortgage loans that were securitized in
December 31, 1995. Non-interest income adjusted for security sales increased 57%
over the first quarter of 1995. The non-interest income increase was driven by
fee based services on higher account volume and mortgage banking income. Higher
account volume and continued investment in fee based initiatives contributed to
a 10.6% increase in operating expenses. There was a $5.4 million provision for
loan losses during the quarter with net charge-offs of $5.3 million. The
significant increase in net charge-offs was directly attributable to the
deterioration of a single commercial credit.
NET INTEREST INCOME
- -------------------
Tax-equivalent net interest income was $21.9 million for the first quarter
of 1996 which represented a $1.9 million increase over the prior year. Growth
in average earning assets contributed $2.6 million to net interest income which
was partially offset by a 15 basis point drop in net interest margin.
Provident's interest income on earning assets rose $5.3 million from the
first quarter of 1995, the result of a $283 million expansion in average earning
10
<PAGE> 11
asset balances offset in part by a 9 basis point decline in yield. Earning asset
growth was the result of increases of $318 million in consumer loans, $30
million in commercial business loans and $38 million in real estate construction
and commercial mortgage loans. Investments increased $151 million as the
Corporation securitized $281 million of residential real estate mortgage loans.
Mortgage loans held for sale increased $38 million. The decrease in the yield
was mainly attributable to the lower interest rate environment.
Total interest expense was $3.4 million above a year ago, the combined
result of a $241 million increase in average interest-bearing liabilities,
including $47 million in brokered deposits, $54 million in certificates of
deposit, $25 million in interest bearing demand deposits and $112 million of
borrowings. In addition, the average rate paid increased 9 basis points.
As a result of off-balance sheet transactions undertaken to insulate the
bank from interest rate risks, interest income has been decreased by $546
thousand and interest expense has been reduced by $534 thousand, for a net
decrease of $12 thousand for the quarter ending March 31, 1996. The forward
yield curve indicates that short-term rates will increase by 75 basis points and
long term rates will increase 25 basis points over the next twelve months. The
Corporation's analysis indicates that if management did not adjust its March 31,
1996 off-balance sheet positions and the forward yield curve assumptions became
reality, off-balance sheet positions would decrease net interest income by $2.4
million over the next twelve months.
PROVISION FOR LOAN LOSSES
- -------------------------
The Corporation recorded a $5.4 million provision for loan losses for the
quarter. Net charge-offs were $5.3 million compared to net charge-offs of $93
thousand for the first quarter of 1995. The increase in charge-offs is primarily
attributed to one large commercial loan which deteriorated rapidly toward the
end of the first quarter. The deterioration resulted from a substantial loss in
market share by the borrower during their critical selling season of December
through March. Sales have continued to drop well below expectation and
11
<PAGE> 12
recovery is not anticipated. The Corporation continues to emphasize loan quality
and closely monitors potential problem credits. Senior managers meet at least
monthly to review the credit quality of the loan portfolios and at least
quarterly with Executive Management to review the adequacy of the allowance for
loan losses. The allowance for loan losses at March 31, 1996 was $21.6 million,
up slightly from the $20.8 million a year ago. At March 31, 1996, the allowance
represented 1.49% of total loans and 129% of non-performing and past due loans.
Total non-performing and past due loans were $16.7 million at March 31, 1996
compared to $8.9 million at March 31, 1995. Residential mortgage loans
represented $10.2 million of total non-performing loans at March 31, 1996, $6.8
million of which are insured or guaranteed by the United States Government. Also
contributing to the rise was the increase in consumer loans outstanding of $342
million from the first quarter, 1995.
NON-INTEREST INCOME
- -------------------
Non-interest income totaled $13.8 million in the first quarter of 1996
compared to $5.6 million in 1995. Net of securities gains of $5.1 million,
non-interest income increased 57%. This increase was driven by fee based
services on higher account volume and mortgage banking income. The mortgage
originations were $102 million for the first quarter of 1996 compared to $67
million for the first quarter of 1995. Deposit service fees continued their
upward trend, increasing 53% over the prior year following a 31% rise in the
number of retail demand deposit accounts from the first quarter of 1995 and a
change in the fee structure.
NON-INTEREST EXPENSE
- --------------------
First quarter non-interest expense of $21.9 million was 11% or $2.1 million
higher than a year ago. Salaries and benefits rose 20% largely the result
of increased mortgage banking activities and additional supermarket branch
locations.
Occupancy costs increased $164 thousand or 8.9% over last year
and furniture and equipment expense increased $244 thousand resulting from
branch network expansion and upgrades of technology.
12
<PAGE> 13
External processing fees increased $627 thousand due to increased account
volume. All other expenses decreased a total of $950 thousand mainly benefiting
from the reduction of the FDIC insurance premium.
INCOME TAXES
- ------------
Provident recorded income tax expense of $2.9 million based on income
before taxes of $8.2 million, an effective tax rate of 35.7%. During the first
quarter of 1995, Provident recorded tax expense of $1.9 million on pre-tax
income of $5.6 million, an effective tax rate of 33.5%. The increase in the
effective tax rate from 33.5% for 1995 to 35.7% for 1996 is primarily due to the
1995 change in the federal tax rate on deferred items which resulted in a one
time reduction in the effective tax rate in the year of the change.
FINANCIAL CONDITION
- -------------------
Total assets of the Corporation increased $100.6 million from December 31,
1995 to March 31, 1996 as loan balances increased $110.3 million. Consumer loans
were up $87.6 million, commercial business loans $9.5 million, real estate
construction loans $10.3 million and real estate mortgage loans $2.9 million.
Securities available for sale and investment securities declined $62.7 million.
In addition, mortgage loans held for sale declined $17.5 million. Total deposits
ended the quarter at $1.65 billion, an increase of $77.7 million over the
December 31, 1995 level. Non-interest bearing deposits increased $9.4 million
from December 31, 1995 levels while interest bearing deposits increased $68.4
million. Borrowings decreased $32.1 million from December 31, 1995 ending the
quarter at $753.4 million.
At March 31, 1996, loans held for sale, investments available for sale and
investment securities maturing within one year totaled $1.02 billion or 41% of
total liabilities, compared to $1.10 billion or 46% as of December 31, 1995.
At quarter-end, the leverage ratio was 7.22% and total stockholders' equity
represented 10.22% of risk adjusted assets. These ratios exceed the minimum
requirements of the current leverage capital and risk-based capital standards
established by regulatory agencies.
13
<PAGE> 14
PART II - OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
(a) The exhibits filed as part of this report are listed below:
(3.1) Articles of Incorporation of Provident Bankshares
Corporation.*
(3.2) Amended and Restated Bylaws of Provident
Bankshares Corporation.**
(11) Statement re: Computation of Per Share Earnings.
(27) Financial Data Schedule.
(b) Reports on Form 8-K
There were no current reports on Form 8-K filed during the quarter
ended March 31, 1996.
* Incorporated by reference from Registrant's
Registration Statement on Form S-3 (File No.
33-73162) filed with the Commission on
August 18, 1994.
** Incorporated by reference from the Registrant's
1994 Annual Report on Form 10-K (File No.
0-16421) filed with the Commission on February
17, 1995.
14
<PAGE> 15
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.
PROVIDENT BANKSHARES CORPORATION
--------------------------------
Registrant
May 13, 1996 /s/ Peter M. Martin
------------------------------------------
Peter M. Martin
President and Chief Operating Officer
May 13, 1996 /s/ R. Wayne Hall
------------------------------------------
R. Wayne Hall
Treasurer
15
<PAGE> 16
EXHIBIT INDEX
-------------
Exhibit Description
- ------- -----------
(11) Statement re: Computation of Per Share Earnings filed herewith
(27) Financial Data Schedule filed herewith
16
<PAGE> 1
<TABLE>
<CAPTION>
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
- --------------------------------------------------------------------------------
Three Months Ended
March 31
(in thousands, except per share data) 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Primary:
- -------
Actual shares outstanding 8,015 7,746
===== =====
Average shares outstanding 7,971 7,698
Net effect of dilutive stock options
based on the treasury stock method
using the average market price 347 348
----- -----
Total Shares Outstanding 8,318 8,046
===== =====
Net Income $ 5,305 $ 3,710
===== =====
Net Income Per Share $ 0.64 $ 0.46
==== ====
Fully Diluted:
- -------------
Actual shares outstanding 8,015 7,746
===== =====
Average shares outstanding 7,971 7,698
Net effect of dilutive stock options
based on the treasury stock method using the
average market price or quarter end price,
whichever is greater 366 351
----- -----
Total Shares Outstanding 8,337 8,049
===== =====
Net Income $ 5,305 $ 3,710
===== =====
Net Income Per Share $ 0.64 $ 0.46
==== ====
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from the Form
10-Q and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000818969
<NAME> PROVIDENT BANKSHARES CORPORATION
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1996
<CASH> 52,956
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 953,060
<INVESTMENTS-CARRYING> 33,359
<INVESTMENTS-MARKET> 32,825
<LOANS> 1,443,077
<ALLOWANCE> 21,556
<TOTAL-ASSETS> 2,663,536
<DEPOSITS> 1,647,074
<SHORT-TERM> 500,637
<LIABILITIES-OTHER> 81,702
<LONG-TERM> 252,812
0
0
<COMMON> 8,244
<OTHER-SE> 173,067
<TOTAL-LIABILITIES-AND-EQUITY> 2,663,536
<INTEREST-LOAN> 29,461
<INTEREST-INVEST> 17,535
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 46,996
<INTEREST-DEPOSIT> 15,069
<INTEREST-EXPENSE> 25,306
<INTEREST-INCOME-NET> 21,690
<LOAN-LOSSES> 5,400
<SECURITIES-GAINS> 5,070
<EXPENSE-OTHER> 13,111
<INCOME-PRETAX> 8,249
<INCOME-PRE-EXTRAORDINARY> 8,249
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,305
<EPS-PRIMARY> .64
<EPS-DILUTED> .64
<YIELD-ACTUAL> 3.58
<LOANS-NON> 10,628
<LOANS-PAST> 6,097
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 21,462
<CHARGE-OFFS> 5,516
<RECOVERIES> 210
<ALLOWANCE-CLOSE> 21,556
<ALLOWANCE-DOMESTIC> 21,556
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
