================================================================================
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
JUNE 30, 1998.
COMMISSION FILE NUMBER: 0-23790
-------
METROBANCORP
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
INDIANA 35-1712167
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10333 N. MERIDIAN STREET, SUITE 111, INDIANAPOLIS, INDIANA 46290
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(317) 573-2400
- --------------------------------------------------------------------------------
(Issuer's telephone number)
http://www.metb.com
- -------------------
(Issuer's Internet Website Address)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 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
--- ---
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
1,765,308 Shares of Common Stock
- --------------------------------
Transitional Small Business Disclosure Format:
Yes No X
--- ---
================================================================================
<PAGE>
METROBANCORP
FORM 10-QSB
INDEX
PART I - FINANCIAL INFORMATION Page
----
Item 1. Financial Statements
Consolidated Statement of Condition
June 30, 1998 and December 31, 1997 3
Consolidated Statement of Operations
Three Months Ended June 30, 1998 and 1997 4
Consolidated Statement of Operations
Six Months Ended June 30, 1998 and 1997 5
Consolidated Statement of Cash Flows
Six Months Ended June 30, 1998 and 1997 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of
Security Holders 13
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 15
EXHIBITS
2
<PAGE>
METROBANCORP
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF CONDITION
(unaudited)
(dollars in thousands)
<TABLE>
<CAPTION>
06/30/98 12/31/97
-------- --------
<S> <C> <C>
Assets
Cash and Due from Banks $ 9,825 $ 9,595
Federal Funds Sold 8,150 7,500
-------- --------
Total Cash and Cash Equivalents 17,975 17,095
Investment Securities HTM - at Cost 9,418 9,519
Investment Securities AFS - at Market 24,331 18,518
-------- --------
Total Investment Securities 33,749 28,037
Loans:
Gross Loans 78,562 77,295
Less: Allowance for Loan Losses (1,149) (998)
-------- --------
Loans, Net 77,413 76,297
Premises and Equipment, Net 1,523 1,406
Accrued Interest Receivable 874 834
Core Deposit Intangible, Net 111 182
Deferred Tax Asset 391 419
Other Assets 397 448
-------- --------
Total Assets $132,433 $124,718
======== ========
Liabilities
Deposits:
Non-Interest Bearing Demand $ 26,785 $28,552
Interest Bearing:
Savings and NOW Accounts 47,037 40,500
Time Deposits of $100,000 and over 14,096 12,530
Other Time Deposits 30,742 29,652
-------- -------
Total Deposits 118,660 111,234
Accrued Interest Payable 472 426
Other Liabilities 920 926
-------- -------
Total Liabilities 120,052 112,586
-------- -------
Commitments and Contingencies - -
Shareholders' Equity
Preferred Stock: 1,000,000 Shares Authorized; None Outstanding - -
Common Stock: 3,000,000 Shares Authorized;
1,765,308 Shares Issued and Outstanding 12,134 11,210
Accumulated Earnings 210 880
Net Unrealized Gain on Investment Securities AFS
37 42
-------- --------
Total Shareholders' Equity 12,381 12,132
-------- --------
Total Liabilities and Shareholders' Equity $132,433 $124,718
======== ========
</TABLE>
See "Notes to Consolidated Financial Statements"
3
<PAGE>
METROBANCORP
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(dollars in thousands, except share data)
<TABLE>
<CAPTION>
Three Months Ended
-------------------------
06/30/98 06/30/97
---------- ----------
<S> <C> <C>
Interest Income
Interest and Fees on Loans $ 1,944 $ 1,789
Interest on Investment Securities 390 406
Interest on Federal Funds Sold 114 6
---------- ----------
Total Interest Income 2,448 2,201
Interest Expense
Interest on Deposits 1,054 914
Other Interest Expense - 19
---------- ----------
Total Interest Expense 1,054 933
---------- ----------
Net Interest Income 1,394 1,268
---------- ----------
Provision for Loan Losses 75 38
---------- ----------
Net Interest Income after Provision for Loan Losses 1,319 1,230
---------- ----------
Non-Interest Income
Service Charges on Deposit Accounts 88 79
Loss on Sale of Investment Securities - (16)
Other Service Charges, Commissions and Fees 157 127
---------- ----------
Total Non-Interest Income 245 190
Non-Interest Expense
Salaries and Employee Benefits 505 463
Occupancy Expense 103 86
Equipment Expense 84 99
Advertising and Public Relations 59 66
Legal, Professional and Audit Services 44 53
Data Processing 85 74
Student Loan Servicing Fees 9 21
FDIC Insurance Assessment 2 20
Amortization of Core Deposit Intangible 35 35
Postage Expense 12 13
Telephone Expense 20 24
Other 196 192
---------- ----------
Total Non-Interest Expense 1,154 1,146
Income before Income Taxes 410 274
Applicable Income Taxes 166 112
---------- ----------
Net Income $ 244 $ 162
========== ==========
Net Income per Common Share $ 0.14 $ 0.09
Net Income per Common Share - Assuming Dilution $ 0.13 $ 0.09
Weighted Average Shares Outstanding 1,765,308 1,765,308
Weighted Average Shares Outstanding - Assuming Dilution 1,843,443 1,778,448
</TABLE>
See "Notes to Consolidated Financial Statements"
4
<PAGE>
METROBANCORP
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(dollars in thousands, except share data)
<TABLE>
<CAPTION>
Six Months Ended
---------------------------
06/30/98 06/30/97
------------ ------------
<S> <C> <C>
Interest Income
Interest and Fees on Loans $ 3,852 $ 3,384
Interest on Investment Securities 747 819
Interest on Federal Funds Sold 229 10
------------ ------------
Total Interest Income 4,828 4,213
Interest Expense
Interest on Deposits 2,086 1,784
Other Interest Expense - 28
------------ ------------
Total Interest Expense 2,086 1,812
------------ ------------
Net Interest Income 2,742 2,401
------------ ------------
Provision for Loan Losses 149 67
------------ ------------
Net Interest Income after Provision for Loan Losses 2,593 2,334
------------ ------------
Non-Interest Income
Service Charges on Deposit Accounts 167 154
Loss on Sale of Investment Securities (8) (16)
Other Service Charges, Commissions and Fees 284 297
------------ ------------
Total Non-Interest Income 443 435
Non-Interest Expense
Salaries and Employee Benefits 1,008 921
Occupancy Expense 207 159
Equipment Expense 172 181
Advertising and Public Relations 124 118
Legal, Professional and Audit Services 99 94
Data Processing 165 144
Student Loan Servicing Fees 20 43
FDIC Insurance Assessment 5 40
Amortization of Core Deposit Intangible 70 70
Postage Expense 27 29
Telephone Expense 42 43
Other 383 394
------------ ------------
Total Non-Interest Expense 2,322 2,236
Income before Income Taxes 714 533
Applicable Income Taxes 287 216
------------ ------------
Net Income $ 427 $ 317
============ ============
Net Income per Common Share $ 0.24 $ 0.18
Net Income per Common Share - Assuming Dilution $ 0.23 $ 0.18
Weighted Average Shares Outstanding 1,765,308 1,765,308
Weighted Average Shares Outstanding - Assuming Dilution 1,845,365 1,774,082
</TABLE>
See "Notes to Consolidated Financial Statements"
5
<PAGE>
METROBANCORP
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(dollars in thousands, except share data)
<TABLE>
<CAPTION>
Six Months Ended
---------------------------
06/30/98 06/30/97
------------ ------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income $ 427 $ 317
Adjustments to Reconcile Net Income to
Cash Provided by Operating Activities:
Provision for Loan Losses 149 67
Depreciation and Amortization 211 219
Gain on Sale of Real Estate - (56)
Loss on Sale of Securities 8 16
Increase in Accrued Interest Receivable (40) (22)
Decrease in Other Assets 79 104
Increase in Accrued Interest Payable 46 82
Increase/(Decrease) in Other Liabilities (6) 112
------------ ------------
Total Adjustments 447 522
------------ ------------
Net Cash Flows Provided by Operating Activities 874 839
------------ ------------
Cash Flows from Investing Activities:
Proceeds from Maturities of Investment Securities Held to Maturity 1,020 54
Proceeds from Maturities of Investment Securities Available for Sale 2,546 -
Proceeds from Sales of Investment Securities Available for Sale 3,500 4,193
Purchases of Investment Securities Available for Sale (11,875) (2,496)
Purchases of Investment Securities Held to Maturity (921) -
Proceeds from the Sale of Student Loans - 3,085
Proceeds from the Repayment of Student Loans 280 975
Net Loans Made to Customers (1,547) (12,767)
Purchases of Premises and Equipment (251) (334)
Proceeds from the Sale of Real Estate - 461
------------ ------------
Net Cash Flows Used in Investing Activities (7,248) (6,829)
------------ ------------
Cash Flows from Financing Activities:
Net Increase/(Decrease) in DDA, NOW and Savings Accounts 4,770 (2,900)
Net Increase in Time Deposits 2,656 1,940
Net Increase in Federal Funds Purchased - 1,100
Net Decrease in Securities Sold Under Agreements to Repurchase - (1,500)
Cash Dividends Paid (172) (168)
------------ ------------
Net Cash Flows Provided by/(Used in) Financing Activities 7,254 (1,528)
------------ ------------
Net Increase/(Decrease) in Cash and Cash Equivalents 880 (7,518)
Cash and Cash Equivalents at Beginning of Period 17,095 13,775
------------ ------------
Cash and Cash Equivalents at End of Period $ 17,975 $ 6,257
============ ============
</TABLE>
See "Notes to Consolidated Financial Statements"
6
<PAGE>
MetroBanCorp
Notes to Consolidated Financial Statements
1. Basis of Presentation
---------------------
The consolidated financial statements include the accounts of
MetroBanCorp and its wholly-owned affiliate, MetroBank (together,
"Metro"). All significant intercompany transactions and balances have
been eliminated.
In the opinion of management of Metro, the consolidated financial
statements contain all the normal and recurring adjustments necessary to
present fairly the consolidated financial condition of Metro as of June
30, 1998 and December 31, 1997, and the results of its operations and
cash flows for the six months ended June 30, 1998 and 1997.
These financial statements should be read in conjunction with Metro's
latest Annual Report on Form 10-KSB for the year ending December 31,
1997.
2. Investments
-----------
The market value and amortized cost of investment securities of Metro as
of June 30, 1998 are set forth below:
Market Value Amortized Cost
------------ --------------
Held to Maturity $ 9,316,000 $ 9,418,000
Available for Sale 24,331,000 24,235,000
------------ ------------
Total Investments $ 33,647,000 $ 33,653,000
============ ============
3. Allowance for Loan and Lease Losses
-----------------------------------
As of June 30, 1998, Metro had investments in loans which are impaired in
accordance with Statement of Financial Accounting Standard Nos. 114 and
118 of $326,000. Of this amount, $319,000 had no related specific
allowance. The remaining $7,000 of impaired loans were fully reserved.
Metro's policy for recognizing income on impaired loans is to accrue
earnings until a loan is classified as impaired. For loans which receive
the classification of impaired during the current period, interest
accrued to date is charged against current earnings. All payments
received on a loan which is classified as impaired are utilized to reduce
the principal outstanding.
7
<PAGE>
For the six months ended June 30, 1998, the average balance of impaired
loans was $121,000. Additionally, there was $10,000 in interest income
earned on these loans during the first six months of 1998.
4. Comprehensive Income
--------------------
During the first quarter of 1998, Metro adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income."
Comprehensive Income is defined as the change in equity of a business
enterprise during a period from transactions and other events and
circumstances from nonowner sources. It includes all changes in equity
during a period except those resulting from investment by owners and
distributions to owners. In Metro's case, comprehensive income includes
net income and unrealized gains and losses on available for sale
securities. Total comprehensive income was $245,000 and $205,000 for the
three month period ended June 30, 1998 and 1997, respectively. Total
comprehensive income was $422,000 and $337,000 for the six month period
ended June 30, 1998 and 1997, respectively.
5. Per Share Data
--------------
Basic net income per common share is computed by dividing net income by
the weighted average number of common shares outstanding during each
year. Net income per common share, assuming full dilution, is computed as
above except that the denominator is increased to include the number of
additional common shares that would have been outstanding if the dilutive
potential common shares (stock options) had been issued. Below is a table
reconciling basic net income per common share and net income per common
share assuming full dilution:
<TABLE>
<CAPTION>
For the Three Months Ended
------------------------------------------------------------------------------
June 30, 1998 June 30, 1997
-------------------------------------- -------------------------------------
Income Shares Per Share Income Shares Per Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
-------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Income per Common Share
Income Available to Common
Stockholders $244,000 1,765,308 $0.14 $162,000 1,765,308 $0.09
========= =========
Effects of Dilutive Options
Stock Options - 78,135 - 13,140
--------------------------- --------------------------
Net Income per Common
Share - Assuming Dilution $244,000 1,843,443 $0.13 $162,000 1,778,448 $0.09
===================================== =====================================
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
For the Six Months Ended
------------------------------------------------------------------------------
June 30, 1998 June 30, 1997
-------------------------------------- -------------------------------------
Income Shares Per Share Income Shares Per Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
-------------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Income per Common Share
Income Available to Common
Stockholders $427,000 1,765,308 $0.24 $317,000 1,765,308 $0.18
========= =========
Effects of Dilutive Options
Stock Options - 80,057 - 8,774
--------------------------- --------------------------
Net Income per Common
Share - Assuming Dilution $427,000 1,845,365 $0.23 $317,000 1,774,082 $0.18
====================================== =====================================
</TABLE>
Per share data included in Metro's consolidated statement of operations
for the three months and six months ended June 30, 1998 and 1997 was
based on the weighted average number of common shares outstanding.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
-----------------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
The following management discussion is presented to provide information
concerning the consolidated financial condition of Metro as of June 30, 1998
as compared to December 31, 1997, and the results of operations for the three
and six month periods ending June 30, 1998 and 1997.
FINANCIAL CONDITION
At June 30, 1998, Metro had total assets of $132.4 million, an increase of
$7.7 million or 6.2 percent from December 31, 1997. This increase is due to an
increase in interest bearing deposits.
Consolidated earning assets totaled to $120.5 million, or 91.0 percent of
total assets, at June 30, 1998. The principal components of earning assets
were loans in the amount of $78.6 million or 65.2 percent of total earning
assets, and investment securities of $33.7 million or 28.0 percent of total
earning assets. Earning assets at December 31, 1997 were $112.8 million, or
90.5 percent of total assets.
LOANS
- -----
Total gross loans outstanding increased $1.3 million or 1.6 percent from
December 31, 1997 to June 30, 1998. This growth is a result of increased
indirect consumer lending and growth in the commercial loan portfolio. The
overall loan demand has been relatively steady in Metro's market area.
9
<PAGE>
At June 30, 1998, net loans amounted to 58.4 percent of total assets as
compared to 61.2 percent at year end 1997. Metro's loan to deposit ratio,
which is one measure of liquidity, was 65.2 percent at June 30, 1998, as
compared to 68.6 percent at year end 1997.
<TABLE>
<CAPTION>
LOAN PORTFOLIO AT PERIOD-END
(dollars in thousands)
June 30, 1998 December 31, 1997 % Change
------------- ----------------- --------
<S> <C> <C> <C>
Commercial $49,341 $47,527 3.82%
Real Estate - Construction 2,547 3,689 -30.96%
Mortgage 747 646 15.63%
Installment 21,240 20,467 3.78%
Student Loans 4,687 4,966 -5.62%
------------- ----------------- --------
Total Loans $78,562 $77,295 1.64%
Less:
Allowance for Loan Losses (1,149) (998) 15.13%
------------- ----------------- --------
Net Loans $77,413 $76,297 1.46%
============= ================= ========
</TABLE>
Delinquent loans at June 30, 1998 were $920,000, representing 1.2 percent of
total loans. At December 31, 1997, delinquent loans amounted to $915,000 or
1.2 percent of total loans outstanding. Delinquent loans in both periods shown
above consisted primarily of student loans guaranteed by USA Funds, a
subsidiary of USA Group, Inc. Non-accruing loans at June 30, 1998 amounted to
$326,000 as compared to $10,000 at December 31, 1997. Net recoveries on
charged-off loans amounted to $2,000 for the six months ending June 30, 1998.
At June 30, 1998 and December 31, 1997, Metro had an allowance for loan losses
of $1,149,000 and $998,000, respectively. The percentage of provision for loan
losses to ending loans amounted to 1.46 percent and 1.29 percent for June 30,
1998 and December 31, 1997, respectively. Metro provides for possible loan
losses through regular provisions to the allowance for loan losses. The
provisions are made at a level which is considered necessary by management to
absorb estimated losses in the loan portfolio and is based upon an assessment
of adequacy of Metro's loan loss reserve account.
10
<PAGE>
ALLOWANCE FOR LOAN LOSSES
SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(dollars in thousands)
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
Allowance for Loan Losses, January 1 $ 998 $ 866
Loans Charged-Off:
Commercial - -
Real Estate - -
Mortgage - -
Installment (17) (50)
Student Loans - -
--------- ---------
Total Charged-Off Loans (17) (50)
--------- ---------
Recoveries on Charged-Off Loans:
Commercial - 5
Real Estate - -
Mortgage - -
Installment 19 2
Student Loans - -
--------- ---------
Total Recoveries 19 7
--------- ---------
Net Charged-Off Loans 2 (43)
--------- ---------
Provision for Loan Losses 149 67
--------- ---------
Allowance for Loan Losses, June 30 $ 1,149 $ 890
========= =========
Average Loans Outstanding $77,136 $70,159
========= =========
Net Charged-Off loans to Average Loans .003% -.061%
========= =========
</TABLE>
INVESTMENT SECURITIES
- ---------------------
Total investments at June 30, 1998 were $33.7 million, increasing by $5.7
million or 20.4 percent from the amount at December 31, 1997.
DEPOSITS
- --------
Total deposits at June 30, 1998 amounted to $118.7 million in comparison to
$111.2 million at December 31, 1997, representing an increase of $7.4 million
or 6.7 percent. Since December 31, 1997, non-interest bearing demand deposits
decreased by $1.8 million or 6.2 percent. In the first six months of 1998,
interest bearing deposits increased by $9.2 million or 11.1 percent.
OTHER LIABILITIES
- -----------------
Other liabilities decreased to $920,000 from $926,000 from December 31, 1997.
Total liabilities increased by $7.5 million or 6.6 percent to $120.1 million
since December 31, 1997.
11
<PAGE>
CAPITAL
- -------
Metro's total capital increased by a net amount of $249,000 or 2.1 percent
during the first six months of 1998. Metro's earnings in the first six months
of 1998 amounted to $427,000. The net unrealized gain on investment securities
available for sale amounted to $37,000 at June 30, 1998, decreasing by $5,000
or 11.9 percent since December 31, 1997. Capital decreased by $172,000 in 1998
following the payment of a $.05 quarterly cash dividend in the months of March
and June, 1998.
During the first quarter of 1998, the Board of Directors of Metro declared a
five percent stock dividend issuable April 6, 1998 to shareholders of record
as of March 18, 1998. Fractional shares resulting from the stock dividend were
paid in cash. As a result, there were 84,017 shares issued, bringing the new
number of common shares outstanding to 1,765,308. A transfer from accumulated
earnings equity account to the common stock equity account in the amount of
$924,000 followed the stock dividend issuance.
Metro is subject to various capital requirements imposed by the federal
banking agencies. Quantitative measures established by regulation to ensure
capital adequacy require Metro to maintain minimum amounts and ratios of total
Tier 1 capital (as defined in the regulations) to risk-weighted assets, and
Tier 1 capital to average assets. Management believes, as of June 30, 1998,
that Metro meets all capital adequacy requirements to which it is subject. The
following table sets forth the actual and minimum capital amount and ratios of
Metro and the Bank as of June 30, 1998 (dollars in thousands):
<TABLE>
<CAPTION>
To Be Well Capitalized
Under Prompt Corrective
Actual Action Provisions
----------------------- -----------------------------
Amount Ratio Amount Ratio
-------- ------- ---------- ----------
<S> <C> <C> <C> <C>
Total Capital
(to Risk Weighted Assets)
Consolidated $13,382 15.52% > $8,408 > 10.00%
Bank $10,314 12.26% > $8,411 > 10.00%
Tier 1 Capital
(to Risk Weighted Assets)
Consolidated $12,233 14.55% > $5,045 > 6.00%
Bank $9,165 10.90% > $5,046 > 6.00%
Tier 1 Capital
(to Average Assets)
Consolidated $12,233 9.77% > $6,261 > 5.00%
Bank $9,165 7.48% > $6,127 > 5.00%
</TABLE>
As of December 31, 1997, the most recent notification from the FDIC
categorized the Bank as "well capitalized" under the regulatory framework for
prompt corrective action. To be categorized as "well capitalized", the Bank
must maintain minimum total risk-weighted, Tier 1 capital and leverage ratios
as set forth in the table. There are no conditions or events since the FDIC
notification that management believes have changed Metro's or the Bank's
capital categories.
12
<PAGE>
RESULTS OF OPERATIONS
NET INTEREST INCOME
- -------------------
Net interest income after provision for loan losses was $2.6 million for the
six months ending June 30, 1998, compared to $2.3 million for the comparable
period of 1997, an increase of 11.1 percent. Net Interest income increased
principally due to growth in earning assets in 1998. The Bank's provision for
loan loss expense was $149,000 for the six months ended June 30, 1998,
compared to $67,000 for the same period in 1997. The provision made in 1998
was a level considered necessary by management to absorb estimated losses in
the loan portfolio and is based upon an assessment of the adequacy of the
Bank's loan loss reserve account.
NON-INTEREST EXPENSE
- --------------------
Non-interest expense amounted to $2.3 million for the six month period ending
June 30, 1998, compared to $2.2 million for the same period in 1997.
NET INCOME
- ----------
Metro recognized net income of $427,000 for the six month period ending June
30, 1998, compared to $317,000 for the same period one year earlier.
PART II-OTHER INFORMATION
-------------------------
Item 4. Submission of Matters to a Vote of Security Holders
- ------- ---------------------------------------------------
(a) Metro held its annual meeting of shareholders on April 23, 1998.
(c) (i) At the annual meeting, Metro's shareholders elected ten directors to
serve until the next annual meeting of the shareholders and until
their successors are duly elected, qualified and serving. The votes
cast for the directors at the annual meeting were as follows:
<TABLE>
<CAPTION>
Number of Votes
-------------------------------------------------
Director's Name For Withheld Abstaining
- ------------------------ --------- -------- ----------
<S> <C> <C> <C>
Chris G. Batalis 1,550,485 127,606 3,200
Ike G. Batalis 1,550,485 127,606 3,200
Terry L. Eaton 1,548,619 129,472 3,200
Evans M. Harrell 1,548,619 129,472 3,200
Robert L. Lauth, Jr. 1,547,519 130,572 3,200
Edward G. McMahon 1,548,319 129,772 3,200
Larry E. Reed 1,549,685 128,406 3,200
R. D. "Rusty" Richardson 1,548,619 129,472 3,200
Edward R. Schmidt 1,550,585 127,506 3,200
Donald F. Walter 1,550,785 127,306 3,200
- ------------------------ --------- -------- ----------
</TABLE>
13
<PAGE>
(ii) At the annual meeting, Metro's shareholders also ratified the
appointment of Arthur Andersen, LLP, Indianapolis, Indiana, as
independent public accountants for Metro for the fiscal year ending
December 31, 1998, upon the following vote:
For: 1,550,595 Against: 200 Abstaining: 130,496
--------- --- -------
Item 5. Other Information
- ------- -----------------
During the first quarter of 1998, the Bank opened its sixth branch office
located at 16825 Clover Road, Noblesville, Indiana. This new facility
commenced operations on February 11, 1998. With the continuing commercial
expansion of Noblesville's east side, MetroBank's presence will provide
greater convenience and accessibility for local businesses and area residents
with extended hours and an increased emphasis on sales of financial products
and services.
If a shareholder proposal is introduced at the 1999 Annual Meeting of
Shareholders without any discussion of the proposal in the proxy statement,
and if the proponent does not notify the Company on or before February 1,
1999, as required by SEC Rule 14a-4(c)(1), of the intent to raise such
proposal at the Annual Meeting of Shareholders, then proxies received by the
Company for the 1999 Annual Meeting will be voted by the persons named as
proxies in their discretion with respect to such proposal. Notice of such
proposals is to be given to the Secretary of the Company in writing at its
principal executive office, 10333 North Meridian Street, Indianapolis, Indiana
46290.
Item 6. Exhibits and Reports on Form 8-K
- ------- --------------------------------
(a) Exhibits:
Exhibit 27 Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter ended June 30, 1998.
14
<PAGE>
SIGNATURES
----------
In accordance with the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
METROBANCORP
(Registrant)
August 14, 1998 By: /S/ Ike G. Batalis
------------------------
Ike G. Batalis
Chairman and
President (Principal
Executive Officer)
August 14, 1998 By: /S/ Charles V. Turean
------------------------
Charles V. Turean
Executive Vice President
(Principal Financial and
Accounting Officer)
15
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 9,825
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 8,150
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 24,331
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0
0
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</TABLE>
