<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
Commission File No. 0-27448
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
(Exact name of small business issuer as specified in its charter)
Georgia 58-1756713
(State of Incorporation) (I.R.S. Employer Identification No.)
3811 Frederica Road, St. Simons Island, Georgia 31522
(Address of Principal Executive Offices)
(912) 638-0667
(Issuer's Telephone Number, Including Area Code)
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last
Report)
Check whether the issuer (1) 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 issuer 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 equity as of the latest practicable
date.
Common Stock, no par value per share: 2,500,500 shares issued and outstanding
as of November 1, 1999.
Transitional Small Business Disclosure Format:
Yes No X
--- ---
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<PAGE>
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
September 30, December 31,
1999 1998
(Unaudited) (Audited)
------------------ ------------------
<S> <C> <C>
Assets
Cash and due from banks $ 2,881,324 $ 3,131,141
Federal funds sold 4,131,538 2,550,000
Securities available for sale, at fair value 23,040,867 22,490,648
Loans 92,939,551 90,774,151
Less allowance for loan losses 2,603,872 1,825,319
------------------ ------------------
Loans, net 90,335,679 88,948,832
Premises and equipment, net 2,878,199 3,015,992
Other assets 3,088,983 2,096,009
------------------ ------------------
Total assets $ 126,356,590 $ 122,232,622
================== ==================
Liabilities and Stockholders' Equity
Deposits
Noninterest-bearing deposits $ 10,546,977 $ 9,743,289
Interest-bearing deposits 96,195,537 91,528,632
------------------ ------------------
Total deposits 106,742,514 101,271,921
Federal Home Loan Bank borrowings 6,105,164 6,500,500
Other liabilities 487,855 997,325
------------------ ------------------
Total liabilities 113,335,533 108,769,746
------------------ ------------------
Stockholders' equity
Common stock, no par value; 50,000,000
shares authorized; 2,500,500 and 2,474,377
shares issued and outstanding 1,094,338 1,094,338
Capital surplus 11,678,177 11,482,666
Retained earnings 482,862 724,462
Accumulated other comprehensive income (loss) (234,320) 161,410
------------------ ------------------
Total stockholders' equity 13,021,057 13,462,876
------------------ ------------------
Total liabilities and stockholders' equity $ 126,356,590 $ 122,232,622
================== ==================
</TABLE>
See Notes to Consolidated Financial Statements.
2
<PAGE>
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
1999 1998
-------------- ---------------
<S> <C> <C>
Interest income $ 2,589,348 $ 2,626,315
Interest expense 1,350,444 1,340,511
-------------- ---------------
Net interest income 1,238,904 1,285,804
Provision for loan losses 1,310,000 147,643
-------------- ---------------
Net interest income (loss)
after provision for loan losses (71,096) 1,138,161
-------------- ---------------
Other income 158,356 178,931
-------------- ---------------
Other expense
Salaries and employee benefits 533,268 436,826
Depreciation and amortization 70,395 72,753
Regulatory fees and assessments 7,140 8,958
Supplies and printing 30,282 58,160
Legal and professional 65,414 87,908
Advertising 23,866 30,566
Other operating expenses 206,031 205,735
-------------- ---------------
Total other expense 936,396 900,906
-------------- ---------------
Income (loss) from continuing operations
before income tax (849,136) 416,186
Applicable income tax (benefit) (288,878) 104,846
-------------- ---------------
Income (loss) from continuing operations (560,258) 311,340
Discontinued operations
Net loss from operations, less applicable
income tax benefit of $13,725 0 (43,179)
Gain from disposal of business segment, less applicable
income tax of $159,318 0 309,265
--------------------------------
Net income (loss) (560,258) 577,426
-------------- ---------------
Other comprehensive income, net of tax
Net unrealized holding gains (losses) arising during period (170,136) 168,322
-------------- ---------------
Comprehensive income (loss) $ (730,394) $ 745,748
============== ===============
Earnings (loss) per share - basic $ (0.22) $ 0.23
============== ===============
Earnings (loss) per share - diluted $ (0.22) $ 0.23
============== ===============
Average shares outstanding 2,494,277 2,465,767
============== ===============
</TABLE>
See Notes to Consolidated Financial Statements.
3
<PAGE>
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
1999 1998
--------------- ---------------
<S> <C> <C>
Interest income $ 7,498,397 $ 7,454,222
Interest expense 3,924,215 3,897,174
--------------- ---------------
Net interest income 3,574,182 3,557,048
Provision for loan losses 1,450,000 273,000
--------------- ---------------
Net interest income after provision
for loan losses 2,124,182 3,284,048
--------------- ---------------
Other income 498,121 525,449
--------------- ---------------
Other expense
Salaries and employee benefits 1,520,007 1,327,968
Depreciation and amortization 216,544 206,520
Regulatory fees and assessments 22,902 24,240
Supplies and printing 79,153 108,205
Legal and professional 160,169 177,875
Advertising 64,913 69,359
Other operating expenses 621,569 614,168
--------------- ---------------
Total other expense 2,685,257 2,528,335
--------------- ---------------
Income (loss) from continuing operations
before income tax (62,954) 1,281,162
Applicable income tax (benefit) (20,033) 439,908
--------------- ---------------
Income (loss) from continuing operations (42,921) 841,254
Discontinued operations
Net loss from operations, less applicable
income tax benefit of $9272 0 (57,962)
Gain from disposal of business segment,
less applicable
income tax of $159,318 0 309,265
--------------- ---------------
Net income (loss) (42,921) 1,092,557
--------------- ---------------
Other comprehensive income, net of tax
Net unrealized holding gains (losses)
arising during period (395,730) 222,452
--------------- ---------------
Comprehensive income (loss) $ (438,651) $ 1,315,009
=============== ===============
Earnings (loss) per share - basic $ (0.02) $ 0.46
=============== ===============
Earnings (loss) per share - diluted $ (0.02) $ 0.46
=============== ===============
Average shares outstanding 2,484,465 2,381,687
=============== ===============
</TABLE>
4
<PAGE>
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
(Unaudited)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
1999 1998
----------------- -----------------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ (42,921) $ 1,092,557
Deduct income from discontinued operations 0 251,303
----------------- -----------------
Income (loss) from continuing operations (42,921) 841,254
Adjustments to reconcile income from continuing operations
to net cash provided by continuing operations:
Depreciation and amortization 216,544 206,520
Provision for loan losses 1,450,000 273,000
Net change in other prepaids and accruals (1,298,583) 471,723
----------------- -----------------
Net cash provided by continuing operations 325,040 1,792,497
Net cash provided by discontinued operations 0 378,759
----------------- -----------------
Net cash provided by operating activities 325,040 2,171,256
----------------- -----------------
INVESTING ACTIVITIES
Increase in Federal funds sold (1,581,538) (3,710,000)
Available for sale securities:
Proceeds from maturities and paydowns 9,356,635 7,046,697
Purchases (10,506,445) (12,643,882)
Decrease in loans held for sale 0 307,457
(Increase) decrease in loans, net (2,836,847) 3,523,576
Purchase of premises and equipment (78,751) (106,593)
----------------- -----------------
Net cash used in investing activities (5,646,946) (5,582,745)
----------------- -----------------
FINANCING ACTIVITIES
Net increase in deposits 5,470,593 8,057,839
Net decrease in notes payable and other borrowings (395,336) (6,529,793)
Payment of dividends (198,677) 0
Proceeds from exercise of stock options 167,636 61,574
Proceeds from exercise of stock warrants 0 1,414,878
Vesting of restricted stock, net 27,873 24,350
----------------- -----------------
Net cash provided by financing activities 5,072,089 3,028,848
----------------- -----------------
Net decrease in cash and due from banks (249,817) (382,641)
Cash and due from banks at beginning of period 3,131,141 3,224,761
----------------- -----------------
Cash and due from banks at end of period $ 2,881,324 $ 2,842,120
================= =================
</TABLE>
See Notes to Consolidated Financial Statements.
5
<PAGE>
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting and reporting policies of Golden Isles Financial
Holdings, Inc. ("the Company") conform to generally accepted
accounting principles and to general practices within the banking
industry. The interim consolidated financial statements included
herein are unaudited, but reflect all adjustments which, in the
opinion of management, are necessary for a fair presentation of the
consolidated financial position and results of operations for the
interim periods presented. All adjustments reflected in the interim
financial statements are of a normal, recurring nature. Such financial
statements should be read in conjunction with the financial statements
and notes thereto and the report of the independent auditors included
in the Company's Form 10-KSB Annual Report for the year ended December
31, 1998. The results of operations for the nine months ended
September 30, 1999 are not necessarily indicative of the results to be
expected for the full year.
NOTE 2. DISCONTINUED OPERATIONS
During 1998, the Company discontinued the operations of its consumer
finance subsidiary and disposed of its assets. The gain on disposal of
the assets and the operations of the discontinued business segment
have been accounted for as discontinued operations. The prior period's
consolidated financial statements have been restated to reflect the
discontinuation of the consumer finance segment.
-6-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Liquidity is the Company's ability to meet all deposit withdrawals
immediately, while also providing for the credit needs of customers. The
September 30, 1999 consolidated financial statements evidence a fair liquidity
position as total cash and Federal funds sold amounted to $7.0 million,
representing 5.6% of total assets. Investment securities amounted to $23.0
million, representing 18.2% of total assets. These securities provide a
secondary source of liquidity since they can be converted into cash in a timely
manner. The Company's ability to maintain and expand its deposit base and
borrowing capabilities would provide an additional source of liquidity. For the
nine-month period ended September 30, 1999, total deposits increased 5.4% from
$101.3 million to $106.7 million. Management has obtained additional funding
sources for the fourth quarter of 1999 in the event extra liquidity is needed
due to Year 2000 concerns. Management closely monitors and maintains appropriate
levels of interest-earning assets and interest-bearing liabilities so that
maturities of assets are such that adequate funds are provided to meet customer
withdrawals and loan demand. There are no trends, demands, commitments, events
or uncertainties that will result in or are reasonably likely to affect the
Company's liquidity position in any material way.
The Company is subject to various regulatory capital requirements
administered by the federal and state banking agencies. Failure to meet minimum
capital requirements can initiate certain mandatory and possibly additional
discretionary, actions by regulators that, if undertaken, could have a direct
material effect on the financial statements. Under capital adequacy guidelines
and the regulatory framework for prompt corrective action, the Company must meet
specific capital guidelines that involve quantitative measures of the assets,
liabilities, and certain off-balance sheet items as calculated under regulatory
accounting practices. The Company's capital amounts and classification are also
subject to qualitative judgments by the regulators about components, risk
weightings and other factors.
Quantitative measures established by regulation to ensure capital adequacy
require the Company to maintain minimum amounts and ratios of total and Tier 1
capital to risk-weighted assets and of Tier 1 capital to average assets.
Management believes, as of September 30, 1999, the Company meets all capital
adequacy requirements to which it is subject and should be categorized as well
capitalized under the regulatory framework for prompt corrective action.
-7-
<PAGE>
RESULTS FROM CONTINUING OPERATIONS
For the nine months ended September 30, 1999, the Company realized a net
loss from continuing operations of $43,000, as compared to net income of
$841,000 for the nine months ended September 30, 1998. The primary reason for
the net loss for the first nine months of 1999 was due to the increase in the
provision for loan losses.
For the nine months ended September 30, 1999 and 1998, the provision for
loan losses was $1,450,000 and $273,000, respectively. The increase of the
provision was needed to replace net charge-offs incurred, to provide for new
loan growth, and to strengthen the allowance for loan losses for potential
credit weaknesses identified during the nine months ended September 30, 1999.
Net loan charge-offs increased from $120,000 during the nine months ended
September 30, 1998 to $671,000 during the nine months ended September 30, 1999.
Total loans increased during the nine months ended September 30, 1999 by
$2,165,000, or 2.4%. The decision to further strengthen the allowance for loan
losses in the nine months ended September 30, 1999 was the result of
management's routine credit review during the period. In their review,
management identified potential credit deficiencies in a relatively small number
of large loans in the subsidiary bank's loan portfolio. Management believes the
weaknesses identified are not indicative of deterioration in the overall credit
quality of the total loan portfolio. Approximately $1,175,000 of the $1,450,000
provision and $467,000 of the $671,000 net charge-offs for 1999 were attributed
to those few large credit relationships.
The Company's results of operations are determined by its ability to
effectively manage interest income and expense, to minimize loan and investment
losses, to generate noninterest income and to control noninterest expense. Since
interest rates are determined by market forces and economic conditions beyond
the control of the Company, the ability to generate net interest income is
dependent upon its ability to obtain an adequate spread between the rate earned
on interest-earning assets and the rate paid on interest-bearing liabilities.
The primary component of consolidated earnings is net interest income, or
the difference between interest income on interest-earning assets and interest
paid on interest-bearing liabilities. The net interest margin is net interest
income expressed as a percentage of average interest-earning assets. Interest-
earning assets consist of loans, investment securities and Federal funds sold.
Interest-bearing liabilities consist of deposits and other borrowings.
Net interest income increased $17,000 from $3,557,000 during the nine
months ended September 30, 1998 to $3,574,000 during the nine months ended
September 30, 1999. The change in net interest income is the result of the
combined effects of changes in interest rates
-8-
<PAGE>
and account balances. Average loans outstanding increased from $82.2 million
during the nine months ended September 30, 1998 to $88.7 million during the nine
months ended September 30, 1999. However, the increase in loan volume was offset
by a decrease in average loan yield of 88 basis points from 10.27% for the nine
months ended September 30, 1998 to 9.39% for the nine months ended September 30,
1999. Net fees on loans decreased from $347,000 for the nine months ended
September 30, 1998 to $209,000 for the same period in 1999. Excluding loan fee
income, the yield on loans would have been 9.07% and 9.73% during the nine
months ended September 30, 1999 and 1998, respectively. The impact of the loss
of interest income due to an increase in loans placed on nonaccrual status
during the first nine months of 1999 lowered the average loan yield by 11 basis
points. Additionally, competitive pressure during 1999 forced the Company to
lower loan rates and loan fees to compete in the local market.
The net interest margin was 4.05% and 4.43% during the nine months ended
September 30, 1999 and 1998, respectively, a decrease of 38 basis points. The
decrease is due primarily to a decrease in the yield on loans discussed
previously. The yield on average earning assets was 8.49% and 9.28% during the
nine months ended September 30, 1999 and 1998, respectively. Cost of funds also
decreased to 5.26% for the nine months ended September 30,1999 as compared to
5.61% for the nine months ended September 30, 1998.
Noninterest income for the nine months ended September 30, 1999 and 1998
amounted to $498,000 and $520,000, respectively. There was a decrease of
$113,000 in service charges and overdraft charges from $410,000 for the first
nine months of 1998 to $297,000 for the same period in 1999. Service charges
decreased due to a reduction in the monthly fee schedule on business accounts to
compete with local competition. Overdraft charges decreased due to management's
tightening of credit review standards for deposit accounts. In an effort to
increase noninterest income, the Company started a mortgage loan department in
its subsidiary bank. Gross fees from the mortgage operations were $129,000 for
the first nine months of 1999. The Company had not established its mortgage
operations by September 30, 1998.
Noninterest expense for the nine months ended September 30, 1999 and 1998
amounted to $2,685,000 and $2,528,000, respectively, or an increase of $157,000.
Salaries and employee benefits were 56.9% and 48.5% of total noninterest expense
for the nine months ended September 30, 1999 and 1998, respectively. Attributing
to the increase were salaries and commissions for the mortgage loan department
which totaled $91,000 for the first nine months of 1999. As a percent of total
average assets, noninterest expense amounted to 2.9% in 1999 and 3.0% in 1998.
-9-
<PAGE>
RESULTS FROM DISCONTINUED OPERATIONS
Following is a condensed summary of the results from discontinued
operations for the nine months ended September 30, 1998. There were no results
from discontinued operations during the nine months ended September 30, 1999.
Interest income $ 1,198,000
Interest expense (455,000)
-------------
Net interest income 743,000
Provision for loan losses (182,000)
Other income 193,000
Other expense (821,000)
-------------
Loss from discontinued operations before tax
and disposal of assets (67,000)
Applicable income tax benefit 9,000
------------
Loss from discontinued operations before
disposal of assets (58,000)
Gain from disposal of assets, less applicable
income tax 309,000
------------
Net income from discontinued operations $ 251,000
============
YEAR 2000 READINESS
The Company has developed and implemented a strategic plan to address Year
2000 issues in accordance with Federal Financial Institutions Examination
Council (FFIEC) guidelines. The Year 2000 issue involves the risk that various
problems may result from the improper processing of dates and date-sensitive
calculations by computers and other equipment as the Year 2000 approaches.
The Company conducts ongoing employee education on the issue and has
identified all information technology (computers, software, etc.) and non-
information technology (alarms, vaults, etc.) that may be affected by the Year
2000 date change. Since the Company does not develop its own software, it has
contacted the various third party software vendors it uses to obtain written
documentation from them confirming Year 2000 compliance. All mission critical
software has been inventoried and tested and remediation has been completed. The
Company has tested its equipment for compliance and items found not in
compliance have been remedied to be compliant. Hardware, software and systems
will be re-tested if any changes are made to those systems after initial testing
is complete.
The Company's core data processing is done on an in-house IBM AS 400 with
Jack Henry Associates software. The hardware and software have been tested and
are Year 2000 compliant.
-10-
<PAGE>
The Company has developed a communication and assessment plan for its
customers. The Company has communicated the Year 2000 issue to both borrower and
depositor clients by various methods. The Company has contacted its key loan
clients to determine their status and plans with respect to the Year 2000 issue
and to determine the Company's exposure to any such customer's failure to
resolve its own Year 2000 problems. This initial customer review is complete and
follow-up reviews of key clients will be conducted regularly.
To date, the Company has spent $288,000 on the Year 2000 project for
hardware and software upgrades, customer communications, testing and other items
required to complete the plan. Year 2000 project costs during the nine months
ended September 30, 1999 were not material.
The Company believes that its mission critical systems are compliant and
that its customers are aware of and are addressing their own Year 2000 issues.
However, in the Company's most reasonably likely worst case scenario, some
portion of a mission critical system may not function properly or some borrowers
may be unable to meet their loan commitments due to problems with their systems.
In the event that a mission critical system temporarily fails to perform
properly, the Company will invoke its contingency plan to correct the problem.
The Company will incur extra costs for salaries and for independent expert
assistance. These costs are not expected to be material. Some of the Company's
loan customers may experience financial difficulties if their mission critical
systems are not compliant and do not perform properly. There can be no guarantee
that customers will resolve their Year 2000 issues on a timely basis.
Significant business interruptions or failures by key clients resulting from
Year 2000 problems could have a material adverse effect on the Company.
The Company has developed contingency plans to mitigate the potential
effects of a disruption in normal operations resulting from Year 2000 problems.
The plan addresses, among other factors, the Company's potential increased
liquidity and currency requirements at the critical dates, security issues, and
business resumption planning. The Company has in place written procedures to
manually perform or outsource every mission critical task relating to loan and
deposit processing in the event some part of a system does not function
properly. The Company is developing forecasts of liquidity needs and will
inventory extra currency to meet any higher than normal demand during the
critical periods. Security will be augmented during these periods. Personnel
staffing will be carefully scheduled during the affected periods. These
contingency plans are frequently reviewed and updated as needed. The Company has
submitted all requested information to the FDIC for its Year 2000 examination.
The FDIC is scheduled to conduct a liquidity review during the last quarter of
1999.
-11-
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings. As of September 30, 1999, there are no material
pending legal proceedings to which the Company or any of its subsidiaries is a
party or of which any of their property is the subject.
Item 2. Changes in Securities.
(a) None.
(b) 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) Exhibits
Exhibit No: Description
27 Financial Data Schedule
(b) Reports on Form 8-K - There were no reports on Form 8-K filed
during the quarter ended September 30, 1999.
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.
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
(Registrant)
Date: November 12, 1999
By: /s/ Sharon D. Hundley
Sharon D. Hundley
Chief Financial Officer
-12-
<PAGE>
INDEX TO EXHIBITS
Exhibit Sequential
Number Description Page Number
27 Financial Data Schedule 14
-13-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SUMMARY CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM GOLDEN ISLES
FINANCIAL HOLDINGS, INC. UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR THE
PERIOD ENDED SEPTEMBER 30, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 2,881,324
<INT-BEARING-DEPOSITS> 1,001,538
<FED-FUNDS-SOLD> 3,130,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 23,040,867
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 92,939,551
<ALLOWANCE> 2,603,872
<TOTAL-ASSETS> 126,356,590
<DEPOSITS> 106,742,514
<SHORT-TERM> 0
<LIABILITIES-OTHER> 487,855
<LONG-TERM> 6,105,164
0
0
<COMMON> 1,094,338
<OTHER-SE> 11,926,719
<TOTAL-LIABILITIES-AND-EQUITY> 126,356,590
<INTEREST-LOAN> 6,228,097
<INTEREST-INVEST> 1,270,300
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 7,498,397
<INTEREST-DEPOSIT> 3,646,007
<INTEREST-EXPENSE> 3,924,215
<INTEREST-INCOME-NET> 3,574,182
<LOAN-LOSSES> 1,450,000
<SECURITIES-GAINS> 240
<EXPENSE-OTHER> 2,685,257
<INCOME-PRETAX> (62,954)
<INCOME-PRE-EXTRAORDINARY> (62,954)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (42,921)
<EPS-BASIC> (0.02)
<EPS-DILUTED> (0.02)
<YIELD-ACTUAL> 4.05
<LOANS-NON> 1,506,000
<LOANS-PAST> 10,000
<LOANS-TROUBLED> 715,000
<LOANS-PROBLEM> 7,358,000
<ALLOWANCE-OPEN> 1,825,319
<CHARGE-OFFS> 726,275
<RECOVERIES> 54,828
<ALLOWANCE-CLOSE> 2,603,872
<ALLOWANCE-DOMESTIC> 2,121,960
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 481,912
</TABLE>
