<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C 20549
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
- - --- THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 1996
Commission file number: 0-17482
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
- - --- THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
County Bank Corp
Michigan EIN 38-0746239
83 W. Nepessing St., Lapeer, MI 48446
(313) 664-2977
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 latest practicable date.
There are 593,236 shares of common stock ($5.00 par value) outstanding as of
March 31, 1996.
<PAGE> 2
COUNTY BANK CORP
FORM 10-Q
For the Quarter Ended March 31, 1996
INDEX
PART I: FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
. Introduction- 2
. Balance Sheets- 3
At March 31, 1996 and December 31, 1995
. Statements of Income- 4
For the three months ended March 31, 1996 and 1995
. Statement of Cash Flows- 5
For the three months ended March 31, 1996 and 1995
Item 2. Management's Discussion and Analysis of Financial 6-7
Condition and Results of Operations
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 8
All items except those set forth above are inapplicable and have been omitted.
SIGNATURES 9
PAGE 1
<PAGE> 3
Part I - Financial Information
Item I - Financial Statements
Introduction to Financial Statements
The consolidated financial statements of County Bank Corp and subsidiary,
Lapeer County Bank & Trust Co., have been prepared, without audit, pursuant to
the rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
omitted pursuant to such rules and regulations. The Company believes that the
disclosures are adequate to make the information presented not misleading when
read in conjunction with financial statements and the notes thereto included in
County Bank Corp's form 10-K as filed with the Securities and Exchange
Commission for the year ended December 31, 1995.
The financial information presented reflects all adjustments (consisting only
of normal recurring adjustments) which are, in the opinion of management,
necessary for a fair statement of the results for the interim periods
presented. The results for interim periods are not necessarily indicative of
the results to be expected for the year.
PAGE 2
<PAGE> 4
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS
BALANCE SHEETS (in thousands) MARCH 31 DECEMBER 31
1996 1995
-------- -----------
<S> <C> <C>
ASSETS
Cash and due from banks ........................ 8,004 8,027
Investment securities available for sale ....... 13,919 14,371
Investment securities held to maturity .......... 31,978 33,793
------- -------
Total investment securities .................. 45,897 48,164
Federal funds sold ............................. 6,200 5,050
Loans .......................................... 107,036 105,349
Less: Reserve for possible loan losses ....... 1,692 1,687
------- -------
Net loans .................................. 105,344 103,662
Bank premises & equipment ...................... 2,793 2,655
Interest receivable and other assets ........... 2,400 2,319
------- -------
TOTAL ASSETS ............................... 170,638 169,877
======= =======
LIABILITIES & STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Demand ....................................... 62,554 61,531
Savings ...................................... 42,286 42,621
Time ......................................... 46,247 46,736
------- -------
Total deposits ............................. 151,087 150,888
Interest payable and other liabilities ......... 1,338 1,269
------- -------
TOTAL LIABILITIES .......................... 152,425 152,157
STOCKHOLDERS' EQUITY
Common stock-$5.00 par value, 1,200,000 shares
authorized, 593,236 shares outstanding in
1996 and 296,618 shares outstanding in 1995... 2,966 2,966
Surplus ........................................ 8,634 8,634
Undivided profits .............................. 6,289 5,810
Unrealized losses on securities available for
sale ......................................... 324 310
------- -------
TOTAL STOCKHOLDERS' EQUITY ................. 18,213 17,720
------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.. 170,638 169,877
======= =======
</TABLE>
PAGE 3
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CONSOLIDATED INCOME STATEMENTS
(in thousands)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31
1996 1995
----- -----
<S> <C> <C>
INTEREST INCOME
Interest and fees on loans .......................... 2,292 2,133
Interest on investment securities: 689 767
Interest on Federal funds sold ...................... 68 21
----- -----
TOTAL INTEREST INCOME ........................... 3,049 2,921
INTEREST EXPENSE
Demand deposits ................................... 274 176
Savings deposits .................................. 305 335
Time deposits ..................................... 601 584
Borrowed funds .................................... 0 5
----- -----
TOTAL INTEREST EXPENSE .......................... 1,180 1,100
----- -----
NET INTEREST INCOME ................................. 1,869 1,821
Provision for possible loan losses .................. 30 30
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES.. 1,839 1,791
OTHER INCOME
Service fees on loan and deposit accounts ........... 277 265
Other ............................................... 203 184
----- -----
TOTAL OTHER INCOME .............................. 480 449
OTHER EXPENSES
Salaries and employee benefits ...................... 874 795
Net occupancy expense ............................... 191 209
Other ............................................... 397 442
----- -----
TOTAL OTHER EXPENSE ............................. 1,462 1,446
----- -----
INCOME BEFORE PROVISION FOR FEDERAL INCOME TAX ...... 857 794
Provision for Federal income tax .................... 230 201
----- -----
NET INCOME .......................................... 627 593
===== =====
EARNINGS PER SHARE
Net Income .......................................... 1.06 1.00
Cash Dividend Declared .............................. 0.25 0.21
</TABLE>
PAGE 4
<PAGE> 6
STATEMENT OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31
1996 1995
------ ------
<S> <C> <C>
Cash flows from operating activities
Net income .......................................... 627 593
Adjustments to reconcile net income to net cash
provided from operating activities:
Depreciation and amortization ....................... 115 88
Provision for loan losses ........................... 30 30
Net amortization and accretion of securities ........ 51 83
Deferred income taxes ............................... 0 0
Net gain on sale of investment securities ........... 0 0
(Gain) loss on other real estate owned .............. 0 (2)
Net change in accrued interest receivable ........... (266) (373)
Net change in accrued interest payable and other .... 69 146
------ ------
Net cash provided by operating activities ........... 626 565
------ ------
Cash flows from investing activities
Proceeds from sale of investment securities: AFS .... 0 0
Proceeds from maturities of investment
securities: AFS ................................... 1,421 1,148
Proceeds from maturities of investment
securities: HTM ................................... 1,815 728
Purchase of investment securities: AFS .............. (1,020) 0
Purchase of investment securities: HTM .............. 0 (1,507)
Net (increase) decrease in loans .................... (1,730) (955)
Proceeds from the sale of Other Real Estate ......... 185 2
Premises and equipment expenditures ................. (221) (101)
------ ------
Net Cash provided from (used in) investing
activities ........................................ 450 (685)
------ ------
Cash flows from financing activities
Net increase (decrease) in interest bearing
and non-interest bearing demand accounts .......... 1,023 (3,710)
Net decrease in savings and time deposits ........... (824) (884)
Cash dividends paid ................................. (148) (122)
------ ------
Net Cash provided from (used in) financing
activities ........................................ 51 (4,716)
------ ------
Net increase (decrease) in cash and equivalents ..... 1,127 (4,836)
Cash and equivalents at beginning of year 13,077 12,422
------ ------
Cash and equivalents at end of period 14,204 7,586
====== ======
Cash paid for:
Interest ............................................ 1,181 1,097
Income taxes ........................................ 241 31
</TABLE>
PAGE 5
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and the
Results of Operations
This discussion primarily applies to Lapeer County Bank & Trust Co. (the Bank),
the wholly owned subsidiary and sole asset of County Bank Corp (the Corporation)
Financial Condition
The loans to deposits ratio reached 70.9% at the end of the first quarter of
1996. This increased from 65% at fourth quarter 95. Mortgages increased to
25.4% of the loan portfolio from 23.4% during the fourth quarter 95 and 21.4% at
the first quarter of 1995. Mortgages grew 10.6% during the first quarter of
1996. Mortgages increased 28.9% over mortgage balances one year ago. Consumer
loans and commercial loans declined slightly from year end balances. The Bank
normally experiences limited or negative growth in loans during the first
quarter. Commercial loans grew 7.7% over first quarter 1995 balances. Consumer
loans decreased 4.6% from March 31, 1995 balances, however, consumer loans
posted unusually high growth of 16.1% in 1995.
Deposits continue to flow toward demand and interest-bearing demand accounts.
Interest-bearing demand accounts have grown 5.7% during the fourth quarter of
1995 due primarily to continued increases in the Choice account product. Demand
deposits dropped 3.4% for fourth quarter 1995 levels, but they remain 15.1%
above balances for the first quarter of 1995. Time deposits continue to decline
as customers seek liquidity and return.
Results of Operations
The interest spread for the first quarter tightened to 4.15% from 4.24% in the
fourth quarter of 1995 and 4.31% for the first quarter of 1995. Interest margin
as a percentage of average assets declined to 4.68% during the first quarter of
1996 from 4.79% in the fourth quarter of 1995 and 4.75% in the first quarter of
1995. Interest margin remains relatively strong due to the increased loans to
deposits ratio. Non-interest income and non-interest expense ratios remain at
levels within historical parameters for the Bank. However, other expense is
below first quarter levels because the Bank posted only minimal levels of FDIC
premium expense.
Capital
The Bank continues to retain earnings to increase capital. The moderate growth
in total assets contributes to the increasing capital ratios.
Page 6
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Risk
Past due and non-performing loan ratios increased slightly for the first
quarter of 1996. However, these ratios remain at historically low levels. The
Reserve for loan losses to gross loans ratios remains very strong. The adequacy
of the loan loss reserve is calculated based on historical experience and
specific allocations for problem credits. The excess reserve based on this
calculation is $1,389,000 at the end of the first quarter of 1996.
Rate risk continues to be controllable with a rate sensitivity of (4.0%) at six
months and (.3%) at twelve months. This means the bank will be repricing
liabilities more quickly than loans during these periods. Maturing deposits
that are priced at or slightly below current rates. In a stable or slightly
increasing rate environment, the Bank will experience increased pressure on the
interest margin.
Page 7
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Part II.
Item 6. Exhibits and Reports on Form 8-K.
A) Not Applicable
B) A Form 8-K has not been filed during the three months ended
March 31, 1996.
PAGE 8
<PAGE> 10
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.
COUNTY BANK CORP
Date May 10, 1996
Joseph H. Black
---------------------------------
Joseph H. Black, Treasurer
PAGE 9
<PAGE> 11
Exhibit Index
<TABLE>
<CAPTION>
Exhibit No. Description
- - ----------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 8,004
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 6,200
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 14,225
<INVESTMENTS-CARRYING> 31,672
<INVESTMENTS-MARKET> 31,872
<LOANS> 107,036
<ALLOWANCE> 1,692
<TOTAL-ASSETS> 170,637
<DEPOSITS> 151,087
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,337
<LONG-TERM> 0
0
0
<COMMON> 2,966
<OTHER-SE> 15,247
<TOTAL-LIABILITIES-AND-EQUITY> 170,637
<INTEREST-LOAN> 2,292
<INTEREST-INVEST> 689
<INTEREST-OTHER> 68
<INTEREST-TOTAL> 3,049
<INTEREST-DEPOSIT> 1,180
<INTEREST-EXPENSE> 1,180
<INTEREST-INCOME-NET> 1,869
<LOAN-LOSSES> 30
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,462
<INCOME-PRETAX> 857
<INCOME-PRE-EXTRAORDINARY> 857
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 627
<EPS-PRIMARY> 1.06
<EPS-DILUTED> 1.06
<YIELD-ACTUAL> 7.71
<LOANS-NON> 582
<LOANS-PAST> 66
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 65
<ALLOWANCE-OPEN> 1,687
<CHARGE-OFFS> 43
<RECOVERIES> 18
<ALLOWANCE-CLOSE> 1,692
<ALLOWANCE-DOMESTIC> 303
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,389
</TABLE>
