<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 September 30, 1997
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
(810) 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 re- quired 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
September 30, 1997.
<PAGE> 2
COUNTY BANK CORP
FORM 10-Q
For the Quarter Ended September 30, 1997
INDEX
<TABLE>
<CAPTION>
PART I: FINANCIAL INFORMATION PAGE
<S> <C>
Item 1. Financial Statements 2
. Introduction-
. Balance Sheets - 3
At September 30, 1997 and December 31, 1996
. Statements of Income - 4
For the three months and six months ended September 30, 1997 and 1996
. Statement of Cash Flows - 5
For the three months and six months ended September 30, 1997 and 1996
Item 2. Management's Discussion and Analysis of 6
Financial Condition and Results of Operations
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 7
All items exept those set forth above are inapplicable and have been omitted.
SIGNATURES 8
</TABLE>
<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, 1996.
The financial information presented reflects all adjustments (consisting only
of normal recurring adjustments) which are, in the opinion of mangement,
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) SEPT 30 DECEMBER 31
1997 1996
<S> <C> <C>
ASSETS
Cash and due from banks................................................. 8,096 8,626
Investment securities available for sale................................ 16,837 19,330
Investment securities held to maturity.................................. 29,634 28,079
------- -------
Total investment securities......................................... 46,471 47,409
Federal funds sold ..................................................... 4,700 1,200
Loans................................................................... 119,526 117,474
Less: Reserve for possible loan losses............................... 1,922 1,805
------- -------
Net loans......................................................... 117,604 115,669
Bank premises & equipment............................................... 2,701 2,715
Interest receivable and other assets.................................... 2,468 2,167
------- -------
TOTAL ASSETS......................................................... 182,040 177,786
======= =======
LIABILITIES & STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Demand............................................................... 69,646 68,614
Savings.............................................................. 40,670 41,292
Time ................................................................ 47,984 46,612
------- -------
Total deposits..................................................... 158,300 156,518
Interest payable and other liabilities.................................. 1,750 1,406
------- -------
TOTAL LIABILITIES.................................................... 160,050 157,924
STOCKHOLDERS' EQUITY
Common stock-$5.00 par value, 1,200,000 shares authorized and
593,236 shares outstanding in 1996 and 1997............................ 2,966 2,966
Surplus................................................................. 8,634 8,634
Undivided profits....................................................... 9,687 7,882
Unrealized gains on securities available for sale 703 380
------- -------
TOTAL STOCKHOLDERS' EQUITY........................................... 21,990 19,862
------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........................... 182,040 177,786
======= =======
</TABLE>
Page 3
<PAGE> 5
<TABLE>
<CAPTION>
STATEMENT OF CASH FLOWS THREE MONTHS ENDED NINE MONTHS ENDED
(in thousands) SEPTEMBER 30 SEPTEMBER 30
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net income......................................................... 764 730 2,303 2,205
Adjustments to reconcile net income to net
cash provided from operating activities:
Depreciation and amortization...................................... 61 61 326 276
Provision for loan losses.......................................... 30 30 90 90
Net amortization and accretion of securities....................... (138) 14 (42) 148
Deferred income taxes.............................................. 0 0 0 0
Net gain on sale of investment securities.......................... 0 0 0 0
(Gain) loss on other real estate owned............................. (24) (5) (37) (12)
Net change in accrued interest receivable.......................... (207) (209) (355) (323)
Net change in accrued interest payable and other................... 469 (63) 344 74
------ ------ ------ ------
Net cash provided by operating activities.......................... 955 558 2,629 2,458
------ ------ ------ ------
Cash flows from investing activities
Proceeds from sale of investment securities: AFS................... 0 0 0 0
Proceeds from maturities of investment securities: AFS............. 1,526 72 4,538 1,755
Proceeds from maturities of investment securities: HTM............. 196 2,060 2,101 5,974
Purchase of investment securities: AFS............................. (1,267) (195) (1,592) (4,215)
Purchase of investment securities: HTM............................. (1,388) (1,499) (3,755) (2,833)
Net (increase) decrease in loans................................... (263) (6,113) (2,081) (9,985)
Proceeds from the sale of Other Real Estate........................ 93 54 180 278
Premises and equipment expenditures................................ (250) (29) (334) (282)
------ ------ ------ ------
Net Cash provided from (used in) investing activities (1,353) (5,650) (943) (9,308)
------ ------ ------ ------
Cash flows from financing activities
Net increase (decrease) in interest bearing
and non-interest bearing demand accounts......................... 19 907 1,032 5,251
Net increase (decrease) in savings and time deposits............... 718 (297) 750 (2,068)
Cash dividends paid................................................ (166) (148) (498) (445)
------ ------ ------ ------
Net Cash provided from (used in)financing activities............... 571 462 1,284 2,738
------ ------ ------ ------
Net increase (decrease) in cash and equivalents.................... 173 (4,630) 2,970 (4,112)
Cash and equivalents at beginning of year 12,623 13,595 9,826 13,077
------ ------ ------ ------
Cash and equivalents at end of period 12,796 8,965 12,796 8,965
====== ====== ====== ======
Cash paid for:
Interest........................................................... 1,291 1,223 3,855 3,583
Income taxes....................................................... 334 408 914 890
</TABLE>
Page 5
<PAGE> 6
<TABLE>
<CAPTION>
CONSOLIDATED INCOME STATEMENTS
(in thousands) THREE MONTHS FOR THE NINE MONTHS
ENDED ENDED
SEPTEMBER 30 SEPTEMBER 30
INTEREST INCOME 1997 1996 1997 1996
<S> <C> <C> <C> <C>
Interest and fees on loans............................. 2,658 2,441 7,795 7,077
Interest on investment securities: 693 723 2,106 2,090
Interest on Federal funds sold......................... 67 49 214 200
----- ----- ------ -----
TOTAL INTEREST INCOME............................ 3,418 3,213 10,115 9,367
INTEREST EXPENSE
Demand deposits..................................... 354 319 1,034 881
Savings deposits.................................... 305 305 968 918
Time deposits....................................... 632 599 1,851 1,783
Borrowed funds...................................... 0 0 2 1
----- ----- ------ -----
TOTAL INTEREST EXPENSE........................... 1,291 1,223 3,855 3,583
----- ----- ------ -----
NET INTEREST INCOME.................................... 2,127 1,990 6,260 5,784
Provision for possible loan losses..................... 30 30 90 90
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES........................... 2,097 1,960 6,170 5,694
OTHER INCOME
Service fees on loan and deposit accounts.............. 276 281 819 846
Other.................................................. 257 207 716 833
----- ----- ------ -----
TOTAL OTHER INCOME............................... 533 488 1,535 1,679
OTHER EXPENSES
Salaries and employee benefits......................... 901 857 2,642 2,586
Net occupancy expense.................................. 245 189 677 574
Other.................................................. 425 395 1,202 1,158
----- ----- ------ -----
TOTAL OTHER EXPENSE.............................. 1,571 1,441 4,521 4,318
----- ----- ------ -----
INCOME BEFORE PROVISION FOR
FEDERAL INCOME TAX.................................. 1,059 1,007 3,184 3,055
Provision for Federal income tax....................... 295 277 881 850
----- ----- ------ -----
NET INCOME............................................. 764 730 2,303 2,205
===== ===== ====== =====
EARNINGS PER SHARE
Net Income............................................. $1.29 $1.23 $3.88 $3.72
Cash Dividend Declared................................. $0.28 $0.25 $0.84 $0.75
</TABLE>
Page 4
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and the
Results of Operations.
Financial Condition
New loan production continued through the third quarter of 1997, but on a
slower pace than the second quarter and first quarter produced. New loan
production has declined in each quarter. Net increases in loans totaled
$2,081,000 year to date in 1997. Net increases in deposits for both interest
bearing and non-interest bearing demand deposits totaled 19,000 for the quarter
and totaled $1,032,000 for the year. Time and savings deposits increased
$718,000 during the quarter. Year to date increased in Time and savings
deposits totaled $750,000. Moderate deposit growth is characteristic of the
Corporation's market.
Loan demand was met with cash provided deposit growth. Income from operations
and net decreases in the investment portfolio resulted in net increases to cash
and cash equivalents. Management expects continued loan growth during the
fourth quarter and is remaining liquid to meet the demand from loan customers.
Results of Operations
Net income per share for the quarter was $1.29 resulting in year to date
earnings per share of $3.88. The growth in loans was the primary contributor
to increased interest income. Non interest income and expense categories
remained at levels consistent with the Corporation's recent performance.
Risk Factors
Loan quality remains high. The reserve for loan losses to gross loans ratio is
1.61%. The non performing loans to total loans ratios is .78%. This ratio
compares loans past due 90 days or more and loans in non-accrual status to
total loans. This is an historically low ratio and indicates a high quality
portfolio.
The Corporation remains liability sensitive in relation to the risk of changes
in interest rates. The demand for residential mortgages remains strong in the
market area. Options to maintain both repricing opportunities for assets and
market tendencies for deposits are under constant review.
Capital
Strong net income performance and conservative dividend payments result in
increased capital. The moderate growth results in improving capital ratios.
Page 6
<PAGE> 8
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 six months ended
September 30, 1997.
Page 7
<PAGE> 9
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 November 11, 1997
/s/ Joseph H. Black
---------------------------------
Joseph H. Black, Treasurer
Page 8
<PAGE> 10
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
EX-27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 8,096
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,700
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 46,471
<INVESTMENTS-MARKET> 46,936
<LOANS> 119,526
<ALLOWANCE> 1,922
<TOTAL-ASSETS> 182,040
<DEPOSITS> 158,300
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,750
<LONG-TERM> 0
0
0
<COMMON> 2,966
<OTHER-SE> 18,321
<TOTAL-LIABILITIES-AND-EQUITY> 182,040
<INTEREST-LOAN> 7,795
<INTEREST-INVEST> 2,106
<INTEREST-OTHER> 214
<INTEREST-TOTAL> 10,115
<INTEREST-DEPOSIT> 3,853
<INTEREST-EXPENSE> 3,855
<INTEREST-INCOME-NET> 6,260
<LOAN-LOSSES> 90
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 4,521
<INCOME-PRETAX> 3,184
<INCOME-PRE-EXTRAORDINARY> 3,184
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,303
<EPS-PRIMARY> 3.88
<EPS-DILUTED> 3.88
<YIELD-ACTUAL> 8.21
<LOANS-NON> 821
<LOANS-PAST> 1,695
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 50
<RECOVERIES> 78
<ALLOWANCE-CLOSE> 1,922
<ALLOWANCE-DOMESTIC> 50
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,872
</TABLE>
