<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Mark one
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1998
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT
For the transition period from ___________ to ___________
Commission File Number: 33-23062
Eufaula BancCorp, Inc.
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(Exact name of small business issuer as specified in its charter)
Delaware 63-0989868
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
Post Office Box 1269, Eufaula, Alabama 36072
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Address of principal executive offices
(334) 687-3581
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(Issuer's Telephone Number)
N/A
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(Former name, former address and former fiscal
year, if changed since last report)
Check whether the issuer (1) filed all reports required to 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 .
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APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of commo
equity, as of common equity, as of March 31, 1998-----2,103,916
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EUFAULA BANCCORP, INC. AND SUBSIDIARIES
INDEX
Part I. Page No.
Item 1. Financial Information
Consolidated Balance Sheet--March 31, 1998 & 3
March 31, 1997.
Consolidated Statements of Income three months ending 4
March 31, 1998 and 1997.
Consolidated Statements of Cash Flows; 5
Three Months ended March 31, 1998 and 1997
Note to Consolidated Financial Statements 6
Item 2. Management's discussion and analysis of financial
condition and results of operations. Three months
ending March 31, 1998. 7 & 8
Part II. Other Information
Item 4. Any matter submitted to the security holders for a vote 10
Item 6. Exhibits and reports on Form 8-K 10-12
(a) Exhibits:
Loan Compostion Summary
Loans over 90 days past due and non accrual loans
Allowance for Loan Loss analysis
(b) Report of Form 8-K
NONE
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<PAGE>
Item 1 - Part 1 - Financial Information
EUFAULA BANCCORP, INC. & SUBSIDIARIES
Consolidated Balance Sheet
March 31, l998 & March 31, 1997
(unaudited)
(Dollars in Thousands)
ASSETS
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1998 1997
---- ----
Cash & Due from Banks $ 7016 $ 4981
Interest bearing deposits in banks 189 750
Investment Securities:
Held to maturity 9053 10042
Available for Sale at est. market value 17139 25320
Federal Funds Sold 3700 0
Loans 89567 59028
Less Allowance for loan losses 841 643
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88726 58385
Premises & Equipment, Net 3824 2652
Intangible Assets 1450 1529
Other Assets 2971 3112
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TOTAL ASSETS $ 134068 $ 106771
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LIABILITIES & STOCKHOLDERS' EQUITY
- ----------------------------------
Deposits:
Non interest-bearing demand $ 21094 17980
Interest-bearing Demand 36487 28220
Savings 5037 5492
Time Deposits 55315 39841
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TOTAL DEPOSITS $ 117933 $ 91533
Federal Funds Purchased 400 1950
Other Borrowings 2500 0
Other Liabilities 1198 2464
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TOTAL LIABILITIES $ 122031 $ 95947
STOCKHOLDERS' EQUITY
Common Stock, par value$1 5,000,000
shares authorized: 2,103,916 shares issued 2104 1368
Surplus 153 438
Retained Earnings 9758 9302
unrealized gain (loss) on investments 22 (284)
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Total Equity $ 12037 $ 10824
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TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $134068 $ 106771
======= ========
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CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended March 31, l998 and March 31, l997
(unaudited)
(Dollars in Thousands, except per share amounts)
1998 1997
Interest Income ------- -------
Interest & fees on loans $ 2073 $ 1323
Interest on Federal Funds Sold 48 23
Interest on interest-bearing deposits 9 11
Interest on taxable securities 286 455
Interest on not-taxable securities 112 120
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$ 2528 $ 1932
Interest Expense
Interests on deposits $ 1087 $ 780
Interest on Federal Funds Purchased/
Other Borrowed Funds 52 31
Net interest income $ 1389 $ 1121
Provision for loan losses 83 30
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Net interest income after
provision for loan losses $ 1306 $ 1091
Other Operating Income
Service Charges on deposit accounts 180 210
Security Gains 0 0
Other Income 151 77
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331 287
Other operating expenses
Salaries & Other Employee Benefits $ 773 $ 570
Occupancy & Equipment expenses 202 142
Other operating expense 528 358
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$ 1503 $ 1070
Income before taxes $ 134 $ 308
Applicable Income Taxes 31 98
Net Income after Taxes $ 103 $ 210
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Per share of common stock based on
average number of shares outstanding
during period
Net Income .05 .10
Average shares outstanding 2,103,916 1,353,204
Cash dividends per share of common stock .04 .03
The accompanying note is an integral part of these consolidated financial
statements.
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<PAGE>
EUFAULA BANCCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
Three Months Ended March 31, 1998 and March 31, l997
(Unaudited)
(Dollars in Thousands)
1998 1997
---- ----
CASH FLOWS FROM OPERATING
ACTIVITIES
Net Income $ 103 $210
Adjustments to reconcile
net income to net cash
provided by (used in)
operating activities:
Depreciation & amortization 80 49
Provision for loan losses 83 30
Securities gains 0 0
(Increase) decrease in interest
receivable 104 93
Increase in interest payable 20 15
Other prepaids, deferrals
and accruals, net 870 (441)
----- -----
Net cash provided by
operating activities $ 1260 $ (44)
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CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales &
maturities of investment
securities $ 1288 $ 1909
Purchase of investment
securities (2023) (375)
Net decrease in Federal
Funds sold (1250) 1375
Net (increase) decrease in
bank-owned deposits (189) 0
Net increase in loans (10968) (6903)
Purchase of property &
equipment (240) (288)
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Net cash provided by
investing activities $(13382) $(4282)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in
deposits $ 13324 $ 1236
Net increase (decrease) in Fed
Funds purchased 400 750
Net increase in other
borrowings (600) -0-
Proceeds from exercise of
stock options 52 -0-
Dividends paid (84) -0-
Net cash used in financing activities $ 13092 $ 1986
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Net increase (decrease) in
cash and due from banks 970 (2340)
Cash & due from banks, beginning
of period 6046 7321
Cash & due from banks, end
of period $7016 $4981
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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during period for:
Interest $1151 $ 811
The accompanying note is an integral part of these consolidated financial
statements.
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<PAGE>
EUFAULA BANCCORP, INC. AND SUBSIDIARIES
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Basis of Presentation
The financial information included here is unaudited; however,
such information reflects all adjustments (consisting solely of
normal recurring adjustments) which are, in the opinion of
management, necessary for a fair statement of results for the
interim periods.
The results of operations for the three month period ended March
31, 1998, are not necessarily indicative of the results to be
expected for the full year.
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors which have affected the Company's financial position and operating
results during the periods included in the accompanying consolidated financial
statements.
The Company's quarterly report contains statements that constitute "forward-
looking statements" within the meaning of Section 27A of the SecuritiesAct of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. The words "believe", "estimate", "expect","intend","anticipate" and
similar expressions and variations thereof identify certain of such forward-
looking statements, which speak only as of the dates which they were made. The
Company undertakes no obligation topublicly update or revise any forward-looking
statements, whether as a result of new information, future events, or otherwise.
Readers are cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and uncertainties, and that
actual results may differ materially from those indicated in the forward-looking
statements as a result of various factors. Readers are cautioned not to place
undue reliance on these forward-looking statements.
FINANCIAL CONDITION
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As of March 31, 1998, the Company experienced an increase of 25.57 % in total
assets as compared to March 31, 1997. This increase is a result of a 52 %
increase in loans and a 28.8 % increase in deposits. Total investments declined
16.7% from March 31, 1997, to March 31, 1998. This is primarily due to funding
loans for new branches.
Net interest income for three months ended March 31, 1998, amounted to
$1,389,000 representing an increase of $268,000 or 23.9% from net interest
income of $1,121,000 for the three months ended March 31, 1997. Non-interest
income for the three months ended March 31, 1998, amounted to $331,000 as
compared to $287,000 for the three months ended March 31, 1997, representing an
increase of $44,000 or 15.33%. Service charges on deposit accounts decreased
$30,000 or 14.29% to $180,000 for the three months ended March 31,1998, as
compared to $210,000 for the three months ended March 31, 1997. This decrease in
service charges was attributable to developing a no fee checking account. All
other non-interest income increased $74,000 or 96.10% to $151,000 for the three
months ended March 31, 1998, as compared to $77,000 for the three months ended
March 31, 1997.
Provision for loan losses increased from $30,000 for the three month period
ending March 31, 1997, to $83,000 for the three month period ending March 31,
1998. This was the result of increased loan volume.
Non-interest expense for the three months ended March 31, 1998, amounted
$1,503,000, representing an increase of $433,000 or 40.47% from non-interest
expense of $1,070,000 for the three months ended March 31, 1997. Salaries and
benefits increased $203,000 or 35.61% to $773,000 for the three months ended
March 31,1998, as compared to $570,000 for the three months ended March 31,
1997. The majority of the increase in salaries and benefits is attributable to
the establishment of branches in Montgomery and Huntsville, Alabama, and
Freeport and Panama City, Fl. Occupancy and equipment expense increased $60,000
to $202,000 for the three months ended March 31, 1998, as compared to $142,000.
The increase in occupancy and equipment expense is attributable to the opening
of a new branch bank in Florida, a branch in Montgomery, Alabama, and the
renovation of the Eufaula Bank. Other non-interest expense increased $170,000
to $528,000 for the three months ended March 31, 1998, as compared to $358,000
for the three months ended March 31, 1997. Directors fees increased $14,000 due
to board members being appointed for
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the Montgomery office. In May, 1997, the banks out-sourced their data
processing; as a result, the data processing fees increased $33,000 from the
first quarter of 1997 to the first quarter of 1998. Other operating line item
expenses increased as a result of expansion efforts.
Because of the expenses related to expansion, net income decreased $107,000
to $103,000 for the three months ended March 31, 1998, as compared to $210,000
for the three months ended March 31, 1997.
Total cash and due from banks amounted to $7,016,000 at March 31, 1998, as
compared to $4,981,000 at March 31, 1997, representing an increase of
$2,035,000. Securities and temporary investments decreased $5,470,000 to
$29,892,000 at March 31, 1998, as compared to $35,362,000 at March 31, 1997.
Loans net of allowance for loan losses increased $30,341,000 to $88,726,000 at
March 31, 1998. as compared to $53,385 000 at March 31, 1997. The increase in
loans was funded primarily by the decrease in securities and temporary
investments, and an increase of $26,400,000 in deposits. Total equity increased
$1,213,000 to $12,037,000 at March 31, 1998, as compared to $10,824,000 at March
31, 1997. Total assets increased $27,297,000 to $134 068 000 at March 31 1998,
as compared to $106,771,000 at March 31, 1997.
LIQUIDITY
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As of March 31, 1998, the liquidity ratio was 29 % Liquidity is measured by the
ratio of net cash, short-term and marketable securities to net deposits and
short-term liabilities. Management believes that this ratio is more than
adequate to meet the liquidity needs of the Bank.
CAPITAL
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Both the leverage capital ratio and the risk-based capital ratio are well above
the minimum requirements.
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<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DATE: 4-30-98 EUFAULA BANCCORP, INC.
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BY: /s/ Greg Faison
_______________________
Greg Faison, President
BY: /s/ Gloria A. Hagler
_______________________
Gloria A. Hagler, Secretary/Treasurer
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EXHIBIT 3(A)
3a The composition of loans is summarized as follows:
1998 1997
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Commercial, Financial $ 11030 $ 10167
Agricultural 2904 2021
Real Estate-Construction 8554 3042
Real Estate-Mortgage 50756 30042
Consumer 16359 13318
Other 170 630
TOTAL 89773 59220
Unearned Discount (206) (192)
Allowance for loan losses (841) (643)
NET LOANS $ 88726 $ 58385
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EXHIBIT 3C(1)
3c-1 The following is a schedule of non accrual loans and loans past due 90
days and over:
March 31
1998 1997
Past due non accrual Past due nonaccrual
90 days or 90 days or
more more
Real Estate Loans 90 3 0
Installment Loans 11 16 6
Commercial Loans 1
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EXHIBIT 3C(2)
3c-2 Non accrual loans were not material to the total amount of loans
outstanding.
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EXHIBIT 4(A)
4a Changes in the allowance for loan lossesfor March 31, 1998 and 1997 were as
follows:
1998 1997
Balance, beginning of year 762 655
Provision charged to operations 83 30
Loans charged off (9) (44)
Recoveries 6 3
Rounding (1) (1)
Balance 3-31 841 643
1998 1997
Charge offs Recoveries Charge offs Recoveries
Installment Loans 9 6 12 3
Credit Cards & Related
Plans 4
Commercial and All Other Loans 28
TOTALS 9 6 44 3
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 7,016
<INT-BEARING-DEPOSITS> 189
<FED-FUNDS-SOLD> 3,700
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 9,053
<INVESTMENTS-CARRYING> 17,139
<INVESTMENTS-MARKET> 0
<LOANS> 89,567
<ALLOWANCE> 841
<TOTAL-ASSETS> 134,068
<DEPOSITS> 177,933
<SHORT-TERM> 0
<LIABILITIES-OTHER> 2,500
<LONG-TERM> 0
0
0
<COMMON> 2,104
<OTHER-SE> 0
<TOTAL-LIABILITIES-AND-EQUITY> 134,068
<INTEREST-LOAN> 2,073
<INTEREST-INVEST> 398
<INTEREST-OTHER> 57
<INTEREST-TOTAL> 2,528
<INTEREST-DEPOSIT> 1087
<INTEREST-EXPENSE> 1139
<INTEREST-INCOME-NET> 1389
<LOAN-LOSSES> 83
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1503
<INCOME-PRETAX> 134
<INCOME-PRE-EXTRAORDINARY> 103
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 103
<EPS-PRIMARY> .05
<EPS-DILUTED> .04
<YIELD-ACTUAL> 8.51
<LOANS-NON> 90
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<LOANS-PROBLEM> 396
<ALLOWANCE-OPEN> 762
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<ALLOWANCE-CLOSE> 841
<ALLOWANCE-DOMESTIC> 841
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
