SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) Quarterly report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended June 30, 1997 or
( ) Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from ___________ to __________.
Commission File Number 0-17494
DIME FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Connecticut 06-1237470
- ----------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
95 Barnes Road, Wallingford, Connecticut 06492
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(address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (203) 269-8881
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 the latest practicable date.
Common Stock - $1.00 par value; 5,152,462 shares were outstanding as of July
31, 1997.
The total number of pages in this report is 27
Exhibit Index is on page 23
DIME FINANCIAL CORPORATION AND SUBSIDIARY
INDEX
Part I Financial Information Page No.
Item 1. Financial Statements
Consolidated Statements of Condition
June 30, 1997 and 1996 (unaudited)
and December 31, 1996. 3
Consolidated Statements of Operations
Three months ended June 30, 1997 and 1996 (unaudited)
and six months ended June 30, 1997 and 1996 (unaudited) 3
Selected Financial Highlights 3
Consolidated Statement of Changes in Shareholders' Equity
(unaudited) 4
Consolidated Statements of Cash Flows
Six months ended June 30, 1997 and 1996 (unaudited) 5
Notes to Consolidated Financial Statements (unaudited) 6-10
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11-19
Part II Other Information
Item 4. Submission of matters to a vote of Security Holders 20
Item 6. Exhibits and Reports on Form 8-K 21
Signatures 22
Exhibit Index 23
Part I. - FINANCIAL INFORMATION
Item 1. Financial Statements
The registrant incorporates herein by reference the following information
from its Quarterly Report to Shareholders for the quarters ended June 30,
1997 and 1996, filed as Exhibit 19 hereto:
Consolidated Statements of Condition (unaudited)
Consolidated Statements of Operations (unaudited)
Selected Financial Highlights
Dime Financial Corporation and Subisdiary
Consolidated Statement of Changes in Shareholders' Equity
Six Months Ended June 30, 1997
<TABLE>
Net Unrealized
Loss on
Additional Retained Available
Common Paid-in Earnings for Sale Treasury
(dollars in thousands) Stock Capital (Deficit) Securities Stock Total
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1996 $5,481 $52,209 $ 8,788 ($969) ($2,898) $62,611
Net Income 7,924 7,924
Options Exercised 18 198 216
Dividends Paid (977) (977)
Change in net unrealized gain
on securities available for sale (203) (203)
---------------------------------------------------------------------
Balance at June 30, 1997 $5,499 $52,407 $ 15,735 ($1,172) ($2,898) $69,571
=====================================================================
</TABLE>
Item 1 (cont'd) DIME FINANCIAL CORPORATION AND SUBSIDIARY
Consolidated Statements of Cash Flows
Six months ended June 31, 1997 and 1996 (unaudited)
<TABLE>
<CAPTION>
(Dollars in thousands) 1997 1996
-------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 7,924 $ 5,899
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for loan losses 100 1,300
Depreciation and amortization 414 509
Amortization/Accretion investments, net (575) (228)
Amortization of intangible assets 175 175
Amortization of net deferred loan fees (98) (34)
Gain on investment securities (17) (171)
Gains on sale of other real estate owned (24) (475)
Increase in accrued income receivable (987) (388)
(Increase) decrease in other assets (752) 1,377
Increase (decrease) in other liabilities 896 (274)
-------------------
Net cash provided by operating activities 7,056 7,690
-------------------
Cash flows from investing activities:
Available for sale investment securities:
Proceeds from sale of investment securities 5,006 4,076
Investment securities purchased (10,000) (14,577)
Proceeds from principal payments 2,033 597
Available for sale mortgage-backed securities:
Mortgage-backed securities purchased (126,417) (80,346)
Proceeds from principal payments 11,443 6,020
Proceeds from sale of mortgage-backed securities 3,336 39,409
Held to maturity investment securities:
Investment securities purchased (33,999) (49,281)
Proceeds from maturity of investment securities 20,500 19,000
Held to maturity mortgage-backed securities:
Mortgage-backed securities purchased (2,956) -
Proceeds from principal payments 58 -
Net decrease in loans 8,785 32,377
Proceeds from sale of loans 1,185 733
Purchase of premises and equipment (80) (140)
Proceeds from sale of bank-owned buildings - 245
Proceeds from sale of other real estate owned 898 1,520
-------------------
Net cash used by investing activities (120,208) (40,367)
-------------------
Cash flows from financing activities:
Net increase in deposits 129,745 26,051
Payments of FHLB of Boston advances (15,000) -
Proceeds from exercise of DFC stock options 190 812
Payments of cash dividends (977) (705)
-------------------
Net cash provided by financing activities 113,958 26,158
-------------------
Net increase (decrease) in cash and cash equivalents 806 (6,519)
Cash and cash equivalents at beginning of period 31,875 35,489
-------------------
Cash and cash equivalents at end of period $ 32,681 $28,970
===================
</TABLE>
Item 1 (cont'd)
DIME FINANCIAL CORPORATION AND SUBSIDIARY
Notes to Consolidated Financial Statements
June 30, 1997 (unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements should be read
in conjunction with the audited financial statements and notes thereto
included in Dime Financial Corporation's 1996 Annual Report and Proxy
Statement dated March 12, 1997. In the opinion of management, the
accompanying consolidated financial statements reflect all necessary
adjustments, consisting of normal recurring accruals for a fair presentation
of results as of the dates and for the periods covered by the consolidated
financial statements. The results of operations of the interim period may
not be indicative of results for the entire 1997 fiscal year.
2. EARNINGS PER SHARE
The calculation of earnings per share is based on the weighted average
number of common shares and common stock equivalents outstanding during the
periods presented. Actual shares outstanding totalled 5,147,387 at June 30,
1997 and 5,101,601 at June 30, 1996.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
(dollars in thousands, except share data) 6/30/97 6/30/96 6/30/97 6/30/96
--------------------------------------
<S> <C> <C> <C> <C>
Net income $4,150 $3,040 $7,924 $5,899
=================================================================================
Weighted Average Common Shares and
Common Stock Equivalents Outstanding 5,342 5,122 5,325 5,100
Primary earnings per share $0.78 $0.59 $1.49 $1.16
=================================================================================
Weighted Average Common Shares and
Common Stock Equivalents Outstanding 5,394 5,152 5,391 5,134
Fully diluted earnings per share $0.77 $0.59 $1.47 $1.15
=================================================================================
</TABLE>
3. INVESTMENT SECURITIES
The amortized cost, approximate market values, and maturity groupings of
investment securities are as follows:
<TABLE>
<CAPTION>
June 30, 1997 June 30, 1996
------------------- -------------------
Amortized Market Amortized Market
(Dollars in Thousands) Cost Value Cost Value
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT SECURITIES AVAILABLE FOR SALE:
U.S. Government-sponsered agency obligations:
After 1 but within 5 years $ 4,000 $ 3,954 -- --
After 5 but within 10 years 13,000 12,826 -- --
Asset-backed securities:
After 10 years 12,303 12,304 13,991 14,041
Equity Securities 12 12 12 12
- -------------------------------------------------------------------------------------------
Total Investment Securities Available for Sale $ 29,315 $ 29,096 $ 14,003 $ 14,053
===========================================================================================
INVESTMENT SECURITIES HELD TO MATURITY:
U.S. treasury securities:
After 1 but within 5 years $ 3,464 $ 3,503 $ 2,428 $ 2,425
After 5 but within 10 years -- -- 1,011 1,044
U.S Government-sponsored agency obligations:
After 1 but within 5 years 54,886 54,675 39,821 39,557
After 5 but within 10 years 75,451 74,596 38,952 37,793
- -------------------------------------------------------------------------------------------
Total Investment Securities Held to Maturity $133,801 $132,774 $ 82,212 $ 80,819
===========================================================================================
MORTGAGE-BACKED SECURITIES AVAILABLE FOR SALE:
Mortgage-backed securities:
GNMA $ 61,718 $ 61,960 $ 50,176 $ 49,755
FNMA -- -- 3,051 3,020
FHLMC 33 33 753 747
REMIC / CMO's 210,511 208,546 76,168 75,085
- -------------------------------------------------------------------------------------------
Total Mortgage-backed Sec. Available for Sale $272,262 $270,539 $130,148 $128,607
===========================================================================================
MORTGAGE-BACKED SECURITIES HELD TO MATURITY:
REMIC / CMO's $ 2,897 $ 2,920 -- --
- -------------------------------------------------------------------------------------------
Total Mortgage-backed Sec. Held to Maturity $ 2,897 $ 2,920 -- --
===========================================================================================
</TABLE>
<TABLE>
<CAPTION>
June 30, 1997 June 30, 1996
-----------------------------
<S> <C> <C>
INVESTMENT SECURITIES AVAILABLE FOR SALE:
Gross unrealized gains $ 37 $ 79
Gross unrealized losses $ 256 $ 29
INVESTMENT SECURITIES HELD TO MATURITY:
Gross unrealized gains $ 92 $ 93
Gross unrealized losses $1,119 $1,486
MORTGAGE-BACKED SECURITIES AVAILABLE FOR SALE:
Gross unrealized gains $ 398 $ 70
Gross unrealized losses $2,121 $1,611
MORTGAGE-BACKED SECURITIES HELD TO MATURITY:
Gross unrealized gains $ 23 --
</TABLE>
4. ALLOWANCE FOR LOAN LOSSES
Changes in the allowance for loan losses are as follows:
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------
1997 1996
(In Thousands)
<S> <C> <C>
Balance at January 1, $ 12,929 $ 12,779
Provision for loan losses 100 1,300
Charge-offs (819) (1,396)
Recoveries 120 1,202
- ----------------------------------------------------------------------------
Balance at June 30, $ 12,330 $ 13,885
============================================================================
Average loans $393,833 $441,584
Net charge-offs as a percentage of average loans 0.18% 0.04%
Non-performing loans $ 2,819 $ 5,741
Allowance for loan losses as a percentage of
non-performing loans 437.39% 241.85%
Allowance for loan losses as a percentage of
total loans 3.17% 3.28%
</TABLE>
5. NON-PERFORMING ASSETS
<TABLE>
<CAPTION>
June 30,
----------------
1997 1996
----------------
(In Thousands)
<S> <C> <C>
Mortgage loans on real estate $2,438 $5,187
Commercial loans 226 307
Consumer loans 155 247
Total non-performing loans 2,819 5,741
Other real estate owned, net 487 612
----------------
Total non-performing assets $3,306 $6,353
================
Non-performing loans as a percentage of total loans 0.72% 1.36%
Non-performing assets as a percentage of total assets 0.38% 0.92%
</TABLE>
6. IMPAIRED LOANS
Impaired loans are commercial, commercial real estate, non-owner occupied
residential mortgage loans, and individually significant owner-occupied
residential mortgage and consumer loans for which it is probable that the
Company will not be able to collect all amounts due according to the
contractual terms of the loan agreement. Owner occupied residential mortgage
and consumer loans which are not individually significant are measured for
impairment collectively.
The definition of "impaired loans" is not the same as the definition of
"non-accrual loans". Non-accrual loans include impaired loans and are those
on which the accrual of interest is discontinued when collectibility of
principal or interest is uncertain or payments of principal or interest have
become contractually past due 90 days. The Company does not accrue income
on loans that are past due 90 days or more except in the case of education
loans which are conditionally guaranteed. Education loans which were 90
days or more past due at June 30, 1997 and in accrual status totalled
$164,000. The Company may choose to place a loan on non-accrual status
while not classifying the loan as impaired if it is probable that the
Company will collect all amounts due in accordance with the contractual
terms of the loan.
Factors considered by management in determining impairment include payment
status and collateral value. Loans that experience insignificant payment
delays and insignificant shortfalls are not classified as impaired.
Management determines the significance of payment delays and payment
shortfalls on a case-by-case basis, taking into consideration all of the
circumstances surrounding the loan and the borrower, including the length of
delay, reasons for delay, the borrower's prior payment record, and the
amount of the shortfall in relation to the total debt owed. The amount of
impairment is generally determined by the difference between the fair value
of underlying collateral securing the loan and the recorded amount of the
loan.
Interest payments received from commercial mortgage loans, commercial
business loans, and non-owner occupied residential investment mortgage loans
which have been classified as impaired are generally applied to the carrying
value of such loans. Interest payments received from all other loans which
are classified as impaired are recognized on a cash basis.
At June 30, 1997 impaired loans totalled $3.4 million with a related
allowance of $520,000 compared with impaired loans at June 30, 1996 of $4.3
million with a related allowance of $730,000. Management believes that the
valuation allowance for impaired loans at June 30, 1997 is adequate.
7. FHLBB ADVANCES
Federal Home Loan Bank of Boston advances consisted of the
following:
<TABLE>
<CAPTION>
June 30,
1997 1996
------------------
(In Thousands)
<S> <C> <C>
7.16% due 1997 - 25,000
6.05% due 1998 15,000 15,000
6.66% due 1999 10,000 -
6.29% due 1999 10,000 10,000
6.51% due 2000 8,000 8,000
-----------------------------------------
Total FHLBB advances $43,000 $58,000
</TABLE>
Item 2:
DIME FINANCIAL CORPORATION AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
Dime Financial Corporation of Wallingford, Connecticut (the "Company"),
organized in 1988, is the parent company of one wholly-owned subsidiary, The
Dime Savings Bank of Wallingford ("Dime") which was organized in 1871.
Consolidated assets as of June 30, 1997 were $873.9 million.
The Company provides a full range of banking services to individual and
corporate customers through its subsidiary which operates eleven retail
banking offices in six contiguous communities within New Haven County,
Connecticut. Products and services offered include a variety of savings,
time, and checking products, as well as numerous mortgage loans, consumer
loans, and commercial loans. Deposits are insured by the Federal Deposit
Insurance Corporation ("FDIC") up to certain limits under the law.
FINANCIAL CONDITION
The Company's earnings primarily depend upon the difference between the
interest and dividend income earned on loans and investments and the
interest expense paid on deposits and borrowed money ("net interest
income"). The difference between the average interest rate earned on loans
and investments and the average interest rate paid on deposits and
borrowings is affected by economic factors influencing general interest
rates, loan demand, the level of non-performing loans, and savings flows as
well as the effects of competition for loans and deposits. Net income is
also affected by gains and losses on investment securities transactions and
other operating income such as service charges and fees offset by additions
to the provision for loan losses, other operating expenses and income tax
expense.
In the second quarter of 1997, the Company reported net income of $4.2
million or $0.77 per share compared with net income of $3.0 million or $0.59
per share for the quarter ended June 30, 1996. Net income for the six month
period ended June 30, 1997 totalled $7.9 million or $1.47 per share compared
with net income of $5.9 million or $1.15 per share for the six month period
ended June 30, 1996. Results for 1997 were affected primarily by a lower
provision to the allowance for loan losses, an improvement in net interest
income and a reduction in operating expenses.
The provision to the allowance for loan losses totalled $50,000 for the
quarter ended June 30, 1997 compared with a provision of $600,000 during the
second quarter of 1996. The provision to the allowance for loan losses for
the six months ended June 30, 1997 totalled $100,000 compared with $1.3
million for the year earlier period. The change in the provision from 1996
reflects a reduction in non-performing loans and total loans outstanding as
well as improvement in the coverage ratio of the allowance for loan losses
to non-performing loans.
Net interest income totalled $7.1 million for the quarter ended June 30,
1997 representing a net interest rate spread ("spread") of 2.90% and a net
interest margin ("margin") of 3.42% compared with net interest income of
$6.9 million for the quarter ended June 30, 1996 representing a spread of
3.61% and a margin of 4.15%. Net interest income for the six months ended
June 30, 1997 totalled $13.8 million representing a spread of 2.91% and a
margin of 3.45% as compared with net interest income of $13.3 million for
the six months ended June 30, 1996 representing a spread of 3.51% and a
margin of 4.05%. The increase in net interest income was primarily caused
by a larger volume of interest-earning assets which was partially offset by
a decrease in the spread and margin. The decrease in the spread and margin
was due primarily to the combination of higher costing deposits, a lower
loan yield, and a greater volume of short-term investments, on average, as a
percentage of assets.
Operating expenses, excluding the net cost of operations of other real
estate owned ("OREO operations") equalled $3.3 million for the quarter ended
June 30, 1997 compared with $3.9 million for the second quarter of 1996.
Total operating expenses excluding OREO operations for the six month period
ended June 30, 1997 were $6.7 million compared with $7.6 million for the six
month period ended June 30, 1996. The decrease in operating expenses during
1997 was caused primarily by a decrease in occupancy and equipment expenses
resulting from the outsourcing of data processing operations during the
second quarter of 1996.
OREO operations may include gains or losses on the sale of OREO, writedowns
of OREO, and expenses to operate and maintain OREO. The net cost of
operation of OREO equalled a net cost of $48,000 for the second quarter of
1997 compared with a net gain of $136,000 for the second quarter of 1996.
For the first six months of 1997 the OREO operations equalled a net cost of
$99,000 compared with a net gain of $290,000 for the same period in 1996.
The increase in costs during 1997 was primarily due to a reduction in gains
realized on the sales of OREO compared with the first six months of 1996.
At June 30, 1997, the Company's allowance for loan losses was $12.3 million
or 437.39% of non-performing loans, 372.99% of non-performing assets, and
3.17% of total loans. At December 31, 1996, the allowance for loan losses
was $12.9 million, or 503.07% of non-performing loans, 342.02% of non-
performing assets, and 3.23% of total loans. At June 30, 1996, the
allowance for loan losses was $13.9 million, or 241.85% of non-performing
loans, 218.54% of non-performing assets, and 3.28% of total loans.
At June 30, 1997, non-performing loans totalled $2.8 million, or 0.72% of
total loans, compared with $2.6 million, or 0.64% of total loans at December
31, 1996, and compared with $5.7 million, or 1.36% of total loans at June
30, 1996. Other real estate owned totalled $487,000 at June 30, 1997,
compared with $1.2 million at December 31, 1996 and $612,000 at June 30,
1996. Total non-performing assets, were $3.3 million, or 0.38% of total
assets at June 30, 1997, compared with $3.8 million or 0.50% of total assets
at December 31, 1996, and compared with $6.4 million or 0.92% of total
assets at June 30, 1996.
Total assets grew to $873.9 million at June 30, 1997 representing an
increase of $122.6 million or 16% from December 31, 1996 and increased
$184.9 million or 27% from June 30, 1996. The growth in assets was due to an
increase in the investment securities portfolio and was funded by deposit
growth. Investment securities, excluding the investment in FHLBB stock,
totalled $436.3 million at June 30, 1997 representing an increase of $131.1
million or 43% from December 31, 1996 and representing an increase of $211.5
million or 94% from June 30, 1996. Deposits totalled $755.8 million at June
30, 1997 representing an increase of $129.7 million or 21% from December 31,
1996 and representing an increase of $186.4 million or 33% from June 30,
1996. The growth in deposits was the result of enhanced retail marketing
efforts. In addition, $23 million of brokered deposits were added as
compared with the prior year.
Gross loans totalled $389.5 million at June 30, 1997 representing a decrease
of $10.7 million or nearly 3% from December 31, 1996 and down $33.5 million
or 8% from June 30, 1996. The reduction in total loans outstanding was
caused primarily by a decrease in the demand for quality loans.
ASSET QUALITY
The composition of the Company's balance sheet has changed over the past
year. Fierce competition and highly competitive pricing tempered loan
production as management believed that the pricing necessary to sustain the
loan portfolio was inconsistent with the risk presented. As a result, the
Company directed its focus to the investment securities portfolio. The
Company's investment securities portfolio equalled $436.3 million
representing 50% of total assets at June 30, 1997 compared with $224.9
million or approximately 33% of total assets at June 30, 1996. While the
portfolio increased over the past year, the quality of the investments
continue to be of the highest caliber consisting entirely of U.S. Treasury
securities, U.S. Government Agency securities, U.S. Government-Sponsored
Agency securities and AAA rated non-Agency securities. Included within the
total portfolio are $211.4 million of collateralized mortgage obligations
("CMO").
Ongoing loan review procedures assess loan quality in addition to providing
the Board and management with analysis to determine that the allowance for
loan losses is sufficient given the risks inherent in the loan portfolio at
a point in time. During the second quarter of 1997 the Company added
$50,000 to the allowance for loan losses compared with a provision of
$600,000 in the second quarter of 1996. The Company added $100,000 for the
first six months of 1997 compared with a provision of $1.3 million for the
same period in 1996. The decreased provision in 1997 reflects a reduction
in non-performing loans and total loans outstanding as well as improvement
in the coverage ratio of the allowance for loan losses to non-performing
loans.
In addition to non-performing loans, management has classified performing
loans totalling $1.6 million as substandard for internal purposes, at June
30, 1997 compared with $1.2 million at June 30, 1996 and compared with $3.3
million at December 31, 1996. Substandard loans are inadequately protected
by the current sound worth and paying capacity of the obligor or of the
collateral pledged, if any, and must have a well-defined weakness or
weaknesses that jeopardize the liquidation of the debt. These loans are
still performing and management does not have serious doubt as to their
collectibility.
ASSET / LIABILITY MANAGEMENT
The primary objective of asset / liability management is to maximize net
interest income while ensuring adequate liquidity, and maintaining an
appropriate balance between interest rate sensitive assets and interest rate
sensitive liabilities. Interest rate sensitivity management seeks to
minimize fluctuating net interest margins and to enhance consistent growth
of net interest income through periods of changing interest rates.
The Company has an asset / liability committee ("ALCO") which meets weekly
to discuss loan and deposit pricing and trends, current liquidity and
interest rate risk positions, interest rates and economic trends and other
relevant information. To aid in the measurement of interest rate risk, the
Company utilizes an asset / liability model which, given many key
assumptions, projects estimated results within the constraints of those
assumptions. The model is also used to estimate movement within the balance
sheet, given certain scenarios, and to measure the effects of that movement
on net interest income.
During the second quarter of 1997, Dime entered into interest rate contracts
in order to hedge against future changes in net interest income caused by
fluctuations in the level of prevailing interest rates. Dime purchased an
interest rate floor contract with a notional value of $10.0 million for a
three year period. This hedge was purchased in order to mitigate the impact
of falling interest rates which could cause increases in prepayment within
the loan, mortgage-backed security, and CMO portfolios. The contract calls
for payments to be made to Dime when the three month London Interbank
Offering Rate ("LIBOR" or "the index") falls below a specified level at
certain measurement dates. The premium for this contract is amortized over
the life of the contract and is recorded as a reduction of interest income.
Dime also entered into interest rate cap corridor contracts with a notional
amount totalling $20.0 million for a three year period. This hedge was
purchased in order to mitigate the impact of rising interest rates which
could cause an increase in the cost of funds. This contract calls for
payments to be made to the Bank when the same index rises above a specified
level at certain measurement dates. The premium for these contracts is
amortized over the life of the contract and is recorded as an increase in
interest expense. The costs of these contracts are fixed to Dime. No
interest rate contracts were outstanding prior to the second quarter of
1997.
LIQUIDITY MANAGEMENT
Liquidity management involves the ability to meet the cash flow requirements
of the Company's loan and deposit customers. Cash on hand, deposits at other
financial institutions, interest-bearing deposits with an original maturity
of three months or less, and Federal funds sold are the principal sources of
liquidity. Cash and cash equivalents amounted to $32.7 million at June 30,
1997, compared with $29.0 million at June 30, 1996. Cash and cash
equivalents represented 3.74% of total assets at June 30, 1997 compared with
4.20% of total assets at June 30, 1996. The Company believes that liquidity
is sufficient to meet currently known demands and commitments.
Principal sources of funds include cash receipts from deposits, loan
principal and interest payments, earnings on investments, and proceeds from
amortizing and maturing investments. The current principal uses of funds
include disbursements to fund investment purchases, loan originations,
payments of interest on deposits, and payments to meet operating expenses.
During the first six months of 1997, deposits increased by $129.7 million
from $626.1 million at December 31, 1996 to $755.8 million at June 30, 1997.
In addition to the increase in the retail deposit base, Dime sold retail
brokered certificates of deposit ("brokered deposits"). During 1996, when
these were first introduced, the Bank sold $3 million of brokered deposits.
During the first six months of 1997, Dime sold an additional $20 million of
brokered deposits, to total $23 million at June 30, 1997.
Dime is a member of the Federal Home Loan Bank of Boston ("FHLBB") and as a
member may borrow from the FHLBB to secure additional funds. At June 30,
1997, FHLBB borrowings equalled $43.0 million, down from $58.0 million at
year-end 1996 and June 30, 1996. Funds may be derived from the FHLBB,
retail brokered certificates, or from other alternative funding sources. In
April of 1997 a $25.0 million borrowing matured with the FHLBB. The Company
replaced this borrowing with a combination of retail brokered certificates
and borrowings from the FHLBB with terms of two to four years.
The Company's primary source of funds is in the form of dividends received
from its subsidiary bank, Dime. Therefore, the liquidity and the capital
resources of the Company are largely dependent upon the liquidity,
profitability, and capital position of its subsidiary, and the ability of
the subsidiary to declare and pay dividends under applicable laws and
regulations. The Company must comply with the capital ratio requirements
set by the Board of Governors of the Federal Reserve while Dime must comply
with the capital ratio requirements set by the FDIC. At June 30, 1997 the
Tier 1 leverage capital ratio of Dime was 8.12%. The following table
presents the Company's risk-based and leverage capital ratios:
<TABLE>
<CAPTION>
June 30,
Required 1997 1996
---------------
<S> <C> <C> <C>
Tier I risk-based capital 4.0% 19.30% 16.94%
Total risk-based capital 8.0% 20.58% 18.22%
Leverage capital 4.0% 8.13% 8.05%
</TABLE>
On July 16, 1997 the Board of Directors declared a regular quarterly
dividend payment of $0.10 per share payable on August 15, 1997 to
shareholders of record on July 31, 1997.
COMPARATIVE ANALYSIS
The following table sets forth the dollar increases (decreases) in the
components of the Company's consolidated statements of operations during the
periods indicated and is followed by management's discussion of the various
changes.
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, 1997 June 30, 1997
compared to compared to
June 30, 1996 June 30, 1996
-------------------------------------
<S> <C> <C>
Interest income $2,376 $3,987
Interest expense 2,180 3,519
--------------------------
Net interest income 196 468
Provision for loan losses (550) (1,200)
Investment securities gains, net (6) (154)
Other operating income 3 12
Other operating expenses (369) (509)
--------------------------
Income before income taxes 1,112 2,035
Income tax expense 2 10
--------------------------
Net income $1,110 $2,025
==========================
</TABLE>
Quarter and Six months Ended June 30, 1997
Compared with
Quarter and Six months Ended June 30, 1996
General. Net income for the quarter ended June 30, 1997, was $4.2 million
or $0.77 per share, compared with net income of $3.0 million or $0.59 per
share for the same period in 1996. Net income for the six months ended June
30, 1997 totalled $7.9 million or $1.47 per share compared with $5.9 million
or $1.15 per share for the first six months of 1996. The change in net
income was influenced primarily by a decrease in the provision for loan
losses, an improvement in net interest income and a decrease in operating
expenses.
Interest Income. Interest income for the quarter ended June 30, 1997
totalled $15.5 million representing an average yield on interest earning
assets of 7.50% and totalled $29.7 million for the six months ended June 30,
1997 representing an average yield on interest earning assets of 7.49%.
Interest income for the quarter ended June 30, 1996 totalled $13.1 million
and represented an average yield on interest earning assets of 7.89% and
totalled $25.7 million for the six months ended June 30, 1996 and
represented an average yield of 7.84%. The increase in interest income was
caused primarily by an increase in the volume of interest-earning assets.
The decrease in yield was caused primarily by a decrease in the volume of
higher yielding loans and an increase in the volume of lower yielding
investment securities. Interest income for the quarter and six months ended
June 30, 1996 was favorably affected by the recovery of $637,000 of interest
income from the payoff of a large commercial mortgage that had been
restructured. These interest payments had previously been recorded as
reductions of principal.
Interest Expense. Interest expense totalled $8.4 million for the quarter
ended June 30, 1997 representing an average cost of funds of 4.60% and
totalled $15.9 million for the six months ended June 30, 1997 representing
an average cost of funds of 4.58%. Total interest expense for the quarter
ended June, 1996 was $6.2 million which represented an average cost of funds
of 4.28% and totalled $12.4 million for the first six months of 1996 which
represented an average cost of funds of 4.33%. The increase in interest
expense was caused primarily by an increase in the volume of interest-
bearing deposits. The increase in the cost of funds was caused by an
increase in the volume of higher-costing certificates of deposit versus
lower-costing savings deposits.
Net Interest Income. Net interest income totalled $7.1 million for the
quarter ended June 30, 1997 compared with $6.9 million for the quarter ended
June 30, 1996. Net interest income totalled $13.8 million for the first
half of 1997 compared with $13.3 million for the first six months of 1996.
The net interest rate spread for the quarter ended June 30, 1997 was 2.90%
compared with 3.61% for the quarter ended June 30, 1996. The net interest
rate spread for the six months ended June 30, 1997 was 2.91% down from the
prior year spread of 3.51%. The net interest margin was 3.42% for the
second quarter of 1997 compared with a net interest margin of 4.15% for the
second quarter of 1996. The net interest margin was 3.45% for the first
half of 1997 compared with a net interest margin of 4.05% for the six months
ended June 30, 1996. The following table summarizes the yields for the
major components of net interest income for the periods presented:
Comparative Interest Spread Table
For the quarters and six months ended
<TABLE>
<CAPTION>
Quarter Quarter YTD YTD
6/30/97 6/30/96 6/30/97 6/30/96
-------------------------------------
<S> <C> <C> <C> <C>
Interest Earning Assets:
Loans 8.22% 8.65% 8.17% 8.54%
Investment Securities 6.93% 6.58% 6.90% 6.49%
Federal Funds Sold 5.46% 5.23% 5.32% 5.24%
Yield on Interest Earning Assets 7.50% 7.89% 7.49% 7.84%
Interest Bearing Liabilities:
Deposits 4.47% 3.99% 4.41% 4.03%
Borrowings 6.35% 6.75% 6.50% 6.93%
Cost of Interest Bearing Liabilities 4.60% 4.28% 4.58% 4.33%
Net Interest Rate Spread 2.90% 3.61% 2.91% 3.51%
Net Interest Margin 3.42% 4.15% 3.45% 4.05%
</TABLE>
Provision for Loan Losses. The provision to the allowance for loan losses
for the quarter ended June 30, 1997 totalled $50,000 compared with a
provision of $600,000 for the second quarter of 1996. The provision for the
first six months of 1997 totalled $100,000 compared with a provision of $1.3
million for the first half of 1996.
Investment Securities Gains (Losses), Net. The Company recorded $17,000 of
net realized investment security gains during the first half of 1997
compared with net realized security gains of $171,000 booked during the year
earlier period.
Other Operating Income. Other operating income totalled $488,000 for the
second quarter of 1997 compared with $485,000 in the second quarter of 1996
and totalled $1.0 million for the first half of 1997 compared with $991,000
for the first half of 1996. The following table comparatively summarizes
the categories of other operating income:
<TABLE>
<CAPTION>
OTHER OPERATING INCOME:
Quarter Quarter YTD YTD
(Dollars in thousands) 6/30/97 6/30/96 6/30/97 6/30/96
-------------------------------------
<S> <C> <C> <C> <C>
Deposit account fees $403 $396 $800 $789
Customer service fees 34 34 68 66
Fees from savings bank life
insurance sales 28 31 101 95
Loan and loan servicing fees 13 12 22 24
Other fees 10 12 12 17
----------------------------------
Total Other Operating Income $488 $485 $1,003 $991
==================================
</TABLE>
Other Operating Expenses. Total operating expenses, including OREO
operations, equalled $3.4 million for the second quarter of 1997 compared
with total operating expenses of $3.8 million for the second quarter of
1996. Total operating expenses for the six month period ended June 30, 1997
were $6.8 million compared with $7.3 million for the six month period ended
June 30, 1996. The following table comparatively illustrates the categories
of operating expenses:
<TABLE>
<CAPTION>
OPERATING EXPENSES
(Dollars in thousands)
Quarter Quarter YTD YTD
6/30/97 6/30/96 6/30/97 6/30/96
--------------------------------------
<S> <C> <C> <C> <C>
Salaries and Employee Benefits $1,696 $1,643 $3,345 $3,408
Professional Services 556 578 1,139 1,094
Occupancy and Equipment 506 939 971 1,613
FDIC Assessment 20 40 38 78
Net Cost (Gain) of OREO operations 48 (136) 99 (290)
Restructure Expense, net -- 182 -- 340
Other Operating Expenses 569 518 1,191 1,049
-------------------------------------
Total Operating Expenses $3,395 $3,764 $6,783 $7,292
=====================================
</TABLE>
DIME FINANCIAL CORPORATION AND SUBSIDIARY
PART II OTHER INFORMATION
Item 4 Submission of Matters to a Vote of Security Holders
a. The annual meeting of shareholders was held on Wednesday,
April 23, 1997 (the "annual meeting").
b. Two matters were submitted to a vote at the annual meeting.
1. The election of four directors for a three year term
who, with the six directors whose terms of office did not
expire at the annual meeting, constitute the full Board
of Directors.
<TABLE>
<CAPTION>
Total Votes Total Votes
For Each Director Withheld
--------------------------------
<S> <C> <C>
Richard H. Dionne 4,390,436 74,700
Robert Nicoletti, Ph.D. 4,377,884 87,252
Richard D. Stapleton 4,390,811 74,325
Fred A. Valenti 4,385,385 78,751
</TABLE>
2. The ratification of the appointment of KPMG Peat Marwick,
LLP as independent auditors for the fiscal year ending
December 31, 1997.
<TABLE>
<CAPTION>
For Against Abstain
--------- ------- -------
<S> <C> <C> <C>
Total Votes 4,447,184 9,967 7,985
</TABLE>
Item 6 Exhibits and Reports on Form 8-K
a. The following exhibits are included in this report:
Exhibit No. Description
----------- -----------
19 Report furnished to the Company's shareholders for
the quarter ended June 30, 1997.
27 Financial Data Schedule
b. No report on form 8-K has been filed by the registrant with
the Securities and Exchange Commission during the quarter
ended June 30, 1997.
DIME FINANCIAL CORPORATION AND SUBSIDIARY
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.
DIME FINANCIAL CORPORATION
Date: August 4, 1997 /s/ Richard H. Dionne
Richard H. Dionne
President & Chief Executive Officer
Date: August 1, 1997 /s/ Albert E. Fiacre, Jr.
Albert E. Fiacre, Jr.
Executive Vice President
and Chief Financial Officer
Date: August 4, 1997 /s/ Robert P. Simon
Robert P. Simon
Vice President & Comptroller
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
19 Report furnished to the Company's shareholders for the
quarter ended June 30, 1997.
27 Financial Data Schedule
Dime Financial P.O. Box 700
Corporation Wallingford, CT 06492
(203) 269-8881
Dime Financial Corporation - Second Quarter Results
Dime Financial Corporation ("DFC") (NASDAQ: DIBK) announced net income of
$4.2 million or $0.77 per share on a fully diluted basis for the quarter ended
June 30, 1997 compared with net income of $3.0 million or $0.59 per share on a
fully diluted basis for the quarter ended June 30, 1996 representing a per
share increase of nearly 31%. Net income for the six months ended June 30, 1997
totalled $7.9 million or $1.47 per share on a fully diluted basis compared with
$5.9 million or $1.15 per share on a fully diluted basis for the six months
ended June 30, 1996. The change in net income from the prior year was primarily
the result of a reduced provision to the allowance for loan losses, improvement
in net interest income and reduced operating expenses. In addition, the Board
of Directors declared a quarterly dividend of $0.10 per share payable on August
15, 1997 to shareholders of record on July 31, 1997. The provision to the
allowance for loan losses totalled $50,000 for the quarter ended June 30, 1997
compared with a provision of $600,000 for the quarter ended June 30, 1996. The
provision to the allowance for loan losses during the first six months of 1997
totalled $100,000 compared with $1.3 million for the six months ended June 30,
1996. The change in the provision from 1996 reflects a reduction in
non-performing loans and total loans outstanding as well as continued strength
in the coverage ratios of the allowance for loan losses to total loans and to
non-performing loans.
Net interest income, the key component of the Company's earnings,
totalled $7.1 million for the quarter ended June 30, 1997 representing a net
interest spread of 2.90% and a net interest margin of 3.42% compared with net
interest income of $6.9 million for the quarter ended June 30, 1996
representing a net interest spread of 3.61% and a net interest margin of 4.15%.
Net interest income for the six months ended June 30, 1997 totalled $13.8
million representing a net interest spread of 2.91% and a net interest margin
of 3.45% compared with net interest income of $13.3 million for the six months
ended June 30, 1996 representing a net interest spread of 3.51% and a net
interest margin of 4.05%. The increase in net interest income was primarily the
result of a larger volume of interest-earning assets which was partially offset
by a decrease in the net interest rate spread and net interest margin. The
decrease in the net interest rate spread and net interest margin was due
primarily to the combination of a higher cost of deposits and a lower loan
yield.
Total operating expenses, excluding the net cost of operations of other
real estate owned ("OREO operations"), equalled $3.3 million for the quarter
ended June 30, 1997 compared with operating expenses of $3.9 million for the
quarter ended June 30, 1996. Operating expenses, excluding OREO operations,
totalled $6.7 million for the six months ended June 30, 1997 compared with $7.6
million for the six months ended June 30, 1996. The ratio of operating expenses
to average assets improved to 1.59% for the quarter ended June 30, 1997 (versus
2.19% for the prior year quarter) and 1.64% of assets for the six months ended
June 30, 1997 (versus 2.16% for the prior year period). OREO operations
equalled a net expense of $48,000 for the second quarter of 1997 compared with
a net gain of $136,000 for the second quarter of 1996 and equalled a net
expense of $99,000 for the six months ended June 30, 1997 compared with a net
gain of $290,000 for the first half of 1996.
Total assets were $873.9 million at June 30, 1997 compared with total
assets of $689.0 million at June 30, 1996, representing an increase of $184.9
million or nearly 27%. In addition to the increase in total assets, the
composition of the Company's balance sheet continued to change with an increase
in the investment securities portfolio and a decrease in total loans
outstanding. At June 30, 1997, investment securities totalled $436.3 million
compared with $224.9 million at June 30, 1996, representing an increase of
$211.4 million or 94%. The investment securities portfolio at June 30, 1997
consisted entirely of instruments issued by the U.S. Treasury, U.S. government
agencies, U.S. government-sponsored agencies, or AAA rated non-agencies. Total
loans, net of the allowance for loan losses, equalled $377.2 million at June
30, 1997 compared with $409.1 million at June 30, 1996, a decrease of nearly
8%. The second quarter of 1997 was marked by continued growth in the Company's
deposit base. Total deposits rose to $755.8 million at June 30, 1997 an
increase of $68.7 million or nearly 10% from March 31, 1997 and an increase of
$186.4 million or 33% from June 30, 1996. The increase in deposits from 1996
was caused primarily by an increased advertising effort and competitive pricing
for selected deposit products.
Non-performing loans equalled $2.8 million at June 30, 1997 representing
a decrease of $2.9 million or 51% from June 30, 1996. Other real estate owned
("OREO") totalled $487,000 at June 30, 1997 compared with OREO of $612,000 at
June 30, 1996. Total non-performing assets were $3.3 million at June 30, 1997
compared with $6.4 million at June 30, 1996. Non-performing assets equalled
0.38% of total assets at June 30, 1997 compared with 0.92% of total assets at
June 30, 1996.The allowance for loan losses at June 30, 1997 totalled $12.3
million and equalled 3.17% of total loans outstanding compared with an
allowance for loan losses of $13.9 million at June 30, 1996 representing 3.28%
of total loans outstanding. The allowance for loan losses equalled 437% of
non-performing loans at June 30, 1997 compared with 242% at June 30, 1996.
Total shareholders' equity was $69.6 million at June 30, 1997 compared
with shareholders' equity of $56.5 million at June 30, 1996. The Tier 1
regulatory capital ratio at June 30, 1997 for The Dime Savings Bank of
Wallingford ("Dime"), the Company's sole subsidiary, was 8.12% compared with a
Tier 1 regulatory capital ratio of 8.02% at June 30, 1996. The risk-based
capital ratio of Dime at June 30, 1997 equalled 20.56% compared with a
risk-based capital ratio of 18.08% at June 30, 1996. These ratios are in excess
of the regulatory minimums. Book value per share equalled $13.52 at June 30,
1997 compared with $11.08 at June 30, 1996.
Dime Financial Corporation and Subsidiary
<TABLE>
<CAPTION>
Consolidated Statements of Condition
- ---------------------------------------------------------------------------------------------------------------
June 30, December 31, June 30,
(In thousands, except share data) 1997 1996 1996
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Assets
Cash and amounts due from banks $ 8,161 $ 10,430 $ 10,084
Interest bearing deposits 44 149 209
Federal funds sold 24,476 21,296 18,677
Investment securities available for sale (a) 29,096 26,233 14,053
Investment securities held to maturity (b) 133,801 120,257 82,212
Mortgage-backed securities available for sale (c) 270,539 158,728 128,607
Mortgage-backed securities held to maturity (d) 2,897 -- --
Investment in Federal Home Loan Bank of Boston stock 7,192 7,192 7,192
Loans receivable:
Mortgage Loans:
Residential real estate - owner occupied 277,018 287,654 309,677
Residential real estate - non-owner occupied 29,939 31,365 24,914
Commercial real estate 31,814 33,448 36,968
Builders' and Land 357 447 1,084
Commercial loans 7,712 3,075 3,954
Consumer loans 42,660 44,233 46,396
Allowance for loan losses (12,330) (12,929) (13,885)
--------------------------------------
Loans receivable, net 377,170 387,293 409,108
Premises and equipment, net 4,761 5,095 5,312
Accrued income receivable 6,201 5,214 4,839
Other real estate owned, net 487 1,210 612
Other assets 6,810 5,788 5,495
Excess of cost over fair value of net assets acquired 2,243 2,418 2,593
--------------------------------------
Total assets $ 873,878 $ 751,303 $ 688,993
======================================
Liabilities and Shareholders' equity
Liabilities:
Deposits $ 755,843 $ 626,098 $ 569,395
Federal Home Loan Bank of Boston advances 43,000 58,000 58,000
Other liabilities 5,464 4,594 5,068
--------------------------------------
Total liabilities 804,307 688,692 632,463
--------------------------------------
Shareholders' equity:
Preferred stock; no par value; authorized 1,000,000 shares; none
issued and outstanding -- -- --
Common stock; $1.00 par value; authorized 9,000,000 shares; issued
5,498,994 shares, 5,480,896 and 5,453,208, respectively; outstanding
5,147,387 shares, 5,129,289 and 5,101,601, respectively 5,499 5,481 5,453
Additional paid-in capital 52,407 52,209 51,925
Retained earnings 15,735 8,788 3,034
Net unrealized loss on available for sale securities (1,172) (969) (984)
Treasury stock --351,607 shares at cost (2,898) (2,898) (2,898)
--------------------------------------
Total shareholders' equity 69,571 62,611 56,530
--------------------------------------
Total liabilities and shareholders' equity $ 873,878 $ 751,303 $ 688,993
======================================
<FN>
- --------------------
<F1> (a) amortized cost: $29,315 at June 30, 1997; $26,304 at December 31, 1996;
and $14,003 at June 30, 1996.
<F2> (b) market value: $132,774 at June 30, 1997; $119,238 at December 31, 1996;
and $80,819 at June 30, 1996.
<F3> (c) amortized cost: $272,262 at June 30, 1997; $160,124 at December 31, 1996;
and $130,148 at June 30, 1996.
<F4> (d) market value: $2,920 at June 30, 1997
</FN>
</TABLE>
Dime Financial Corporation and Subsidiary
<TABLE>
<CAPTION>
Consolidated Statements of Operations
- ----------------------------------------------------------------------------------------------------------
Three months ended Six Months Ended
June 30, June 30,
(In thousands, except share data) 1997 1996 1997 1996
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans $ 8,039 $ 9,357 $ 16,094 $ 18,865
Interest-bearing deposits 1 9 2 21
Federal funds sold 287 270 596 480
Interest and dividends on investments:
U.S. treasury securities 57 67 114 129
U.S. government agency obligations 2,564 1,178 4,889 2,170
REMIC/CMO's 1,896 787 3,217 1,620
Non-agency REMIC/CMO's 1,280 421 2,414 489
Mortgage-backed securities 996 760 1,631 1,511
Asset-backed securities 230 126 478 126
Other bonds and notes -- -- -- 39
Dividends on Federal Home Loan Bank of Boston Stock 116 115 230 228
---------------------------------------------
Total Interest Income 15,466 13,090 29,665 25,678
---------------------------------------------
Interest Expense
Interest to depositors 7,578 5,195 14,129 10,327
Interest on Federal Home Loan Bank of Boston advances 787 990 1,749 2,032
---------------------------------------------
Total Interest Expense 8,365 6,185 15,878 12,359
---------------------------------------------
Net Interest Income 7,101 6,905 13,787 13,319
Provision for loan losses 50 600 100 1,300
---------------------------------------------
Net interest income after provision 7,051 6,305 13,687 12,019
Investment securities gains, net 6 12 17 171
Other operating income 488 485 1,003 991
---------------------------------------------
Income before other operating expenses 7,545 6,802 14,707 13,181
---------------------------------------------
Other Operating Expenses:
Salaries and employee benefits 1,696 1,643 3,345 3,408
Professional and other services 556 578 1,139 1,094
Bank occupancy and equipment expense 506 939 971 1,613
FDIC Assessment 20 40 38 78
Net (benefit) cost of operation of other real estate 48 (136) 99 (290)
Restructure expense, net -- 182 -- 340
Other operating expenses 569 518 1,191 1,049
---------------------------------------------
Total Other Operating Expenses 3,395 3,764 6,783 7,292
---------------------------------------------
Income before income taxes 4,150 3,038 7,924 5,889
Income tax expense (benefit) -- (2) -- (10)
---------------------------------------------
Net income $ 4,150 $ 3,040 $ 7,924 $ 5,899
=============================================
Primary Earnings per Share $ 0.78 $ 0.59 $ 1.49 $ 1.16
Weighted Average Common Shares and Common Stock
Equivalents outstanding 5,342 5,122 5,325 5,100
Fully Diluted Earnings per Share $ 0.77 $ 0.59 $ 1.47 $ 1.15
Weighted Average Common Shares and Common Stock
Equivalents outstanding 5,394 5,152 5,391 5,134
</TABLE>
<TABLE>
<CAPTION>
Selected Financial Highlights
- ---------------------------------------------------------------------------------------
Three months ended Six months ended
June 30, June 30,
(Dollars in thousands) 1997 1996 1997 1996
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Average yield on interest-earning assets 7.50% 7.89% 7.49% 7.84%
Average cost of funds 4.60% 4.28% 4.58% 4.33%
Net interest rate spread 2.90% 3.61% 2.91% 3.51%
Net interest margin 3.42% 4.15% 3.45% 4.05%
Net income $ 4,150 $ 3,040 $ 7,924 $ 5,899
Return on average assets 1.97% 1.79% 1.96% 1.76%
Return on average equity 25.26% 22.47% 24.56% 22.14%
Leverage capital ratio 8.13% 8.05% 8.13% 8.05%
Fully diluted earnings per share $ 0.77 $ 0.59 $ 1.47 $ 1.15
Book value per share $ 13.52 $ 11.08 $ 13.52 $ 11.08
</TABLE>
Dime Financial Corporation And Subsidiary
<TABLE>
<CAPTION>
Selected Financial Data
- -----------------------------------------------------------------------------------------
June 30, December 31, June 30,
(in thousands) 1997 1996 1996
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Non-Performing Asset Information:
Non-Performing Loans:
Residential Real Estate - owner occupied $ 454 $ 862 $ 2,000
Residential Real Estate - non-owner occupied 477 510 1,358
Commercial Real Estate 1,507 788 1,829
-----------------------------------
Total Mortgage Loans 2,438 2,160 5,187
Commercial Loans 226 303 307
Consumer Loans 155 107 247
-----------------------------------
Total Non-Performing Loans 2,819 2,570 5,741
Other Real Estate Owned 487 1,210 656
Less: Reserve for OREO Losses -- -- 44
-----------------------------------
Total OREO, net 487 1,210 612
Total Non-Performing Assets $ 3,306 $ 3,780 $ 6,353
===================================
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------
June 30, December 31, June 30,
(in thousands) 1997 1996 1996
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Average Balance Information
For the quarters ended:
Interest earning assets:
Gross loans $ 391,283 $ 407,780 $ 432,696
Investment securities 411,946 271,856 210,003
Federal funds sold / interest bearing deposits 21,274 22,982 21,362
--------------------------------------
Total interest earning assets 824,503 702,618 664,061
Total Assets $ 842,298 $ 716,892 $ 678,354
======================================
Interest bearing liabilities:
Interest bearing deposits $ 681,017 $ 552,925 $ 522,188
Borrowings 49,055 58,000 58,000
--------------------------------------
Total interest bearing liabilities 730,072 610,925 580,188
Total Liabilities 776,584 655,992 624,244
Shareholders' Equity 65,714 60,900 54,110
Total Liabilities & Shareholders' Equity $ 842,298 $ 716,892 $ 678,354
======================================
Average Balance Information
For the six and twelve months ended:
Interest earning assets:
Gross loans $ 393,833 $ 427,008 $ 441,584
Investment securities 376,157 227,010 194,652
Federal funds sold / interest bearing deposits 22,370 18,003 18,882
--------------------------------------
Total interest earning assets 792,360 672,021 655,118
Total Assets $ 809,804 $ 686,624 $ 670,386
======================================
Interest bearing liabilities:
Interest bearing deposits $ 645,952 $ 528,245 $ 515,619
Borrowings 53,497 58,000 58,000
--------------------------------------
Total interest bearing liabilities 699,449 586,245 573,619
Total Liabilities 745,287 630,408 617,105
Shareholders' Equity 64,517 56,216 53,281
Total Liabilities & Shareholders' Equity $ 809,804 $ 686,624 $ 670,386
======================================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 8,161
<INT-BEARING-DEPOSITS> 44
<FED-FUNDS-SOLD> 24,476
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 299,635
<INVESTMENTS-CARRYING> 136,698
<INVESTMENTS-MARKET> 135,694
<LOANS> 389,500
<ALLOWANCE> 12,330
<TOTAL-ASSETS> 873,878
<DEPOSITS> 755,843
<SHORT-TERM> 0
<LIABILITIES-OTHER> 5,464
<LONG-TERM> 43,000
0
0
<COMMON> 5,499
<OTHER-SE> 64,072
<TOTAL-LIABILITIES-AND-EQUITY> 873,878
<INTEREST-LOAN> 16,094
<INTEREST-INVEST> 12,743
<INTEREST-OTHER> 828
<INTEREST-TOTAL> 29,665
<INTEREST-DEPOSIT> 14,129
<INTEREST-EXPENSE> 15,878
<INTEREST-INCOME-NET> 13,787
<LOAN-LOSSES> 100
<SECURITIES-GAINS> 17
<EXPENSE-OTHER> 6,783
<INCOME-PRETAX> 7,924
<INCOME-PRE-EXTRAORDINARY> 7,924
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,924
<EPS-PRIMARY> 1.49
<EPS-DILUTED> 1.47
<YIELD-ACTUAL> 3.45
<LOANS-NON> 2,819
<LOANS-PAST> 164
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 12,929
<CHARGE-OFFS> 819
<RECOVERIES> 120
<ALLOWANCE-CLOSE> 12,330
<ALLOWANCE-DOMESTIC> 12,330
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
