<PAGE>
1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD ENDED JUNE 30, 1997
Commission File Number: 33-28514-A
----------
BRYAN BANCORP OF GEORGIA, INC.
-------------------------------------------------------------------------------
(exact name of small business issuer as specified in its charter)
GEORGIA 58-1835646
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
9971 Ford Avenue, Richmond Hill, Georgia 31324
- ---------------------------------------- ------------------------------------
(Address of principal executive offices) (Zip code)
(912) 756-4444
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(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name,former address and former fiscal year,if changed since last report)
Check whether the registrant (1) filed all reports to be filed by section 13 or
15(d) of the Securities Exchange Act of 1934 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
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each issuer's classes of common stock,
as of the latest practicable date:
Common Stock, $1.00 Par Value - 503,608 shares as of August 11, 1997
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Transitional Small Business Disclosure Format:
Yes No X
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Page 1 of 10 Pages
Exhibit Index - Not Applicable
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2
INDEX
BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheet - June 30, 1997
Consolidated Statements of Income - Six Months Ended June 30, 1997
and 1996
Consolidated Statements of Cash Flows - Six Months Ended June 30, 1997
and 1996
Notes to Consolidated Financial Statements - June 30, 1997
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
<PAGE>
3
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
- ----------------------------
BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET - (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
June 30, 1997
-------------
ASSETS
<S> <C>
Cash and due from banks ...................................... $ 2,633,650
Federal funds sold ........................................... 250,000
Investment securities available for sale ..................... 7,283,129
Investment securities held to maturity (estimated market
value of $3,508,404) ....................................... 3,419,119
Loans ........................................................ 45,852,617
Less allowance for loan losses ............................... (508,775)
------------
Loans, net ......................................... 45,343,842
Interest receivable .......................................... 440,325
Premises and equipment, net .................................. 1,437,238
Other assets ................................................. 192,838
------------
Total assets ................................................. $ 61,000,141
============
LIABILITIES
Deposits:
Noninterest-bearing ........................................ $ 7,773,001
Interest-bearing ........................................... 44,983,693
------------
Total deposits ..................................... 52,756,694
Federal Home Loan Bank advances .............................. 360,000
Other borrowed funds ......................................... 513,644
Interest payable ............................................. 213,277
Other liabilities ............................................ 246,256
------------
Total liabilities .................................. 54,089,871
------------
SHAREHOLDERS' EQUITY
Common stock - par value $1 per share;
authorized 10,000,000 shares;
issued 521,758 shares .................................... 521,758
Additional paid-in capital ................................. 4,869,485
Retained earnings .......................................... 1,848,667
Net unrealized loss on investment
securities available for sale ............................ (17,040)
------------
7,222,870
Less 17,400 shares of treasury stock- at cost .............. (312,600)
------------
Total shareholders' equity ......................... 6,910,270
------------
Total liabilities and shareholders' equity ................... $ 61,000,141
============
</TABLE>
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4
BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME - (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
-------------------------- --------------------------
1997 1996 1997 1996
----------- ----------- ----------- -----------
INTEREST INCOME:
<S> <C> <C> <C> <C>
Loans ................................... $ 1,108,226 $ 938,309 $ 2,159,683 $ 1,862,966
Investment securities:
Taxable ............................... 108,828 76,284 199,449 160,451
Tax-exempt ............................ 38,936 37,907 77,622 75,437
Federal funds sold ...................... 16,332 42,957 45,371 64,471
Deposits in other banks ................. 538 3,003 709 4,289
----------- ----------- ----------- -----------
Total interest income ........... 1,272,860 1,098,460 2,482,834 2,167,614
----------- ----------- ----------- -----------
INTEREST EXPENSE:
Deposits ................................ 517,616 464,065 1,019,270 910,393
Federal Home Loan Bank advances ......... 12,185 1,134 19,041 7,790
Other borrowed funds .................... 1,617 1,612 2,548 2,686
----------- ----------- ----------- -----------
531,418 466,811 1,040,859 920,869
----------- ----------- ----------- -----------
NET INTEREST INCOME ....................... 741,442 631,649 1,441,975 1,246,745
----------- ----------- ----------- -----------
PROVISION FOR LOAN LOSSES ................. 45,000 30,000 90,000 30,000
----------- ----------- ----------- -----------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES ......................... 696,442 601,649 1,351,975 1,216,745
NONINTEREST INCOME:
Service charges on deposit accounts ..... 85,356 84,609 178,816 164,943
Loan servicing fees ..................... 95,558 73,221 172,611 137,177
Other service charges and fees .......... 36,468 32,781 71,452 52,662
Net realized loss on sales of available
for sale securities ................... (675)
Other ................................... 36,731 24,447 86,986 56,321
----------- ----------- ----------- -----------
254,113 215,058 509,190 411,103
----------- ----------- ----------- -----------
NONINTEREST EXPENSES:
Salaries and employee benefits .......... 284,822 222,025 567,883 437,217
Occupancy ............................... 23,652 24,802 45,839 49,464
Equipment and processing expense ........ 45,103 27,316 90,927 51,551
Other ................................... 143,114 162,127 313,568 320,120
----------- ----------- ----------- -----------
496,691 436,270 1,018,217 858,352
----------- ----------- ----------- -----------
INCOME BEFORE INCOME TAXES ................ 453,864 380,437 842,948 769,496
PROVISION FOR INCOME TAXES ................ 163,090 130,400 280,650 249,400
----------- ----------- ----------- -----------
NET INCOME $ 290,774 $ 250,037 $ 562,298 $ 520,096
=========== =========== =========== ===========
Net income per share $ .58 $ 0.49 $ 1.11 $ 1.02
=========== =========== =========== ===========
Weighted average number shares outstanding 504,358 509,839 504,358 509,839
=========== =========== =========== ===========
</TABLE>
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5
BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDAIRY
CONSOLIDATED STATEMENTS OF CASH FLOWS - (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------------
1997 1996
----------- -----------
OPERATING ACTIVITIES:
<S> <C> <C>
Net income ................................................. $ 562,298 $ 520,096
Adjustments to reconcile net income
to cash provided by operating activities:
Depreciation .......................................... 59,657 42,583
Amortization and accretion, net ....................... 1,765 (603)
Provision for loan losses ............................. 90,000 30,000
Net realized loss on available for sale securities .... 675
Changes in:
Interest receivable ................................ (67,236) 14,642
Other assets ....................................... 67,790 5,630
Interest payable ................................... (14,663) (29,302)
Other liabilities .................................. 69,061 (123,350)
----------- -----------
Net cash provided by operating activities ...... 769,347 459,696
----------- -----------
INVESTING ACTIVITIES:
Net (increase) decrease in federal funds sold .............. 5,280,000 (859,000)
Proceeds from sale of investment securities:
Available for sale securities ............................ 199,250
Proceeds from maturities of investment securities:
Available for sale securities ............................ 1,268,290 826,731
Purchase of investment securities:
Available for sale securities ............................ (3,448,203)
Held to maturity securities .............................. (223,500) (106,900)
Net increase in loans ...................................... (3,628,403) (2,287,008)
Additions to premises and equipment ........................ (39,902) (419,375)
----------- -----------
Net cash used for investing activities ......... (592,468) (2,845,552)
----------- -----------
FINANCING ACTIVITIES:
Net increase in deposits ................................... 152,618 4,384,993
Federal Home Loan Bank advance proceeds .................... 150,000 800,000
Repayment of Federal Home Loan Bank advances ............... (170,000) (1,700,000)
Net increase in other borrowings ........................... 460,449 50,026
Dividends paid ............................................. (428,704) (354,591)
Acquisition of treasury stock .............................. (4,000) (210,800)
----------- -----------
Net cash provided by financing activities ...... 160,363 2,969,628
----------- -----------
Increase in cash and cash equivalents ........................ 337,242 583,772
Cash and cash equivalents - beginning ........................ 2,296,408 2,406,895
----------- -----------
Cash and cash equivalents - ending ........................... $ 2,633,650 $ 2,990,667
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes $ 244,199 $ 372,601
=========== ===========
Interest $ 1,055,522 $ 950,171
=========== ===========
</TABLE>
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6
BRYAN BANCORP OF GEORGIA, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (UNAUDITED)
JUNE 30, 1997
NOTE 1 - BASIS OF PRESENTATION
------------------------------
The accompanying unaudited financial statements of Bryan Bancorp of
Georgia, Inc. and subsidiary have been prepared in accordance with
generally accepted accounting principles for interim financial information
and with the instructions to form 10-QSB. Accordingly, they do not include
all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the six month period ended June 30, 1997 are not necessarily
indicative of the results that may be expected for the year ended December
31, 1997. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company's annual report on
form 10-KSB for the year ended December 31, 1996
.
<PAGE>
7
Item 2. Management's Discussion and Analysis of Financial
---------------------------------------------------------
Condition and Results of Operations
-----------------------------------
The goal of liquidity management is to ensure the availability of
adequate funds to meet the loan demand and the deposit withdrawal
needs of the Bank's customers. This is achieved through maintaining a
combination of sufficient liquid assets, core deposit growth, and
unused capacity to purchase funds in the money markets. With ample
funds for lending being supplied primarily by core deposit growth, the
Company has considerable liquidity and funding flexibility.
The Company meets most of its daily liquidity needs through the
management of cash and federal funds sold. The Company continues in a
liquid position at June 30, 1997, with approximately $.3 million
invested in daily federal funds sold and approximately $2.6 million in
cash and due from banks. The company's cash and cash equivalents plus
federal funds sold decreased by approximately $4.9 million at June 30,
1997 compared to December 31, 1996. This decrease was due primarily to
an increase in loan demand during the first six months of 1997.
Management monitors the Company's asset and liability positions in
order to maintain a balance between rate sensitive assets and rate
sensitive liabilities and at the same time maintain sufficient liquid
assets to meet expected customer needs for loans and for withdrawal of
deposits.
The Company has the ability on a short-term basis to borrow funds from
other financial institutions. In addition to a credit line with the
Federal Home Loan Bank which allows advances up to seventy-five
percent of the book value of one-to-four family first mortgage loans,
the Company has federal funds line of credit arrangements aggregating
$3 million. As of June 30, 1997, the Company had borrowed $360,000 on
its credit line with the Federal Home Loan Bank and purchased $400,000
of federal funds from other financial institutions.
There are no trends, demands, commitments, events or uncertainties
that will result in or are reasonably likely to result in the
company's liquidity increasing or decreasing in any material way.
The Company's total assets increased from $60.2 million at December
31, 1996 to $61 million at June 30, 1997, representing an increase of
$.8 million or 1.3%. Loans increased $3.6 million or 8.5% during the
first six months of 1997 with a slight increase in deposits of $.1
million or .3% .
Shareholders' equity at June 30, 1997 was $6.9 million or 11.3% of
total assets. The Company paid a $.85 per share cash dividend during
the first six months of 1997. The Company also repurchased 200 shares
of its own common stock during the first six months of 1997 at a cost
of $20 per share. Management anticipates that capital will be adequate
to sustain the Company's anticipated 1997 growth.
<PAGE>
8
Item 2. Continued
-----------------
The Company's capital is in excess of the applicable regulatory
requirements. At June 30, 1997, the Company's leverage ratio was
11.12% and its tier 1 and total risk-based capital ratios were 13.86%
and 14.94%, respectively.
Net interest income increased in the second quarter of 1997 by
approximately $110,000 or 17.4% over the same quarter in 1996. For the
six months ended June 30, 1997, net interest income was up
approximately $195,000 or 15.7% over the same period of 1996. This
increase is primarily attributable to the growth of the loan
portfolio. Management anticipates that demand for loans will continue
strong throughout the remainder of 1997.
Noninterest income increased in the second quarter of 1997
approximately $39,000 or 18.2% over the same quarter of 1996. For the
six months ended June 30, 1997, noninterest income was up
approximately $98,000, or 23.9% over the same six months of 1996. This
increase is primarily attributable to an increase in loan service fees
generated from loan demand.
Noninterest expenses totaled approximately $497,000 for the quarter
ended June 30, 1997 compared to approximately $436,000 for the same
quarter in 1996. For the six months ended June 30, 1997, noninterest
expenses totaled approximately $1,018,000, compared to approximately
$858,000 during the same six months of 1996. This increase of 18.6% in
the first six months is due primarily to an increase in salaries and
employee benefits. The Company's efficiency ratio (non-interest
expense divided by the sum of net interest income after provision for
loan losses and non-interest income) was 55% for the first six months
of 1997 as compared to 53% for the first six months of 1996.
Net income for the quarter ended June 30, 1997 was $290,774 a 16.3%
increase compared to $250,037 for the same period in 1996. For the six
months ended June 30, 1997, net income was $562,298 which is a 8.1%
increase over the same period in 1996.
<PAGE>
9
PART II. - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security-Holders
----------------------------------------------------------
The following matters were submitted to a vote of security-holders
through the solicitation of proxies for the annual meeting held on May
15, 1997.
Matter No. One: To elect four directors to serve for a term of three
---------------
years and until their successors are elected and qualified. All
nominees were elected.
Matter No. Two: To approve the Bryan Bancorp of Georgia, Inc. 1997
----------------
Incentive Stock Option Plan adopted by the Board of Directors of the
Company. This matter was approved by the shareholders.
Matter No. Three: To ratify the appointment of the certifying
-------------------
accountant for the fiscal year 1997. This matter was ratified by the
shareholders.
The following is a tabulation of the votes cast for the above matters:
<TABLE>
<CAPTION>
Total Total Total Total
Eligible Votes Votes Votes
Votes For Against Abstain
----------- ----------- -----------------------
<S> <C> <C> <C> <C>
Matter No. One ........... 504,358 337,627 100 none
Matter No. Two ........... 504,358 317,977 14,800 4,950
Matter No. Three ......... 504,358 337,727 none none
</TABLE>
Note: Abstain or proxies returned without a vote by brokers were not
voted for or against the matter with respect to which the
abstention or brokers non-vote related.
Item 6. Exhibits and Reports on Form 8-K
----------------------------------------
(a) Exhibits. No exhibits are required to be filed with this report.
(b) Reports on Form 8-K. No report on Form 8-K was filed during the
quarter ended June 30, 1997.
<PAGE>
10
SIGNATURES
Pursuant to the requirements of Section 15(d) 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.
BRYAN BANCORP OF GEORGIA, INC.
Date: August 11, 1997 By: /s/ E. James Burnsed
--------------- ---------------------
E. James Burnsed,
President and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF BRYAN BANCORP OF GEORGIA, INC. FOR THE PERIOD ENDED
JUNE 30, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 2,633,650
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 250,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7,283,129
<INVESTMENTS-CARRYING> 3,419,119
<INVESTMENTS-MARKET> 3,508,404
<LOANS> 45,852,617
<ALLOWANCE> 508,775
<TOTAL-ASSETS> 61,000,141
<DEPOSITS> 52,756,694
<SHORT-TERM> 873,644
<LIABILITIES-OTHER> 459,533
<LONG-TERM> 0
0
0
<COMMON> 521,758
<OTHER-SE> 6,388,512
<TOTAL-LIABILITIES-AND-EQUITY> 61,000,141
<INTEREST-LOAN> 2,159,683
<INTEREST-INVEST> 277,071
<INTEREST-OTHER> 46,080
<INTEREST-TOTAL> 2,482,834
<INTEREST-DEPOSIT> 1,019,270
<INTEREST-EXPENSE> 1,040,859
<INTEREST-INCOME-NET> 1,441,975
<LOAN-LOSSES> 90,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,018,217
<INCOME-PRETAX> 842,948
<INCOME-PRE-EXTRAORDINARY> 842,948
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 562,298
<EPS-PRIMARY> 1.11
<EPS-DILUTED> 0
<YIELD-ACTUAL> 5.27
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 454,820
<CHARGE-OFFS> 49,126
<RECOVERIES> 13,081
<ALLOWANCE-CLOSE> 508,775
<ALLOWANCE-DOMESTIC> 508,775
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
