UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________________________________
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR
15 (D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Quarterly Period Ended March 31, 1997
Commission File Number 33-29696-A
__________________________________________________
CITRUS FINANCIAL SERVICES, INC.
(Exact Name of registrant as specified in its charter)
Florida 65-0136594
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1717 Indian River Boulevard
Suite 100
Vero Beach, Florida 32960
(Address of Principal Executive Offices) (Zip Code)
__________________________________________________
(561) 778-4100
(Registrant's telephone number including area code)
__________________________________________________
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 of outstanding of each of the issuer's classes
of Common Stock:
Class Outstanding as of May 8, 1997
Common Stock 854,120
Par Value $3.47 per share
<PAGE>
CITRUS FINANCIAL SERVICES, INC.
INDEX
PAGE
PART I: FINANCIAL INFORMATION NUMBER
Item 1: Financial Statements:
Consolidated Balance Sheets as of March 31, 1997
(unaudited) and December 31, 1996 1
Consolidated Statements of Operations for the three months
ended March 31, 1997 and 1996 (unaudited) 2
Consolidated Statements of Cash Flows for the three months
ended March 31, 1997 and 1996 (unaudited) 3
Notes to Consolidated Financial Statements (unaudited) 4 - 6
Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations 7 - 9
PART II: OTHER INFORMATION 10
Signatures 11
<PAGE>
<TABLE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
<CAPTION>
March 31, December 31,
(dollars in thousands) 1997 1996
(unaudited) (audited)
<S> <C> <C>
ASSETS
Cash and Due From Banks $ 439 $ 2,514
Federal Funds Sold 7,790 ---
Interest Bearing Deposits in Other Banks 40 106
Investment Securities 4,050 4,203
(Market Value March 31, 1997 was $4,511)
(Market Value December 31, 1996 was $4,013)
Securities Available for Sale 5,312 5,296
Loans:
Loans, net of deferred fee income 48,041 51,024
Less Allowance for Loan Losses 379 354
Net Loans 47,662 50,670
Premises & Equipment 2,500 2,550
Other Assets 1,155 1,077
Total Assets $ 68,948 $ 66,416
LIABILITIES
Deposits:
Noninterest Bearing Demand Deposits $ 8,638 $ 8,136
Interest Bearing Accounts:
NOW 2,991 3,386
Money Market Deposit Accounts 4,587 3,889
Savings 4,653 2,987
Certificates of Deposits 41,866 40,248
Total Deposits 62,735 58,646
FHLB Advances and Federal Funds Sold 524 2,055
Other Liabilities 320 288
Total Liabilities 63,579 60,989
STOCKHOLDERS' EQUITY
Treasury Stock (1) (1)
Common Stock 2,966 2,966
Additional Paid-In Capital 3,108 3,108
Accumulated Deficit ( 534) ( 488)
Unrealized loss on securities available for sale ( 170) ( 158)
Total shareholders' equity 5,369 5,427
Total Liabilities and Stockholders' Equity $ 68,948 $ 66,416
</TABLE>
<PAGE>
<TABLE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
Three months ended March 31,
dollars in thousands except per share amounts 1997 1996
(unaudited)
<S> <C> <C>
Interest Income
Interest and Fees on Loans $ 1,174 $ 1,058
Interest on Investment Securities and Interest
Bearing Deposits in Other Banks 136 146
Income on Federal Funds Sold 34 17
Total Interest Income 1,344 1,221
Interest Expense
Interest on Deposits 603 559
Other Interest 17 13
Total Interest Expense 620 572
Net Interest Income 724 649
Provision for Loan Losses 198 31
Net Interest Income After Provision for Loan Losses 526 618
Noninterest Income 111 85
Noninterest Expense 688 546
INCOME BEFORE INCOME TAXES (51) 157
INCOME TAXES (CREDIT) (5) 59
NET INCOME $ (46) $ 98
NET INCOME PER COMMON SHARE $ (0.05) $ 0.11
AVERAGE NUMBER OF SHARES OUTSTANDING 854,120 854,120
</TABLE>
<PAGE>
<TABLE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CPTION>
Three Months Ended March 31,
(dollars in thousands) 1997 1996
(unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss) $ (46) $ 98
Adjustment To Reconcile Net Income to
Net Cash Used by Operating Activities:
Depreciation and Amortization 55 46
(Increase) in Other Assets (78) (120)
Provision for Loan Losses 198 31
Origination of Loans Held for Sale (13,802) (9,125)
Proceeds on Sale of Loans Held for Sale 16,933 5,679
Increase in Other Liabilities 32 65
Net Cash Used by Operating Activities 3,292 (3,326)
Cash Flows from Investing Activities:
Loan Originations, Net of Principal Payments (321) (413)
Purchase of Investment Securities and Interest
Bearing Deposits --- (31)
Proceeds on Maturing Securities 219 105
Purchase of Securities Available for Sale (28) 0
Proceeds on Sale of Securities Available for Sale --- (3)
Capitalization of Premises and Equipment (5) (3)
Net Cash Used By Investing Activities (135) (345)
Cash Flows from Financing Activities:
Increase (Decrease) in Certificates of Deposit - Net 1,618 (1,059)
Increase (Decrease) in Other Deposits - Net 2,471 2,622
Repayment of FHLB Advances (1,531) (1,186)
Net Cash Provided by Financing Activities 2,558 377
Net (Decrease) in Cash and Cash Equivalents 5,715 (3,294)
Cash and cash equivalents at Beginning of Period 2,514 5,002
Cash and cash equivalents at End of Period $ 8,229 $ 1,708
Supplemental disclosure of cash flow information
Amount paid during the period for:
Interest Expense $ 604 $ 560
</TABLE>
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note (1) Accounting Policies
The consolidated financial statements include the accounts of Citrus Financial
Services, Inc. (Company) and its wholly owned subsidiary Citrus Bank, National
Association, (Bank). The information contained in the financial statements is
unaudited. In the opinion of management, all adjustments have been made
(consisting only of normal recurring accruals) necessary to present a fair
statement of the results for interim periods. The results for interim periods
are not necessarily indicative of trends or results to be expected for a full
year. It is suggested that these financial statements and notes be read in
conjunction with the Company's financial statements for the year ended December
31, 1996 included in the Company's annual report on Form 10-KSB filed with
the Securities and Exchange Commission.
Note (2) Loans
Loans receivable are stated at unpaid principal balances, less unearned
discounts, and net of deferred loan origination fees and costs. Interest
receivable is accrued only if deemed collectible. Generally, Company policy
is not to accrue interest on loans delinquent over ninety days. Such interest
ultimately collected is credited to income in the period received.
Loans, as categorized by the underlying collateral, consist of:
<TABLE>
<CAPTION>
March 31, 19 December 31, 1996
(dollars in thousands)
<S> <C> <C> <C> <C>
Real Estate $ 34,783 72.4% $ 37,980 74.4%
Commercial, Financial, and Agriculture 9,517 19.8% 9,133 17.9%
Consumer and other 3,760 7.8% 3,945 7.7%
Total loans, gross $ 48,060 100.0% $ 51,058 100.0%
</TABLE>
Note (3) Allowance for Loan Losses
The Company's Board of Directors monitors the loan portfolio monthly in order
to enable it to evaluate the adequacy of the allowance for loan losses. In
addition to reviews by regulatory agencies and the Company's certified public
accountants, the services of outside lending professionals have been engaged
to assist in the valuation of credit quality and loan administration. These
professionals compliment the system implemented by the Company which identifies
potential problem credits as early as possible, categorizes the credits as to
risk and puts a reporting process in place to monitor the progress of the
credits.
The Company maintains the allowance for loan losses at a level sufficient to
absorb all estimated losses inherent in the loan portfolio. The allowance for
loan losses is made up of two primary components, amounts allocated to loans
based on collateral type and amounts allocated for loans reviewed on an
individual basis in accordance with a credit risk grading system.
Activity in the allowance for loan losses from January 1 through March 31
follows: (in thousands)
<TABLE>
<CAPTION>
<S> <C> <C>
1997 1996
Balance, January 1, $ 354 $ 373
Recoveries 0 508
Chargeoffs (173) (879)
Provision charged to expense 198 352
Balance, March 31, $ 379 $ 354
</TABLE>
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note (4) Investment Securities
Investment securities are carried at cost, adjusted for amortization of
premiums or accretion of discounts. The amortized cost and estimated fair
value of investments in securities are as follows:
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
Amortized Estimated Amortized Estimated
Cost Fair Value Cost Fair Value
Debt Securities: (in thousands)
<S> <C> <C> <C> <C>
U.S. Government Agencies $ 1,469 $ 1,330 $ 1,499 $ 1,322
Mortgaged-Backed Securities 2,330 2,268 2,452 2,442
Other 251 248 252 249
Total Securities $ 4,050 $ 3,846 $ 4,203 $ 4,013
</TABLE>
The amortized cost and estimated fair value of debt securities by contractual
maturity, are shown below. Debt securities with maturities greater than ten
years include fixed rate mortgage backed obligations which have significantly
shorter expected maturities as a result of prepayments.
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
Amortized Estimated Amortized Estimated
Cost Fair Value Cost Fair Value
(in thousands)
<S> <C> <C> <C> <C>
Due in One Year or Less $ 89 $ 89 $ --- $ ---
From One to Five Years 3,614 3,555 2,661 2,627
From Five to Ten Years 500 443 900 759
Due After Ten Years 439 424 390 378
Other --- --- 252 249
$ 4,642 $ 4,511 $ 4,203 $ 4,013
</TABLE>
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note (5) Securities Available for Sale
The amortized cost and estimated fair value of securities available for sale
as of March 31, 1997 and December 31, 1996 are as follows:
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
Amortized Estimated Amortized Estimated
Cost Fair Value Cost Fair Value
(in thousands)
<S> <C> <C> <C> <C>
U.S. Government Agencies $ 500 $ 495 $ 500 $ 495
Mortgage Backed Securities 4,620 4,390 4,643 4,427
Other 427 427 374 374
Total Securities $ 5,547 $ 5,312 $ 5,517 $ 5,296
</TABLE>
The amortized cost and estimated fair value of debt securities by contractual
maturity, are shown below. Debt securities with maturities greater than ten
years are all adjustable rate issues or fixed rate mortgage backed obligations
that have significantly shorter expected maturities as a result of prepayments.
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
Amortized Estimated Amortized Estimated
Cost Fair Value Cost Fair Value
(in thousands)
<S> <C> <C> <C> <C>
Due in One to Five Years $ 0 $ 0 $ 500 $ 495
Due from Five to Ten Years 500 492 --- ---
Due After Ten Years 4,858 4,692 4,643 4,427
Other 373 373 374 374
Total Securities $ 5,731 $ 5,557 $ 5,517 $ 5,296
</TABLE>
From January 1, 1997 through March 31, 1997 securities were prepaid that
aggregated $ 22,000. No securities were purchased. Securities Available for
Sale had an unrealized market value loss of $266,000 as of March 31, 1997.
Note (6) Financial Instruments With Off-Balance Sheet Risk
The Company is a party to financial instruments with off-balance sheet risk in
the normal course of business to meet the financing needs of its customers.
These financial instruments included commitments to extend credit. Those
instruments involve, to varying degrees, elements of credit, and interest rate
risk in excess of the amounts recognized in the balance sheet. The contract or
notional amounts of those instruments reflect the extent of involvement the
Company has in particular classes of financial instruments.
Financial instruments at March 31, 1997 consisted of commitments to extend
credit approximating $7,934,000, and letters of credit of $375,000.
Commitments to extend credit are agreements to lend to a customer as long as
there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since many of the commitments are expected
to expire without being drawn upon, the total commitment amounts do not
necessarily represent future cash requirements.
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
Citrus Financial Services, Inc. is a one bank holding company with consolidated
assets of $68,948,000 at the end of the first quarter of 1997. While the
consolidated company had grown from $66,416,000 since December 31, 1996,
increased provisions for loan losses and concurrent increases in noninterest
expenses relative to litigation were responsible for a $46,000 first quarter
loss. These expenses reflect one loan relationship that is proceeding in
litigation but has not yet reached adjudication for ultimate resolution. Net
interest income for the first quarter exceeded the first quarter of 1996 and
noninterest income also exceeds the same period last year. Management and the
directorate are proceeding to resolve this problematic loan and are confident
that a return to profitable operations are assured upon its resolution.
STATEMENT OF CONDITION ANALYSIS
The Company's consolidated assets have continued to expand and aggregated
$68,948,000 at the first quarter's end. Deposits grew 7% during this quarter
for an increase in deposits of $4,089,000 and totaled $62.7 million at
March 31, 1997. Management expects continued deposit growth throughout 1997
and anticipates deposit growth to exceed $650,000 per month for the year. The
Company's prospects for deposit growth are heightened with the continued growth
of the banking center in Sebastian, Florida and the newest banking center in
Barefoot Bay, Florida. The Barefoot Bay Banking Center has expanded the
Company's market into Brevard County and heightens both the growth and
profitability aspects for the Company.
The deposit mix reflects disintermediation during the period as NOW, money
market, and certificates of deposit as a percentage of total average deposits,
have decreased while noninterest bearing and savings deposits as a percentage
of total deposits increased. These changes reflect increased activity in
business deposits and personal savings accounts. The Company's newest branch
in Barefoot Bay as well as heightened solicitation efforts in the local
community account for the largest part of these increases in aggregate
deposits.
The following schedule illustrates this deposit mix change using monthly
average consolidated deposit aggregates:
<TABLE>
<CAPTION>
Average Monthly Deposit Mix Comparison
Deposit Types 3/97 Change 12/96
<S> <C> <C> <C>
Demand Deposits 14.9% 1.9% 13.0%
NOW Accounts 5.1% -0.1% 5.2%
Money Market Accounts 6.4% -0.5% 6.9%
Savings Deposits 6.7% 1.6% 5.1%
Certificates of Deposit 66.9% -2.9% 69.8%
</TABLE>
Total loans decreased $2,983,000 during the first quarter from a downturn in
one of the Company's residential real estate loan programs that was reevaluated.
This program will be resumed during the second quarter. Management expects loan
growth to be heightened during 1997 and exceed 1996 by the year's end as the
local economy continues to expand and business leaders continue to be confident
about future economic prospects.
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
Aggregate real estate loans at the end of March represented 72.4% of gross loans
as compared to 74.4% at the end of 1996. This change reflects the aforementioned
downturn in the residential real estate loan program. Commercial non-real estate
loans increased from 17.9% of gross loans to 19.8% on March 31, 1997. These
movements are reflective of management's continued exploration of commercial
accounts. Commercial loans were the only expanding loan group during the first
quarter moving from $9,133,000 at the end of 1996 to $9,517,000 by the end of
March. Loans secured by real estate had the largest dollar change, down
$3,197,000 from December 31, 1996, this decrease is primarily residential real
estate loans that are held for sale. Consumer loans have increased from 7.7%
to 7.8% but dollar totals are down $185,000. Management has relaxed targets
for growth in consumer loans during 1997 targeting commercial and residential
loan growth.
This change in the loan portfolio's mix together with management's anticipated
loss potential with regard to identified problematic loans is reflected in the
change in the reserve for loan losses. The reserve was increased by $25,000,
net of chargeoffs, through March 31, 1997. An additional writedown of an
existing credit of $167,000 required a $198,000 loan loss provision for the
period. The reserve was .79% of total loans at March 31, 1997.
Future anticipations are for continued loan growth for the remainder of 1997.
The continued development of the commercial and the real estate loan market
is expected to be the most productive.
In particular, the bank's loan operation has enhanced its full service mortgage
loan activities that originates and sells mortgages in the secondary market as
well as retaining mortgages for the bank's own loan portfolio. This activity
generated $13,000 in real estate loan brokerage fees through the first quarter
of 1997 but the activity is generating significant interest income on real
estate loans held for sale that aggregated $66,000 in the first quarter. With
the change in the Company's real estate program and the increase in interest
rates, the need for these services has reduced dramatically at the end of the
quarter but management expects this activity to rebound during the remainder
of the year.
During 1997 the market value of securities available for sale has increased
from $5,296,000 at December 31, 1996 to $5,312,000. As of March 31, 1997, the
investment portfolio had decreased to $9,362,000. U.S. Government and Agency
securities represent 93% of total securities. As of March 31, 1997, aggregate
securities yielded 5.71% compared to 5.6% on December 31, 1996. The increased
yield reflects increasing coupons on adjustable rate securities. Bank
management continues to curtail investment activities opting to invest growth
into loans.
Unrealized losses on Securities Available for Sale totaled $266,000 as of
March 31, 1997. Securities Available for Sale are recorded at market, in the
aggregate, with any unrealized market value gains or losses taken through the
Company's equity capital.
Management will continue to position the investment portfolio to best serve all
the needs of the Company. Consideration will be given to current economic
conditions and forecasts. The Company's adopted investment strategy coincides
with the Company's overall strategies and market anticipations. At the end of
March, 1997, 42% of the aggregate investment portfolio had adjustable interest
rates that would change with the market within a one year time frame.
The Bank exhibits sufficient liquidity at the current time with $439,000 in
Cash and Due from Banks, $7,790,000 in federal funds sold, $2,250,000 in
unsecured federal funds purchased lines of credit with correspondent banks,
and $5,312,000 in the market value of securities available for sale. In
addition, the Bank has established $10,000,000 in lines of credit with the
Federal Home Loan Bank (FHLB) to provide additional funding should the need
arise. This relationship provides the bank an opportunity to fund loan growth
with a borrowing that can match interest rate volatility. Such balanced funding
limits the bank's exposure to interest rate risk. One FHLB borrowing is secured
by the Bank's residential mortgage loan portfolio. Another FHLB line of
credit has also been established to fund residential mortgage loans that will
be sold into the secondary market and transferred to the permanent holder.
These loans are normally held less than one month and are appropriately matched
against this funding line of credit. This line is secured by investment
securities. Management anticipates that these funding sources are adequate to
meet anticipated needs.
<PAGE>
CITRUS FINANCIAL SERVICES, INC. and SUBSIDIARY
The Company's capitalization continues to be held to fund future expansion.
As of March 31, 1997, capital represents 7.8% of assets and overnight cash and
cash equivalents aggregate 11.9% of assets. The regulatory capital adequacy
measurement is known as risk based capital and applies risk weighted capital
needs according to predetermined risk factors per category of asset. Assets
or commitments with less potential risk require less supportive capital while
those items considered to have greater risk potential require greater capital
support. At March 31, 1997 the Company had a risk based capital to asset ratio
of 12.2%; the regulatory minimum is 8.0%. Management expects to maintain
capital above the required level through earnings retention and management of
the Company's mix of risk weighted assets.
RESULTS OF OPERATIONS
The consolidated statement of operations for the three months ended
March 31, 1997, reflects a net loss of $46,000. Net interest income, however,
compared favorably to the same period in 1996 showing a 12% or $75,000
improvement and growing to $724,000. This increase was not adequate to cover
$198,000 in loan losses provisions and heightened noninterest expenses of
$688,000. The increased loan loss provision and heightened noninterest
expenses were both related to the bank's problem loan credit that now nears
judicial review through lengthy and costly litigation. Without these increased
costs, the Company's increasing net interest income would have produced a
profitable period as it would have been more than adequate to offset net
noninterest expenses. Management will continue to pursue this problem credit
to conclusion while moving ahead toward profitable operations.
The bank's net interest income to average earning assets (net interest margin)
improved from 4.32% for year to date March 31, 1996 to the current level of
4.50%. The improving net interest margin reflects the change in deposit mix
toward less costly deposits and the loan portfolio's ability to hold interest
rates at their current level. The bank's downturn in loan volumes is expected
to be corrected in the near term as new residential loan programs have been
introduced to replaced those that were extinguished during the later part of
the first quarter. This anticipated increase in residential loan production
should fill the shortfall experienced at the end of March and continue to be
reflected in a growing loan portfolio that is expected to exceed the growth
experienced in 1996. Management continues to actively solicit loans and price
loan products competitively to attract prudent loans with the goal of
maintaining a strong loan to deposit ratio while increasing the banks total
assets.
<TABLE>
<CAPTION>
Net Interest Non Interest
Income Expense
<S> <C> <C>
Three months ended 3/31/97 $ 724,000 $ 688,000
Three months ended 3/31/96 649,000 546,000
</TABLE>
The Company's earning assets increased from $60,629,000 on December 31, 1996
to $65,233,000 on March 31, 1997. While total deposits increased $4,089,000
during the first quarter, noninterest bearing deposits and lower interest
deposits made up the largest part of the increase at $2,471,000 to $20,869,000
as management continues to attract lower cost deposits in an effort to
increase the net interest margin.
Noninterest expenses included in the three months ended March 31,1997 aggregate
$688,000 compared to $546,000 for the same period last year and reflect
$51,000 in additional legal fees and $54,000 in increased salaries primarily
to staff the new Barefoot Bay Center. The remainder of the increase relates
to the growing size of the Company's operations.
Using the current balance sheet, the current maturity schedule, and the
forecasted balance sheet, management projects the worst-case scenario to be
falling rates. Should the prime rate decrease to 6.5% from 8.50% during the
next twelve months, net interest income could be reduced about $173,000.
The Bank continues to engage an outside firm to provide management with
monthly asset/liability position reports. These reports measure the Bank's
vulnerability to interest rates should rates change in an adverse direction.
In addition, the future impact of these rate changes are measured over a
twelve month period using management's expectations as to future growth and
mix. Meetings are held with the Bank's Asset/Liability Investment Committee
to work with these reports and management's expectations to continue to
control and monitor balance sheet mix and interest rate exposures.
<PAGE>
CITRUS FINANCIAL SERVICES, INC.
PART II: OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes In Securities.
None.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
None.
<PAGE>
CITRUS FINANCIAL SERVICES, INC.
SIGNATURE
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.
Citrus Financial Services, Inc.
Date: May 8, 1997 /s/ Josh C. Cox, Jr.
Josh C. Cox, Jr.
President and CEO
Date: May 8, 1997 /s/ Henry O. Speight
Henry O. Speight
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 439
<INT-BEARING-DEPOSITS> 40
<FED-FUNDS-SOLD> 7,790
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 5,312
<INVESTMENTS-CARRYING> 4,050
<INVESTMENTS-MARKET> 4,511
<LOANS> 48,041
<ALLOWANCE> 379
<TOTAL-ASSETS> 68,948
<DEPOSITS> 62,735
<SHORT-TERM> 0
<LIABILITIES-OTHER> 320
<LONG-TERM> 524
0
0
<COMMON> 2,966
<OTHER-SE> 2,403
<TOTAL-LIABILITIES-AND-EQUITY> 68,948
<INTEREST-LOAN> 1,174
<INTEREST-INVEST> 136
<INTEREST-OTHER> 34
<INTEREST-TOTAL> 1,344
<INTEREST-DEPOSIT> 603
<INTEREST-EXPENSE> 620
<INTEREST-INCOME-NET> 724
<LOAN-LOSSES> 198
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 688
<INCOME-PRETAX> (51)
<INCOME-PRE-EXTRAORDINARY> (51)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (46)
<EPS-PRIMARY> (.05)
<EPS-DILUTED> .18
<YIELD-ACTUAL> 8.39
<LOANS-NON> 831
<LOANS-PAST> 61
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 354
<CHARGE-OFFS> (173)
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 379
<ALLOWANCE-DOMESTIC> 379
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
