<PAGE>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 SEPTEMBER 30, 1998
-----------------------------------
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 0-26350
-------------------------------------------------
ALLEGIANT BANCORP, INC.
- - ------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MISSOURI 43-1519382
- - ---------------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or
organization)
2122 KRATKY ROAD
ST. LOUIS, MISSOURI 63114
- - ------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(314) 692-8200
- - ------------------------------------------------------------------------
(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.
/x/ Yes / / No
Title of class of Number of shares
common stock outstanding as of October 31, 1998
----------------------------- ----------------------------------
Common stock, $0.01 par value 5,318,251
<PAGE>
<PAGE>
ALLEGIANT BANCORP, INC.
FORM 10-Q
<TABLE>
INDEX
<CAPTION>
Page
----
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited) 1
Consolidated Balance Sheets -- September 30, 1998 and 1997 (Unaudited)
and December 31, 1997 1
Consolidated Statements of Income (Unaudited) -- Three Months and Nine
Months Ended September 30, 1998 and 1997 2
Consolidated Statement of Shareholders' Equity -- Nine Months
Ended September 30, 1998 3
Consolidated Statements of Cash Flows (Unaudited) -- Nine Months Ended
September 30, 1998 and 1997 4
Notes to Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation 6
Distribution Of Average Assets, Liabilities And Shareholders' Equity and
Interest Rates - Three Months Ended September 30, 1998 and 1997 8
Distribution Of Average Assets, Liabilities And Shareholders' Equity and
Interest Rates - Nine Months Ended September 30, 1998 and 1997 9
Rate/Volume Analysis - Quarter and Nine Months Ended September 30, 1998
and 1997 10
Investment Securities Portfolio - September 30, 1998 and 1997 and December
31, 1997 11
Lending and Credit Management - September 30, 1998 and 1997 and
December 31, 1997 11
Deposit Liability Composition - September 30, 1998 and 1997 and December
31, 1997 12
Summary of Loan Loss Experience and Related Information--Allocation of
the Allowance for Loan Losses - Nine Months Ended September 30, 1998
and 1997 13
i
<PAGE>
<PAGE>
Risk Elements--Nonaccrual, Past Due and Restructured Loans - September
30, 1998 and 1997 and December 31, 1997 14
Capital Resource And Liquidity 16
Year 2000 16
Item 3. Quantitative and Qualitative Disclosures About Market Risk 18
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 19
Item 2. Changes in Securities and Use of Proceeds 19
Item 3. Defaults Upon Senior Securities 19
Item 4. Submission of Matters to a Vote of Security Holders 19
Item 5. Other Information 19
Item 6. Exhibits and Reports on Form 8-K 19
SIGNATURES 20
EXHIBIT INDEX 21
</TABLE>
ii<PAGE>
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
<CAPTION>
September 30, December 31, September 30,
1998 1997 1997
(Unaudited) (Unaudited)
------------- ------------ -------------
(Dollars in thousands)
<S> <C> <C> <C>
ASSETS
- - ------
Cash and due from banks $ 12,678 $ 14,872 $ 17,242
Federal funds sold and other overnight investments 33,409 1,600 20,360
Investment securities:
Available-for-sale (at estimated market value) 56,927 44,918 41,091
Held-to-maturity (approximate market value of $16,445,
$32,146 and $35,500, respectively) 16,276 31,951 35,266
Loans, net of allowance for possible loan losses, of $5,942
$5,193 and $4,842, respectively 462,824 479,669 434,668
Bank premises and equipment, net of accumulated
depreciation 11,103 10,801 8,996
Accrued interest and other assets 10,297 10,837 7,648
Cost in excess of fair value of net assets acquired 13,041 13,589 13,429
-------- -------- --------
Total assets $616,555 $608,237 $578,700
======== ======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
- - ------------------------------------
Deposits:
Non-interest-bearing $ 48,413 $ 50,060 $ 46,134
Interest-bearing 387,833 382,370 375,572
Certificates of deposit of $100,000 or more 31,818 52,211 51,678
-------- -------- --------
Total deposits 468,064 484,641 473,384
-------- -------- --------
Short-term borrowings 59,286 53,579 52,486
Long-term borrowings 40,775 23,275 15,663
Accrued expenses and other liabilities 2,657 4,671 2,305
-------- -------- --------
Total liabilities 570,782 566,166 543,838
-------- -------- --------
Shareholders' equity:
Common Stock, $.01 par value - shares
authorized, 20,000,000; issued and outstanding, 5,313,904
5,095,740 and 3,567,769, respectively 53 51 35
Capital surplus 40,799 39,504 32,455
Retained earnings 4,699 2,431 2,273
Net unrealized appreciation on securities
available-for-sale 222 85 99
-------- -------- --------
Total shareholders' equity 45,773 42,071 34,862
-------- -------- --------
Total liabilities and shareholders' equity $616,555 $608,237 $578,700
======== ======== ========
See notes to consolidated financial statements.
</TABLE>
1<PAGE>
<PAGE>
<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- ----------------------------
1998 1997 1998 1997
---------- ---------- ---------- ----------
(In thousands, except share and per share data)
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $ 11,190 $ 8,957 $ 33,509 $ 23,037
Investment securities 1,120 1,007 3,175 2,827
Federal funds sold and other overnight investments 142 160 326 246
---------- ---------- ---------- ----------
Total interest income 12,452 10,124 37,010 26,110
---------- ---------- ---------- ----------
Interest expense:
Interest on deposits 5,486 4,403 16,747 11,587
Interest on short-term borrowings 669 993 1,926 2,162
Interest on long-term debt 680 333 2,055 979
---------- ---------- ---------- ----------
Total interest expense 6,835 5,729 20,728 14,728
---------- ---------- ---------- ----------
Net interest income 5,617 4,395 16,282 11,382
Provision for possible loan losses 465 556 1,180 1,677
---------- ---------- ---------- ----------
Net interest income after
provision for possible loan losses 5,152 3,839 15,102 9,705
---------- ---------- ---------- ----------
Other income:
Service charges and other fees 1,946 938 5,173 2,017
Net gain on sale of securities 4 25 62 25
---------- ---------- ---------- ----------
Total other income 1,950 963 5,235 2,042
---------- ---------- ---------- ----------
Other expenses:
Salaries and employee benefits 2,257 1,695 6,832 4,024
Occupancy and other operating expenses 2,855 1,713 8,693 4,162
---------- ---------- ---------- ----------
Total other expenses 5,112 3,408 15,525 8,186
---------- ---------- ---------- ----------
Income before income taxes 1,990 1,394 4,812 3,561
Provision for income taxes 783 556 1,901 1,422
---------- ---------- ---------- ----------
Net income $ 1,207 $ 838 $ 2,911 $ 2,139
========== ========== ========== ==========
Per share data:
Basic:
Weighted average primary
common shares outstanding 5,224,495 3,852,280 5,166,479 3,470,030
Net income $ 0.23 $ 0.22 $ 0.56 $ 0.62
Diluted:
Weighted average diluted
common shares outstanding 5,491,584 4,227,245 5,538,147 3,796,668
Net income $ 0.22 $ 0.20 $ 0.53 $ 0.56
See notes to consolidated financial statements.
</TABLE>
2
<PAGE>
<PAGE>
<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
<CAPTION>
Accumulated
Other
Common Capital Retained Comprehensive Total Share- Comprehensive
Stock Surplus Earnings Income holders' Equity Income
------ ------- -------- -------------- --------------- -----------
(In thousands)
<S> <C> <C> <C> <C> <C> <C>
Balance December 31, 1997 $51 $39,504 $2,431 $ 85 $42,071 $ -
Net income 2,911 2,911 2,911
Unrealized gain on available-for-sale
securities net of reclassification
adjustment (see below) 137 137 137
------
Comprehensive income $3,048
======
Warrants exercised 28 28
New shares issued 148 148
Options exercised 2 1,119 1,121
Dividends (643) (643)
--- ------- ------ ---- -------
Balance September 30, 1998 $53 $40,799 $4,699 $222 $45,773
=== ======= ====== ==== =======
Reclassification Adjustments
Unrealized gain on AFS securities 174
Less: Reclassification adjustment for gains
realized, included in net income (37)
----
Net unrealized gains on securities $137
====
</TABLE>
3
<PAGE>
<PAGE>
<TABLE>
ALLEGIANT BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<CAPTION>
Nine Months Ended
September 30,
--------------------------------
1998 1997
-------- ---------
(In thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
- - --------------------
Net income $ 2,911 $ 2,139
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 3,111 1,259
Provision for loan losses 1,180 1,677
Gain on sale of mortgage loans (1,012) -
Gain on sale of securities available for sale (62) (28)
Changes in assets and liabilities:
Accrued interest receivable and
other assets 2,215 377
Other liabilities (1,949) 301
-------- ---------
Cash provided by operating activities 6,394 5,725
-------- ---------
INVESTING ACTIVITIES:
- - --------------------
Cash and cash equivalents of acquired entities - 84,368
Proceeds from maturities of securities held to maturity 15,675 17,700
Purchase of investment securities held to maturity - (13,068)
Proceeds from maturities of securities available for-sale 60,822 11,482
Proceeds from sales of securities available for-sale 5,473 6,482
Purchase of investments securities available for-sale (78,433) (30,001)
Loans made to customers, net of repayments (61,378) (127,552)
Proceeds from sale of mortgage loans 78,374 -
Purchase of assets held for operating leases (3,049) (2,382)
Additions to premises and equipment (1,759) (3,155)
-------- ---------
Cash provided by (used in) investing activities 15,725 (56,126)
-------- ---------
FINANCING ACTIVITIES:
- - --------------------
Net increase (decrease) in deposits (16,577) 46,213
Net increase of short-term borrowings 5,707 14,348
Proceeds from issuance of long-term debt 17,500 3,000
Retirement of long-term debt - -
Proceeds from issuance of Common Stock 1,297 6,334
Payment of dividends (431) (221)
-------- ---------
Cash provided by financing activities 7,496 69,674
-------- ---------
Net increase in cash and cash equivalents 29,615 19,273
Cash and cash equivalents, beginning of period 16,472 18,329
-------- ---------
Cash and cash equivalents, end of period $ 46,087 $ 37,602
======== =========
See notes to consolidated financial statements.
</TABLE>
4<PAGE>
<PAGE>
ALLEGIANT BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Basis of Presentation
The accompanying consolidated financial statements include the
accounts of Allegiant Bancorp, Inc. (the "Company") and its
subsidiaries: Allegiant Bank (the "Bank") and Edge Mortgage Services,
Inc. ("Edge"). Unless the context requires otherwise, a reference to
the Company includes Allegiant Bancorp, Inc. and its subsidiaries.
The consolidated balance sheet at September 30, 1998 and 1997, the
consolidated statements of income for the three- and nine-month periods
ended September 30, 1998 and 1997, the consolidated statement of
shareholders' equity at September 30, 1998 and the consolidated
statements of cash flows for the nine months ended September 30, 1998
and 1997 are unaudited, but, in the opinion of management of the
Company, reflect all adjustments (consisting only of normal recurring
accruals) necessary for a fair presentation. Reference is hereby made
to the consolidated financial statements, including the notes thereto,
contained in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1997. The results of operations for the nine months
ended September 30, 1998 are not necessarily indicative of the results
that may be obtained for the full year ending December 31, 1998.
Comprehensive Income
As of January 1, 1998, the Company adopted FASB Statement No. 130,
"Reporting Comprehensive Income." Statement 130 establishes new rules
for the reporting and display of comprehensive income and its
components; however, the adoption of this Statement had no impact on the
Company's net income or shareholders' equity. Statement 130 requires
unrealized gains or losses on the Company's available-for-sale
securities, which prior to adoption were reported separately in
shareholder's equity, to be included in other comprehensive income.
Prior year financial statements have been reclassified to conform to the
requirements of Statement 130.
During the third quarter of 1998 and 1997, total comprehensive
income amounted to $3.05 million and $2.21 million, respectively.
5
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
This report contains certain forward-looking statements with
respect to the financial condition, results of operations and business
of the Company and its subsidiaries. These forward looking statements
involve certain risks and uncertainties. For example, by accepting
deposits at fixed rates, at different times and for different terms, and
lending funds at fixed rates for fixed periods, a bank accepts the risk
that the cost of funds may rise and the use of the funds may be at a
fixed rate. Similarly, the cost of funds may fall, but a bank may have
committed by virtue of the term of a deposit to pay what becomes an
above-market rate. Investments may decline in value in a rising
interest rate environment. Loans, and the reserve for loan losses, have
the risk that the borrower will not repay all funds in a timely manner
as well as the risk of total loss. Collateral may or may not have the
value attributed to it. The loan loss reserve, while believed adequate,
may prove inadequate if one or more large borrowers, or numerous mid-
range borrowers, or a combination of both, experience financial
difficulty for individual, national or international reasons. Because
the business of banking is highly regulated, decisions of governmental
authorities, such as the rate of deposit insurance, can have a major
effect on operating results. Unanticipated events associated with Year
2000 compliance, relating to work on developments or modifications to
computer systems and to software, including work performed by suppliers
or vendors, could affect the Company's future financial condition and
operating results. All of these uncertainties, as well as others, are
present in a banking operation and shareholders are cautioned that
management's view of the future on which it prices its products,
evaluates collateral, sets loan reserves and estimates costs of
operation and regulation may prove to be other than anticipated.
RESULTS OF OPERATIONS
Net income for the quarter ended September 30, 1998 was $1.207
million, a 44.03% increase over the $838 thousand earned for the same
period in 1997. For the third quarter of 1998, basic earnings per share
were $0.23 and diluted earnings per share were $0.22 compared to $0.22
and $0.20, respectively, for the third quarter of 1997. Return on average
assets was 0.78% for the third quarter of 1998 compared to 0.68% for the
third quarter of 1997. Return on average equity was 10.70% for the third
quarter of 1998 compared to 12.58% for the third quarter of 1997.
For the nine months ended September 30, 1998 and 1997, net income
was $2.911 million and $2.139 million, respectively. Net income
increased 36.09% for the comparable periods. Basic earnings per share
declined 9.68% to $0.56 from $0.62 and diluted earnings per share
declined 5.36% to $0.53 from $0.56 for the respective nine-month
periods. Return on average assets was 0.63% and return on average equity
was 8.93% for the nine months ended September 30, 1998. This compares to
a return on average assets of 0.68% and return on average equity of
12.61% for the same period in 1997.
The increase in the number of shares outstanding had a significant
impact on earnings per share results as well as contributing to lower
return on equity results. Average diluted shares outstanding increased
by 1.264 million shares for the quarter ended September 30, 1998
compared to the prior year quarter, and 1.741 million for the nine-month
period ended September 30, 1998 compared to the prior year nine-month
period. The share increase resulted from two rights offerings in 1997
and shares issued for an acquisition consummated in the third quarter of
1997. Average shareholders' equity increased 69.31% for the quarter and
92.10% for the nine-month comparable periods. Average equity was $44.752
million for the quarter ended September 30, 1998 and $43.559 million for
the nine months ended September 30, 1998. This compares to $26.432
million and $22.675 million for the respective periods in 1997. The
ratio of average equity to average assets improved to 7.26% from 5.43%,
respectively, for the quarters ended September 30, 1998 and 1997. For
the nine-month periods ended September 30, 1998 and 1997 average equity
to assets was 7.03% and 5.37%, respectively.
6<PAGE>
<PAGE>
Period end balance sheet categories showed moderate growth from
September 1997. Total assets increased $37.86 million, or 6.54%, reaching
$616.55 million. Total loans increased $29.26 million, or 6.66%,
totaling $468.77 million. Investment securities decreased $3.15 million,
or 4.13%, reaching $73.20 million at September 30, 1998. Total
deposits also decreased $5.32 million, or 1.12%, totaling $468.06 million
at September 30, 1998.
NET INTEREST INCOME
Three months ended September 30, 1998
Net interest income for the third quarter of 1998 was $5.617
million, an increase of $1.222 million, or 27.80% compared to the third
quarter of 1997. Refer to the chart showing distribution of balance
sheet components with rates earned and paid for an overall understanding
of the increase in net interest income.
Net interest margin for the third quarter of 1998 increased
15 basis points from the same period a year ago. The net interest spread
increased 19 basis points between the two periods resulting from a
2 basis point increase in earning asset yields and a 17 basis point
decline in the cost of interest-bearing liabilities. The 15 basis point
increase in margin was less than the 19 basis point increase in spread
because of the following reasons. Growth in interest-bearing liabilities
outpaced growth in earning assets. Interest-bearing liabilities grew
23.31% for third quarter of 1998 compared to the third quarter of 1997
while earning assets grew 22.68% for the same period. Total average
assets grew 26.66% meaning that non-earning assets grew faster than
earning assets. This impact is reinforced by the ratio of earning
assets to total assets declining to 92.66% for the third quarter of 1998
compared to 95.67% for the third quarter of 1997. The negative margin
impact of these changes was offset by two factors. First, loans as a
percentage of average earning assets increased to 84.62% for the third
quarter of 1998 compared to 83.05% for the third quarter of 1997. The
higher proportion of loans to earning assets increased the overall
earning asset yields while loan yields remained unchanged. The impact
to margin of this change is already reflected in the increase in net
interest spread. Second, the percentage of non-interest-bearing funds,
primarily demand deposits and shareholders' equity, to total funding
sources increased to 15.83% during the third quarter of 1998 compared to
13.54% in the third quarter of 1997.
Nine months ended September 30, 1998
Net interest income for the nine months ended September 30, 1998
was $16.282 million, a 43.05% increase over the $11.382 million reported
for the comparable period in 1997. This increase is the result of
substantial growth in volumes of assets and liabilities and improved
yields on earning assets together with lower liability costs. The same
balance sheet dynamics described for the third quarter are applicable to
the nine-month period.
The net interest margin for the nine months ended September 30,
1998 increased 4 basis points to 3.79% compared to 3.75% for the nine
months ended September 30, 1997. The net interest spread increased by
9 basis points to 3.32% for the nine months ended September 30, 1998
compared to 3.23% for the nine months ended September 30, 1997.
7<PAGE>
<PAGE>
The following tables set forth the condensed average balance
sheets for the periods reported and the percentage of each principal
category of assets, liabilities and shareholders' equity to total
assets. Also shown is the average yield on each category of interest-
earning assets and the average rate paid on interest-bearing liabilities
for each of the periods reported.
<TABLE>
DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY AND INTEREST RATES
<CAPTION>
Three Months Ended September 30
--------------------------------------------------------------------------------
1998 1997
-------------------------------------- ---------------------------------------
Average Int. Earned/ Yield/ Average Int. Earned/ Yield/
Balance Expense Rate<F1><F2> Balance Expense Rate<F1><F2>
------- ------------ ------------ ------- ------------ ------------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Assets:
Interest-earning assets:
Loans <F1> $483,306 $11,190 9.19% $386,657 $ 8,957 9.19%
Taxable investment securities 76,127 1,100 5.73% 65,292 993 6.03%
Non-taxable investment securities 1,479 20 5.36% 1,093 14 5.08%
Federal funds sold 10,247 142 5.50% 12,538 160 5.06%
-------- ------- ----- -------- ------- -----
Total interest-earning assets 571,159 12,452 8.65% 465,580 10,124 8.63%
-------- ------- ----- -------- ------- -----
Non-interest-earning assets:
Cash and due from banks 12,232 7,129
Bank premises and equipment 11,224 7,153
Other assets 27,487 11,055
Reserve for possible loan losses (5,695) (4,269)
-------- --------
Total assets $616,407 $486,648
======== ========
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Money market/NOW accounts $125,276 1,296 4.10% $ 97,673 1,059 4.30%
Savings deposits 17,105 115 2.67% 9,939 67 2.67%
Certificates of deposit 226,201 3,259 5.72% 165,846 2,420 5.79%
Certificates of deposit
over $100,000 34,551 498 5.72% 47,601 667 5.56%
IRA certificates 21,677 318 5.82% 12,887 190 5.85%
-------- ------- ----- -------- ------- -----
Total interest-bearing deposits 424,810 5,486 5.12% 333,946 4,403 5.23%
-------- ------- ----- -------- ------- -----
Federal funds purchased, repurchase
agreements, and other short-term
borrowings 53,217 669 4.99% 68,122 993 5.78%
Long-term borrowings 40,775 680 6.62% 18,674 333 7.07%
-------- ------- ----- -------- ------- -----
Total interest-bearing liabilities 518,802 6,835 5.23% 420,742 5,729 5.40%
-------- ------- ----- -------- ------- -----
Non-interest-bearing liabilities:
Demand deposits 46,835 37,124
Other liabilities 6,018 2,350
Shareholders' equity 44,752 26,432
-------- --------
Total liabilities and shareholders' equity $616,407 $486,648
======== ========
Net interest income $ 5,617 $ 4,395
======= =======
Net interest spread 3.42% 3.23%
Net interest margin 3.90% 3.75%
<FN>
- - ---------
<F1> Interest on non-accruing loans is not included for purposes of calculating yields.
<F2> All yields are annualized.
</TABLE>
8
<PAGE>
<PAGE>
<TABLE>
DISTRIBUTION OF AVERAGE ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY AND INTEREST RATES
<CAPTION>
Nine Months Ended September 30,
-----------------------------------------------------------------------------
1998 1997
------------------------------------ --------------------------------------
Average Int. Earned/ Yield/ Average Int. Earned/ Yield/
Balance Expense Rate<F1><F2> Balance Expense Rate<F1><F2>
------- ------------ ------------ ------- ------------ ------------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Assets:
Interest-earning assets:
Loans <F1> $497,112 $33,509 9.01% $336,965 $23,037 9.14%
Taxable investment securities 67,810 3,123 6.16% 61,778 2,803 6.07%
Non-taxable investment securities 1,507 52 4.61% 1,151 44 5.11%
Federal funds sold 7,451 326 5.85% 5,807 226 5.20%
-------- ------- ----- -------- ------- -----
Total interest-earning assets 573,880 37,010 8.62% 405,701 26,110 8.60%
-------- ------- ----- -------- ------- -----
Non-interest-earning assets:
Cash and due from banks 11,735 7,417
Bank premises and equipment 11,013 6,105
Other assets 28,170 7,061
Reserve for possible loan losses (5,511) (3,757)
-------- --------
Total assets $619,287 $422,527
======== ========
Liabilities and shareholders' equity:
Interest-bearing liabilities:
Money market/NOW accounts $122,662 3,798 4.14% $ 88,737 2,844 4.29%
Savings deposits 16,791 340 2.71% 7,389 155 2.80%
Certificates of deposit 229,621 9,907 5.77% 142,554 6,178 5.79%
Certificates of deposit
over $100,000 42,140 1,771 5.62% 47,216 1,939 5.49%
IRA certificates 20,909 931 5.95% 10,656 471 5.91%
-------- ------- ----- -------- ------- -----
Total interest-bearing deposits 432,123 16,747 5.18% 296,552 11,587 5.22%
-------- ------- ----- -------- ------- -----
Federal funds purchased, repurchase
agreements, and other short-term
borrowings 51,526 1,926 5.00% 52,399 2,162 5.52%
Long-term borrowings 38,870 2,055 7.07% 17,454 979 7.50%
-------- ------- ----- -------- ------- -----
Total interest-bearing liabilities 522,519 20,728 5.30% 366,405 14,728 5.37%
-------- ------- ----- -------- ------- -----
Non-interest-bearing liabilities:
Demand deposits 46,122 31,262
Other liabilities 7,087 2,185
Shareholders' equity 43,559 22,675
-------- --------
Total liabilities and
shareholders' equity $619,287 $422,527
======== ========
Net interest income $16,282 $11,382
======= =======
Net interest spread 3.32% 3.23%
Net interest margin 3.79% 3.75%
<FN>
- - --------
<F1> Interest on non-accruing loans is not included for purposes of calculating yields.
<F2> All yields are annualized.
</TABLE>
9<PAGE>
<PAGE>
The following table sets forth for the periods indicated the change
in interest income and interest expense which were attributable to
change in average volume and changes in average rates.
<TABLE>
RATE/VOLUME ANALYSIS
<CAPTION>
Quarter Ended September 30, 1998 Nine Months Ended September 30,1998
compared to the compared to the
Quarter Ended September 30, 1997 Nine Months Ended September 30,1997
--------------------------------- -----------------------------------
NET NET
VOLUME RATE CHANGE VOLUME RATE CHANGE
------ ---- ------ ------ ---- ------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Interest earned on:
Loans $2,233 $ - $2,233 $10,805 $(333) $10,472
Taxable investment securities 157 (50) 107 279 41 320
Non-taxable securities 5 1 6 12 (4) 8
Federal funds sold and
other investments (30) 12 (18) 70 30 100
------ ----- ------ ------- ----- -------
Total interest income 2,365 (37) 2,328 11,166 (266) 10,900
Interest paid on:
Money Market and
NOW accounts 290 (53) 237 1,058 (104) 954
Savings deposits 48 - 48 191 (6) 185
Certificates of deposit 870 (31) 839 3,752 (23) 3,729
Certificates of deposit
over $100,000 (187) 18 (169) (212) 44 (168)
IRA Certificates 130 (2) 128 457 3 460
Federal funds purchased and
other short-term borrowings (201) (123) (324) (34) (202) (236)
Long-term borrowings 371 (24) 347 1,137 (61) 1,076
------ ----- ------ ------- ----- -------
Total interest expense 1,321 (215) 1,106 6,349 (349) 6,000
------ ----- ------ ------- ----- -------
Net interest income $1,044 $ 178 $1,222 $ 4,817 $ 83 $ 4,900
====== ===== ====== ======= ===== =======
<FN>
Note: The change in interest due to the combined rate-volume variance
has been allocated to rate and volume changes in proportion to
the absolute dollar amounts of the changes in each. Interest
on non-accruing loans is not included for purposes of the table
above.
</TABLE>
10<PAGE>
<PAGE>
The composition of the investment portfolio is summarized as follows:
<TABLE>
INVESTMENT SECURITIES PORTFOLIO
<CAPTION>
September 30, December 31, September 30,
1998 1997 1997
------------- ------------ -------------
<S> <C> <C> <C>
United States Treasury securities $17,011 $ 9,478 $ 9,469
Obligations of United States government agencies 49,653 57,295 57,414
Federal Home Loan Bank stock 3,574 7,033 7,033
States and political subdivisions 1,457 1,563 1,224
Plus unrealized gain on securities held
available-for-sale 340 129 128
Other 1,168 1,371 1,089
------- ------- -------
Total investment securities $73,203 $76,869 $76,357
======= ======= =======
</TABLE>
The composition of the loan portfolio is summarized as follows:
<TABLE>
LENDING AND CREDIT MANAGEMENT<F1>
<CAPTION>
September 30, December 31, September 30,
1998 1997 1997
----------------------- ------------------------ -----------------------
Percent Percent Percent
of Total of Total of Total
Amount Loans Amount Loans Amount Loans
------ -------- ------ -------- ------ --------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Commercial, financial,
agricultural municipal and
industrial development $134,365 28.66% $109,937 22.67% $ 98,082 22.32%
Real estate--construction 29,731 6.34% 27,181 5.61% 21,628 4.92%
Real estate--mortgage
One- to four-family 112,889 24.08% 195,964 40.42% 184,842 42.06%
Multi-family and commercial 175,211 37.38% 135,452 27.94% 120,326 27.38%
Consumer and other 17,454 3.72% 16,821 3.47% 14,874 3.38%
Less unearned income (884) -0.19% (493) -0.10% (242) -0.06%
-------- ------- -------- ------- -------- -------
Total loans<F1> $468,766 100.00% $484,862 100.00% $439,510 100.00%
======== ======= ======== ======= ======== =======
<FN>
<F1> The Bank had no outstanding foreign loans at the dates reported.
</TABLE>
11
<PAGE>
<PAGE>
The following table summarizes deposit activity:
<TABLE>
DEPOSIT LIABILITY COMPOSITION
<CAPTION>
September 30, December 31, September 30,
1998 1997 1997
------------------------ ------------------------ -----------------------
Percent Percent Percent
of Total of Total of Total
Amount Deposits Amount Deposits Amount Deposits
------ -------- ------ -------- ------ --------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Demand deposits $ 48,413 10.34% $ 50,060 10.33% $ 46,134 9.75%
NOW accounts 19,744 4.22 18,448 3.81 18,643 3.94
Money market accounts 107,054 22.87 97,408 20.10 98,411 20.79
Savings deposits 16,355 3.49 16,157 3.33 19,241 4.06
Certificates of deposit 223,279 47.70 231,601 47.79 219,980 46.47
Certificates of deposit
over $100,000 31,818 6.80 52,211 10.77 51,678 10.92
IRA certificates 21,401 4.57 18,756 3.87 19,297 4.08
-------- ------- -------- ------- -------- -------
Total deposits $468,064 100.00% $484,641 100.00% $473,384 100.00%
======== ======= ======== ======= ======== =======
</TABLE>
ALLOWANCE FOR LOAN LOSSES
The provision for loan losses was $1.18 million through the nine
months of 1998 compared to $1.68 million for the same period in 1997.
Net charge-offs were $431 thousand for the nine months ended September
30, 1998 compared to $342 thousand for the same period in 1997. Net
charge-offs for the first nine months of 1998 represented a low 0.09% of
average loans, compared to 0.10% of average loans for the first nine
months of 1997.
The allowance for loan losses increased to $5.942 million at
September 30, 1998 compared to $4.842 million at September 30, 1997. As
a percentage of loans outstanding, the allowance represented 1.27% of
loans at September 30, 1998 and 1.10% at September 30, 1997.
The lower expense provision and the higher allowance percentage are
the result of the bulk sales of mortgage loans during the second and
third quarters of 1998 and due to the change in the loan mix. The Company
has been focused on generating higher yielding loans from the commercial
and industrial underwriting areas rather than lower yielding mortgage loans.
This change in risk is also reflected in the increase in the allowance as a
percentage of loans outstanding.
The Company continually monitors the quality of its loan portfolio to
ensure the timely charge-off of problem loans, early detection of potential
problem credits and to determine the adequacy of the level of the allowance
for loan losses. The Company believes that its reserve is adequate to reflect
the credit risk in the portfolio.
Non-performing assets increased to $1.192 million at September 30,
1998 compared to $777 thousand at September 30, 1997. This increase
occurred primarily from a greater number of 90 days plus delinquent
mortgage loans. Despite the dollar increase, non-performing assets as a
percentage of total assets remained constant at 0.19% at September 30,
1998 and 0.18% at September 30, 1997. From year-end 1997, the percentage
declined 3 basis points.
12
<PAGE>
<PAGE>
The following table summarizes, for the periods indicated, activity
in the Bank's allowance for possible loan losses, including amounts of
loans charged off, amounts of recoveries and additions to the allowance
charged to operating expenses.
<TABLE>
SUMMARY OF LOAN LOSS EXPERIENCE AND RELATED INFORMATION--ALLOCATION
OF THE ALLOWANCE FOR LOAN LOSSES
<CAPTION>
Nine Months Ended September 30,
-------------------------------
1998 1997
--------- ---------
(Dollars in thousands)
<S> <C> <C>
Allowance for possible loan losses
(beginning of period) $ 5,193 $ 3,507
Loans charged off:
Commercial, financial, agricultural,
municipal and industrial development (219) (201)
Real estate--mortgage (192) (79)
Installment and consumer (77) (94)
Other loans - -
-------- --------
Total loans (488) (374)
-------- --------
Recoveries of loans previously charged off:
Commercial, financial, agricultural,
municipal and industrial development 3 21
Real estate--mortgage 43 -
Installment and consumer 11 11
Other loans - -
-------- --------
Total recoveries 57 32
-------- --------
Net loans charged off (431) (342)
-------- --------
Provision for possible loan losses 1,180 1,677
-------- --------
Allowance for possible loan losses (end of period) $ 5,942 $ 4,842
======== ========
Loans outstanding:
Average $497,112 $336,965
End of period 468,766 439,510
Ratios:
Net charge-offs to average loans outstanding 0.09% 0.10%
Net charge-offs to provision for loan losses 36.78 20.39
Provision for loan losses
to average loans outstanding 0.24 0.50
Allowance for loan losses to total loans outstanding 1.27 1.10
Allocation for possible loan losses at end of period:
Commercial, financial, agricultural,
municipal and industrial development $ 3,597 $ 2,276
Real estate--construction 332 194
Residential real estate loans, first deeds of trust 492 823
Installment loans to individuals 191 145
All other loans - -
Unallocated 1,330 1,404
-------- --------
Total $ 5,942 $ 4,842
======== ========
</TABLE>
13<PAGE>
<PAGE>
<TABLE>
RISK ELEMENTS--PAST DUE, NONACCRUAL AND RESTRUCTURED LOANS
<CAPTION>
September 30, December 31, September 30,
1998 1997 1997
------------- ------------ -------------
(Dollars in thousands)
<S> <C> <C> <C>
Commercial, financial, agricultural and all other loans:
Past due 90 days or more $ - $ 341 $ 14
Nonaccrual 458 360 278
Restructured terms - - -
Real estate--construction:
Past due 90 days or more - - -
Nonaccrual - 108 26
Restructured terms - - -
Real estate--mortgage:
Past due 90 days or more 191 456 166
Nonaccrual 502 70 275
Restructured terms - - -
Installment loans to individuals:
Past due 90 days or more - 21 -
Nonaccrual 41 21 18
Restructured terms - - -
------ ------ ----
Total non-performing loans $1,192 $1,377 $777
====== ====== ====
Ratios:
Non-performing loans to total loans outstanding 0.25% 0.28% 0.18%
Non-performing assets to total assets 0.19 0.23 0.15
Non-performing loans to shareholders' equity 2.58 3.26 2.23
Reserve for possible loan losses to total loans 1.27 1.07 1.10
Reserve for possible loan losses
to non-performing loans 498.57% 377.12% 623.17%
</TABLE>
14
<PAGE>
<PAGE>
OTHER INCOME
Non-interest income increased by $987 thousand to $1.95 million
for the three months ended September 30, 1998 compared to $963 thousand
in the third quarter in 1997.
Included in the third quarter of 1998 was income of $462 thousand
which resulted from the bulk sale of residential mortgage loans. The
Company has been selling its residential mortgage loans to help fund
additional growth in more profitable commercial loans. In addition to
the bulk sale, operating lease income revenues increased by $345
thousand, or 366.40% to $439 thousand from $94 thousand for the
comparable period of 1997.
For the nine months ended September 30, 1998, non-interest income
increased $3.19 million, or 156.37%, to $5.23 million, compared to $2.04
million for the nine months ended September 30, 1997.
Service charge income for the nine-month period ended September 30,
1998 increased $195 thousand or 52.24%, compared to the comparable period
in 1997. This increase is attributed to the Company's focus on revenue
enhancement programs.
Mortgage banking continues to add to income as these revenues for the
period ending September 30, 1998 grew $637 thousand, or 61.94% to $1.67
million compared to $1.03 million for the comparable period in 1997 due
to the favorable mortgage rate environment. Similarly operating lease
income rose $1.04 million, or 711.64%, for the nine months ended September
30, 1998 to a total of $1.67 million. This increase reflects the growth in
this product line since it was first offered in 1997.
The mortgage loan bulk sales added $1.07 million to other income for
the nine months ended September 30, 1998. This strategy of selling
adjustable rate mortgages held in the loan portfolio was employed to
avoid accelerated loan pay offs due to a lowering mortgage rate environment
and utilizing those funds to underwrite higher yielding commercial loans.
OTHER EXPENSES
Because of the Company's rapid expansion during 1997, including
additional branch locations, a thrift acquisition of the Savings Bank,
the acquisition of deposits and business line expansion particularly in
the mortgage origination area, all categories of other expenses showed
very large increases when comparing both the three-month and nine-month
periods ended September 30, 1998 compared to the respective 1997
periods. The majority of the activities mentioned in 1997 occurred at
the end of the third quarter.
For the three months ended September 30, 1998 compared to
September 30, 1997, other expenses increased $1.70 million to $5.11
million from $3.41 million.
Salaries and employee benefits increased to $6.82 million from
$4.02 million for the respective nine-month periods. While this
increase was impacted by the above-mentioned expansion, additional
expenses were incurred with senior level and support staff additions
during 1998. The Company had 237 full-time equivalent employees ("FTE")
at September 30, 1998 compared to 180 FTE employees at September 30,
1997.
Expenses associated with additional premises and equipment showed
substantial increases for the comparable three-month periods ended
September 30, 1998 and 1997 with depreciation expense up $196 thousand,
rent expense up $54 thousand and telephone expense up $37 thousand.
15<PAGE>
<PAGE>
Operating lease depreciation increased by $258 thousand to $404
thousand for the three months ended September 30, 1998 from $146
thousand for the three months ended September 30, 1997 reflecting the
inception of the leasing business during the second quarter of 1997.
For the nine months ended September 30, 1998 operating lease
depreciation increased by $893 thousand or 420% compared to the nine
months ended September 30, 1997.
For the nine months ended September 30, 1998, total other expenses
increased $7.34 million, totaling $15.53 million compared to $8.19 million
for the nine months ended September 30, 1997. The only operating expense
showing a reduction during the nine months of 1998 was legal fees, which
declined $110 thousand because of reduced expansion activity in 1998.
Goodwill amortization was $661 thousand for the nine months
ended September 30, 1998, up $477 thousand, or 260%, from the comparable
period in 1997. This increase was the result of the thrift and deposit
acquisition that occurred in the third quarter of 1997.
The Company's efficiency ratios for the three-month periods ended
September 30, 1998 and 1997 were 67.56% and 63.61%, respectively. For
the nine-month period ended September 30, 1998 and 1997, the efficiency
ratios were 72.50% and 60.98%, respectively. The substantial increases
in this ratio were the result of the rapid expansion during the latter
half of 1997. The Company is diligently working to improve its
efficiency by both revenue enhancement and aggressive cost control. The
third quarter of 1998 showed an improvement in the efficiency ratio
from 71.44% in the second quarter of 1998 to the aforementioned 67.56%.
CAPITAL RESOURCE AND LIQUIDITY
The pace of net growth in earning assets has slowed somewhat during
the last nine months due to the bulk sales of mortgage loans. Period end
deposits decreased slightly from year-end 1997 due to the planned reduction
in non-core $100 thousand and over certificates of deposits. The Company
continues to emphasize growth in stable core deposits while utilizing the
Federal Home Loan Bank as necessary to balance liquidity and cost
effectiveness. The Company closely monitors its level of liquidity to meet
expected future needs.
The Company's commitment to maintaining adequate capital is evident
by the substantial increase in its average equity to average asset ratio
which improved to 7.26 for the quarter ended September 30, 1998 compared
to 5.43% for the third quarter in 1997. The Company remains committed to
maintaining a strong equity base while continuing with its controlled
expansion plans.
Regulatory guidelines require that Tier 1 capital equal at least 4.00%
of risk weighted assets and that total capital equal at least 8.00% of risk
weighted assets. At September 30, 1998, Tier 1 capital was 7.12% and total
risk based capital was 8.94%. This compares to Tier 1 capital of 6.33% and
total risk based capital of 7.38% as of September 30, 1997.
YEAR 2000
The Year 2000 issue arises from the use of a two-digit field to
identify years in computer programs and the assumption of a single
century, the 1900's. In order for computer systems to function
properly, systems must be Year 2000 compliant or able to accurately
identify date information in the 20th and 21st centuries. The Company
has defined Year 2000 compliant as "the ability of software and hardware
systems to correctly receive, process, and provide data within and
between the 20th and 21st centuries." The Company is highly dependent
on computer systems to process its daily transactions. The inability to
accurately process date related information would have a material impact
on its operation and financial condition. To mitigate the
16<PAGE>
<PAGE>
risks of a Year 2000 failure, a Year 2000 action plan has been developed and
implemented. The Plan is comprised of five phases, with completion of
all five necessary to protect the Company against potential Year 2000
failures.
Company Readiness
In phase one of the plan (awareness), a comprehensive strategy for
addressing Year 2000 issues was formulated, including allocating
sufficient human and financial resources to insure successful
implementation. In phase two (assessment), a detailed inventory was
conducted of all hardware and software products that are utilized by the
Company. Hardware and software systems that possess date sensitive
applications were identified and prioritized based on their level of
importance in maintaining financial integrity and in the delivery of
services to Company customers. Initial review of all systems to
determine Year 2000 compliant status was conducted, and "drop dead"
dates for obtaining alternate systems were established. Phase three
(renovation) primarily includes upgrading necessary systems to Year 2000
compliant status. The Company does not possess any internally developed
or programmed software or hardware. All hardware and software has been
provided by third parties under licensing agreements. Therefore, as
necessary, upgraded systems that are certified by the vendor, as Year
2000 compliant will be installed. Phase four (testing) will include
testing of all hardware and software systems to validate the renovation
phase, in addition to testing the compatibility of system interfaces.
Test scripts internally prepared, as well as developed by third party
vendors will be utilized for system testing. Finally, phase five
(implementation) will include certification that all systems are Year
2000 compliant.
Year 2000 Status, Including Timetable for Completion
To date, phase one and two, awareness and assessment, have been
completed. Although most of the Company's significant systems,
including general ledger, deposits and loans, would be materially
impacted by a Year 2000 failure, this risk is mitigated by vendor Year
2000 certifications of the individual systems and comprehensive internal
testing that will be completed by the Company. Phase three
(renovation) is substantially complete with only two lesser significant
software packages that require upgrades. It is anticipated that these
will be replaced no later than December 31, 1998. Phase four (testing)
is progressing as outlined in the Company's Year 2000 testing plan. To
date, approximately 20 percent of all systems have been tested. Testing
the remainder of all "mission critical" systems as well as substantially
all other systems is scheduled to be completed by December 31, 1998.
Phase five (implementation) is expected to be completed by March 31,
1999.
Third Party Exposure
The Company has gathered information about the Year 2000
compliance status of customers with significant credit relationships and
with providers of certain third party services, and continues to monitor
their compliance. To date, the Company is not aware of any third party
service providers or loan customers that would materially impact the
Company's results of operations, liquidity or capital resources.
However, the Company has no means of ensuring that these entities will
be Year 2000 ready. The inability of third parties to complete their
Year 2000 programs in a timely manner could materially impact the
Company. The effect of non-compliant third parties is not determinable.
Year 2000 Costs
The Company will utilize both internal and external resources to
reprogram or replace, test and implement the software and operating
equipment for Year 2000 modifications. The total cost of the Year 2000
17
<PAGE>
<PAGE>
project is estimated at $230,000 and is funded through operating cash
flows. To date, the Company has incurred approximately $159,000
($77,000 expensed and $82,000 capitalized for new systems and
equipment), related to all phases of the Year 2000 project. Of the
total remaining project costs, approximately $50,000 is attributable to
the purchase of new software and operating equipment, which will be
capitalized. The remaining $21,000 relates to the repair of hardware
and software as well as testing, and will be expensed as incurred.
Overall Year 2000 Risks
Management of the Company believes it has an effective program in
place to resolve the Year 2000 issue in a timely manner. As noted
above, the Company has not yet completed all necessary phases of the
Year 2000 program. In the event that additional phases are not
completed, the Company could experience system failures that would have
a significant impact on the Company's financial condition. In addition,
disruptions in the economy generally resulting from Year 2000 issues
could also materially adversely affect the Company. The Company could
be subject to litigation for computer system product failures. The
amount of potential liability and lost revenue cannot be reasonably
estimated at this time.
Contingency Planning
The Company has contingency plans for certain mission critical
applications and is working on such plans for all other systems. These
contingency plans involve, among other actions, manual workarounds and
adjusting staffing strategies. In addition, funding plans are being
developed to insure that adequate levels of liquid assets are available
in the event of significant customer withdrawals of cash items, as a
result of Year 2000 issues.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
18
<PAGE>
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
Proposals of shareholders of the Company intended to be presented at
the 1999 Annual Meeting of Shareholders must be received by the Company by
January 15, 1999 for enclosure in the Company's Proxy Statement and
proxy relating to that meeting. Upon receipt of any such proposal, the
Company will determine whether or not to include such proposal in the
Proxy Statement and proxy in accordance with regulations governing the
solicitation of proxies.
At the 1999 Annual Meeting of Shareholders, the individuals named
in the Proxy relating to such meeting will exercise discretionary
authority to vote on any matter brought before the meeting, with respect
to which the Company was provided with notice on or after March 31,
1999. With respect to matters brought before the meeting which the
Company was provided with notice after January 15, 1999 and before March
31, 1999, the individuals named in the Proxy relating to such meeting
will exercise discretionary authority to vote on any such matter and the
Company will include in the Proxy Statement advice on the nature of the
matter and how the individuals named in the Proxy relating to such
meeting intend to exercise their discretion to vote on each matter.
Notwithstanding the above, the individuals named in the Proxy relating
to such meeting shall not exercise discretionary authority over a matter
if: (i) the Company receives notice of such matter by March 31, 1999;
(ii) by March 31, 1999, the proponent of such matter (the "Proponent")
provides the Company with a written statement that the Proponent intends
to deliver a proxy statement and form of proxy to holders of at least
the percentage of the Company's voting shares required under Missouri
law to carry the proposal; (iii) the Proponent includes the same
statement in its proxy materials filed under Rule 14a-6 of the
Securities Exchange Act of 1934, as amended; and (iv) immediately after
soliciting the percentage of shareholders required to carry the
proposal, the Proponent provides the Company with a statement from any
solicitor or other person with knowledge that the necessary steps have
been taken to deliver a proxy statement and form of proxy to holders of
at least the percentage of the Company's voting shares required under
Missouri law to carry the proposal.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
See Exhibit Index hereto
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended
September 30, 1998.
19
<PAGE>
<PAGE>
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. The undersigned
signs this report in her dual responsibilities as a duly authorized
officer of the registrant and also as the registrant's Chief Financial
Officer.
ALLEGIANT BANCORP, INC.
(Registrant)
_________________________, 1998 By: ________________________________
Sandra L. Friedman,
Senior Vice President and
Chief Financial Officer
20<PAGE>
<PAGE>
EXHIBIT INDEX
Ex. No. Description
- - ------- -----------
3 Amendment of Articles of Incorporation
11.1 Computation of Earnings Per Share
27 Financial Data Schedule for the nine months ended
September 30, 1998
21
<PAGE>
AMENDMENT OF ARTICLES OF INCORPORATION
HONORABLE REBECCA MCDOWELL COOK
SECRETARY OF STATE
STATE OF MISSOURI
P.O. BOX 778
JEFFERSON CITY, MO 65102
Pursuant to the provisions of The General and Business
Corporation Law of Missouri, the undersigned Corporation certifies the
following:
1. The present name of the Corporation is Allegiant Bancorp, Inc.
The name under which it was originally organized was Allegiant
Bancorp, Inc.
2. An amendment to the Corporation's Articles of Incorporation, as
amended, was adopted by the shareholders on May 28, 1998.
3. Article Number 3 is amended to read as follows:
"ARTICLE THREE
--------------
The aggregate number, class and par
value, if any, of shares which the corporation
shall have authority to issue shall be: twenty
million (20,000,000) shares of Common Stock
with a par value of One Cent ($0.01) each.
The preferences, qualifications,
limitations, restrictions and the special or
relative rights, including, convertible
rights, if any, in respect of the shares of
each class are as follows: None."
4. Of the 5,140,224 shares outstanding, 5,140,224 of such shares
were entitled to vote on such amendment. The number of
outstanding shares of any class entitled to vote thereon as a
class were as follows:
Class Number of Outstanding Shares
Common Stock 5,140,224
5. The number of shares voted for and against the amendment was as
follows:
Class No. Voted For No. Voted Against
Common Stock 2,601,509 31,693
6. If the amendment provides for an exchange, reclassification, or
cancellation of issued shares, or a reduction of the number of
authorized shares of any class below the number of issued shares
of that class, the following is a statement of the manner in
which such reduction shall be effected:
N/A
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the undersigned, Shaun R. Hayes, President of
Allegiant Bancorp, Inc. has executed this instrument and its Assistant
Secretary has affixed its corporate seal hereto and attested said seal
on the 11th day of August, 1998.
PLACE
CORPORATE SEAL
HERE.
(IF NO SEAL, STATE "NONE.")
Allegiant Bancorp, Inc.
ATTEST:
/s/ Christy Siburt By /s/ Shaun R. Hayes
- - ----------------------------------- --------------------------------
Christy Siburt, Assistant Secretary Shaun R. Hayes, President
FILED AND CERTIFICATE
ISSUED
AUG 13 1998
/s/ Rebecca McDowell Cook
SECRETARY OF STATE
State of Missouri )
)ss
County of St. Louis )
I, Lisa G. Evans, a Notary Public, do hereby certify that on this
11th day of August, 1998, personally appeared before me Shaun R. Hayes,
who, being by me first duly sworn, declared that he is the President of
Allegiant Bancorp, Inc., that he signed the foregoing document as the
President of the corporation, and that the statements therein contained
are true.
NOTARIAL SEAL /s/ Lisa G. Evans
---------------------------------------
LISA G. EVANS My commission expires 8/10/2002
LINCOLN COUNTY ---------
MY COMMISSION EXPIRES
AUGUST 10, 2002
- 2 -
<PAGE>
<TABLE>
Exhibit 11.1
COMPUTATION OF EARNINGS PER SHARE
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
------------------------ ------------------------
1998 1997 1998 1997
--------- --------- --------- ---------
(Dollars in thousands except earnings per share)
<S> <C> <C> <C> <C>
DILUTED:
Average common shares outstanding 5,224,495 3,852,280 5,166,479 3,470,030
Average common stock equivalents of
warrants and options outstanding
based on the treasury stock method
using market price 267,089 374,965 371,668 326,638
--------- --------- --------- ---------
Weighted average diluted shares outstanding 5,491,584 4,227,245 5,538,147 3,796,668
Net income $1,207 $838 $2,911 $2,139
Diluted earning per common share $0.22 $0.20 $0.53 $0.56
Basic earning per common share $0.23 $0.22 $0.56 $0.62
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 12,678,000
<INT-BEARING-DEPOSITS> 419,651,000
<FED-FUNDS-SOLD> 33,409,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 56,927,000
<INVESTMENTS-CARRYING> 16,276,000
<INVESTMENTS-MARKET> 16,445,000
<LOANS> 468,766
<ALLOWANCE> 5,942,000
<TOTAL-ASSETS> 616,555,000
<DEPOSITS> 468,064,000
<SHORT-TERM> 59,286,000
<LIABILITIES-OTHER> 2,657,000
<LONG-TERM> 40,775,000
0
0
<COMMON> 53,000
<OTHER-SE> 45,720,000
<TOTAL-LIABILITIES-AND-EQUITY> 616,555
<INTEREST-LOAN> 33,509,000
<INTEREST-INVEST> 3,175,000
<INTEREST-OTHER> 326,000
<INTEREST-TOTAL> 37,010,000
<INTEREST-DEPOSIT> 16,747,000
<INTEREST-EXPENSE> 20,728,000
<INTEREST-INCOME-NET> 16,282,000
<LOAN-LOSSES> 1,180,000
<SECURITIES-GAINS> 62,000
<EXPENSE-OTHER> 15,525,000
<INCOME-PRETAX> 4,812,000
<INCOME-PRE-EXTRAORDINARY> 2,911,000
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,911,000
<EPS-PRIMARY> .56
<EPS-DILUTED> .53
<YIELD-ACTUAL> 8.62
<LOANS-NON> 1,001,000
<LOANS-PAST> 191,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 5,193,000
<CHARGE-OFFS> 488,000
<RECOVERIES> 57,000
<ALLOWANCE-CLOSE> 5,942,000
<ALLOWANCE-DOMESTIC> 4,612,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,330,000
</TABLE>
