<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
----- -----------------
Commission File Number 0-18014
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PAMRAPO BANCORP, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 22-2984813
- -------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
611 Avenue C, Bayonne, New Jersey 07002
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, 201-339-4600
including area code ------------
Indicate by check X 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
---- ------
The number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date April 30, 1997.
$.01 par value common sock - 2,842,924 shares outstanding
<PAGE>
PAMRAPO BANCORP, INC.
AND SUBSIDIARIES
INDEX
Page
PART I - FINANCIAL INFORMATION Number
------
Consolidated Statements of Financial Condition
at March 31, 1997 and December 31, 1996 (Unaudited) 1
Consolidated Statements of Income 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 - 4
Notes to Consolidated Financial Statements 5
Management's Discussion and Analysis of
Financial Condition and Results of Operations 6 - 11
PART II - OTHER INFORMATION 12 - 13
SIGNATURES 14
<PAGE>
<TABLE>
<CAPTION>
PAMRAPO BANCORP, INC. AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
-----------------------------------------------------------
(Unaudited)
March 31, December 31,
Assets 1997 1996
- ------ -------------- --------------
<S> <C> <C>
Cash and amounts due from depository institutions $ 10,070,200 $ 12,042,656
Interest-bearing deposits in other banks 13,700,000 9,000,000
Federal funds sold 100,000 100,000
-------------- --------------
Total cash and cash equivalents 23,870,200 21,142,656
Securities available for sale 15,595,645 22,232,193
Mortgage-backed securities; held to maturity estimated
fair value of $105,221,000 (1997) and $96,099,000 (1996) 107,983,783 96,726,545
Loans receivable 205,240,161 207,405,393
Foreclosed real estate 1,717,881 1,995,801
Investment in real estate 296,387 300,080
Premises and equipment 3,563,769 3,630,828
Federal Home Loan Bank stock, at cost 2,979,400 2,979,400
Interest receivable 2,687,386 2,677,043
Excess of cost over assets acquired 394,225 424,550
Other assets 3,030,743 3,395,989
-------------- --------------
Total assets $ 367,359,580 $ 362,910,478
============== ==============
Liabilities and stockholders' equity
- ------------------------------------
Liabilities
- -----------
Deposits $ 300,877,670 $ 300,785,420
Advances from Federal Home Loan Bank of New York 12,583,100 3,583,100
Other borrowed money 288,371 293,094
Advance payments by borrowers for taxes and insurance 1,940,294 1,598,104
Other liabilities 4,643,347 3,141,799
-------------- --------------
Total liabilities 320,332,782 309,401,517
-------------- --------------
Stockholders' equity
- --------------------
Preferred stock; authorized 3,000,000 shares;
issued and outstanding - none
Common stock; par value $.0; authorized 7,000,000 shares;
3,450,000 shares issued; 2,862,924 shares (1997) and
3,155,964 shares (1996) outstanding 34,500 34,500
Paid-in capital in excess of par value 18,906,768 18,906,768
Retained earnings - substantially restricted 41,374,368 40,944,218
Unrealized loss on securities available for sale (255,407) (196,935)
Treasury stock, at cost; 587,076 shares (1997)
and 294,036 shares (1996) (13,033,431) (6,179,590)
-------------- --------------
Total stockholders' equity 47,026,798 53,508,961
-------------- --------------
Total liabilities and stockholders' equity $ 367,359,580 $ 362,910,478
============== ==============
</TABLE>
See notes to consolidated financial statements.
-1-
<PAGE>
<TABLE>
<CAPTION>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
--------------------------------------
(Unaudited)
Three Months Ended
March 31,
----------------------------
1997 1996
----------- -----------
<S> <C> <C>
Interest income:
Loans $ 4,727,918 $ 4,941,218
Mortgage-backed securities 1,848,094 1,958,064
Investments and other interest-earning assets 361,718 276,163
----------- -----------
Total interest income 6,937,730 7,175,445
----------- -----------
Interest expense:
Deposits 2,725,743 2,793,189
Advances and other borrowed money 70,750 109,545
----------- -----------
Total interest expense 2,796,493 2,902,734
----------- -----------
Net interest income 4,141,237 4,272,711
Provision for loan losses 150,000 150,000
----------- -----------
Net interest income after provision for loan losses 3,991,237 4,122,711
----------- -----------
Non-interest income:
Fees and service charges 185,096 107,978
Gain on sale of mortgage-backed securities 111,583 -
Miscellaneous 100,204 50,979
----------- -----------
Total non-interest income 396,883 158,957
----------- -----------
Non-interest expenses:
Salaries and employee benefits 1,190,070 1,323,105
Net occupancy expense of premises 200,578 198,103
Equipment 203,982 195,719
Advertising 36,637 42,947
Loss on foreclosed real estate 43,920 64,625
Federal insurance premium 48,860 175,073
Amortization of intangibles 30,325 30,325
Miscellaneous 558,927 835,314
----------- -----------
Total non-interest expenses 2,313,299 2,865,211
----------- -----------
Income before income taxes 2,074,821 1,416,457
Income taxes 761,952 212,377
----------- -----------
Net income $ 1,312,869 $ 1,204,080
=========== ===========
Net income per common share and common stock equivalents $ 0.42 $ 0.35
=========== ===========
Dividends per common share $ 0.25 $ 0.225
=========== ===========
Weighted average number of common shares and
common stock equivalents outstanding 3,151,908 3,441,860
=========== ===========
</TABLE>
See notes to consolidated financial statements.
-2-
<PAGE>
<TABLE>
<CAPTION>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------
(Unaudited)
Three Months Ended
March 31,
--------------------------------
1997 1996
------------- -------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,312,869 $ 1,204,080
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation of premises and equipment and investment in real estate 80,251 80,072
Amortization of deferred fees, premiums and discounts, net 7,512 (38,871)
Gain on sales of mortgage-backed securities (111,583) -
(Gain) loss on sale of foreclosed real estate (24,771) 1,610
Provision for loan losses 150,000 150,000
Provision for losses on foreclosed real estate 45,342 30,000
(Increase) in interest receivable (10,343) (20,296)
Decrease (increase) in other assets 393,246 (392,332)
Amortization of intangibles 30,325 30,325
Reduction in debt of Employee Stock Ownership Plan - 49,593
Increase in other liabilities 1,501,548 48,930
------------- -------------
Net cash provided by operating activities 3,374,396 1,143,111
------------- -------------
Cash flows from investing activities:
Proceeds from maturities of securities available for sale 2,000,000 -
Purchases of securities available for sale (15,909) (2,000,000)
Principal repayments on securities available for sale 557,165 777,427
Proceeds from sales of securities available for sale 3,992,226 -
Purchase of mortgage-backed securities held to maturity (18,078,028) -
Principal repayments on mortgage-backed securities held to maturity 3,210,894 3,271,459
Proceeds from sales of mortgage-backed securities held to maturity 3,640,635 -
Sale of student loans 59,102 220,716
Net change in loans receivable 2,210,212 3,210,980
Proceeds from sale of foreclosed real estate 93,193 179,605
Additions to premises and equipment (9,499) (47,710)
------------- -------------
Net cash (used in) provided by investing activities (2,340,009) 5,612,477
------------- -------------
Cash flows from financing activities:
Net increase in deposits 92,250 3,174,468
Repayment of borrowings (4,723) (53,954)
Net increase (decrease) in advances from Federal Home Loan Bank of New York 9,000,000 (4,000,000)
Increase in advance payments by borrowers for taxes and insurance 342,190 151,129
Purchase of treasury stock (6,976,650) (3,047,500)
Proceeds from sale of treasury stock 34,339 327,973
Cash dividends paid (794,249) (776,020)
------------- -------------
Net cash provided by (used in) financing activities 1,693,157 (4,223,904)
------------- -------------
Net increase in cash and cash equivalents 2,727,544 2,531,684
Cash and cash equivalents - beginning 21,142,656 13,893,609
------------- -------------
Cash and cash equivalents - ending $ 23,870,200 $ 16,425,293
============= =============
</TABLE>
See notes to consolidated financial statements.
-3-
<PAGE>
<TABLE>
<CAPTION>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------
(Unaudited)
Three Months Ended
March 31,
-----------------------------------
1997 1996
-------------- --------------
<S> <C> <C>
Supplemental information
Increase in unrealized (loss) on securities available for sale, net $ (58,472) $ (49,522)
============== ==============
Transfer of loans receivable to foreclosed real estate $ 150,644 $ 993,698
============== ==============
Loans to facilitate sale of foreclosed real estate $ 314,800 $ 164,000
============== ==============
Cash paid during the period for:
Income taxes $ 16,870 $ -
============== ==============
Interest on deposits and borrowings $ 2,796,493 $ 2,902,734
============== ==============
</TABLE>
See notes to consolidated financial statements.
-4-
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
1. PRINCIPLES OF CONSOLIDATION
- --------------------------------
The consolidated financial statements include the accounts of Pamrapo Bancorp,
Inc. (the "Corporation") and its wholly owned subsidiaries, Pamrapo Savings
Bank, SLA (the "Bank") and Pamrapo Service Corp, Inc. The Corporation's business
is conducted principally through the Bank. All significant intercompany accounts
and transactions have been eliminated in consolidation.
2. BASIS OF PRESENTATION
- --------------------------
The accompanying unaudited consolidated financial statements were prepared in
accordance with instructions for Form 10-Q and regulations S-X and do not
include information or footnotes necessary for a complete presentation of
financial condition, results of operations, and cash flows in conformity with
generally accepted accounting principles. However, in the opinion of management,
all adjustments (consisting of normal recurring adjustments) necessary for a
fair presentation of the consolidated financial statements have been included.
The results of operations for the three months ended March 31, 1997, are not
necessarily indicative of the results which may be expected for the entire
fiscal year.
3. NET INCOME PER COMMON SHARE
- --------------------------------
Net income per common share is based on the weighted average number of common
shares actually outstanding plus the shares that would be outstanding assuming
the exercise of dilutive stock options, all of which are considered to be common
stock equivalents. The number of common shares that would be issued from the
exercise of stock options has been reduced by the number of common shares that
could have been purchased from the proceeds at the average market price of the
Corporation's common stock.
-5-
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
CHANGES IN FINANCIAL CONDITION
The Corporation's assets at March 31, 1997 totalled $367.4 million, which
represents an increase of $4.5 million or 1.24% as compared with $362.9 million
at December 31, 1996.
Securities available for sale at March 31, 1997 decreased $6.6 million or 29.73%
to $15.6 million when compared with $22.2 million at December 31, 1996. The
decrease during the three months ended March 31, 1997, resulted primarily from
maturities of securities available for sale of $2.0 million, repayments on
securities available for sale of $557,000 and sales of securities available for
sale of $4.0 million.
Mortgage-backed securities held to maturity increased $11.3 million or 11.69% to
$108.0 million at March 31, 1997 when compared to $96.7 million at December 31,
1996. The increase during three months ended March 31, 1997, resulted from
purchases of mortgage-backed securities of $18.1 million, sufficient to offset
principal repayments of $3.2 million and sales of mortgage-backed securities of
$3.5 million. During the three months ended March 31, 1997, certain mortgage-
backed securities held to maturity were sold which had principal outstanding of
less than 15.0% of the original face amount.
Net loans amounted to $205.2 million at March 31, 1997 as compared to $207.4
million at December 31, 1996, which represents a decrease of $2.2 million or
1.06%. The decrease, during the three months ended March 31, 1997, resulted
primarily from loan principal repayments exceeding loan originations.
Foreclosed real estate decreased from $2.0 million at December 31, 1996 to $1.7
million at March 31, 1997. During the three months ended March 31, 1997, five
foreclosed real estate properties with a combined book value of $394,000 were
sold. At March 31, 1997, foreclosed real estate consisted of seventeen
properties, three of which are under contract for sale.
Total deposits at March 31, 1997 totalled $300.9 million as compared with $300.8
million at December 31, 1996.
Advances from the Federal Home Loan Bank of New York ("FHLB") amounted to $12.6
million and $3.6 million at March 31, 1997 and December 31, 1996, respectively.
The increase, during the three months ended March 31, 1997, resulted from short-
term advances from the FHLB of $9.0 million. These funds were used for general
corporate purposes.
Stockholders' equity totalled $47.0 million and $53.5 million at March 31, 1997
and December 31, 1996, respectively. During the three months ended March 31,
1997, the Corporation repurchased 298,900 shares of its common stock at prices
ranging from $20.50 to $23.50 per share for a total of $7.0 million and issued
5,860 shares of its common stock out of treasury stock for $34,000 as a result
of the exercise of stock options by the officers and employees.
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
1996
Net income increased $109,000 or 9.05% to $1.313 million for the three months
ended March 31, 1997 compared with $1.204 million for the same 1996 period. The
increase in net income during the 1997 period resulted from an increase in non-
interest income, along with decreases in total interest expense and non-interest
expenses, which were partially offset by a decrease in total interest income and
an increase in income taxes.
-6-
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
1996 (CONT'D.)
Interest income on loans decreased $213,000 or 4.31% to $4.7 million during the
three months ended March 31, 1997 when compared with $4.9 million during the
same 1996 period. The decrease during the 1997 period resulted from a decrease
of $10.2 million in the average balance of loans outstanding sufficient to
offset a four basis points increase in the yield earned on the loan portfolio.
Interest on mortgage-backed securities decreased $110,000 or 5.62% to $1.85
million during the three months ended March 31, 1997 when compared with $1.96
million for the same 1996 period. The decrease during the 1997 period resulted
primarily from a decrease of fifty basis points in the yield earned on the
mortgage-backed securities outstanding sufficient to offset an increase of $1.6
million in the average balance of such portfolio outstanding. Interest earned on
investments and other interest-earning assets increased by $86,000 or 31.16% to
$362,000 during the three months ended March 31, 1997, when compared to $276,000
during the same 1996 period primarily due to an increase of $2.1 million in the
average balance of such assets outstanding along with a ninety-five basis points
increase in the yield earned on such portfolio.
Interest expense on deposits decreased $67,000 or 2.40% to $2.7 million during
the three months ended March 31, 1997 when compared to $2.8 million during the
same 1996 period. Such decrease was primarily attributable to a decrease of $1.3
million in the average balance of interest-bearing deposits sufficient to offset
an increase of eight basis points in the cost of interest-bearing deposits.
Interest expense on advances and other borrowed money decreased by $39,000 or
35.45% to $71,000 during the three months ended March 31, 1997 when compared
with $110,000 during the same 1996 period, primarily due to a decrease of $2.8
million in the average balance of advances outstanding from the FHLB sufficient
to offset a seventy-three basis points increase in the cost of advances and
borrowed money.
Net interest income decreased $132,000 or 3.09% during the three months ended
March 31, 1997 when compared with the same 1996 period. Such decrease was due to
a decrease in total interest income of $238,000, sufficient to offset a decrease
in total interest expense of $106,000. The Bank's net interest rate spread
decreased from 4.32% in 1996 to 4.28% in 1997. The decrease in the interest rate
spread resulted from a decrease of thirteen basis points in the yield earned on
interest-earning assets sufficient to offset a nine basis points decrease in the
cost of interest-bearing liabilities.
During each of the three months ended March 31, 1997 and 1996, the Bank provided
$150,000 as a provision for loan loses. The allowance for loan losses is based
on management's evaluation of the risk inherent in its loan portfolio and gives
due consideration to the changes in general market conditions and in the nature
and volume of the Bank's loan activity. The Bank intends to continue to provide
for loan loses based on its periodic review of the loan portfolio and general
market conditions. At March 31, 1997, December 31, 1996 and March 31, 1996, the
Bank's non-performing loans, which were delinquent ninety days or more, totalled
$11.5 million or $3.13% of total assets, $10.5 million or 2.89% of total assets
and $9.1 million or 2.47% of total assets, respectively. At March 31, 1997, $4.8
million of non-performing loans were accruing interest and $6.7 million were on
nonaccrual status. During the three months ended March 31, 1997 and 1996, the
Bank transferred $151,000 and $994,000, respectively, of loans to foreclosed
real estate. The non-performing loans primarily consist of one-to-four family
mortgage loans. During the three months ended March 31, 1997 and 1996, the Bank
charged off loans aggregating $186,000 and $174,000, respectively. The allowance
for loan losses amounted to $2.764 million at March 31, 1997, representing 1.30%
of total loans and 24.0% of loans delinquent ninety days or more and $2.8
million at December 31, 1996, representing 1.32% of total loans and 26.7% of
loans delinquent ninety days or more.
-7-
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
1996 (CONT'D.)
Non-interest income increased $238,000 or 149.69% to $397,000 during the three
months ended March 31, 1997 from $159,000 during the same 1996 period. The
increase resulted from increases in fees and service charges, gain on sale of
mortgage-backed securities and miscellaneous income of $77,000, $112,000 and
$49,000, respectively.
Non-interest expenses decreased by $552,000 or 19.27% to $2.3 million during the
three months ended March 31, 1997 when compared with $2.9 million during the
same 1996 period. Salaries and employees' benefits, advertising, loss on
foreclosed real estate, federal insurance premium and miscellaneous expenses
decreased $133,000, $6,000, $21,000, $126,000 and $276,000, respectively, which
was sufficient to offset increases in net occupancy expense and equipment of
$3,000 and $8,000, respectively, during the 1997 period when compared with the
same 1996 period. The decrease in federal insurance premium resulted from a
reduction in the premium paid on the assessable deposits from 23 basis points in
1996 to 6.4 basis points commencing on January 1, 1997. The decrease in
miscellaneous expenses resulted primarily from a decrease in non-recurring
expense of $250,000 related to the 1996 Annual Meeting of Stockholders.
Income taxes totalled $762,000 and $212,000 during the three months ended March
31, 1997 and 1996, respectively. The increase during the 1997 period resulted
from an increase in pre-tax income. The 1996 income tax expense included a
reduction in such expense resulting from the exercise of non-statutory stock
options.
LIQUIDITY AND CAPITAL RESOURCES
The Bank is required to maintain minimum levels of liquid assets as defined by
the Office of Thrift Supervision (the "OTS") regulations. This requirement,
which may vary from time to time, depending upon economic conditions and deposit
flows, is based upon a percentage of deposits and short-term borrowings. The
required ratio currently is 5%. The Bank's liquidity averaged 7.36% during the
month of March 1997. The Bank adjusts its liquidity levels in order to meet
funding needs for deposit outflows, payment of real estate taxes from escrow
accounts on mortgage loans, repayment of borrowings, when applicable and loan
funding commitments. The Bank also adjusts its liquidity level as appropriate to
meet its asset/liability objectives.
The Bank's primary sources of funds are deposits, amortization and prepayments
of loans and mortgage-backed securities principal, FHLB advances, maturities of
investment securities and funds provided from operations. While scheduled loan
and mortgage-backed securities amortization and maturing investment securities
are a relatively predictable source of funds, deposit flow and loan and
mortgage-backed securities prepayments are greatly influenced by market interest
rates, economic conditions and competition. The Bank invests its excess funds in
federal funds and overnight deposits with the FHLB, which provides liquidity to
meet lending requirements. Federal funds sold and interest-bearing deposits at
March 31, 1997 amounted to $100,000 and $13.7 million, respectively.
- 8 -
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
LIQUIDITY AND CAPITAL RESOURCES (CONT'D.)
The Bank's liquidity, represented by cash and cash equivalents, is a product of
its operating, investing and financing activities. These activities are
summarized below:
<TABLE>
<CAPTION> Three Months Ended
March 31,
------------------
(In Thousands)
1997 1996
------- -------
<S> <C> <C>
Cash and cash equivalents - beginning $21,143 $13,894
------- -------
Operating activities:
Net income 1,313 1,204
Adjustments to reconcile net income to
net cash provided by operating activities 2,061 (61)
------- -------
Net cash provided by operating activities 3,374 1,143
Net cash (used in) provided by investing activities (2,340) 5,612
Net cash provided by (used in) financing activities 1,693 (4,224)
------- -------
Net increase in cash and cash equivalents 2,727 2,531
------- -------
Cash and cash equivalents - ending $23,870 $16,425
======= =======
</TABLE>
Cash was generated by operating activities during the three months ended March
31, 1997. The primary source of cash was net income. Funds provided by financing
activities resulted primarily from a $9.0 million increase in short-term FHLB
advances, which more than offset the utilization of $7.0 million to repurchase
298,900 shares of common stock at prices ranging from $20.50 to $23.50 per
share. Additionally, during the three months ended March 31, 1997, the
Corporation issued 5,860 shares of its common stock out of treasury stock for
$34,000 as a result of the exercise of stock options by officers and employees.
Cash dividends paid during the three months ended March 31, 1997 and 1996
amounted to $794,000 and $776,000, respectively.
The primary sources of investing activity of the Bank are lending and the
purchase of mortgage-backed securities. Net loans amounted to $205.2 million and
$207.4 million at March 31, 1997 and December 31, 1996, respectively. Securities
available for sale totalled $15.6 million and $22.2 million at March 31, 1997
and December 31, 1996, respectively. Mortgage-backed securities held to maturity
totalled $108.0 million and $96.7 million at March 31, 1997 and December 31,
1996, respectively. In addition to funding new loan production and mortgage-
backed securities purchases through operations and financing activities, such
activities were funded by principal repayments on existing loans and mortgage-
backed securities.
Liquidity management is both a daily and long-term function of business
management. Excess liquidity is generally invested in short-term investments
such as federal funds and interest-bearing deposits. If the Bank requires funds
beyond its ability to generate them internally, borrowing agreements exist with
the FHLB which provides an additional source of funds. At March 31, 1997,
advances from the FHLB amounted to $12.6 million.
- 9 -
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
LIQUIDITY AND CAPITAL RESOURCES (CONT'D.)
The Bank anticipates that it will have sufficient funds available to meet its
current loan commitments. At March 31, 1997, the Bank has outstanding
commitments to originate mortgage loans of $5.0 million and to purchase
mortgage-backed securities of $3.3 million. Certificates of deposit scheduled to
mature in one year or less at March 31, 1997, totalled $112.7 million.
Management believes that, based upon its experience and the Bank's deposit flow
history, a significant portion of such deposits will remain with the Bank.
Under OTS regulations, three separate measurements of capital adequacy (the
"Capital Rule") are required. The Capital Rule requires each savings institution
to maintain tangible capital equal to at least 1.5 % and core capital equal to
3.0% of its adjusted total assets. The core capital requirement has been
effectively increased to 4.0% since under OTS regulations an institution with
less than 4.0% core capital is deemed to be "undercapitalized". The Capital Rule
further requires each savings institution to maintain total capital equal to at
least 8.0% of its risk-weighted assets.
The following table sets forth the Bank's capital position at March 31, 1997, as
compared to the minimum regulatory capital requirements:
Percent of
Amount Adjusted Assets
-------------- ---------------
(In Thousands)
Tangible Capital:
Requirement $ 5,494 1.50%
Actual 44,793 12.23
-------- -----
Excess $ 39,299 10.73%
======== =====
Core Capital:
Requirement $ 10,988 3.00%
Actual 44,793 12.23
-------- -----
Excess $ 33,805 9.23%
======== =====
Risk-based Capital:
Requirement $ 14,296 8.00%
Actual 46,755 26.16
-------- -----
Excess $ 32,459 18.15%
======== =====
- 10 -
<PAGE>
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THRIFT RECHARTERING LEGISLATION
The proposed legislation regarding elimination of the federal thrift charter and
related issues remains pending before Congress. The Bank is unable to predict
whether such legislation would be enacted, the extent to which the legislation
would restrict or disrupt its operations or whether the BIF or SAIF funds will
eventually merge.
SUPERVISORY EXAMINATION
The Bank's financial statements are periodically examined by the OTS, the
Federal Deposit Insurance Corporation and the New Jersey Department of Banking
and Insurance, as part of their regulatory oversight of the thrift industry. As
a result of these examinations, the regulators can direct that the Bank make
adjustments to its financial statements based on their findings.
- 11 -
<PAGE>
PAMRAPO BANCORP, INC.
PART II
ITEM 1. Legal Proceedings
-----------------
On February 15, 1994, Bank Pulska Kasa Opieki S.A. filed a complaint in
the United States District Court, District of New Jersey against the
Bank and Chemical Banking Corporation, Civil No. 94-663. On April 11,
1997, settlement negotiations were completed and as a result, management
believes that no further liabilities will be incurred in connection with
this lawsuit. See Form 10-K for the fiscal year ended December 31, 1996
for further discussion.
Neither the Corporation nor the Bank are involved in any pending legal
proceedings other than routine legal proceedings occurring in the
ordinary course of business, which involve amounts which in the
aggregate are believed by management to be immaterial to the financial
condition of the Corporation and the Bank, except as discussed above.
ITEM 2. Changes in Securities
---------------------
Not applicable.
ITEM 3. Defaults Upon Senior Securities
-------------------------------
Not applicable.
ITEM 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
The Annual Stockholders' Meeting was held on April 16, 1997. The
following matters were submitted to the stockholders:
1. Election of two directors:
A. Directors elected at the meeting for terms to expire in 2000.
Number of Shares
---------------------
For Withheld
--------- ---------
Mr. William J. Campbell 2,731,380 * 85,205
Mr. John A. Morecraft 2,728,147 * 88,438
The following directors' terms of office as a director continued
after the meeting:
(i) Dr. Jamie Portela
(ii) Mr. James Kennedy
(iii) Mr. Daniel J. Masarelli
(iv) Mr. Francis J. O'Donnell
- 12 -
<PAGE>
PART II (Cont'd.)
ITEM 4. Submission of Matters to a Vote of Security Holders (Cont'd.)
---------------------------------------------------
<TABLE>
<CAPTION> Number of Shares
-------------------------------
For Against Abstained
--------- ------- ---------
<S> <C> <C> <C>
2. The ratification of Radics & Co., LLC
as independent auditors of the
Corporation for the Fiscal year
ending December 31, 1997. 2,800,745* 12,237 3,603
* Excludes 278,900 shares which were purchased during the three months ended
March 31, 1997 and were ineligible to be voted.
</TABLE>
ITEM 5. Exhibits and Reports on Form 8-K
--------------------------------
(a) The following Exhibits are filed as part of this report.
3.1 Certificate of Incorporation of Pamrapo Bancorp, Inc.*
3.2 By-Laws of Pamrapo Bancorp, Inc.*
10.1 Change in control agreement between Pamrapo Bancorp, Inc. and
Robert A. Hughes (filed herewith).
11.0 Computation of earnings per share (filed herewith).
27.0 Financial data schedule (filed herewith).
* Incorporated herein by reference to Form S-1, Registration
Statement, as amended, filed on August 11, 1989,
Registration Number 33-30370.
(b) Reports on Form 8-K
A Form 8-K was filed on March 25, 1997 to report the Corporation
entering into a Standstill Agreement with Roger T. Conlan.
- 13 -
<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.
PAMRAPO BANCORP, INC.
Date: May 6, 1997 By: /s/ William J. Campbell
----------------------------- ---------------------------------------
William J. Campbell
President and Chief Executive Officer
Date: May 6, 1997 By: /s/ Gary J. Thomas
----------------------------- ---------------------------------------
Gary J. Thomas
Vice President, Chief Financial Officer
- 14 -
<PAGE>
Exhibit 11.0
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
-----------------------------------------------
Three Months Ended
March 31, 1997
------------------
Net income $1,312,869
==========
Weighted average shares outstanding 3,151,908
Common stock equivalents due to dilutive
effect on stock options -
==========
Total weighted average common shares and
equivalent outstanding 3,151,908
==========
Primary earnings per share $ 0.42
==========
Total weighted average common shares and
equivalents outstanding for fully diluted computation 3,151,908
==========
Fully diluted earnings per share $ 0.42
==========
- 15 -
<PAGE>
Exhibit 10.1
PAMRAPO BANCORP, INC.
CHANGE IN CONTROL AGREEMENT
This AGREEMENT is made effective as of January 1, 1997, by and between
Pamrapo Bancorp, Inc. (the "Holding Company"), a corporation organized under the
laws of the State of Delaware, with its office at 611 Avenue C, Bayonne, New
Jersey, and Robert Hughes ("Executive"). The term "Bank" refers to Pamrapo
Savings Bank, SLA, the wholly-owned subsidiary of the Holding Company or any
successor thereto.
WHEREAS, the Holding Company recognizes the substantial contribution
Executive has made to the Holding Company and wishes to protect his position
therewith for the period provided in this Agreement; and
WHEREAS, Executive has agreed to serve in the employ of the Holding Company
or an affiliate thereof.
NOW, THEREFORE, in consideration of the contribution and responsibilities
of Executive, and upon the other terms and conditions hereinafter provided, the
parties hereto agree as follows:
1. TERM OF AGREEMENT.
-----------------
The term of this Agreement shall be deemed to have commenced as of the date
first above written and shall continue for a period of thirty-six (36) full
calendar months thereafter. Commencing on January 1, 1997, the term of this
Agreement shall be extended one day each day until such time as the Board of
Directors of the Holding Company (the "Board") or the Executive elects not to
extend the term of this Agreement by giving written notice to the other party in
accordance with Section 4 of this Agreement, in which case the term of this
Agreement shall be fixed and shall end on the third anniversary date of such
written notice.
2. CHANGE IN CONTROL.
-----------------
(a) Upon the occurrence of a Change in Control of the Holding Company (as
herein defined) followed at any time during the term of this Agreement by the
termination of Executive's employment, other than for Cause, as defined in
Section 2(c) hereof, the provisions of Section 3 shall apply. Upon the
occurrence of a Change in Control, Executive shall have the right to elect to
voluntarily terminate his employment at any time during the term of this
Agreement.
(b) For purposes of this Agreement, a "Change in Control" of the
Association or Holding Company shall mean an event of a nature that: (i) would
be required to be reported in response to Item 1(a) of the Current Report on
Form 8-K, as in effect on the date hereof, pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act"); or (ii) results in a
Change in Control of the Bank or the Holding Company within the meaning of the
Home Owners' Loan Act of 1933 and the Rules and Regulations promulgated
<PAGE>
by the Office of Thrift Supervision ("OTS") (or its predecessor agency), as in
effect on the date hereof (provided, that in applying the definition of change
in control as set forth under the rules and regulations of the OTS, the Board
shall substitute its judgment for that of the OTS); or (iii) without limitation
such a Change in Control shall be deemed to have occurred at such time as (A)
any "person" (as the term is used in Sections 13(d) and 14(d) of the Exchange
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Bank or the Holding
Company representing 20% or more of the Bank's or the Holding Company's
outstanding securities except for any securities of the Bank purchased by the
Holding Company in connection with the conversion of the Bank to the stock form
and any securities purchased by any employee benefit plan of the Bank, or (B)
individuals who constitute the Board on the date hereof (the "Incumbent Board")
cease for any reason to constitute at least a majority thereof, provided that
any person becoming a director subsequent to the date hereof whose election was
approved by a vote of at least three-quarters of the directors comprising the
Incumbent Board, or whose nomination for election by the Holding Company's
stockholders was approved by the same Nominating Committee serving under an
Incumbent Board, shall be, for purposes of this clause (B), considered as though
he were a member of the Incumbent Board, or (C) a plan of reorganization,
merger, consolidation, sale of all or substantially all the assets of the Bank
or the Holding Company or similar transaction occurs in which the Bank or
Holding Company is not the resulting entity, or (D) a proxy statement is
distributed soliciting proxies from stockholders of the Holding Company, by
someone other than the current management of the Holding Company, seeking
stockholder approval of a plan of reorganization, merger or consolidation of the
Holding Company or Bank with one or more corporations as a result of which the
outstanding shares of the class of securities then subject to such plan or
transaction are exchanged for or converted into cash or property or securities
not issued by the Bank or the Holding Company shall be distributed, or (E) a
tender offer is made for 20% or more of the voting securities of the Bank or
Holding Company then outstanding.
(c) Executive shall not have the right to receive termination benefits
pursuant to Section 3 hereof upon Termination for Cause. The term "Termination
for Cause" shall mean termination because of Executive's personal dishonesty,
incompetence, willful misconduct, any breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, willful violation
of any law, rule, regulation (other than traffic violations or similar offenses)
or final cease and desist order, or any material breach of this Agreement. In
determining incompetence, the acts or omissions shall be measured against
generally prevailing standards of professional competence for officers having
comparable positions in the savings institutions industry. Notwithstanding the
foregoing, Executive shall not be deemed to have been Terminated for Cause
unless and until there shall have been delivered to him a copy of a resolution
duly adopted by the affirmative vote of not less than three-fourths of the
members of the Board at a meeting of the Board called and held for that purpose
(after reasonable notice to Executive and an opportunity for him, together with
counsel, to be heard before the Board), finding that in the good faith opinion
of the Board, Executive was guilty of conduct justifying Termination for Cause
and specifying the particulars thereof in detail. Executive shall not have the
right to receive compensation or other benefits for any period after Termination
for Cause. Any stock options and related limited rights granted to
2
<PAGE>
Executive under any stock option plan, or any unvested awards granted to
Executive under any restricted stock benefit plan of the Holding Company or its
subsidiaries, shall become null and void effective upon Executive's receipt of
Notice of Termination For Cause pursuant to Section 8 hereof, and shall not be
exercisable by or delivered to Executive at any time subsequent to such
Termination For Cause.
3. TERMINATION BENEFITS.
--------------------
(a) Upon the occurrence of a Change in Control, followed at any time during
the term of this Agreement by the voluntary or involuntary termination of
Executive's employment, other than for Termination for Cause, the Holding
Company shall be obligated to pay Executive, or in the event of his subsequent
death, his beneficiary or beneficiaries, or his estate, as the case may be, a
sum equal to three (3) times Executive's average annual compensation for the
three (3) preceding taxable years, such annual compensation shall include any
bonuses and any other compensation paid or to be paid to Executive in any such
year, the amount of benefits paid or accrued to Executive pursuant to any
employee benefit plan maintained by the Bank or Holding Company in any such year
and the amount of any contributions made or to be made on behalf of Executive
pursuant to any employee benefit plan maintained by the Bank or the Holding
Company in any such year. At the election of Executive which election is to be
made prior to a Change in Control, such payment shall be made in a lump sum. In
the event that no election is made, payment to Executive will be made on a
monthly basis in approximately equal installments during the remaining term of
this Agreement.
(b) Upon the occurrence of a Change in Control of the Bank or the Holding
Company followed at any time during the term of this Agreement by Executive's
termination of employment, other than for Termination for Cause, the Holding
Company shall cause to be continued life, medical and disability coverage
substantially identical to the coverage maintained by the Bank for Executive
prior to his severance, except to the extent such coverage may be changed in its
application to all Bank employees. Such coverage and payments shall cease upon
expiration of thirty-six (36) full calendar months following the Date of
Termination.
(c) Notwithstanding the preceding paragraphs of this Section 3, in the
event that:
(i) the aggregate payments or benefits to be made or afforded to
Executive under this Section 3, when taken together with any payments
or benefits under any other provisions of: this Agreement; or of any
other agreement, contract, or understanding heretofore or hereafter
entered into between the Executive and Pamrapo Savings Bank, SLA or
Pamrapo Bancorp, Inc. ("Other Agreement(s)"), except an agreement,
contract, or understanding hereafter entered into that expressly
modifies or excludes application of this Section 3; or of any formal
or informal plan or other arrangement heretofore or hereafter adopted
by Pamrapo Savings Bank, SLA or Pamrapo Bancorp, Inc. for the direct
or indirect provision of compensation to employees of Pamrapo
3
<PAGE>
Savings Bank, SLA or Pamrapo Bancorp, Inc. (including groups or
classes of participants or beneficiaries of which the Executive is a
member), whether or not such compensation is deferred, is in cash, or
is in the form of a benefit to or for the Executive ("Benefit
Plan(s)"), (herein referred to collectively as the "Termination
Benefits") would be deemed to include an "excess parachute payment"
within the meaning of Section 280G(b) of the Internal Revenue Code of
1986, as amended, (the"Code") (an "Excess Parachute Payment"), and
(ii) if such Termination Benefits were reduced to an amount (the
"Non-Triggering Amount"), the value of which is one dollar ($1.00)
less than an amount equal to three (3) times Executive's "base
amount," as determined in accordance with said Section 280G, and the
Non-Triggering Amount would be greater than the aggregate value of the
Termination Benefits (without such reduction) minus the amount of tax
required to be paid by Executive thereon by Section 4999 (or any
successor provision) of the Code, then the Termination Benefits shall
be reduced to the Non-Triggering Amount. The allocation of the
reduction required by this paragraph of Section 3 shall be determined
by the Executive. The Executive shall have the right, in the
Executive's sole discretion, to designate those payments or benefits
under this Agreement, any Other Agreements, and/or any Benefit Plans,
which should be reduced or eliminated so as to avoid having the
payment to the Executive under this Agreement to be deemed an Excess
Parachute Payment.
4. NOTICE OF TERMINATION.
---------------------
(a) Any purported termination by the Holding Company, or by Executive shall
be communicated by Notice of Termination to the other party hereto. For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination (which, in the case of Termination for Cause, shall not be less than
thirty (30) days from the date such Notice of Termination is given).
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, the Date of Termination shall be the
date on which the dispute is finally determined, either by mutual written
agreement of the parties, by a binding arbitration award, or by a final
judgment, order or decree of a court of competent jurisdiction (the time for
appeal therefrom having expired and no appeal having been perfected) and
provided further that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the party giving such
notice pursues the resolution of such dispute with reasonable diligence.
Notwithstanding the pendency of any such dispute, the Holding
4
<PAGE>
Company will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to his
current annual salary) and continue him as a participant in all compensation,
benefit and insurance plans in which he was participating when the notice of
dispute was given, until the dispute is finally resolved in accordance with this
Agreement. Amounts paid under this Section 4(c) are in addition to all other
amounts due under this Agreement and shall not be offset against or reduce any
other amounts due under this Agreement.
5. SOURCE OF PAYMENTS.
------------------
It is intended by the parties hereto that all payments provided in this
Agreement shall be paid in cash or check from the general funds of the Holding
Company. Further, the Holding Company guarantees such payment and provision of
all amounts and benefits due hereunder to Executive and, if any amount and
benefits due from the Bank are not timely paid or provided by the Bank, such
amounts and benefits shall be paid and provided by the Holding Company.
6. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS.
-----------------------------------------------------
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior agreement between the Holding Company and Executive,
except that this Agreement shall not affect or operate to reduce any benefit or
compensation inuring to Executive of a kind elsewhere provided. No provision of
this Agreement shall be interpreted to mean that Executive is subject to
receiving fewer benefits than those available to him without reference to this
Agreement.
Nothing in this Agreement shall confer upon Executive the right to continue
in the employ of the Holding Company or shall impose on the Holding Company any
obligation to employ or retain Executive in its employ for any period.
7. NO ATTACHMENT.
-------------
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
Executive, the Holding Company and their respective successors and assigns.
5
<PAGE>
8. MODIFICATION AND WAIVER.
-----------------------
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
waiver or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any act other than that
specifically waived.
9. SEVERABILITY.
-------------
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
10. HEADINGS FOR REFERENCE ONLY.
---------------------------
The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.
11. GOVERNING LAW.
-------------
The validity, interpretation, performance, and enforcement of this
Agreement shall be governed by the laws of the State of Delaware.
12. ARBITRATION.
-----------
Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration, conducted before a panel
of three arbitrators sitting in a location selected by Executive within fifty
(50) miles from the location of the Holding Company, in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court having jurisdiction; provided,
however, that Executive shall be entitled to seek specific performance of his
right to be paid until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with this Agreement.
6
<PAGE>
13. PAYMENT OF LEGAL FEES.
---------------------
All reasonable legal fees paid or incurred by Executive pursuant to any
dispute or question of interpretation relating to this Agreement shall be paid
or reimbursed by the Holding Company if Executive is successful pursuant to a
legal judgment, arbitration or settlement.
14. INDEMNIFICATION.
---------------
The Holding Company shall provide Executive (including his heirs, executors
and administrators) with coverage under a standard directors' and officers'
liability insurance policy at its expense, or in lieu thereof, shall indemnify
Executive (and his heirs, executors and administrators) to the fullest extent
permitted under Delaware law and as provided in the Holding Company's
certificate of incorporation against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which he may be involved by reason of his having been a director
or officer of the Holding Company (whether or not he continues to be a director
or officer at the time of incurring such expenses or liabilities), such expenses
and liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements.
15. SUCCESSOR TO THE HOLDING COMPANY.
--------------------------------
The Holding Company shall require any successor or assignee, whether direct
or indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Holding Company,
expressly and unconditionally to assume and agree to perform the Holding
Company's obligations under this Agreement, in the same manner and to the same
extent that the Holding Company would be required to perform if no such
succession or assignment had taken place.
SIGNATURES
IN WITNESS WHEREOF, Pamrapo Bancorp, Inc. has caused this Agreement to be
executed by its duly authorized officer, and Executive has signed this
Agreement, on the 25th day of February, 1997.
ATTEST: Pamrapo Bancorp, Inc.
/s/ Margaret Russo By: /s/ William J. Campbell
- ---------------------------------- ---------------------------------
Secretary William J. Campbell
President and Chief Executive
Officer
WITNESS:
/s/ Judith M. McAuliffe /s/ Robert A. Hughes
- ---------------------------------- ---------------------------------
Robert A. Hughes
Executive
Seal
7
<PAGE>
Exhibit 11.0
PAMRAPO BANCORP, INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
-----------------------------------------------
Three Months Ended
March 31, 1997
------------------
Net income $1,312,869
==========
Weighted average shares outstanding 3,151,908
Common stock equivalents due to dilutive
effect on stock options -
==========
Total weighted average common shares and
equivalent outstanding 3,151,908
==========
Primary earnings per share $ 0.42
==========
Total weighted average common shares and
equivalents outstanding for fully diluted computation 3,151,908
==========
Fully diluted earnings per share $ 0.42
==========
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 10,070,200
<INT-BEARING-DEPOSITS> 13,700,000
<FED-FUNDS-SOLD> 100,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 15,595,645
<INVESTMENTS-CARRYING> 107,983,783
<INVESTMENTS-MARKET> 105,221,000
<LOANS> 208,004,516
<ALLOWANCE> 2,764,355
<TOTAL-ASSETS> 367,359,580
<DEPOSITS> 300,877,670
<SHORT-TERM> 12,871,471
<LIABILITIES-OTHER> 6,583,641
<LONG-TERM> 0
0
0
<COMMON> 34,500
<OTHER-SE> 46,992,298
<TOTAL-LIABILITIES-AND-EQUITY> 367,359,580
<INTEREST-LOAN> 4,727,918
<INTEREST-INVEST> 1,848,094
<INTEREST-OTHER> 361,718
<INTEREST-TOTAL> 6,937,730
<INTEREST-DEPOSIT> 2,725,743
<INTEREST-EXPENSE> 2,796,493
<INTEREST-INCOME-NET> 4,141,237
<LOAN-LOSSES> 150,000
<SECURITIES-GAINS> 111,583
<EXPENSE-OTHER> 2,313,299
<INCOME-PRETAX> 2,074,821
<INCOME-PRE-EXTRAORDINARY> 2,074,821
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,312,869
<EPS-PRIMARY> .42
<EPS-DILUTED> .42
<YIELD-ACTUAL> 4.82
<LOANS-NON> 6,664,000
<LOANS-PAST> 4,827,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,800,000
<CHARGE-OFFS> 185,895
<RECOVERIES> 250
<ALLOWANCE-CLOSE> 2,764,355
<ALLOWANCE-DOMESTIC> 802,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,962,355
</TABLE>
