<PAGE> 1
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 June 30, 1997
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
----------- ------------
Commission file number 0-18560
The Savannah Bancorp, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-1861820
- ------------------------------- ---------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
25 Bull Street, Savannah, GA 31401
----------------------------------------------------
(Address of principal executive offices) (Zip Code)
912-651-8200
---------------------------------------------------
(Registrant's telephone number, including area code)
N/A
-------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of July 31, 1997.
1,709,548 shares of Common Stock, $1.00 par value per share
================================================================================
<PAGE> 2
THE SAVANNAH BANCORP, INC.
FORM 10-Q INDEX
JUNE 30, 1997
<TABLE>
<CAPTION>
Page
----
<S> <C>
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - June 30, 1997 and December 31, 1996 2
Consolidated Statements of Income For the Quarter and
For the Six Months Ended June 30, 1997 and 1996 3
Consolidated Statements of Changes in Shareholders Equity
For the Six Months Ended June 30, 1997 and 1996 4
Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 1997 and 1996 5
Condensed Notes to Consolidated Financial Statements 6-7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 7-10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits or Reports on Form 8-K 11
Signatures 11
</TABLE>
1
<PAGE> 3
THE SAVANNAH BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
JUNE 30, December 31,
1997 1996
---------- ------------
ASSETS
<S> <C> <C>
Cash and due from banks $ 6,688 $ 6,015
Federal funds sold 3,230 10,810
Investment securities available for sale:
U. S. Treasury Securities (amortized cost of
$14,186 and $16,235 in 1997 and 1996) 14,115 16,209
Other taxable investments (amortized cost of
$13,874 and $9,936 in 1997 and 1996) 13,838 9,896
State and municipal investments (amortized cost of
$3,125 in 1997 and 1996) 3,224 3,186
--------- ---------
Total investment securities available for sale 31,177 29,291
Loans 96,055 88,649
Less allowance for loan losses (1,343) (1,240)
--------- ---------
Net loans 94,712 87,409
Premises and equipment, net 2,553 2,368
Other assets 1,764 1,559
--------- ---------
TOTAL ASSETS $ 140,124 $ 137,452
========= =========
LIABILITIES
Deposits:
Non-interest bearing demand $ 21,067 $ 21,812
Interest-bearing demand 19,368 22,611
Savings 3,422 3,232
Money market accounts 17,760 14,656
Time, $100,000 and over 23,189 23,106
Other time deposits 37,299 35,983
--------- ---------
Total deposits 122,105 121,400
Federal funds purchased and securities sold under
agreements to repurchases 2,983 1,850
Other liabilities 994 916
--------- ---------
TOTAL LIABILITIES 126,082 124,166
--------- ---------
SHAREHOLDERS' EQUITY
Common stock, par value $1 per share: authorized
20,000,000 shares; issued 1,782,598 and 1,188,408 1,783 1,188
shares in 1997 and 1996
Preferred stock, par value $1 per share:
authorized 10,000,000 shares, none issued -- --
Capital surplus 8,924 9,519
Retained earnings 3,844 3,136
Treasury stock, at cost, 73,050 and 54,200 shares
in 1997 and 1996 (504) (554)
Net unrealized holding losses on
available for sale securities (5) (3)
--------- ---------
TOTAL SHAREHOLDERS' EQUITY 14,042 13,286
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 140,124 $ 137,452
========= =========
</TABLE>
See the condensed notes to the consolidated financial statements.
2
<PAGE> 4
THE SAVANNAH BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
For the Quarter Ended For the Six Months Ended
June 30, June 30,
--------------------------- ----------------------------
1997 1996 1997 1996
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans (includes loan fees) $2,105 $1,801 $4,093 $3,549
Investment securities 472 459 918 876
Federal funds sold 157 124 274 207
------------ ------------ ------------ -------------
Total interest income 2,734 2,384 5,285 4,632
------------ ------------ ------------ -------------
INTEREST EXPENSE
Deposits 1,204 1,102 2,358 2,153
Other short-term borrowings 37 8 66 29
------------ ------------ ------------ -------------
Total interest expense 1,241 1,110 2,424 2,182
------------ ------------ ------------ -------------
NET INTEREST INCOME 1,493 1,274 2,861 2,450
Provision for loan losses 65 60 115 120
------------ ------------ ------------ -------------
Net interest income after
provision for loan losses 1,428 1,214 2,746 2,330
------------ ------------ ------------ -------------
OTHER INCOME
Service charges on deposit accounts 107 100 204 185
Mortgage origination fees 74 54 134 107
Other income 46 21 81 33
------------ ------------ ------------ -------------
Total other operating income 227 175 419 325
------------ ------------ ------------ -------------
OTHER EXPENSE
Salaries and employee benefits 528 418 1,038 829
Occupancy expense 79 76 157 150
Equipment expense 72 58 140 119
Other operating expenses 294 265 581 508
------------ ------------ ------------ -------------
Total other expense 973 817 1,916 1,606
------------ ------------ ------------ -------------
Income before provision for income taxes 682 572 1,249 1,049
Provision for income taxes 237 205 437 376
------------ ------------ ------------ -------------
NET INCOME $ 445 $ 367 $ 812 $ 673
============ ============ ============ =============
NET INCOME PER SHARE: (A)
Primary $ .25 $ .21 $ .45 $ .38
============ ============ ============ =============
Fully diluted $ .25 $ .21 $ .45 $ .38
============ ============ ============ =============
</TABLE>
(a) - 1996 restated for a 3-for-2 stock split distributed on February 24, 1997.
See the condensed notes to the consolidated financial statements.
3
<PAGE> 5
THE SAVANNAH BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
COMMON CAPITAL RETAINED
SHARES STOCK SURPLUS EARNINGS
------------- ---------- ------------ ----------
<S> <C> <C> <C> <C>
FOR THE SIX MONTHS
ENDED JUNE 30, 1996
Balance, December 31, 1995 1,188,408 $ 1,188 $ 9,519 $ 1,759
Cash dividends - $.055 per share - - - (62)
Change in unrealized gains (losses) on
securites available for sale, net of tax - - - -
Net income - - - 673
------------- ---------- ------------ ----------
Balance at end of period 1,188,408 $ 1,188 $ 9,519 $ 2,370
============= ========== ============ ==========
FOR THE SIX MONTHS
ENDED JUNE 30, 1997
Balance, December 31, 1996 1,188,408 $ 1,188 $ 9,519 $ 3,136
Three-for-two stock split 594,190 595 (595) -
Cash dividends - $.06 per share - - - (104)
Change in unrealized losses on securities
available for sale, net of tax - - - -
Reissuance of treasury stock - - - -
Net income - - - 812
------------- ---------- ------------ ----------
Balance at end of period 1,782,598 $ 1,783 $ 8,924 $ 3,844
============= ========== ============ ==========
<CAPTION>
NET
UNREALIZED
HOLDING
TREASURY GAINS (LOSSES),
STOCK NET OF TAX TOTAL
---------- ------------ ------------
<S> <C> <C> <C>
FOR THE SIX MONTHS
ENDED JUNE 30, 1996
Balance, December 31, 1995 ($ 554) $ 251 $ 12,163
Cash dividends - $.055 per share - - (62)
Change in unrealized gains (losses) on
securites available for sale, net of tax - (430) (430)
Net income - - 673
---------- ------------ ------------
Balance at end of period ($ 554) ($ 179) $ 12,344
========== ============ ============
FOR THE SIX MONTHS
ENDED JUNE 30, 1997
Balance, December 31, 1996 ($ 554) ($ 3) $ 13,286
Three-for-two stock split - - -
Cash dividends - $.06 per share - - (104)
Change in unrealized losses on securities
available for sale, net of tax - (2) (2)
Reissuance of treasury stock 50 - 50
Net income - - 812
---------- ----------- -----------
Balance at end of period ($ 504) ($ 5) $ 14,042
========== =========== ===========
</TABLE>
See the condensed notes to the consolidated financial statements.
4
<PAGE> 6
THE SAVANNAH BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
For the Six Months Ended
June 30
---------------------------------------
OPERATING ACTIVITIES 1997 1996
------------------ ----------------
<S> <C> <C>
Net income $ 812 $ 673
Adjustments to reconcile net income to cash
Provided by operating activities:
Provision for loan losses 115 120
Depreciation of premises and equipment 126 123
Amortization of investment securities discount-net 180 56
Increase in accrued interest receivable (176) (172)
Increase in prepaid expenses and other assets (29) (111)
Decrease in accrued interest payable (36) (42)
Increase (decrease) in other liabilities 113 (295)
-------------- ------------
Net cash provided by operating activities 1,105 352
-------------- ------------
INVESTING ACTIVITIES
Net increase (decrease) in federal funds sold 7,580 (1,056)
Purchases of investment securities (4,068) (10,111)
Proceeds from maturities of investment securities 2,000 5,791
Net increase in loans made to customers (7,419) (4,947)
Capital expenditures (311) (544)
-------------- -------------
Net cash used in investing activities (2,218) (10,867)
-------------- -------------
FINANCING ACTIVITIES
Net (decrease) increase in demand, savings and money market accounts (694) 8,910
Net increase in certificates of deposit 1,399 4,371
Net increase (decrease) in securities sold under agreements to
repurchase 704 (1,818)
Increase in federal funds purchased 429 265
Reissuance of treasury stock 50 0
Dividend payments (104) (62)
-------------- -------------
Net cash provided by financing activities 1,784 11,666
-------------- -------------
INCREASE IN CASH AND CASH EQUIVALENTS 671 1,151
Cash and cash equivalents at beginning of year 6,015 4,459
-------------- -------------
Cash and cash equivalents at end of period $ 6,686 $ 5,610
============== =============
</TABLE>
See the condensed notes to the consolidated financial statements.
5
<PAGE> 7
The Savannah Bancorp, Inc. and Subsidiary
Condensed Notes to Consolidated Financial Statements
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the six month period
ended June 30, 1997 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1997. For further information, refer
to the consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-KSB for the year ended December 31, 1996.
NOTE 2 - SHAREHOLDERS' EQUITY
On January 26, 1997, the Company's Board of Directors declared a three-for-two
stock split payable February 24, 1997 to shareholders of record on February 7,
1997. Per share amounts and weighted-average shares have been restated to
reflect the stock split.
NOTE 3 - SHARES USED IN COMPUTING NET INCOME PER SHARE
Net income per fully diluted income share is computed using the
weighted-average number of common and dilutive common equivalent shares
outstanding during the periods. The fully diluted weighted average shares
outstanding for the second quarters of 1997 and 1996 were 1,800,000 and
1,763,000, respectively. They included 97,000 and 62,000 common share
equivalent shares in 1997 and 1996. The fully diluted weighted average shares
outstanding were 1,803,000 and 1,759,000 for the first six months of 1997 and
1996, respectively. They included 97,000 and 58,000 common equivalent shares
in 1997 and 1996, respectively.
NOTE 4 - CHANGE IN ACCOUNTING STANDARD
In February, 1997, The Financial Accounting Standards Board issued Statement of
Financial Accounting Standard (SFAS) No. 128, Earnings Per Share which, when
adopted, will replace the current methodology for calculating and presenting
earnings per share. Under SFAS No. 128, primary earnings per share will be
replaced with a presentation of basic earnings per share and fully diluted
earnings per share will be replaced with diluted earnings per share. Basic
earnings per share excludes dilution and is computed by dividing income
available to common shareholders by the weighted average number of common
shares outstanding for the period. Diluted earnings per share are computed
similarly to fully diluted earnings per share. The statement will be effective
beginning in the Companys financial statements for the year ended December 31,
1997, including restatement of historical earnings per share presented in such
6
<PAGE> 8
financial statements. Management does not expect the impact of SFAS No. 128 to
materially differ from the current presentation of earnings per share.
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
For a comprehensive presentation of The Savannah Bancorp, Inc.s financial
condition at June 30, 1997 and December 31, 1996, and results of operations for
the quarters ended June 30, 1997 and 1996, the following analysis should be
reviewed along with other information including the Companys December 31, 1996
Annual Report on Form 10-KSB.
LIQUIDITY AND INTEREST RATE SENSITIVITY MANAGEMENT
The objectives of funds management include maintaining adequate liquidity and
reasonable harmony between the repricing of sources and uses of funds on
interest sensitive assets and liabilities. The goal of liquidity management is
to insure the availability of adequate funds to meet the loan demand and the
deposit withdrawal needs of the bank's customers. This is achieved through
maintaining a combination of sufficient liquid assets, core deposit growth, and
unused capacity to purchase funds in the money markets.
The Company will fund anticipated loan growth primarily through normal deposit
growth. However, the Bank is a member of the Federal Home Loan Bank of Atlanta
(FHLB) and has access to borrowings in excess of $10.0 million by pledging
qualifying residential real estate loans under a blanket float lien agreement.
The FHLB will also lend against unpledged investment securities of
approximately $15 million. In addition, the Bank has $8.0 million of unused
short-term federal funds borrowing lines available from correspondent banks.
The relatively high volume of $23.2 million of certificates of deposit over
$100,000 includes $8-10 million of negotiated rate deposits. The remaining
large certificates are considered to be core deposit funds. Most are on an
automatically renewing basis for 6 - 12 months and have proven to be no more
rate sensitive than the smaller time deposits. These deposits have been
acquired and retained primarily through relationships and service. The Bank
has done no advertising of higher rates to attract deposits and has
consistently set its deposit rates with very little premium above the regional
bank competition in our market area.
The Bank is expected to open its fourth office six miles east of downtown
Savannah in the fourth quarter, 1997. This new office along with the offices
opened in 1990, 1992 and 1995 are expected to provide continued core deposit
growth as well as commercial and consumer loan growth.
A continuing objective of asset liability management is to maintain a high
level of variable rate assets, including variable rate loans and
shorter-maturity investments, to balance increases in market sensitive
liabilities. Interest sensitivity management and its
7
<PAGE> 9
effects on the net interest margin require analyses and actions which take into
consideration volumes repriced and the timing and magnitude of their change.
The interest sensitivity gaps that existed at June 30, 1997 are presented in
the following table:
<TABLE>
<CAPTION>
Cumulative
Interest sensitive within: Assets Liabilities Gap Gap
-------------------------- ------ ----------- --- ---
<S> <C> <C> <C> <C>
3 months $ 58,071 $ 61,039 $ (2,968) $ (2,968)
3 - 6 months 7,201 14,964 (7,763) (10,731)
6 - 12 months 10,242 14,595 (4,353) (15,084)
Over 12 months 54,956 13,423 41,533 $26,449
-------- -------- -------- =======
Total $130,470 $104,021 $ 26,449
======== ======== ========
</TABLE>
At June 30, 1997, the balance sheet was liability-sensitive within one year.
However, because certain deposits such as NOW, savings and money market
accounts reprice with less volatility than prime, the Banks income statement is
asset sensitive. Management has policies and procedures in place to measure
and report anticipated net interest income fluctuations based on rising and
falling rates. The Board has specified a maximum risk level of 5% of
annualized net interest income on an immediate decrease in the prime rate of
200 basis points. The Bank is presently operating within the specified risk
levels.
FINANCIAL CONDITION
For the first six months of 1997, loans increased $7.4 million to $96.1
million, and deposits increased $.7 million to $122.1 million. The loan to
deposit ratio was 78.7% at June 30, 1997 compared to 73.0% at December 31,
1996. Non-performing assets were $156,000 at June 30, 1997 compared to $23,000
at December 31, 1996.
Management has continued to classify all investment securities as available for
sale. Fluctuations in the U.S. Treasury market rates have caused both
decreases and increases in the market value of the available for sale
investment portfolio and the related equity valuation account. Capital ratios
for regulatory purposes are not impacted by the net unrealized holding gains
(losses) on available for sale securities. Management has chosen the
flexibility to restructure the investment portfolio and to recognize gains or
losses on securities when appropriate.
The Company's lending and investment policies emphasize quality and
well-managed growth. These policies may translate into slower growth in net
interest income and earnings in the short-term; however, management believes
these policies result in lower costs and quality earnings and are best for the
shareholders and customers in the long-term.
At June 30, 1997, $2.6 million or approximately 18.2% of equity capital, was
invested in bank premises and equipment. Equity capital was $14.0 million, or
10.0% of total assets, compared to the regulatory minimum of 4.0%. Total
capital is 15.8% of risk-based assets compared to the regulatory minimum of 8%.
The net unrealized holding losses on the available for sale portfolio were
$5,000 at June 30, 1997 compared to $3,000 at December 31, 1996.
8
<PAGE> 10
RESULTS OF OPERATIONS - SECOND QUARTER, 1997 VS. SECOND QUARTER, 1996
The net income for the second quarter, 1997 was $445,000 or $.25 per fully
diluted share, compared to $367,000, or $.21 per fully diluted share in the
same period of 1996, an increase of 21% in net income and 19% in per share
earnings. Per share amounts for 1996 have been restated to reflect a
three-for-two stock split distributed on February 24, 1997.
Net interest income for the second quarter, 1997, was $1,493,000 compared to
$1,274,000 in 1996, an increase of 17.2%. Average interest-earning assets were
up 8.5% in 1997 over 1996. The second quarter net yield on interest-earning
assets increased to 4.52% from 4.29% in 1996. The higher net interest margin
is primarily attributable to a 25 basis point increase in the prime lending
rate in March, 1997 and the higher levels of loans as compared to the prior
year.
The provision for loan losses was $65,000 in the second quarter of 1997,
compared to $60,000 for the same period in 1996. There were $18,000 charge-offs
and $6,000 recoveries in the second quarter of 1997, and no charge-offs or
recoveries during the same period in 1996.
Total other income in 1997 was $227,000 compared to $175,000 in 1996, an
increase of 29.7%. Volume increases in service charges on deposit accounts and
mortgage origination fees and new ATM transaction fees are the primary reasons
for the increase.
Other expenses were $973,000 in the second quarter, 1997 compared to $817,000
in the second quarter, 1996, an increase of 19.1%. Salaries and employee
benefits increases include three new staff positions, and promotional and
incentive increases. Increases in occupancy, equipment and other expenses
primarily reflect normal volume and inflation growth.
The provision for income taxes was $237,000 in the second quarter of 1997
compared to $205,000 in the second quarter of 1996. The effective combined
federal and state income tax provisions were 35.3% in 1997 and 36.1% in 1996.
The slightly lower rate is due to higher tax-exempt income on securities.
RESULTS OF OPERATIONS - FIRST SIX MONTHS, 1997 VS. FIRST SIX MONTHS, 1996
The net income for the first six months of 1997 was $812,000, or $.45 per
share, compared to $673,000, or $.38 per fully diluted share in the same period
of 1996. Per share amounts for 1996 have been restated to reflect a
three-for-two stock split distributed on February 24, 1997.
Net interest income for the first six months, 1997, was $2,861,000 compared to
$2,450,000 in 1996, an increase of 16.7%. Average interest-earning assets were
up 15.1% in 1997 over 1996. The net yield on interest-earning assets increased
to 4.47% from 4.37%. The increase in the net yield on interest-earning assets
is primarily attributable to a 25 basis point increase in the prime rate in
March 1997 and the 19% increase in loans over the prior year.
9
<PAGE> 11
The provision for loan losses was $115,000 and $120,000 in the first six months
of 1997 and 1996, respectively. Charge-offs were $18,000 and recoveries were
$6,000 in the first six months of 1997 and charge-offs were $11,000 in 1996.
There were no recoveries in the first six months of 1996.
Other income was $419,000 in the first six months, 1997 compared to $325,000
for the same period in 1996. Higher volumes of deposit accounts, non-sufficient
check fee volume, mortgage origination fees and new ATM transaction fees are
the primary reasons for the increases in other income. Other expenses totaled
$1,916,000 and $1,606,000 for first six months of 1997 and 1996, respectively,
an increase of 19.3%. Other operating expense increases included expenses
related to five additional staff positions in 1997 and higher data processing
fees, supplies costs and postage expense, which are directly related to the
rapidly growing loan portfolio and deposit base of the Bank.
10
<PAGE> 12
PART II - OTHER INFORMATION
Item 1. Legal proceedings. None.
Item 2. Changes in Securities.
As described in Note 2, a three-for-two stock split in the form of a 50 percent
stock dividend was declared on January 27, payable on February 24, 1997 to
shareholders of record on February 7, 1997. An additional 594,190 shares were
issued bringing the total issued shares to 1,782,598.
Item 3. Defaults upon Senior Securities. None.
Item 4. Submission of Matters to a Vote of Security Holders. None.
Item 5. Other Information. None.
Item 6. Exhibits or Reports on Form 8-K. None.
27 - Financial Data Schedule (for SEC use only).
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 Savannah Bancorp, Inc.
---------------------------------------
(Registrant)
Date 7/31/97 /s/ Archie H. Davis
------- ---------------------------------------
Archie H. Davis - President & CEO
Date 7/31/97 /s/ Robert B. Briscoe
------- ---------------------------------------
Robert B. Briscoe - Chief Financial
Officer
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE
1997 FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
INFORMATION.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<CASH> 6,688
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 3,230
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 31,185
<INVESTMENTS-MARKET> 31,177
<LOANS> 96,055
<ALLOWANCE> (1,343)
<TOTAL-ASSETS> 140,124
<DEPOSITS> 122,105
<SHORT-TERM> 2,983
<LIABILITIES-OTHER> 994
<LONG-TERM> 0
0
0
<COMMON> 1,783
<OTHER-SE> 12,259
<TOTAL-LIABILITIES-AND-EQUITY> 140,124
<INTEREST-LOAN> 4,093
<INTEREST-INVEST> 918
<INTEREST-OTHER> 274
<INTEREST-TOTAL> 5,285
<INTEREST-DEPOSIT> 2,358
<INTEREST-EXPENSE> 2,424
<INTEREST-INCOME-NET> 2,861
<LOAN-LOSSES> 115
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,916
<INCOME-PRETAX> 1,249
<INCOME-PRE-EXTRAORDINARY> 1,249
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 812
<EPS-PRIMARY> .45
<EPS-DILUTED> .45
<YIELD-ACTUAL> 4.47
<LOANS-NON> 123
<LOANS-PAST> 33
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 33
<ALLOWANCE-OPEN> 1,240
<CHARGE-OFFS> 18
<RECOVERIES> 6
<ALLOWANCE-CLOSE> 1,343
<ALLOWANCE-DOMESTIC> 1,343
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
