<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM 10-QSB
/X/ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended: June 30, 1996
-------------
/X/ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
---------- ----------
Commission file number: 0-23322
----------
CASCADE BANCORP
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
OREGON 93-1034484
(State of Incorporation) (I.R.S. Employer Identification #)
1100 NW WALL STREET, BEND, OREGON 97701
(541) 385-6205
(Address and Telephone Number of Issuer's Principal Executive Offices)
-------------------------
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. 2,132,967 shares of no par value
common Stock on July 31, 1996. --------------------------------
- - ------------------------------
Transitional Small Business Disclosure Format (check one): Yes No X
--- ---
<PAGE>
CASCADE BANCORP
FORM 10-QSB
QUARTERLY REPORT
JUNE 30, 1996
INDEX
PART I: FINANCIAL INFORMATION PAGE
----
Condensed Consolidated Balance Sheets as of
June 30, 1996 and December 31, 1995 . . . . . . . . . . . . . . . .3
Condensed Consolidated Statements of Income for the six months and
three months ended June 30, 1996 and 1995 . . . . . . . . . . . . .4
Condensed Consolidated Statements of Changes in Stockholders' Equity
for the six months ended June 30 1996 and 1995. . . . . . . . . . .5
Condensed Consolidated Statements of Cash Flows for the six months
ended June 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . .7
Management's Discussion and Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . . . . . . . . . . 11
PART II: OTHER INFORMATION
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2
<PAGE>
PART I
CASCADE BANCORP & SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 AND DECEMBER 31, 1995
(Unaudited)
1996 1995
---------- ----------
ASSETS
Cash and cash equivalents:
Cash and due from banks $ 19,908,339 $ 14,012,461
Federal funds sold 13,400,000 13,100,000
------------ ------------
Total cash and cash
equivalents 33,308,339 27,112,461
Investment securities
available-for-sale 11,398,878 9,965,676
Investment securities
held-to-maturity 3,779,017 3,402,179
Loans, net 131,229,674 124,711,355
Mortgage loans held for sale 2,133,932 3,009,584
Premises and equipment, net 3,705,807 3,467,085
Accrued interest and other assets 6,597,530 5,893,932
------------ ------------
Total assets $192,153,177 $177,562,272
------------ ------------
------------ ------------
LIABILITIES & STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Demand $ 52,066,782 $ 43,692,451
Interest bearing demand 82,048,782 80,186,924
Savings 13,073,539 13,149,653
Time deposits 17,789,959 15,409,039
------------ ------------
Total deposits 164,979,062 152,438,067
Long-term debt 5,000,000 5,000,000
Accrued interest and other
liabilitities 953,783 1,084,250
------------ ------------
Total liabilities 170,932,845 158,522,317
Stockholders' equity:
Common stock, no par value;
10,000,000 shares authorized;
2,132,967 issued and
outstanding (1,939,061-1995) 13,058,417 9,253,012
Retained earnings 8,143,075 9,734,936
Unrealized gains on investment
securities available-for-sale,
net of deferred income taxes 18,840 52,007
------------ ------------
Total stockholders' equity 21,220,332 19,039,955
------------ ------------
Total liabilities and
stockholder's equity $192,153,177 $177,562,272
------------- ------------
------------- ------------
See accompanying notes.
3
<PAGE>
CASCADE BANCORP & SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SIX MONTHS AND THREE MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
---------------------------- ----------------------------
1996 1995 1996 1995
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $6,895,026 $5,606,955 $3,492,324 $3,060,194
Taxable interest on investments 311,519 726,694 137,202 316,615
Nontaxable interest on investments 50,667 68,768 28,187 30,948
Interest on federal funds sold 207,358 15,784 104,051 303
---------- ---------- ---------- ----------
Total interest income 7,464,570 6,418,201 3,761,764 3,408,060
Interest expense:
Deposits:
Interest bearing demand 1,193,600 1,141,513 596,792 588,620
Savings 139,981 159,782 69,971 78,003
Time 419,819 259,320 216,790 141,579
Other borrowings 172,561 248,552 85,498 175,720
---------- ---------- ---------- ----------
Total interest expense 1,925,961 1,809,167 969,051 983,922
---------- ---------- ---------- ----------
Net interest income 5,538,609 4,609,034 2,792,713 2,424,138
Loan loss provision 148,721 238,958 66,454 182,026
---------- ---------- ---------- ----------
Net interest income after loan loss provision 5,389,888 4,370,076 2,726,259 2,242,112
Noninterest income:
Service charges on deposit accounts 734,773 667,976 381,144 349,361
Mortgage loan origination and processing fees 501,300 281,644 290,961 163,343
Gains on sales of mortgage loans 241,197 143,821 56,013 87,169
Losses on sales of investment securities 0
available-for-sale - (173,937) - (24,841)
Other income 453,876 393,881 225,896 255,888
---------- ---------- ---------- ----------
Total noninterest income 1,931,146 1,313,385 954,014 830,920
Noninterest expense:
Salaries and employee benefits 2,015,161 1,571,795 965,213 822,225
Net occupancy and equipment 618,000 651,063 302,457 333,994
Other expenses 1,141,362 969,498 577,093 486,496
---------- ---------- ---------- ----------
Total noninterest expense 3,774,523 3,192,356 1,844,763 1,642,715
---------- ---------- ---------- ----------
Income before income taxes 3,546,511 2,491,105 1,835,510 1,430,317
Provision for income taxes 1,332,967 931,491 689,825 528,276
---------- ---------- ---------- ----------
Net income $2,213,544 $1,559,614 $1,145,685 $ 902,041
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income per common share $ 1.04 $ .73 $ .54 $ .42
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
</TABLE>
See accompanying notes.
4
<PAGE>
CASCADE BANCORP AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
UNREALIZED
GAINS(LOSSES) TOTAL
COMMON RETAINED ON SECURITIES STOCKHOLDERS'
STOCK EARNINGS AVAILABLE-FOR-SALE EQUITY
---------- ------------ ------------------ -------------
<S> <C> <C> <C> <C>
Balance at December 31, 1994 $ 7,093,607 $ 8,262,066 $(544,738) $14,810,935
10% stock dividend (176,278 shares)
declared in June 1995 2,159,405 (2,159,405) - -
Net change in unrealized gains (losses) on
securities available-for-sale - - 550,380 550,380
Net income - 1,559,614 - 1,559,614
----------- ----------- --------- -----------
Balance at June 30, 1995 $ 9,253,012 $ 7,662,275 $ 5,642 $16,920,929
----------- ----------- --------- -----------
----------- ----------- --------- -----------
Balance at December 31, 1995 $ 9,253,012 $ 9,734,936 $ 52,007 $19,039,955
10% stock dividend (193,906 shares)
declared in June 1996 3,805,405 (3,805,405) - -
Net change in unrealized gains (losses) on
securities available-for-sale - - (33,167) (33,167)
Net income - 2,213,544 - 2,213,544
----------- ----------- --------- -----------
Balance at June 30, 1996 $13,058,417 $ 8,143,075 $ 18,840 $21,220,332
----------- ----------- --------- -----------
----------- ----------- --------- -----------
</TABLE>
See accompanying notes.
5
<PAGE>
CASCADE BANCORP & SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
------------- ------------
<S> <C> <C>
Net cash provided (used) by operating activities $ 446,169 $ (1,200,674)
Investing activities:
Purchases of investment securities available-for-sale (3,985,000) -
Purchases of investment securities held-to-maturity (909,309) -
Proceeds from maturities and calls of investment securities
available-for-sale 2,491,406 4,174,793
Proceeds from maturities and calls of investment securities
held-to-maturity 546,287 885,000
Proceeds from sales of investment securities
available-for-sale - 7,784,500
Net increase in loans (6,425,843) (23,379,369)
Purchases of premises and equipment, net (347,101) (157,446)
----------- ------------
Net cash used in investing activities (8,629,560) (10,692,522)
Financing activities:
Net increase in deposits 12,540,995 5,089,147
Net increase in short-term borrowings 5,500,000
Net increase in long-term debt 5,000,000
----------- ------------
Net cash provided by financing activities 12,540,995 15,589,147
----------- ------------
Net increase in cash and cash equivalents 4,357,604 3,695,951
Cash and cash equivalents at beginning of period 27,112,461 9,811,579
----------- ------------
Cash and cash equivalents at end of period $31,470,065 $ 13,507,530
----------- ------------
----------- ------------
</TABLE>
See accompanying notes.
6
<PAGE>
CASCADE BANCORP & SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(Unaudited)
1. BASIS OF PRESENTATION
The interim condensed consolidated financial statements include the
accounts of Cascade Bancorp (Bancorp), a bank holding company, and its wholly-
owned subsidiary, Bank of the Cascades (the Bank). All significant intercompany
accounts and transactions have been eliminated in consolidation.
The interim condensed consolidated financial statements are unaudited, but
include all adjustments, consisting of only normal accruals, which Bancorp
considers necessary for a fair presentation of the results of operations for
such interim periods. In preparing the condensed consolidated financial
statements, management is required to make estimates and assumptions that affect
the reported amounts of assets and liabilities as of the date of the balance
sheet and income and expenses for the period. Actual results could differ from
those estimates.
The interim condensed consolidated financial statements should be read in
conjunction with the December 31, 1995 consolidated financial statements,
including the notes thereto, included in Bancorp's Annual Report to Shareholders
for 1995.
Certain amounts for 1995 have been reclassified to conform with the 1996
presentation.
2. INVESTMENT SECURITIES
Investment securities at June 30, 1996 and December 31, 1995 consisted of
the following:
<TABLE>
<CAPTION>
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED MARKET
JUNE 30, 1996 COST GAINS LOSSES VALUE
- - ---------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
AVAILABLE-FOR-SALE
U.S. Government agencies. . . $ 6,880,119 $17,551 $ 1,604 $ 6,896,066
U.S. Treasury securities. . . $ 4,488,372 14,440 - 4,502,812
----------- ------------ ------------ ------------
$11,368,491 $31,991 $ 1,604 $11,398,878
----------- ------------ ------------ ------------
----------- ------------ ------------ ------------
HELD-TO-MATURITY
Obligations of state and
political subdivisions. . $ 2,544,553 $ 1,810 $10,938 $ 2,535,425
Other. . . . . . . . . . . . 1,234,464 - - 1,234,464
----------- ------------ ------------ ------------
$ 3,779,017 $ 1,810 $10,938 $ 3,769,889
----------- ------------ ------------ ------------
----------- ------------ ------------ ------------
GROSS GROSS ESTIMATED
AMORTIZED UNREALIZED UNREALIZED MARKET
DECEMBER 31, 1995 COST GAINS LOSSES VALUE
- - ----------------- ------------ ------------ ------------ ------------
AVAILABLE-FOR-SALE
U.S. Government agencies . . $ 5,394,386 $13,828 $ - $ 5,408,214
U.S. Treasury securities . . 4,487,408 70,054 - 4,557,462
----------- ------------ ------------ ------------
$ 9,881,794 $83,882 $ - $ 9,965,676
----------- ------------ ------------ ------------
----------- ------------ ------------ ------------
HELD-TO-MATURITY
Obligations of state and
political subdivisions $ 2,189,815 $16,527 $ - $ 2,206,342
Other. . . . . . . . . . . . 1,212,364 - 1,212,364
----------- ------------ ------------ ------------
$ 3,402,179 $16,527 $ - $ 3,418,706
----------- ------------ ------------ ------------
----------- ------------ ------------ ------------
</TABLE>
7
<PAGE>
3. LOANS AND RESERVE FOR LOAN LOSSES
The composition of the loan portfolio at June 30, 1996 and December 31,
1995 was as follows:
1996 1995
------------ ------------
Commercial . . . . . . . . . . $ 21,788,218 $ 21,710,608
Real Estate:
Construction. . . . . . . 37,580,067 33,983,778
Mortgage. . . . . . . . . 25,063,347 24,749,955
Commercial. . . . . . . . 34,735,771 31,018,825
Installment. . . . . . . . . . 14,190,987 15,271,595
------------ ------------
133,358,390 126,734,761
Less:
Reserve for loan losses . 1,776,961 1,651,352
Deferred loan fees. . . . 351,755 372,054
------------ ------------
2,128,716 2,023,406
------------ ------------
Loans, net. . . . . . . . . . . $131,229,674 $124,711,355
------------ ------------
------------ ------------
Mortgage loans held for sale of $2,133,932 and $3,009,584 at June 30, 1996
and December 31, 1995, respectively, represent real estate mortgage loans.
These loans are recorded at cost which approximates market.
As of June 30, 1996 and December 31, 1995, the Bank also held servicing
rights to approximately $127,975,000 and $123,574,000, respectively, in mortgage
loans which have been sold to the Federal National Mortgage Association. These
mortgage loans are being serviced for the Bank by another financial institution
under a sub-servicing agreement. The sale of these mortgage loans are subject
to technical underwriting exceptions and related repurchase risks. Such risks
are considered in the determination of the reserve for loan losses.
Effective January 1, 1996, the Bank prospectively adopted Statement of
Financial Accounting Standards (SFAS) No. 122, "Accounting for Mortgage
Servicing Rights" (SFAS 122). SFAS 122 requires the Bank to recognize as
separate assets the rights to service mortgage loans which are acquired through
loan origination activities subsequent to December 31, 1995. Other assets in
the accompanying balance sheet as of June 30, 1996 includes approximately
$236,000 for the capitalized mortgage servicing rights.
The fair value of the capitalized mortgage servicing rights was determined
based on estimates of the present value of expected future cash flows and
comparisons to current market transactions involving mortgage servicing rights
with similar portfolio characteristics. There were no significant changes in
the valuation on allowance for capitalized mortgage servicing rights during the
six months ended June 30, 1996. The predominant risk characteristics of the
underlying loans used to stratify the capitalized mortgage servicing rights for
purposes of measuring impairment are note rates, terms and interest methods
(i.e., fixed and variable).
Transactions in the reserve for loan losses for the six months ended June
30, 1996 and 1995 were as follows:
1996 1995
---------- ----------
Balance at beginning of period . . . . . . . $1,651,352 $1,172,238
Provisions charged to operations . . . . . . 148,721 238,958
Loans charged off. . . . . . . . . . . . . . (29,871) (30,037)
Recoveries of loans previously
charged off . . . . . . . . . . . . . . . . 6,759 88,511
---------- ----------
Balance at end of period . . . . . . . . . . $1,776,961 $1,469,670
---------- ----------
---------- ----------
8
<PAGE>
The reserve for loan losses represents management's recognition of the
assumed risks of extending credit and the quality of the existing loan
portfolio. The reserve is maintained at a level considered adequate to provide
for potential loan losses based on management's assessment of various factors
affecting the portfolio. Such factors include loss experience, review of
problem loans, current economic conditions, and an overall evaluation of the
quality, risk characteristics and concentration of loans in the portfolio. The
reserve is increased by provisions charged to operations and reduced by loans
charged-off, net of recoveries.
Although a risk of nonpayment exists with respect to all loans, certain
specific types of risks are associated with different types of loans. Due to
the nature of the Bank's customer base and the growth experienced in the Bank's
market area, real estate is frequently a material component of collateral for
the Bank's loans. The expected source of repayment of these loans is generally
the operations of the borrower's business or personal income; however, real
estate provides an additional measure of security. Risks associated with real
estate loans include fluctuating land values, local economic conditions, changes
in tax policies, and a concentration of loans within the Bank's market area.
The Bank mitigates risks on construction loans by generally lending funds
to customers that have been prequalified for long term financing and who are
using experienced contractors approved by the Bank. The commercial real estate
risk is further mitigated by making the majority of commercial real estate loans
to owner-occupied users of the property.
The Bank manages the general risks inherent in the loan portfolio by
following loan policies and underwriting practices designed to result in prudent
lending activities. The following table presents information with respect to
non-performing assets at June 30, 1996 and December 31, 1995 (dollars in
thousands):
1996 1995
----- -----
Loans on non-accrual status. . . . . . . $503 $45
Loans past due greater than 90 days
but not on non-accrual status. . . . . 24 21
Other real estate owned. . . . . . . . . - -
----- -----
Total non-performing assets. . . . . . . $527 $66
----- -----
----- -----
Percentage of non-performing assets
to total assets. . . . . . . . . . . . 27% .04%
The accrual of interest on a loan is discontinued when, in management's
judgment, the future collectibility of principal or interest is in doubt. Loans
placed on nonaccrual status may or may not be contractually past due at the time
of such determination, and may or may not be secured. When a loan is placed on
nonaccrual status, it is the Bank's policy to reverse, and charge against
current income, interest previously accrued but uncollected. Interest
subsequently collected on such loans is credited to loan principal if, in the
opinion of management, full collectibility of principal is doubtful. If
interest on nonaccrual loans had been accrued, such income would have been
insignificant for the six months ended June 30, 1996 and 1995.
At June 30, 1996, there were no potential problem loans, except as
discussed above, where known information about possible credit problems of the
borrower caused management to have serious doubts as to the ability of such
borrower to comply with the present loan repayment terms and which may result in
such loans being placed on a non-accrual basis.
4. LONG-TERM BORROWINGS
At June 30, 1996 and December 31, 1995, the Bank had $5.0 million in long-
term debt from the Federal Home Loan Bank of Seattle (FHLB) on a three year note
payable due in May 1998, with a fixed interest rate of 6.96%. The borrowings
from FHLB are secured by Bank assets.
9
<PAGE>
5. NET INCOME PER COMMON SHARE
Net income per common share is net income divided by the weighted average
shares outstanding for that period. The weighted average number of common
shares outstanding used to compute net income per common share, was
approximately 2,133,000 for the six-month and three-month periods ended June 30,
1996 and 1995. Weighted average shares outstanding consists of common shares
outstanding and common stock equivalents attributable to stock options. Net
income per common share and weighted average shares outstanding have been
restated to retroactively reflect 10% stock dividends declared In June 1996 and
1995.
6. ADOPTION OF ADDITIONAL NEW ACCOUNTING STANDARDS
Effective January 1, 1996, Bancorp adopted SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of"
(SFAS 121). SFAS 121 requires that long-lived assets, certain identifiable
intangibles, and goodwill related to those assets be reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount of
the asset may not be recoverable. SFAS 121 does not apply to core deposit or
credit card intangibles, mortgage servicing rights, or deferred tax assets.
Under SFAS 121, a loss is to be recognized to the extent that the fair value of
an impaired asset is less than the asset's carrying amount. The effect of
adopting SFAS 121 was not significant.
Effective January 1, 1996, Bancorp adopted SFAS 123, "Accounting for Stock-
Based Compensation" (SFAS 123). SFAS 123 establishes financial accounting and
reporting standards for stock-based employee compensation plans. The effect of
adopting SFAS 123 was not significant.
10
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE SIX MONTHS AND THREE MONTHS ENDED JUNE 30, 1996 AND 1995
The following discussion should be read in conjunction with Bancorp's
unaudited condensed consolidated financial statements and the notes thereto for
the six-month and three-month periods ended June 30, 1996 and 1995 included in
this report.
RESULTS OF OPERATIONS
Bancorp reported net income of approximately $2,214,000, or $1.04 per
share, for the six months ended June 30, 1996, compared to net income of
approximately $1,560,000, or $.73 per share, for the same period in 1995. This
represents an increase in net income of 41.9 percent. Net income for the
quarter ended June 30, 1996 was approximately $1,146,000, or $.54 per share,
compared to net income of approximately $902,000, or $.42 per share, for the
same period in 1995, up 27.0 percent.
Net interest income increased 20.2 percent for the six months and 15.2
percent for the three months ended June 30, 1996 as compared to the 1995
periods. The net increases during these periods resulted from increases in
interest income exceeding the increases in interest expense.
Total interest income increased approximately $1,046,400 for the six months
and approximately $353,700 for the quarter ended June 30, 1996 as compared to
the 1995 periods. These increases were primarily the result of increases in the
volume of loans.
Total interest expense increased approximately $116,800 for the six months
and decreased approximately $14,900 for the quarter ended June 30, 1996 as
compared to the 1995 periods. The increase during the six months ended June 30,
1996 was primarily due to increased volume in time deposits partially offset by
a slight decline in average rates paid. The decrease during the quarter ended
June 30, 1996 was primarily due to a decrease in the volume of other borrowings
which resulted in decreased interest expense.
The loan loss provision decreased for the six-months and quarter ended June
30, 1996 as compared to the loan loss provision charged during the 1995 periods,
primarily due to a decrease in the volume of loan growth. Management believes
the current loan loss provision maintains the reserve for loan losses at an
appropriate level. The Bank's ratio of reserve for loan losses to total loans
was 1.31 percent at June 30, 1996 compared to 1.27 percent at December 31, 1995.
Total noninterest income increased 42.4 percent for the six months and 10.0
percent for the quarter ended June 30, 1996 as compared to the 1995 periods.
The increase for the six months ended June 30, 1996 was predominately due to
increases in mortgage loan origination and processing fees, gains on sales of
mortgage loans, other income and the absence of losses on sales of investment
securities available-for-sale. The increase for the quarter ended June 30, 1996
was predominately due to increases in mortgage loan origination and processing
fees.
Increases in mortgage loan origination and processing fees for the six
months and three months ended June 30, 1996 and gains on sales of mortgage loans
for the six months ended June 30, 1996 were primarily due to increased mortgage
loan originations in conjunction with a more stable interest rate environment.
Other income increased during the six months ended June 30, 1996 primarily due
to income of approximately $96,000 on life insurance policies purchased in
connection with certain compensation plans established during the fourth quarter
of 1995.
The decrease in gains on sales of mortgage loans for the quarter ended June
30, 1996 as compared to June 30, 1995 is primarily due to an increase in gains
related to implementation of SFAS No. 122 (See Note 3 to accompanying condensed
consolidated financial statements) offset by increased discounts. Other income
decreased slightly during the quarter ended June 30, 1996 primarily due to the
1995 period includes income of approximately $74,000 which was generated from
the sale of Small Business Administration loans.
11
<PAGE>
Total noninterest expense increased 16.1 percent for the six months and 9.9
percent for the quarter ended June 30, 1996 as compared to the 1995 periods.
These increases are primarily attributed to Bancorp's increased size and
activity levels.
Income tax expense increased between the periods presented primarily as a
result of higher pre-tax income.
FINANCIAL CONDITION
Bancorp's total assets increased to $192.2 million at June 30, 1996
compared to $177.6 million at December 31, 1995, primarily due to an increase in
loans. Loan demand continues to be steady with total loans increasing 5.2
percent to $133.4 million at June 30, 1996 compared to $126.7 million at
December 31, 1995. Loan demand was primarily funded by deposits, which
increased 8.2 percent to $165.0 million at June 30, 1996 compared to $152.4
million at December 31, 1995.
CAPITAL RESOURCES
During the six months ended June 30, 1996 Bancorp continued to strengthen
its capital resources as total capital increased to $21.2 million, or 11.0
percent of total assets. The increase was primarily the result of the Bank's
net income for the six months ended June 30, 1996.
At June 30, 1996, Bancorp had a Risk Based Capital Ratio of 15.27 percent
and Tier 1 Capital Ratio of 14.07 percent. This was compared to 14.29 percent
and 13.13 percent for Risk Based Capital and Tier 1 Capital, respectively, at
December 31, 1995.
PART II
OTHER INFORMATION
No other information is required to be reported for the quarter ended June 30,
1996.
12
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CASCADE BANCORP
---------------------------------------
(Registrant)
Date 8/8/96 By /s/ Roger J. Shields
--------------- ------------------------------------
Roger J. Shields, President
Date 8/8/96 By /s/ Patricia L. Moss
--------------- ------------------------------------
Patricia L. Moss, Chief Financial
Officer
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 18,070
<INT-BEARING-DEPOSITS> 112,912
<FED-FUNDS-SOLD> 13,400
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 11,399
<INVESTMENTS-CARRYING> 3,779
<INVESTMENTS-MARKET> 3,770
<LOANS> 133,358
<ALLOWANCE> 1,777
<TOTAL-ASSETS> 192,153
<DEPOSITS> 164,979
<SHORT-TERM> 0
<LIABILITIES-OTHER> 954
<LONG-TERM> 5,000
0
0
<COMMON> 13,058
<OTHER-SE> 8,162
<TOTAL-LIABILITIES-AND-EQUITY> 21,220
<INTEREST-LOAN> 6,895
<INTEREST-INVEST> 362
<INTEREST-OTHER> 207
<INTEREST-TOTAL> 7,465
<INTEREST-DEPOSIT> 1,753
<INTEREST-EXPENSE> 1,926
<INTEREST-INCOME-NET> 5,539
<LOAN-LOSSES> 149
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,141
<INCOME-PRETAX> 3,547
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,214
<EPS-PRIMARY> 1.04
<EPS-DILUTED> 1.04
<YIELD-ACTUAL> 9.22
<LOANS-NON> 503
<LOANS-PAST> 24
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,651
<CHARGE-OFFS> 30
<RECOVERIES> 7
<ALLOWANCE-CLOSE> 1,777
<ALLOWANCE-DOMESTIC> 1,173
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 604
</TABLE>
