UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarter ended MARCH 31, 1997
Commission file number 0-18676
COMMERCIAL NATIONAL FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 25-1623213
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
900 LIGONIER STREET LATROBE, PA 15650
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (412) 539-3501
Indicate by checkmark 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.
CLASS OUTSTANDING AT APRIL 30, 1997
Common Stock, $2 Par Value 1,800,000 Shares
<PAGE>
INDEX
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Included in Part I of this report:
Page
Commercial National Financial Corporation
Consolidated Balance Sheets 3
Consolidated Statements of Income 4
Consolidated Statements of Changes in
Shareholders' Equity 5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7
ITEM 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II - OTHER INFORMATION
Other Information 14
Signatures 15
<PAGE>
<TABLE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS
<CAPTION>
March 31 December 31
1997 1996
<S> <C> <C>
ASSETS
Cash and due from banks $ 8,638,176 $ 8,839,707
Interest bearing deposits with
other banks 129,045 153,667
------- -------
Total cash and due from banks 8,767,221 8,993,374
Federal funds sold - -
Investment securities available for sale 40,657,669 37,816,171
Investment securities held to maturity
(Market value $67,523,466 in 1997 and
$65,571,756 in 1996) 67,180,870 64,539,801
Loans (all domestic) 162,412,228 160,048,235
Less unearned income (132,580) (112,712)
Less reserve for possible loan losses (2,018,212) (2,035,818)
------------ ------------
Net loans 160,261,436 157,899,705
Premises and equipment 4,822,451 4,802,465
Other assets 4,369,936 4,059,008
------------ ------------
Total Assets $286,059,583 $278,110,524
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits (all domestic):
Non-interest bearing $ 35,104,085 $ 33,972,163
Interest bearing 210,720,684 204,835,908
------------ ------------
Total deposits 245,824,769 238,808,071
Short-term borrowings 2,500,000 1,400,000
Other liabilities 1,910,846 2,514,199
------------ ------------
Total Liabilities 250,235,615 242,722,270
------------ ------------
Shareholders' equity:
Common stock, par value $2
1,800,000 shares authorized, issued
and outstanding 3,600,000 3,600,000
Retained earnings 32,380,618 31,777,511
Unrealized gain/(loss) on investment securities
available for sale net of taxes (156,650) 10,743
------------ ------------
Total Shareholders' Equity 35,823,968 35,388,254
------------ ------------
Total Liabilities and
Shareholders' Equity $286,059,583 $278,110,524
============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
<TABLE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF INCOME
<CAPTION>
March 31 March 31
1997 1996
<S> <C> <C>
INTEREST INCOME:
Interest and fees on loans $3,563,367 $3,281,582
Interest and dividends on investments:
Taxable interest 1,188,984 1,228,687
Interest exempt from federal
income tax 372,765 339,103
Interest on federal funds sold 14,766 46,710
Interest on bank deposits 2,125 1,257
---------- ----------
Total interest income 5,142,007 4,897,339
INTEREST EXPENSE
Interest on deposits 2,195,868 2,085,429
Interest on short-term borrowings 27,350 2,734
---------- ----------
Total interest expense 2,223,218 2,088,163
---------- ----------
NET INTEREST INCOME 2,918,789 2,809,176
Provision for possible loan losses 45,000 15,000
---------- ----------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 2,873,789 2,794,176
---------- ----------
OTHER INCOME
Asset management and trust income 25,922 9,512
Service charges on deposit accounts 135,373 120,115
Other service charges and fees 102,411 99,761
Net Securities gains - 1,750
Other income 78,594 91,961
---------- ----------
Total other income 342,300 323,099
---------- ----------
OTHER EXPENSES
Salaries and employee benefits 1,182,498 1,065,351
Net occupancy expense 142,471 121,993
Furniture and equipment expense 159,236 151,642
Pennsylvania shares tax 67,419 60,000
Other expense 489,358 463,557
---------- ----------
Total other expenses 2,040,982 1,862,543
---------- ----------
INCOME BEFORE TAXES 1,175,107 1,254,732
Applicable income taxes 284,000 322,000
---------- ----------
NET INCOME $ 891,107 $ 932,732
========== ==========
Average Shares Outstanding 1,800,000 1,800,000
========== ==========
EARNINGS PER SHARE $ .50 $ .52
========== ==========
CASH DIVIDENDS DECLARED PER SHARE $ .16 $ .14
========== ==========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
<TABLE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
<CAPTION>
Unrealized
Gain/(Loss)
Additional On Investment Total
Common Paid-in Retained Securities Shareholders'
Stock Capital Earnings Available for Sale Equity
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1995 $3,600,000 $ - $29,143,045 $ 293,425 $33,036,470
Net income - - 932,732 - 932,732
Cash dividends declared
($.14 per share) - - (258,000) - (258,000)
Net change in unrealized
gain/(loss) on investment
securities AFS net of taxes - - - (229,264) (229,264)
--------------------------------------------------------------------------------
Balance at March 31, 1996 $3,600,000 $ - $29,817,777 $ 64,161 $33,481,938
================================================================================
Balance at December 31, 1996 $3,600,000 $ - $31,777,511 $ 10,743 $35,388,254
Net income - - 891,107 - 891,107
Cash dividends declared
($.16 per share) - - (288,000) - (288,000)
Net change in unrealized
gain/(loss) on investment
securities AFS net of taxes - - - (167,393) (167,393)
--------------------------------------------------------------------------------
Balance at March 31, 1997 $3,600,000 $ - $32,380,618 $ (156,650) $35,823,968
================================================================================
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
<TABLE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
For Three Months
Ended March 31
1997 1996
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 891,107 $ 932,732
Adjustments to reconcile net income to net
cash from operating activities:
Depreciation and amortization 156,717 136,461
Provision for possible loan losses 45,000 15,000
Net accretion/(amortization) of securities
and loan fees 30,682 (17,735)
Increase in interest receivable (327,236) (243,269)
Decrease in interest payable (105,576) (115,740)
Increase in taxes payable 72,975 131,090
Decrease in other liabilities (497,777) (455,559)
Decrease in other assets 29,566 40,209
Net security gains - (1,750)
---------- ----------
Net cash provided by operating activities 295,458 421,439
---------- ----------
INVESTING ACTIVITIES
Net(increase)decrease in deposits
with other banks 24,622 (15,428)
Net decrease in fed funds sold - 5,425,000
Purchase of securities AFS (7,106,069) (4,141,562)
Purchase of securities HTM (3,511,793) (4,361,990)
Maturities and calls of securities AFS 4,000,000 1,958,636
Maturities and calls of securities HTM 860,000 3,214,060
Net increase in loans (2,415,744) (3,614,658)
Purchase of premises and equipment (176,703) (263,237)
----------- -----------
Net cash used in investing activities (8,325,687) (1,799,179)
----------- -----------
FINANCING ACTIVITIES
Net increase in deposits 7,016,698 782,536
Net increase in other short-term borrowings 1,100,000 100,000
Dividends paid (288,000) (258,000)
----------- -----------
Net cash provided by financing activities 7,828,698 624,536
----------- -----------
(201,531) (753,204)
Cash and cash equivalents at beginning of year 8,839,707 7,550,942
----------- -----------
Cash and cash equivalents at end of quarter $ 8,638,176 $ 6,797,738
=========== ===========
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest $ 2,328,794 $ 2,203,903
=========== ===========
Income Taxes $ 200,000 $ 297,000
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997
Note 1 Management Representation
------ -------------------------
The accompanying unaudited consolidated interim financial
statements have been prepared in accordance with generally
accepted accounting principles for interim financial information.
However, they do not include all information and footnotes
required by generally accepted accounting principles for complete
financial statements and should be read in conjunction with the
annual financial statements of Commercial National Financial
Corporation for the year ending December 31, 1996, including the
notes thereto. In the opinion of management, the unaudited
interim consolidated financial statements include all adjustments
(consisting of only normal recurring adjustments) necessary for a
fair statement of financial position as of March 31, 1997 and the
results of operations for the three month periods ended March 31,
1997 and 1996, and the statements of cash flows and changes in
shareholders' equity for the three month periods ended March 31,
1997 and 1996. The results of the three months ended March 31,
1997 are not necessarily indicative of the results to be expected
for the entire year.
<TABLE>
Note 2 Reserve for Possible Loan Losses
------ --------------------------------
Description of changes:
<CAPTION>
1997 1996
<S> <C> <C>
Reserve balance January 1 $2,035,818 $2,081,700
Additions:
Provision charged to operating expenses 45,000 15,000
Recoveries on previously charged off
loans 3,242 10,615
Deductions:
Loans charged off (65,848) (27,803)
---------- ----------
Reserve balance March 31 $2,018,212 $2,079,512
========== ==========
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
---------------------
First Three Months of 1997 as compared to the First Three Months of 1996
------------------------------------------------------------------------
Pre-tax net income for the first three months of 1997 was
$1,175,107 compared to $1,254,732 during the same period of 1996,
representing a 6.35% decrease.
Interest income was $5,142,007, an increase of 5.00%. The loan
return rate decreased sixteen(16) basis points to 8.85% and the
securities return rate decreased six(6) basis points to 5.95%. As
a result, the return rate on total average earning assets
decreased four(4) basis points to 7.70%. Average earning asset
volume rose $14,121,197, a 5.58% increase.
Interest expense was $2,223,218, an increase of 6.47%. The cost
rate on average interest bearing liabilities was 4.23%, a two(2)
basis point decrease from a year ago. Average interest bearing
liabilities volume rose $13,735,751, an increase of 6.99%.
Net interest income rose 3.90% to $2,918,789, and represented
4.17% of average total assets compared to 4.24% during the first
three months of 1996.
The average reserve for loan losses declined 2.21% to $2,034,257.
By comparison, total average loans grew 10.65% during the same
period. The 1997 first three months provision for loan losses
was $45,000, compared to $15,000 for the first three months of
1996, a 200% increase.
Net interest income after the application of the provision for
possible loan losses grew 2.85% to $79,613, representing a 4.10%
return on total average assets compared to 4.22% for the first
three months of 1996.
Non-interest income increased 5.94% to $342,300. Asset
management and trust fees totaled $25,922. Service charges on
deposit accounts rose 12.70% to $135,373. Other service charges
and fees rose 2.66% reaching $102,411. Other income declined
14.54% to $78,594.
Non-interest expense reached $2,040,982, an increase of 9.58%, or
$178,439, while total average assets grew 5.73%. Personnel costs
rose 11.00%, a $117,147 increase. Net occupancy expense rose
16.79%, or $20,478. Furniture and equipment expense rose 5.01%,
representing a cost increase of $7,594. Pennsylvania shares tax
expense was $67,419, an increase of 12.37%. Other expense rose
5.57%, an increase of $25,801.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (continued)
---------------------------------
First Three Months of 1997 as compared to the First Three Months
of 1996 continued
-----------------------------------------------------------------
Federal income tax on total first three months earnings was
$284,000 compared to $322,000 a year ago. Net income after taxes
declined $41,625 to $891,107, a decrease of 4.46%. The annualized
return on average assets was 1.27% for the first three months of
1997 compared to 1.41% for the three months ended March 31, 1996.
The annualized return on average equity through March 31, 1997
was 10.01% and had been 11.18% through the first three months of
1996.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (Continued)
RESULTS OF OPERATIONS (Continued)
---------------------------------
LIQUIDITY
---------
Liquidity, the measure of the corporation's ability to meet the
normal cash flow needs of depositors and borrowers in an
efficient manner, is generated primarily from the acquisition of
deposit funds and the maturity of loans and securities.
Additional liquidity can be provided by the sale of investment
securities available for sale which amounted to $40,895,018 with
net unrealized losses of $237,349 on March 31, 1997.
During the first three months of 1997, average deposits and short-
term borrowings increased $12,027,439 and $1,708,312,
respectively, over the same period in 1996. Investments maturing
within one year were 6.53% of total assets on March 31, 1997 and
7.45% on March 31, 1996.
Average loans grew by $15,509,266 and the average securities
portfolio (including federal funds sold) decreased $288,172.
INTEREST SENSITIVITY
--------------------
Interest rate management seeks to maintain a balance between
consistent income growth and the risk that is created by
variations in ability to reprice deposit and investment
categories. The effort to determine the effect of potential
interest rate changes normally involves measuring the so called
"gap" between assets (loans and securities) subject to rate
fluctuation and liabilities (interest bearing deposits) subject
to rate fluctuation as related to earning assets over different
time periods and calculating the ratio of interest sensitive
assets to interest sensitive liabilities.
Repricing periods for the loans, securities, interest bearing
deposits, non-interest bearing assets and non-interest bearing
liabilities are based on contractual maturities, were applicable,
as well as the corporation's historical experience regarding the
impact of interest rate fluctuations on the prepayment and
withdrawal patterns of certain assets and liabilities. Regular
savings, NOW and other similar interest bearing demand deposit
accounts are subject to immediate withdrawal without penalty and
therefore are presented as beginning to reprice in the earliest
period presented in the "gap" table.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (Continued)
RESULTS OF OPERATIONS (Continued)
---------------------------------
INTEREST SENSITIVITY (In thousands)
-----------------------------------
The following table presents this information as of March 31,
1997 and December 31, 1996:
<TABLE>
<CAPTION>
March 31, 1997
0-30 DAYS 31-90 DAYS 91-180 DAYS 181-365 DAYS 1-5 YEARS OVER 5 YRS
<S> <C> <C> <C> <C> <C> <C>
Interest sensitive
assets $ 45,547 $ 9,652 $ 11,538 $ 21,694 $ 119,156 $ 61,870
Interest sensitive
liabilities $ 13,543 $ 17,831 $ 24,539 $ 37,878 $ 121,299 $ 365
Interest sensitivity --------------------------------------------------------------------------
gap $ 32,004 $ (8,179) $ (13,001) $ (16,184) $ (2,143) $ 61,505
==========================================================================
Cumulative gap $ 23,825 $ 10,824 $ (5,360) $ (7,503) $ 54,002
Ratio of cumulative gap =============================================================
to earning assets 8.82% 4.01% (1.98%) (2.78%) 19.99%
=============================================================
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
0-30 DAYS 31-90 DAYS 91-180 DAYS 181-365 DAYS 1-5 YEARS OVER 5 YRS
<S> <C> <C> <C> <C> <C> <C>
Interest sensitive
assets $ 42,401 $ 6,912 $ 13,855 $ 20,397 $ 117,481 $ 60,563
Interest sensitive
liabilities $ 13,673 $ 19,101 $ 25,281 $ 31,181 $ 116,367 $ 633
Interest sensitivity --------------------------------------------------------------------------
gap $ 28,728 $ (12,189) $ (11,426) $ (10,784) $ 1,114 $ 59,930
==========================================================================
Cumulative gap $ 16,539 $ 5,113 $ (5,671) $ (4,557) $ 55,373
Ratio of cumulative gap =============================================================
to earning assets 6.29% 1.95% (2.16%) (1.74%) 21.09%
=============================================================
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
CREDIT QUALITY RISK
- -------------------
The following table presents a comparison of loan performance as of March
31, 1997 with that of March 31, 1996. Non-accrual loans are those for
which interest income is recorded only when received and past due loans
are those which are contractually past due 90 days or more in respect to
interest or principal payments. As of March 31, 1997 the corporation had
$272,919 in other real estate owned and no in-substance foreclosures.
<TABLE>
<CAPTION>
At March 31
1997 1996
<S> <C> <C>
Non-performing Loans:
Loans on non-accrual basis $ 23,172 $ 373,788
Past due loans 170,468 20,058
Renegotiated loans 1,002,802 403,506
--------- ---------
Total Non-performing Loans $ 1,196,442 $ 797,352
========= =========
Other real estate owned 272,919 -
Total non-performing assets $ 1,469,361 $ 797,352
========= =========
Loans outstanding at end of period $162,279,648 $147,905,657
Average loans outstanding (year-to-date) $161,136,149 $145,626,883
Non-performing loans as percent of total
loans .91% .54%
Provision for possible loan losses $ 45,000 $ 15,000
Net charge-offs as percent of average
loans .04% .01%
Provision for possible loan losses as
percent of net charge-offs 71.88% 87.27%
Reserve for possible loan losses as
percent of average loans outstanding 1.25% 1.43%
</TABLE>
CAPITAL RESOURCES
- -----------------
Shareholders' equity for the first three months of 1997 averaged $35,625,753
which represented an increase of $2,250,375 over the average capital of
$33,375,378 recorded in the same period of 1996. These capital levels
represented a capital ratio of 12.71% in 1997 and 12.59% in 1996. When
the loan loss reserve is included, the 1997 capital ratio becomes 13.44%.
The Federal Reserve Board's risk-based capital guidelines are designed
principally as a measure of credit risk. These guidelines require that:
(1) at least 50% of a banking organization's total capital be common and
certain other "core" equity capital ("Tier I Capital"); (2) assets and off-
balance sheet items must be weighted according to risk; and (3) the total
capital to risk-weighted assets ratio be at least 8.00%; and (4) a minimum
4.00% leverage ratio of Tier I capital to average total assets be
maintained. As of March 31, 1997, the corporation, under these
guidelines, had a Tier I and total equity capital to risk adjusted assets
ratio of 21.84% and 23.07% respectively. The leverage ratio was 12.84%.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
CAPITAL RESOURCES (continued)
The table below presents the corporation's capital position at March 31, 1997
(Dollar amounts in thousands)
<TABLE>
<CAPTION>
Percent
of Adjusted
Amount Assets
<S> <C> <C>
Tier I Capital $ 35,981 21.84
Tier I Capital Requirement 6,590 4.00
Total Equity Capital $ 37,989 23.07
Total Equity Capital Requirement 13,179 8.00
- ----------------------------------------------------------------------
Minimum Leverage Capital $ 35,981 12.84
Minimum Leverage Requirement 11,211 4.00
</TABLE>
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
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
Not Applicable
ITEM 5. OTHER INFORMATION
Not applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Not applicable
<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.
COMMERCIAL NATIONAL FINANCIAL CORPORATION
(Registrant)
Dated: May 5, 1997 [S] Louis A. Steiner
Louis A. Steiner
Chairman of the Board
Dated: May 5, 1997 [S] Sandra L. Neiderhiser
Sandra L. Neiderhiser
Secretary/Treasurer
<PAGE>
Commercial National Financial Corporation
900 Ligonier Street
Latrobe, Pennsylvania 15650
Telephone (412) 539-3501
Banking Subsidiary:
Commercial National Bank of Westmoreland County
Banking Offices
Latrobe Area
900 Ligonier Street (412) 539-3501
1900 Lincoln Avenue (412) 537-9980
11 Terry Way * (412) 539-9774
Pleasant Unity
Church Street * (412) 423-5222
Ligonier
201 Main Street * (412) 238-9538
West Newton
109 East Main Street * (412) 872-5100
Greensburg Area
Georges Station Road * (412) 836-7698
19 North Main Street (412) 836-7699
Asset Management and (412) 836-7670
Trust Division
19 North Main Street
Drive-up Facility
Latrobe
Lincoln Road at
Josephine Street * (412) 537-9927
Murrysville
4785 Old William Penn Highway* (412) 733-4888
* Automatic Teller Facilities
Automatic Teller Facilities also located at
Latrobe Area Hospital, Westmoreland County Airport,
and Saint Vincent College
<TABLE> <S> <C>
<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> 8,638,176
<INT-BEARING-DEPOSITS> 129,045
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 40,657,669
<INVESTMENTS-CARRYING> 67,180,870
<INVESTMENTS-MARKET> 67,523,466
<LOANS> 162,279,648
<ALLOWANCE> 2,018,212
<TOTAL-ASSETS> 286,059,583
<DEPOSITS> 245,824,769
<SHORT-TERM> 2,500,000
<LIABILITIES-OTHER> 1,910,846
<LONG-TERM> 0
0
0
<COMMON> 3,600,000
<OTHER-SE> 32,223,968
<TOTAL-LIABILITIES-AND-EQUITY> 286,059,583
<INTEREST-LOAN> 3,563,367
<INTEREST-INVEST> 1,561,749
<INTEREST-OTHER> 16,891
<INTEREST-TOTAL> 5,142,007
<INTEREST-DEPOSIT> 2,195,868
<INTEREST-EXPENSE> 2,223,218
<INTEREST-INCOME-NET> 2,918,789
<LOAN-LOSSES> 45,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2,040,982
<INCOME-PRETAX> 1,175,107
<INCOME-PRE-EXTRAORDINARY> 891,107
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 891,107
<EPS-PRIMARY> $ .50
<EPS-DILUTED> $ .50
<YIELD-ACTUAL> 7.70
<LOANS-NON> 23,172
<LOANS-PAST> 170,468
<LOANS-TROUBLED> 1,002,802
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,035,818
<CHARGE-OFFS> 65,848
<RECOVERIES> 3,242
<ALLOWANCE-CLOSE> 2,018,212
<ALLOWANCE-DOMESTIC> 2,018,212
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
