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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
January 15, 1997
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(Date of earliest event reported)
First Financial Corporation of Western Maryland
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(Exact name of registrant as specified in its charter)
Delaware 0-19837 52-1700036
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
118 Baltimore Street, Cumberland, Maryland 21502
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(Address of principal executive offices) (Zip Code)
(301) 724-3363
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year, if changed since last
report)
Page 1 of 6 Pages
Exhibit Index appears on Page 2
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Item 5. Other Events
On January 15, 1997, First Financial Corporation of Western
Maryland (the "Corporation") announced that the Corporation had consolidated
net income for the quarter ended December 31, 1996 of $1.2 million or $0.55 per
share. Net income for the quarter increased $374,000 or 46.1% as compared to
net income of $811,000 or $0.37 per share for the quarter ended December 31,
1995. For the six month period ended December 31, 1996, the Corporation
realized consolidated net income of $2.4 million or $1.11 per share before the
one-time special Savings Association Insurance Fund ("SAIF") assessment
incurred during the first quarter of the fiscal year, as compared to net income
of $1.6 million or $0.74 per share for the six month period ended December 31,
1995. Net income for the six months ended December 31, 1996 after the SAIF
assessment was $1.2 million or $0.57 per share. A copy of the press release,
dated January 15, 1997, is attached hereto as Exhibit 99 and is incorporated
herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(a) Financial Statements of Business Acquired
Not applicable.
(b) Pro Forma Financial Information
Not applicable.
(c) Exhibits
(99) Press release dated January 15, 1997.
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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.
FIRST FINANCIAL CORPORATION
OF WESTERN MARYLAND
Date: January 21, 1997 By: /s/William C. Marsh
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William C. Marsh
Executive Vice President and
Chief Financial Officer
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[FIRST FINANCIAL LETTERHEAD]
PRESS RELEASE
Release Date:
Further Information:
IMMEDIATE RELEASE
(Patrick J. Coyne)
Chairman of the Board, President
and Chief Executive Officer
- or -
William C. Marsh
Executive Vice President
Chief Financial Officer
January 15, 1997 Phone: 301/724-3363
FIRST FINANCIAL CORPORATION OF WESTERN MARYLAND ANNOUNCES
RECORD EARNINGS FOR SECOND QUARTER OF FISCAL 1997
Cumberland, MD, January 15, 1997 - First Financial Corporation of Western
Maryland (Nasdaq: FFWM), the holding company for First Federal Savings Bank of
Western Maryland, today announced consolidated net income for the quarter ended
December 31, 1996, of $1.2 MILLION or $0.55 per share. Net income for the
quarterly period increased $374,000 or 46.1%, as compared to net income of
$811,000 or $0.37 per share for the quarter ended December 31, 1995. The
Corporation's annualized return on average assets and return on average equity
increased to 1.33% and 11.53%, respectively, for the three months ended
December 31, 1996, compared to 0.97% and 8.18%, respectively, for the same
period in the prior fiscal year.
For the six month period ended December 31, 1996, the Corporation realized
consolidated net income of $2.4 MILLION or $1.11 per share before the one-time
special Savings Association Insurance Fund (SAIF) assessment incurred during
the first quarter of the fiscal year, as compared to net income of $1.6 million
or $0.74 per share for six month period ended December 31, 1995. Net income for
the six months ended December 31, 1996 after the SAIF assessment was $1.2
million or $0.57 per share.
Patrick J. Coyne, Chairman of the Board, President and Chief Executive Officer
of the Corporation and the Bank, said, "The second quarter fiscal 1997
financial results represented record core quarterly earnings. The Corporation
continues, through the efforts of the Bank's management and employees, to
experience sound earnings and asset growth while improving key return on asset,
return on equity and net interest margin ratios as well as asset quality."
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PRESS RELEASE
Page 2 of 3
January 15, 1997
Mr. Coyne attributed the Corporation's improved operating results for the
quarterly and year-to-date fiscal 1997 periods primarily to an increase in net
interest income related principally to continued loan portfolio growth. The
Corporation's net interest income before provision for loan losses increased
$1.0 million or 15.8% to $7.8 million for the six months ended December 31,
1996, compared to $6.8 million for the same period in fiscal 1996. The
Corporation's net interest spread increased to 3.97% for the six month period
ended December 31, 1996, from 3.78% for the same six month period in the prior
fiscal year.
The Corporation originated $88.2 million in new loans during the first six
months of fiscal 1997, resulting in an increase in total loans receivable of
$48.4 million or 19.9% to $291.5 million at December 31, 1996 from $243.1
million at June 30, 1996.
In connection with the growth in the loan portfolio, total assets reached a
record $360.8 million at December 31, 1996, compared to $322.0 million at June
30, 1996. Deposits increased to $276.8 million at December 31, 1996 from $274.8
million at June 30, 1996. Total stockholders' equity increased to $42.1
million at December 31, 1996, from $41.7 million at June 30, 1996. The
Corporation continues to leverage capital through interest-earning asset growth
while maintaining a strong capital position with a capital-to-assets ratio well
above regulatory requirements at 11.7% as of December 31, 1996.
The Corporation continued to strengthen its balance sheet as non-performing
assets net of related reserves decreased $2.6 million or 41.0% to $3.8 million
at December 31, 1996, compared to $6.4 million at June 30, 1996. Non-performing
assets as a percentage of total assets decreased to 1.05% at December 31, 1996,
from 2.00% at June 30, 1996. Total loan loss and real estate owned reserves
represented 216% of non-performing assets at December 31, 1996.
On November 26, 1996, the Corporation and Keystone Financial, Inc. (Nasdaq:
KSTN) entered into a definitive agreement whereby Keystone will acquire the
Corporation and its subsidiaries, including the Bank. The merger transaction,
which is subject to regulatory and stockholder approval, is expected to be
completed during the second quarter of calendar 1997.
First Federal Savings Bank of Western Maryland is a federally chartered,
FDIC-insured stock savings bank which conducts its business through 10 offices
located within the greater Cumberland area, Hagerstown, Frostburg, Oakland and
Westernport, Maryland.
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PRESS RELEASE
Page 3 of 3
January 15, 1997
FIRST FINANCIAL CORPORATION OF WESTERN MARYLAND
SUMMARY OF OPERATING RESULTS
<TABLE>
<CAPTION>
QUARTER ENDED DECEMBER 31: 1996 1995
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<S> <C> <C>
Net income before provision for income taxes $1,917,000 $1,286,000
Provision for income taxes 732,000 475,000
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Net income $1,185,000 $ 811,000
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Net income per share $0.55 $0.37
Annualized return on average assets 1.33% 0.97%
Annualized return on average stockholders' equity 11.53% 8.18%
<CAPTION>
SIX MONTHS ENDED DECEMBER 31: 1996 1995
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<S> <C> <C>
Net income before provision for income taxes and
one-time SAIF assessment $3,894,000 $2,600,000
Provision for income taxes 1,493,000 987,000
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Net income before one-time SAIF assessment 2,401,000 1,613,000
One-time SAIF assessment, net of income taxes 1,172,000 -
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Net income $1,229,000 $1,613,000
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Net income per share:
Net income before one-time SAIF assessment $1.11 $0.74
One-time SAIF assessment, net of income taxes -0.54 -
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Net income per share $0.57 $0.74
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Annualized return on average assets:
Before one-time SAIF assessment 1.40% .97%
After one-time SAIF assessment 0.72% .97%
Annualized return on average stockholders' equity:
Before one-time SAIF assessment 11.47% 8.22%
After one-time SAIF assessment 5.97% 8.22%
<CAPTION>
BALANCE SHEET DATA 12/31/96 06/30/96
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<S> <C> <C>
Total assets $360,849,000 $321,994,000
Total loans $291,487,000 $243,113,000
Total deposits $276,795,000 $274,756,000
Total stockholders' equity $42,142,000 $41,707,000
Total shares outstanding 2,167,896 2,176,739
Book value per share $19.44 $19.16
</TABLE>
