U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY
PERIOD ENDED JUNE 30, 1998
( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
TO
Commission file number 000-21658
MINDEN BANCSHARES, INC.
(Exact name of small business issuer as specified in its charter)
Louisiana 72-0980704
(State or other jurisdiction of (IRS Employer Identification No.)
Incorporation or organization)
401 Main Street, Minden, Louisiana 71055
(Address of principal executive offices) (Zip Code)
(318) 377-4283
(Issuer's telephone number)
Check whether the issuer (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act of 1934 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
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:
280,645 as of July 31, 1998
Transitional Small Business Disclosure Format (Check one):
Yes No X
Page 1 of 29 Pages
Exhibit Index - 26
FORM 10-QSB
INDEX
PART I Page
Item 1. Financial Statements - Minden Bancshares,
Inc. and Subsidiary
Consolidated Balance Sheets as of
June 30, 1998 and December 31, 1997 4
Consolidated Statements of Income for
the Three Months and Six Months
Ended June 30, 1998 and 1997 5
Consolidated Statements of Comprehensive
Income for the Three Months and Six
Months Ended June 30, 1998 and 1997 6
Consolidated Statements of Cash Flows
for the Six Months ended June 30, 1998,
and 1997 7
Notes to Consolidated Financial 8-10
Statements
Item 2. Management's Discussion and Analysis 11-26
PART II
Item 4. Submission of Matters to a Vote
of Security Holders 27
Item 6. Exhibits and Reports on Form 8-K 27
PART I - Financial Information
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<S> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1998 AND DECEMBER 31, 1997
(UNAUDITED)
June December
1998 1997
-------- --------
ASSETS
-------------------------------------------(in thousands, except per share data)
Cash and Cash Equivalents:
Cash and Due From Banks $13,478 $17,196
Federal Funds Sold 20,000 4,500
--------- ---------
Total 33,478 21,696
--------- ---------
Securities:
Held to Maturity 17,792 16,502
Available for Sale 101,926 108,414
--------- ---------
Total 119,718 124,916
--------- ---------
Federal Reserve Bank and Federal Home Loan Bank Stock 1,507 1,400
Loans, Less Allowance for Loan Losses of $3,511 and $3,603 139,925 133,286
Accrued Interest Receivable 2,800 2,642
Bank Premises and Equipment 3,620 3,662
Real Estate Owned Other Than Bank Premises 328 278
Other Assets 4,200 4,198
--------- ---------
Total Assets $305,576 $292,078
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------------------------
Liabilities:
-----------
Deposits:
Noninterest Bearing $46,274 $42,045
Interest Bearing 212,929 206,138
--------- ---------
Total Deposits 259,203 248,183
Securities Sold Under Repurchase Agreement 10,176 10,809
Accrued Interest Payable 1,042 986
Other Liabilities 783 414
--------- ---------
Total Liabilities 271,204 260,392
--------- ---------
Stockholders' Equity:
--------------------
Common Stock, par value $2.50 per share; 500,000
shares authorized; 309,816 shares issued;
280,645 and 280,511 shares outstanding 775 775
Additional Paid-In Capital 11,215 11,205
Undivided Profits 23,213 20,737
Accumulated Other Comprehensive Income 465 269
Treasury Stock-At Cost (1,296) (1,300)
--------- ---------
Total Stockholders' Equity 34,372 31,686
--------- ---------
Total Liabilities and Stockholders' Equity $305,576 $292,078
========= =========
See accompanying notes.
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS & SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
Three Months Six Months
Ended June 30 Ended June 30
================== ===================
1998 1997 1998 1997
-------- -------- -------- ---------
Interest Income: (in thousands, except per share data)
---------------
Interest and Fees on Loans $3,345 $3,051 $6,594 $5,818
Securities:
Held to Maturity (non-taxable) 220 188 431 373
Available for Sale 1,448 1,343 2,932 2,600
Federal Funds Sold 286 233 504 456
Federal Reserve Stock and Other 24 23 43 41
Interest-Bearing Balances with Banks 79 56 161 82
-------- -------- -------- ---------
Total Interest Income 5,402 4,894 10,665 9,370
-------- -------- -------- ---------
Interest Expense:
----------------
Savings and Interest-Bearing Demand Deposits 633 561 1,218 1,118
Time Deposits 1,628 1,492 3,250 2,779
Securities Sold Under Repurchase Agreement and Other 122 73 240 138
-------- -------- -------- ---------
Total Interest Expense 2,383 2,126 4,708 4,035
-------- -------- -------- ---------
Net Interest Income 3,019 2,768 5,957 5,335
Provision for Loan Losses 0 0 0 0
-------- -------- -------- ---------
Net Interest Income After
Provision for Loan Losses 3,019 2,768 5,957 5,335
-------- -------- -------- ---------
Other Income:
------------
Service Charges 416 398 798 789
Trust Department Fees 0 5 0 7
Other Operating Income 241 162 461 322
-------- -------- -------- ---------
Total Other Income 657 565 1,259 1,118
-------- -------- -------- ---------
Operating Expenses:
------------------
Salaries and Employee Benefits 822 756 1,641 1,468
Occupancy Expense 118 103 223 196
Furniture and Equipment Expense 72 72 146 136
Amortization 78 40 155 90
Capital Stock Taxes 106 86 212 173
Stationery, Supplies & Printing 49 58 110 97
Other Operating Expenses 440 424 771 735
-------- -------- -------- ---------
Total Operating Expense 1,685 1,539 3,258 2,895
-------- -------- -------- ---------
Income Before Income Taxes 1,991 1,794 3,958 3,558
Income Taxes 625 562 1,244 1,112
-------- -------- -------- ---------
Net Income $1,366 $1,232 $2,714 $2,446
======== ======== ======== =========
Earnings Per Share $4.87 $4.39 $9.67 $8.72
======== ======== ======== =========
Dividends Declared Per Share $0.85 $0.75 $0.85 $0.75
======== ======== ======== =========
See accompanying notes.
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
THREE MONTHS & SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
Three Months Six Months
Ended June 30 Ended June 30
================== ==================
1998 1997 1998 1997
-------- -------- -------- --------
(in thousands, except per share data)
Net Income $1,366 $1,232 $2,714 $2,446
-------- -------- -------- --------
Other Comprehensive Income:
Unrealized Gains (Losses) on Securities:
Unrealized Gains (Losses) Arising during Period (32) 513 296 73
Less: Reclassification Adjustment for Gains
Arising during Period 0 0 0 0
-------- -------- -------- --------
Total Gains (Losses) Arising during Period (32) 513 296 73
Tax (Expense) Benefit (11) 174 100 24
-------- -------- -------- --------
Other Comprehensive Income (21) 339 196 49
-------- -------- -------- --------
Comprehensive Income $1,345 $1,571 $2,910 $2,495
======== ======== ======== ========
See accompanying notes
</TABLE>
<TABLE>
<S> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
====================
1998 1997
--------- ---------
Cash Flows from Operating Activities: (in thousands, except per share data)
------------------------------------
Net Income $2,714 $2,446
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation and Amortization 285 190
(Gain) Loss on Sale of ORE (17) 0
(Increase) Decrease in Accrued Interest Receivable (158) (311)
Acquisition of Goodwill 0 (1,872)
(Increase) Decrease in Other Assets (257) (106)
Increase (Decrease) in Accrued Interest Payable 56 135
Increase (Decrease) in Other Liabilities 369 810
--------- ---------
Total Adjustments 278 (1,154)
--------- ---------
Net Cash Provided (Used) by Operating Activities 2,992 1,292
Cash Flows from Investing Activities:
------------------------------------
Proceeds from Sales and Maturities of Investment Securities:
Available for sale 53,578 28,348
Held to maturity 872 387
Purchase of Investment Securities:
Available for sale (46,902) (26,965)
Held to maturity (2,162) (266)
Proceeds from Sales of ORE 151 0
Purchase of First Federal Savings Bank-property 0 (175)
Purchase of Equipment (86) (114)
Net (Increase) Decrease in Loans (6,824) (19,841)
--------- ---------
Net Cash (Used) by Investing Activities (1,373) (18,626)
Cash Flows from Financing Activities:
------------------------------------
Dividends Paid (238) (211)
Net Increase (Decrease) in Noninterest Bearing Demand
Deposits 4,229 3,060
Net Increase (Decrease) in Interest-Bearing Deposits 6,791 29,931
Net Increase (Decrease) in Securities Sold Under
Repurchase Agreements (633) 1,775
Purchase of Treasury Stock (2) (3)
Sale of Treasury Stock 16 0
--------- ---------
Net Cash Provided by Financing Activities 10,163 34,552
--------- ---------
Net Increase (Decrease) in Cash and Cash Equivalents 11,782 17,218
Cash and Cash Equivalents at Beginning of Period 21,696 23,407
--------- ---------
Cash and Cash Equivalents at End of Period $33,478 $40,625
========= =========
Cash Payments: Interest $4,661 $3,900
========= =========
Income Taxes $1,375 $1,068
========= =========
See accompanying notes.
</TABLE>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
(Unaudited)
June 30, 1998
1. Basis of Presentation
The unaudited interim consolidated financial statements of Minden
Bancshares, Inc. and subsidiary are prepared in accordance with generally
accepted accounting principles for interim financial information.
On May 21, 1997, Minden Bank & Trust Company ("Minden Bank"), wholly owned
subsidiary of Minden Bancshares, Inc. ("the Company"),acquired all of the
outstanding shares of First Federal Savings Bank ("First Federal")in Shreveport,
Louisiana, and merged it into itself. First Federal's stockholders' equity was
$3,539,000 on the date of acquisition and Minden Bank paid $5,411,000 resulting
in $1,872,000 of goodwill being recorded. The acquisition was recorded under the
"Purchase Method" and the entries recording the purchase are summarized as
follows:
ASSETS ACQUIRED ($Thousands)
Cash and due from banks $ 2,931
Investment securities-AFS 17,622
Net loans 14,487
Facilities and equipment 232
Other assets 17
Goodwill 1,872
--------
Total Assets 37,161
--------
LIABILITIES ACQUIRED
Non-interest bearing deposits 148
Interest bearing deposits 31,505
--------
Total Deposits 31,653
Other liabilities 97
--------
Total Liabilities 31,750
--------
Net Cash Payment $ 5,411
========
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) necessary for a fair presentation of the financial
position and the results of operations for the interim periods presented have
been included.
2. Statement of Cash Flows
For purposes of the Consolidated Statements of Cash Flows, the Company has
defined cash equivalents as those amounts included in the balance sheets
captions Cash and due from banks and Federal funds sold. Cash flows from loans
and deposits of the Company's bank subsidiary are reported on a net basis.
3. Investment Securities
The specific identification method is used to determine realized gains and
losses on sales of investment securities which is included in other operating
income.
Debt securities available for sale are carried at fair market value by
means of valuation account in accordance with SFAS 115. At June 30, 1998, the
fair market value of securities available for sale was $704,000 more than
amortized cost and at December 31, 1997, the fair market value was $408,000
more than amortized cost.
Debt securities held to maturity are carried at cost, adjusted for the
amortization of premiums and accretion of discount. The amortized cost and
estimated market value of securities held to maturity at June 30, 1998 and
December 31, 1997, are as follows:
Securities Held to Maturity
---------------------------
Gross Gross Estimated
Book Unrealized Unrealized Market
Value Gains Losses Value
----- ---------- ---------- --------
June 30, 1998 17,792 495 65 18,222
December 31, 1997 16,502 441 2 16,941
4. Accumulated Other Comprehensive Income
Three Months Ended Three Months Ended
June 30, 1998 June 30, 1997
----------------------- -----------------------
Accumulated Accumulated
Unrealized Other Unrealized Other
Gains (Losses) Comprehensive Gains (Losses) Comprehensive
on Securities Income on Securities Income
-------- --------- -------- -------
Beginning Balance $486 $486 ($216) ($216)
Current-period Change (21) (21) 339 339
-------- --------- -------- --------
Ending Balance $465 $465 $123 $123
======== ========= ======== ========
Six Months Ended Six Months Ended
June 30, 1998 June 30, 1997
----------------------- -----------------------
Accumulated Accumulated
Unrealized Other Unrealized Other
Gains (Losses) Comprehensive Gains (Losses) Comprehensive
on Securities Income on Securities Income
-------- --------- -------- -------
Beginning Balance $269 $269 $74 $74
Current-period Change 196 196 49 49
-------- --------- -------- --------
Ending Balance $465 $465 $123 $123
======== ========= ======== ========
5. Earnings per Common Share
The earnings per common share are computed by dividing the net income for
the interim periods by the weighted average number of common shares outstanding.
The weighted average number of shares outstanding in the second quarter, 1998,
and 1997, were 280,578 and 280,530 respectively, and for the first six months of
1998 and 1997, were 280,556 and 280,540 respectively.
PART I - Financial Information Continued
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
<TABLE>
<S> <C> <C> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS
CONSOLIDATED INCOME SUMMARY
AND SELECTED FINANCIAL DATA
(in thousands, except per share and ratio data)
Three Months Ended Six Months Ended
---------------------- ---------------------
June 30 June 30 June 30 June 30
1998 1997 1998 1997
--------- --------- --------- ----------
Interest income $5,402 $4,894 $10,665 $9,370
Interest expense 2,383 2,126 4,708 4,035
--------- --------- --------- ---------
Net interest income 3,019 2,768 5,957 5,335
Provision for possible loan losses 0 0 0 0
--------- ----------- --------- ----------
Net interest income after provision 3,019 2,768 5,957 5,335
Noninterest income 657 565 1,259 1,118
Noninterest expense 1,685 1,539 3,258 2,895
--------- ----------- --------- ----------
Income before taxes 1,991 1,794 3,958 3,558
Income tax expense 625 562 1,244 1,112
--------- ----------- --------- ----------
Net income $1,366 $1,232 $2,714 $2,446
========= =========== ========= ==========
Earnings per share <F1> $4.87 $4.39 $9.67 $8.72
Dividends declared per share $0.85 $0.75 $0.85 $0.75
Average shares outstanding 280.6 280.5 280.6 280.5
Book value per share $122.48 $106.29 $122.48 $106.29
Selected Quarter End Balances:
Loans $l43,436 $135,434
Deposits 259,203 248,987
Debt 10,176 7,193
Equity 34,372 29,816
Total Assets 305,576 288,023
Selected Average Balances:
Loans 142,300 126,669 140,165 121,745
Deposits 256,841 232,301 252,953 224,394
Debt 10,279 6,961 10,483 6,619
Equity 33,431 29,276 32,766 28,701
Total Assets 302,362 270,372 297,835 261,258
Selected Ratios (%)
Return on average assets 1.81% 1.83% 1.84% 1.89%
Return on average equity 16.39% 16.88% 16.70% 17.19%
Net interest margin (taxable equivalent) 4.39% 4.47% 4.42% 4.50%
Tier 1 risk-based capital 19.84% 19.39%
Total risk based capital 21.11% 20.71%
Tier 1 Leverage 10.18% 9.75%
<F1> Earnings per share is based on the weighted average number
of shares in the respective period
</TABLE>
OVERVIEW
The Company's second quarter 1998 net income totaled $1,366 thousand,
($4.87 per share) up 11 percent from $1,232 thousand ($4.39 per share) in the
second quarter, 1997. For the first six months of 1998, net income was $2,714
thousand ($9.67 per share) up 11% from $2,446 thousand ($8.72 per share) in
the first half of 1997.
The return on average assets was 1.81 percent for the second quarter,
1998, a decrease of 1 percent from the second quarter, 1997 of 1.83 percent.
The return on average assets was 1.84 percent for the first six months of 1998,
a 3 percent decrease from 1.89 percent for the same period last year.
The return on average equity was 16.39 percent for the second quarter,
1998, a decrease of 3 percent from the second quarter, 1997 of 16.88 percent.
The return on average equity was 16.70 percent for the first six months of 1998,
a decrease of 3 percent from 17.19% in the prior year.
The 1998 second quarter earnings benefited from a 9 percent increase in
net interest income and a 16 percent increase in noninterest income while
being detrimented by a 9 percent increase in noninterest expense when
compared to the 1997 second quarter. The first six months of 1998 earnings
benefited from a 12 percent increase in net interest income over the prior
year period, a 13 percent increase in noninterest income while being detri-
mented by 13 percent increase in noninterest expense.
Total assets at June 30, 1998 increased to 305,576 thousand, up 6 percent
from a year ago and up 5 percent from December 31, 1997.
The consolidated income and expenses of the Company for 1998 were affected
by the acquisition of First Federal Savings Bank and its merger into Minden
Bank on May 21, 1997. The 1998 numbers include operations of our Youree Drive
Branch (formerly First Federal Savings Bank) for both entire periods, whereas
1997 numbers include operations beginning on May 22.
RESULTS OF OPERATIONS
<TABLE>
<S> <C> <C> <C> <C>
NET INTEREST INCOME
Second Quarter Six Months
-------------------- --------------------
1998 1997 1998 1997
(in thousands) ========= ========= ========= =========
Total Interest Income $5,402 $4,894 $10,665 $9,370
Total Interest Expense 2,383 2,126 4,708 4,035
--------- --------- --------- ---------
Net Interest Income 3,019 2,768 5,957 5,335
Taxable-Equivalent Adjustment
to Interest Income 85 73 166 145
--------- --------- --------- ---------
Net Interest Income-
Taxable Equivalent Basis <F2> $3,104 $2,841 $6,123 $5,480
========= ========= ========= =========
AVERAGE BALANCES (in thousands):
Interest-Earning Assets <F3> $283,584 $255,167 $279,317 $245,349
========= ========= ========= =========
Interest-Bearing Liabilities $222,449 $199,702 $220,329 $192,448
Interest-Free Funds 61,135 55,465 58,988 52,901
--------- --------- --------- ---------
Total Investible Funds $283,584 $255,167 $279,317 $245,349
========= ========= ========= =========
AVERAGE INTEREST RATES (fully taxable): <F2>
Yield On:
Interest-Earning Assets <F3> 7.76% 7.81% 7.82% 7.82%
Interest-Bearing Liabilities 4.30% 4.27% 4.31% 4.23%
--------- --------- --------- ---------
Spread on Interest-Bearing Funds 3.46% 3.54% 3.51% 3.59%
Contribution of Interest-Free Funds 0.93% 0.93% 0.91% 0.91%
--------- --------- --------- ---------
Net Yield on Interest-Earning Assets 4.39% 4.47% 4.42% 4.50%
========= ========= ========= =========
<F2> Reflects an adjustment to the net interest income amount included in the
Statement of Income to permit comparisons of yields on tax-exempt and
taxable assets.
<F3> Based upon amortized cost of all investment securities. Adjustments to
fair market value for available for sale investment securities amounted to
averages of a positive $588 thousand for the second quarter, 1998, and
$591 thousand positive for the first six months, 1998, as compared to a
negative $295 thousand for the second quarter, 1997, and a negative $126
thousand for the first six months of 1996.
</TABLE>
Net Interest Income
The Company's net interest income for the 1998 second quarter was $3,019
thousand, an increase of 9 percent over $2,768 thousand in the 1997 second
quarter, and an increase of 3 percent over $2,939 thousand in the first quarter,
1998. Net interest income for the first half of 1998 was $5,957, an increase of
12 percent over the first half, 1997 of $5,335 thousand. The acquisition of
First Federal on May 21, 1997 and increases in loan and deposit volume have
contributed to the increase in net interest income for both periods of 1998
over 1997.
Average Interest-Earning Assets
Average interest-earning assets were $283,584 thousand for the 1998
second quarter, $28,417 thousand higher than the 1997 second quarter, an
increase of 11 percent. For the first half of 1998, interest-earning assets
averaged $279,317 thousand, an increase of 14 percent over the prior year of
$245,349 thousand. Average loans increased by $15,631 thousand, during the
second quarter, 1998, over the prior year, and by $18,420 thousand in the first
half, 1998 over the first half, 1997. Average investment securities increased
by $7,904 thousand during the second quarter, 1998 over the prior year and by
$11,642 during the first six months, 1998 over 1997. During the second quarter,
1998, average Federal funds sold increased by $4,109 thousand from the prior
year and increased by $1,851 thousand in the first half, 1998 over the prior
year period. Average interest bearing balances due from banks increased by
$454 thousand in the second quarter, 1998 over the same period last year and
increased by $1,797 thousand in the first half, 1998 over the prior year period.
Average Interest-Bearing Liabilities
Average interest-bearing liabilities for the 1998 second quarter were
$222,449 thousand, compared to $199,702 thousand for the same period last year,
an 11 percent increase, and were $220,329 for the first half of 1998 as compared
to $192,448 for the prior year, a 14 percent increase. Average time deposits
for the 1998 second quarter were $125,130, an increase of $11,035 thousand over
the same period last year, an increase of 10 percent, and average time deposits
for the first half, 1998 were $125,098 thousand as compared to $107,211
thousand in the prior year, an increase of 17 percent. Average savings and
interest-bearing demand deposits for the 1998 second quarter were $87,040
thousand, an increase of $8,484 thousand or 11 percent over the same period
last year, and were $84,748 thousand in the first half, 1998 as compared to
$78,618 in the prior year, an increase of 8 percent.
Net Yield on Interest-Earning Assets
The taxable equivalent net yield on interest-earning assets was 4.39
percent in the second quarter of 1998, a decrease of 8 basis points from 4.47
percent in the same period last year and was 4.42 percent in the first half,
1998 as compared to the prior year of 4.50 percent. The major contributing
factors for the decreases has been the increased competitive banking market for
loans and deposits causing decreased rates on loans while holding deposit rates
steady.
Management expects that the net yield on earning assets will remain
constant or decrease slightly during the balance of 1998.
PROVISION FOR LOAN LOSSES
The Company has made no provision for loan losses in 1998 or 1997.
Management does not anticipate any provision for loan losses during 1998.
A discussion of the Company's loan portfolio, net charge-off and recoveries,
and allowances for loan losses appears on pages 15-18.
<TABLE>
<S> <C> <C> <C> <C>
OTHER INCOME
First
Second Quarter Six Months
------------------- -------------------
1998 1997 1998 1997
(in thousands) ========= ========= ========= =========
Service Charges $416 $398 $798 $789
Trust Fees 0 5 0 7
Other Operating Income 241 162 461 322
--------- --------- --------- ---------
Total Other Income $657 $565 $1,259 $1,118
========= ========= ========= =========
</TABLE>
Other income for the 1998 second quarter was $657 thousand, up $92 thousand
from the same period last year. For the first six months of 1998, other income
was $1,259 thousand, an increase of $141 thousand over the same period last
year.
The increases in other income for both periods of 1998 over 1997 have
resulted primarily from home mortgage loan fees generated from the origination
and sale of home mortgage loans occurring through our Youree Drive Branch
acquired May 21, 1997 and volume increases. The home mortgage loan fees
generated in the first quarters, 1998 and 1997 were $79 thousand and $18
thousand respectively, and $116 thousand and $18 thousand respectively for the
first six months, 1998 and 1997.
<TABLE>
<S> <C> <C> <C> <C>
OPERATING EXPENSES
First
Second Quarter Six Months
------------------- -------------------
1998 1997 1998 1997
(in thousands) ========= ========= ========= =========
Salaries and Employee Benefits $822 $756 $1,641 $1,468
Occupancy Expense 118 103 223 196
Furniture and Equipment Expense 72 72 146 136
Amortization 78 40 155 90
Capital Stock Taxes 106 86 212 173
Stationery, Supplies & Printing 49 58 110 97
Other Operating Expenses 440 424 771 735
--------- --------- --------- ---------
Total Operating Expenses $1,685 $1,539 $3,258 $2,895
========= ========= ========= =========
</TABLE>
Operating expenses for the 1998 second quarter were $1,685 thousand, up
from $1,539 thousand in the 1997 second quarter, an increase of $146 thousand.
Operating expenses for the first six months of 1998 were $3,258 thousand, an
increase of $363 thousand from $2,895 thousand in the comparable period last
year. The increases in operating expenses in the second quarter and for the
first six months, 1998 as compared to the same periods in the prior year were
due to the acquisition of First Federal on May 21, 1997, whereby 1998 reflects
operations for the entire periods while 1997 reflects its operation for only a
portion of the time along with some volume increases.
Salaries and employee benefits in the 1998 second quarter were $822
thousand, compared to $756 thousand in the same period last year. Salaries
and employee benefits in the 1998 first six months were $1,641 thousand as
compared to $1,468 thousand in the same period last year. The increases for
both periods in 1998 over 1997 were attributable to full period operations of
the Youree Drive Branch in 1998 along with Salary increases.
Combined occupancy expense and furniture and equipment expense for the
1998 second quarter were $190 thousand as compared to $175 thousand for the
same period last year. Occupancy expense and furniture and equipment expense
for the 1998 first six months were $369 thousand as compared to $332 thousand
for the same period last year. The major portion of increases in both 1998
periods has been the Youree Drive acquisition in 1997 discussed above.
Of the other operating expense categories shown, the increases in amorti-
zation were attributable primarily to amortization of goodwill from the First
Federal acquisition in 1997. Goodwill amortization was $31 thousand for the
1998 second quarter as compared to $10 thousand for the same period last year,
and the 1998 first six months were $62 thousand as compared to $10 thousand for
the same period last year. The increases in capital stock taxes are due to
increase in stockholders'equity and increased earnings in 1998 over 1997.
INCOME TAXES
In the 1998 second quarter, the Company recorded income tax expense of
$625 thousand, compared to $562 thousand for the same period last year. In
the 1998 first six months, income tax expense was $1,244 thousand as compared
to $1,112 thousand in the same period last year.
The effective tax rate was 31.4% for the 1998 second quarter as compared
to 31.3% for the same period last year. The effective tax rate was 31.4% for
the first six months of 1998, as compared to 31.3% for the same period last
year. The slightly higher effective tax rate in both periods of 1998, as
compared to the same period last year reflects difference in the composition of
the Company's pre-tax income in both years.
RECENT ACCOUNTING PRONOUNCEMENTS
In June of 1997, the Financial Accounting Standards Board (FASB) issued
SFAS 130,Reporting Comprehensive Income, effective for fiscal years beginning
after December 15, 1997. SFAS 130 discusses how to report and display compre-
hensive income and its components. Comprehensive income is defined as "the
change in equity [net assets] of a business enterprise during a period from
transactions and other events and circumstances from non owner sources. It
includes all changes in equity during a period except those resulting from
investments by owners and distributions to owners." This statement divides
comprehensive income into net income and other comprehensive income. The only
item that management anticipates that will be included in other comprehensive
income will be the net unrealized gain or loss on investment securities class-
ified as "available for sale," therefore there should be no material impact by
this SFAS on operations or financial statements.
In June of 1997, the Financial Accounting Standards Board (FASB) issued
SFAS 131, Disclosures about Segments of an Enterprise and Related Information,
effective for fiscal years beginning after December 15, 1997. SFAS 131 requires
that public business enterprises report certain information about operating
segments in complete sets of financial statements of the enterprise and in
condensed financial statements of interim periods issued to shareholders. It
also requires that public business enterprises report certain information about
their products and services, the geographic areas in which they operate, and
their major customers. At the current time, the Company does not meet the
additional reporting requirements of this SFAS.
OTHER ACCOUNTING ISSUES
-----------------------
Year 2000
- ---------
The problem now known as the "Year 2000" is the inability of older computer
systems, software and other equipment which have only maintained a two digit
year in date information to chronologically align dates with the occurrence of
the year 2000.
The Board of Directors has adopted a "Year 2000 Policy" to insure that all
information systems and other areas which may be affected by the "Year 2000"
millennium change are properly and expeditiously addressed to insure the contin-
uation of normal business operations of the Bank into the next millennium. In
the "Year 2000 Policy," provision is made for a "Year 2000 Plan" whereby an EDP
Steering Committee headed by the Vice President and Data Center Manager will
identify the areas which may be affected by the "Year 2000," and will address
all issues and will make any necessary recommendations to the Board of Directors
for approval.
The EDP Steering Committee has researched the need to upgrade the Bank's
"Mainframe" computer and software and has made recommendations to the Board of
Directors, which has approved the acquisition. The scheduling for installation
of the new computer system and software is in process and installation should be
completed in the fourth quarter, 1998. All personal computers in service by
the Bank have been tested, and necessary upgrades have been ordered and
installed. There are some computer networks with which the Bank communicates
that have advised that their upgrades to meet the "Year 2000" requirements will
not be in place until the first quarter, 1999.
Under the Bank's "Year 2000 Policy," all computer systems and electronic
date sensitive devices are to be tested, with necessary upgrades made, and cer-
tified as to their "Year 2000" readiness by the end of the first quarter, 1999.
CREDIT PORTFOLIO
Loan Portfolio
The Company's loans outstanding, totaled $143,436 thousand at June 30, 1998
as compared to $136,889 thousand at December 31, 1997 and $135,434 thousand
at June 30, 1997. The increase in loans has been was due to increased loan
demand.
The following table sets forth the loan classifications at June 301, 1998,
December 31, 1997 and June 30, 1997:
--------------------------------
June 30, Dec. 31, June 30,
(in thousands) 1998 1997 1997
--------- --------- ---------
Commercial, Financial & Agricultural Loans $39,563 $33,673 $30,822
Construction Loans Secured by Real Estate 4,511 3,778 4,855
Other Loans Secured by Real Estate 73,690 75,237 76,676
Installment and Single Payment Loans 23,681 22,186 20,889
Other Loans 2,267 2,178 2,354
--------- --------- ---------
Total Loans 143,712 137,052 135,596
Less Unearned Discount 276 163 162
--------- --------- ---------
Total Loans net of Unearned Discount $143,436 $136,889 $135,434
========= ========= =========
Non-performing Assets
The following table sets forth the non-performing assets at June 30, 1998,
December 31, 1997 and June 30, 1997:
----------------------------
June 30, Dec. 31, June 30,
1998 1997 1997
(in thousands) --------- -------- ---------
Non-Accrual (Impaired-Cash Basis) Loans $269 $562 $362
Past-Due Loans 1,459 587 1,028
Restructured Loans 0 0 0
------- ------- -------
Total Non-performing Loans 1,728 1,149 1,390
Other Real Estate Owned 328 278 260
------- ------- -------
Total Non-performing Assets $2,056 $1,427 $1,650
======= ======= =======
In addition to the non-performing loans discussed above, management has
identified other loans for which payments are current that are subject to poten-
tial future classification as nonperforming. As of June 30, 1998 these loans
totaled $33 thousand as compared to $368 thousand a year ago.
Nonaccrual (impaired-cash basis) loans are those loans on which it appears
that the collection of all principal and interest under the loan terms is un-
likely under either the projection of cash flows or values of underlying col-
lateral. Once a determination has been made as to the projected amount which
may be collected, the anticipated under collection is first applied to accrued
interest by reversal against current year earnings with any further under col-
lection anticipated being reflected by a partial charge off of principal
against the reserve for possible loans losses, leaving the anticipated col-
lectible portion as the loan balance which does not accrue interest until
such time as it appears probable that the loan will be fully collectible as
to principal and interest, at which time, it will be reinstated with the
principal increase being recognized as recovery by crediting to reserve for
possible loan losses and the accrued interest being recognized as interest
income. Collections on impaired loans upon which full collection of principal
and accrued interest is unlikely, are first applied to the remaining principal,
with any excess then being applied to the partially charged off principal by
credit to the reserve for possible loan losses, with any additional collection
then being recognized as interest income. Nonaccrual (impaired-cash basis)
loans amounted to 0.19% of total loans at June 30, 1998 and 0.27% of total
loans at June 30, 1997. Interest income on nonaccrual loans which would
have been reported on an accrual basis amounted to approximately $8,000 for the
quarter ended June 30, 1998 as compared to $9,000 for the quarter ended
June 30, 1997 and $18,000 for the six months ended June 30, 1998 as compared to
to $25,000 for the six months ended June 30, 1997. Interest income included
cash basis interest of $4,000 in the second quarter, 1998 as compared to
$33,000 in the second quarter, 1997 and $13,000 in the first six months, 1998 as
compared to $52,000 in the first six months, 1997. Cash basis interest provided
increases of 1 basis point in the yield on average loans in the second quarter,
1998 as compared to 10 basis points in the second quarter, 1997 and increases of
2 basis points in the first six months, 1998 as compared to 9 basis points in
the first six months, 1997. Interest income for both periods, 1998 and 1997
did not include any interest on restructured loans.
Management groups small homogenous loans - residential mortgage, consumer
installment and small business loans of $20 thousand or less - collectively for
evaluation due to the inability to obtain customer cash flow information to pro-
ject future collections. Due to the inability to project future cash flows, all
of the nonaccrual (impaired) loans discussed are evaluated based upon net
realizable value of underlying collateral. Loans which become past due 90 days
or more, unless due to seasonal fluctuations, are reviewed for impairment.
Other real estate owned normally represents properties acquired as loan
satisfactions which are recorded at the lower of the investment in the loan with
respect to which the assets were acquired, or the fair value of each property,
with the initial write-downs charged to the reserve for loan losses. Subsequent
write-downs of such properties are reflected as such on the income statement and
gains and losses on disposal are accordingly reflected on the income statement.
Other real estate currently includes former branch located at 324 Homer Road
which was closed January 4, 1995. The former branch was capitalized at its
depreciated value and has subsequently been written down by $91 thousand.
Allowance for Loan Losses
The allowance for loan losses is available to absorb potential credit
losses from the entire loan portfolio. The appropriate level of the allowance
is based on analyses of the loan portfolio and reflects an amount which, in
management's judgment, is adequate to provide for potential losses. The
analyses include consideration of such factors as the risk rating of
individual credits, the size and diversity of the portfolio, particularly in
terms of industry, economic and political conditions, prior loss experience
and results of periodic credit reviews of the portfolio. Based upon the
results of these analyses, the allowance for losses is increased, from time to
time, by charges to income to the extent management considers appropriate.
The accompanying table reflects the activity in the allowance for loan
losses for the three month and six month periods ended June 30, 1998, and 1997.
<TABLE>
<S> <C> <C> <C> <C>
Second Quarter First Six Months
------------------- ------------------
1998 1997 1998 1997
(in thousands) ========= ========= ========= ========
Balance at Beginning of Period $3,576 $3,306 $3,603 $3,306
Charge-Offs
Commercial, Financial and Agricultural 20 42 20 42
Real Estate - Construction 23 2 23 2
Real Estate - Mortgage 7 0 17 32
Installment Loans to Individuals 90 20 137 55
--------- --------- ------------------
Total 140 64 197 131
--------- --------- ------------------
Recoveries
Commercial Financial and Agricultural 0 0 0 0
Real Estate - Construction 0 0 0 0
Real Estate - Mortgage 61 82 71 138
Installment Loans to Individuals 14 19 34 30
--------- --------- ------------------
Total 75 101 105 168
--------- --------- ------------------
Net Recoveries (Charge-Offs) (65) 37 (92) 37
Acquired in First Federal acquisition 0 253 0 253
Additions Charged to Operations 0 0 0 0
--------- --------- ------------------
Balance at End of Period $3,511 $3,596 $3,511 $3,596
========= ========= ==================
The following table reflects the allowance coverage ratios at June 30,
1998, December 31, 1997 and June 30, 1997.
June 30, Dec 31, June 30,
For the Quarter Ended: 1998 1997 1997
--------- --------- -----------
Allowance for Loan Losses to:
Loans at Period-End 2.45% 2.63% 2.65%
Average Loans 2.47% 2.64% 2.84%
Non-performing Loans 203.18% 313.58% 258.71%
Non-performing Assets 170.77% 252.49% 217.94%
Total Net Charge-Offs (annualized) to:
Loans at Period-End 0.18% (0.03%) (0.11%)
Average Loans 0.18% (0.03%) (0.11%)
Allowance for Loan Losses 7.43% (1.16%) (4.13%)
</TABLE>
Management deems its allowance for loan losses at June 30, 1998, to be
adequate. The Company considers that it has sufficient reserves to absorb
losses that may currently exist in the portfolio. The Company will continue to
reassess the adequacy of its allowance for loan losses and make provisions
accordingly.
CAPITAL
Total stockholders' equity at June 30, 1998, was $34,372 thousand, up
from $31,686 thousand at December 31, 1997 and $29,816 thousand at June 30,
1997. Stockholders' equity at June 30, 1998, reflects positive impact of $465
thousand of accumulated other comprehensive income.
Risk-Based Capital Ratios
In January, 1989, the Federal Reserve Board ("FRB") issued risk-based
capital guidelines which require banking organizations to maintain certain
ratios of "Qualifying Capital" to "risk-weighted assets." "Qualifying Capital"
is classified into Tier 1 and Tier 2 Capital. Tier 1 Capital applicable to
the Company consists only of common equity. Tier 2 Capital applicable to the
Company consists only of qualifying allowance for loan losses. The amount of
Tier 2 Capital may not exceed Tier 1 Capital. In calculating "risk-weighted
assets," certain risk percentages, as specified by the FRB, are applied to
particular categories of both on- and off-balance sheet assets. Effective
December 31, 1992, the guidelines require that banking organizations maintain
a minimum ratio of Tier 1 Capital to risk-weighted assets of 4% and a minimum
ratio of Tier 1 and Tier 2 Capital ("Total Capital") to risk-weighted assets
of 8% (the "final risk-based guidelines"). At June 30, 1998, the Company's
Tier 1 Capital to risk-weighted assets ratio was 20.19% and the Total Capital
to risk-weighted assets ratio was 21.48%.
Leverage Ratios
The Tier 1 leverage ratio is defined as Tier 1 Capital (as defined under
the risk-based capital guidelines) divided by average total assets (net of
allowance for loan losses). The minimum leverage ratio is 3% for banking
organizations that do not anticipate significant growth and that have well-
diversified risk, excellent asset quality, high liquidity and good earnings.
Other banking organizations are expected to have ratios of at least 4% to 5%,
depending upon their particular condition and growth plans. Higher capital
ratios could be required if warranted by the particular circumstances, or risk
profile, of a given banking organization. The FRB has not advised the Company
of any specific minimum Tier 1 leverage ratio applicable to it.
The table which follows sets forth the Company's Tier 1 and Tier 2
Capital, risk-weighted assets, including off balance sheet items, and the
Company's risk-based capital ratios under the final guidelines as well as
Tier 1 leverage ratios.
Capital and Ratios
June 30, Dec 31, June 30,
1998 1997 1997
(in thousands), except ratios --------- --------- ---------
Tier 1 Capital
Common Stockholders' Equity $30,493 $27,868 $26,010
Tier 2 Capital
Reserve for Possible Loan Losses 1,937 1,773 1,775
--------- --------- ---------
Total Qualifying Capital $32,430 $29,641 $27,785
========= ========= =========
Risk Weighted Assets $151,011 $140,025 $134,130
========= ========= =========
Tier 1 Capital Ratio 20.19% 19.90% 19.39%
Total Capital Ratio 21.48% 21.17% 20.71%
Tier 1 Leverage Ratio 10.20% 9.59% 9.75%
Common Stock Dividends
For the second quarters of 1998 and 1997, the Board of Directors of the
Company declared dividends of $.85 and $.75 per share respectively. Future
dividend policies will be determined by the Board of Directors in light of
earnings and financial condition of the Company and its subsidiary and other
factors, including applicable governmental regulations and policies.
LIQUIDITY MANAGEMENT
The objective of liquidity management is to ensure the availability of
sufficient cash flows to meet all financial commitments and to capitalize on
investment opportunities. Liquidity management addresses the Company's
ability to meet deposit withdrawals on demand or at contractual maturity, to
service indebtedness and to make new loans and investments as opportunities
arise. The Company monitors and reviews its asset and liability mix on a
routine basis.
The primary sources of liquidity include cash and due from banks, Federal
funds sold and investment securities. Additionally, the bank subsidiary has
the ability to borrow and purchase federal funds on a short term basis from
other financial institutions as a source of liquidity should the need arise.
The loan to deposit ratio averaged 55.40% during the 1998 second quarter
and 54.53% during the 1997 second quarter. Cash on hand and due from banks
averaged $17,499 thousand in the 1998 second quarter and $15,091 thousand in
the 1997 second quarter. Federal Funds sold averaged $21,461 thousand in the
1998 second quarter and $17,352 thousand in the 1997 second quarter.
At June 30, 1998, investment securities at amortized cost, totalled
$119,014 thousand, of which $48,803 thousand or 41% mature or reprice
within one year, $53,415 thousand or 45% mature or reprice within two to
five years, and $16,796 thousand or 14% mature in over five years. The
Company does not anticipate any events which would require liquidity beyond
that which is available from the above referenced sources.
SUPERVISION AND REGULATION
Dividends
Substantially all of the funds used by the Company to pay dividends to
its shareholders are derived from dividends paid to it by its subsidiary bank,
which are subject to certain legal restrictions. Under Louisiana law, state
chartered banks cannot pay dividends in excess of current year earnings plus
undistributed earnings of the prior year without the prior approval of the
Commissioner of Financial Institutions. Under Federal law, dividends by state
chartered banks in excess of current year earnings plus undistributed earnings
of the two prior years would require FRB approval.
In addition to the dividend restrictions described above, the FRB and the
Federal Deposit Insurance Corporation ("FDIC") have authority under the
Financial Institutions Supervisory Act to prohibit or to limit the payment of
dividends by banking organizations they supervise, including the Company and
its bank subsidiary if, in the banking regulators' opinions, payment of a
dividend would constitute an unsafe or unsound practice in light of the
financial condition of the banking organization.
Other
In December, 1991, the Federal Deposit Insurance Corporation Improvement
Act of 1991 ("FDICIA") was enacted. This act provided for recapitalization of
the Bank Insurance Fund ("BIF") and the Savings Association Insurance Fund
("SAIF") of which the Bank is a member of both and substantially revised statu-
tory provisions, including capital standards. FDICIA provided insurance rate
structure which provides lower rates for stronger capitalized banks and banks
with higher supervisory ratings. The BIF became fully funded in 1995 and the
SAIF became fully funded in 1996 thereby reducing BIF and SAIF FDIC premiums.
Minden Bank is subject to FDIC insurance assessments. Effective May 1,
1995, the FDIC revised the BIF assessment rates from 0.23% to 0.04% for the
highest rated banks while retaining 0.31% for the weakest banks when the BIF
became fully funded. The BIF rate schedule was reduced to 0.0% for healthiest
banks to 0.27% for the weakest banks effective January 1, 1996. SAIF assess-
ment rates were 0.23% for the healthiest banks to 0.31% for the weakest banks
until October 1, 1996, whereby provisions of the Deposit Insurance Funds Act of
1996 ("Funds") reduced the rates to 0.0% for the healthiest banks to 0.27% for
the weakest Oakar SAIF banks. Also, effective October 1, 1996, under the Funds
Act, a one time assessment was made on all SAIF insured institutions and all
BIF insured banks with Oakar deposits to fully fund the SAIF. The Funds Act
also provided for separate assessments under BIF and SAIF effective January 1,
1997 for FICO bond servicing. The FICO assessments under BIF are at the annual
rate of 0.1296% for 1998 and 0.648% under SAIF for 1998. Minden Bank has
$35,834,110 of deposits in 1998 insured under SAIF as the result of the acqui-
sition in 1994 of the Minden branch of the failed Oak Tree Federal Savings Bank,
and the 1997 acquisition of First Federal Savings Bank.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
MINDEN BANCSHARES, INC. AND SUBSIDIARY
Consolidated Net Interest Income and Average Balances
Three Months Ended June 30, 1998 and 1997
(Thousands)
1998 1997
------------------------------- -------------------------------
Average Rate Average Rate
Balance Interest (Annualized) Balance Interest (Annualized)
--------- -------- ------------ --------- -------- ------------
ASSETS
Interest Bearing Balances Due from Banks $6,046 $79 5.24% $5,592 $56 4.02%
Federal Funds Sold 21,461 286 5.35% 17,352 233 5.39%
Investment Securities <F4> 112,283 1,753 6.26% 104,379 1,604 6.16%
Federal Reserve Bank and
Federal Home Loan Bank Stocks 1,494 24 6.58% 1,175 23 7.85%
Loans 142,300 3,345 9.43% 126,669 3,051 9.66%
--------- -------- --------- --------
Total Interest-
Earning Assets <F4> 283,584 $5,487 7.76% 255,167 $4,967 7.81%
Allowance for Loan Losses (3,586) (3,471)
Cash and Due from Banks 11,453 9,499
Other Assets <F4> 10,911 9,177
--------- ---------
Total Assets $302,362 $270,372
========= =========
LIABILITIES
Savings and Interest-
Bearing Demand $87,040 $633 2.92% $78,556 $561 2.86%
Time Deposits 125,130 1,628 5.22% 114,095 1,492 5.25%
--------- -------- --------- --------
Total Interest-
Bearing Deposits 212,170 2,261 4.27% 192,651 2,053 4.27%
Securities Sold Under
Repurchase Agreements 10,279 122 4.76% 6,961 71 4.09%
Long-Term Debt 0 0 0.00% 90 2 8.91%
--------- -------- --------- --------
Total Interest-
Bearing Liabilities 222,449 $2,383 4.30% 199,702 $2,126 4.27%
Demand Deposits 44,671 39,650
Other Liabilities 1,811 1,744
--------- ---------
Total Liabilities 268,931 241,096
--------- ---------
STOCKHOLDERS' EQUITY
Common Stockholders' Equity 33,431 29,276
--------- ---------
Total Liabilities and
Stockholders' Equity <F4> $302,362 $270,372
========= =========
SPREAD ON INTEREST-BEARING FUNDS <F4> 3.46% 3.54%
NET INTEREST INCOME AND NET
YIELD ON INTEREST-EARNING ASSETS <F4> $3,104 4.39% $2,841 4.47%
======== ============ ======== ============
<F4> Based upon amortized cost of investment securities and includes
adjustment to interest income for the tax equivalent adjustment
on tax-exempt securities.
MINDEN BANCSHARES, INC. AND SUBSIDIARY
Consolidated Net Interest Income and Average Balances
Six Months Ended June 30, 1998 and 1997
(Thousands)
1998 1997
------------------------------- -------------------------------
Average Rate Average Rate
Balance Interest (Annualized) Balance Interest (Annualized)
--------- -------- ------------ --------- -------- ------------
ASSETS
Interest Bearing Balances Due from Banks $5,649 $161 5.75% $3,852 $82 4.29%
Federal Funds Sold 18,923 504 5.37% 17,072 456 5.39%
Investment Securities <F5> 113,130 3,529 6.29% 101,488 3,118 6.20%
Federal Reserve Bank and
Federal Home Loan Bank Stocks 1,450 43 6.00% 1,192 41 6.94%
Loans 140,165 6,594 9.49% 121,745 5,818 9.64%
--------- -------- --------- --------
Total Interest-
Earning Assets 279,317 $10,831 7.82% 245,349 $9,515 7.82%
Allowance for Loan Losses (3,587) (3,398)
Cash and Due from Banks 11,322 10,640
Other Assets <F5> 10,783 8,667
--------- ---------
Total Assets $297,835 $261,258
========= =========
LIABILITIES
Savings and Interest-
Bearing Demand $84,748 $1,218 2.90% $78,618 $1,118 2.87%
Time Deposits 125,098 3,250 5.24% 107,211 2,779 5.23%
--------- -------- --------- --------
Total Interest-
Bearing Deposits 209,846 4,468 4.29% 185,829 3,897 4.23%
Securities Sold Under
Repurchase Agreements 10,483 240 4.62% 6,529 134 4.14%
Long-Term Debt 0 0 0.00% 90 4 8.96%
--------- -------- --------- --------
Total Interest-
Bearing Liabilities 220,329 $4,708 4.31% 192,448 $4,035 4.23%
Demand Deposits 43,107 38,565
Other Liabilities 1,633 1,544
--------- ---------
Total Liabilities 265,069 232,557
--------- ---------
STOCKHOLDERS' EQUITY
Common Stockholders' Equity <F5> 32,766 28,701
--------- ---------
Total Liabilities and
Stockholders' Equity $297,835 $261,258
========= =========
SPREAD ON INTEREST-BEARING FUNDS 3.51% 3.59%
NET INTEREST INCOME AND NET
YIELD ON INTEREST-EARNING ASSETS $6,123 4.42% $5,480 4.50%
======== ============ ======== ============
<F5> Based upon amortized cost of investment securities and includes
adjustment to interest income for the tax equivalent adjustment
on tax-exempt securities.
</TABLE>
PART II - Other Information
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The following four items were submitted to a vote at the Annual
Meeting of Shareholders held on April 14, 1998.
(a) Election of Directors
The following fourteen (14) directors were elected to serve until
the 1999 Annual Meeting.
R. Thad Andress Harry E. McInnis, Jr.
Don L. Brice John W. Montgomery
Dr. Edward D. Brown Don D. Moore
Jack E. Byrd, Jr. Joe E. Ratcliff
Dr. Gary G. Daniel Howard G. Spillers
Hal K. Jackson R. E. Woodard, III
James D. Madden S. Douglas Madden
There were 221,463 votes cast for the election of all directors with no
more than 363 votes being cast against or abstaining on any director.
(b) The appointment of Heard, McElroy & Vestal as independent
auditors for the Company and its subsidiary for the year ending December
31, 1998, was ratified by the following vote:
FOR 221,287
AGAINST 113
ABSTAIN 63
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
11 Computation of earnings per share
(This computation is provided in Note 4 to the
Financial Statements on Page 8 and Page 9 under
Management's Discussion and Analysis)
(1) 27 Financial Data Schedule
(b) Reports on Form 8-K
None
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 hereunto duly authorized.
MINDEN BANCSHARES, INC.
August 10, 1998 BY:s/ Jack E. Byrd, Jr.
-----------------------------
Jack E. Byrd, Jr.
President and CEO
August 10, 1998 BY:s/ Robert W. Hines, Jr.
-----------------------------
Robert W. Hines, Jr.
Vice-President and
Chief Financial Officer
Financial Data Schedule
EXHIBIT 27
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM JUNE
30, 1998 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<EXCHANGE-RATE> 1
<CASH> 13,478
<INT-BEARING-DEPOSITS> 3,645
<FED-FUNDS-SOLD> 20,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 101,926
<INVESTMENTS-CARRYING> 17,792
<INVESTMENTS-MARKET> 18,222
<LOANS> 143,436
<ALLOWANCE> 3,511
<TOTAL-ASSETS> 305,576
<DEPOSITS> 259,203
<SHORT-TERM> 0
<LIABILITIES-OTHER> 10,176
<LONG-TERM> 0
0
0
<COMMON> 775
<OTHER-SE> 33,597
<TOTAL-LIABILITIES-AND-EQUITY> 305,576
<INTEREST-LOAN> 6,594
<INTEREST-INVEST> 3,406
<INTEREST-OTHER> 665
<INTEREST-TOTAL> 10,665
<INTEREST-DEPOSIT> 4,468
<INTEREST-EXPENSE> 4,708
<INTEREST-INCOME-NET> 5,957
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 3,258
<INCOME-PRETAX> 3,958
<INCOME-PRE-EXTRAORDINARY> 2,714
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,714
<EPS-PRIMARY> 9.67
<EPS-DILUTED> 9.67
<YIELD-ACTUAL> 4.42
<LOANS-NON> 269
<LOANS-PAST> 1,459
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 33
<ALLOWANCE-OPEN> 3,603
<CHARGE-OFFS> 197
<RECOVERIES> 105
<ALLOWANCE-CLOSE> 3,511
<ALLOWANCE-DOMESTIC> 3,511
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
