<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________________ to __________________
Commission File Number 0-20620
MIDWEST BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 42-1390587
- ------------------------------- ----------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
3225 Division Street, Burlington, Iowa 52601
- ---------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (319) 754-6526
--------------
Indicate by check mark whether the issuer (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 issuer
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Transitional Small Business Format: Yes [ ] No [X]
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock 1,100,798
----------------- ------------------
Class Shares Outstanding
as of May 4, 1999
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
INDEX
Page
-------
Part I. Financial Information
Item 1 Financial Statements
Consolidated balance sheets March 31, 1999 and
December 31, 1998 1
Consolidated statements of operations, for the three
months ended March 31, 1999 and 1998 2
Consolidated statements of comprehensive income, for
the three months ended March 31, 1999 and 1998 3
Consolidated statements of cash flows, for the three
months ended March 31, 1999 and 1998 4
Notes to consolidated financial statements 5
Item 2 Management's discussion and analysis of financial
condition and results of operations 6 through 10
Part II. Other Information 11
Signatures 12
Exhibit 27 Financial Data Schedule
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
(Dollars in thousands, except per share data)
March 31, December 31,
1999 1998
-------- ------------
Assets
Cash and cash equivalents $ 3,673 $ 4,088
Securities available for sale 37,185 33,843
Securities held to maturity (estimated
fair value of $23,591 and $22,116) 23,366 21,827
Loans receivable, net 94,492 96,348
Real estate acquired through foreclosure 3 192
Federal Home Loan Bank stock, at cost 2,200 2,200
Office property and equipment, net 2,420 2,444
Accrued interest receivable 1,312 1,237
Other assets 332 139
-------- --------
Total assets $164,983 $162,318
======== ========
Liabilities
Deposits $107,534 $105,982
Advances from Federal Home Loan Bank 44,000 43,000
Advances from borrowers for taxes and
insurance 263 413
Accrued interest payable 79 66
Accrued expenses and other liabilities 753 822
-------- --------
Total liabilities 152,629 150,283
-------- --------
Stockholders' equity
Serial preferred stock, $.01 par value;
authorized 500,000 shares; none issued - -
Common stock, $.01 par value; 2,000,000
shares authorized;
1,098,523 shares issued and outstanding in
1999 and 1,077,738 shares issued and
outstanding in 1998 11 11
Additional paid-in capital 1,841 1,772
Retained earnings, substantially restricted 10,165 9,832
Accumulated other comprehensive income -
unrealized appreciation on securities available
for sale 337 420
-------- --------
Total stockholders' equity 12,354 12,035
-------- --------
Total liabilities and stockholders' equity $164,983 $162,318
======== ========
See accompanying notes to consolidated financial statements.
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share data)
Three Months
Ended March 31,
--------------------
1999 1998
------ ------
Interest income:
Loans receivable $1,907 $1,848
Securities available for sale 512 629
Securities held to maturity 354 280
Deposits in other financial institutions 50 21
Other interest-earning assets 34 33
------ ------
Total interest income 2,857 2,811
------ ------
Interest expense:
Deposits 1,191 1,230
Advances from FHLB and other borrowings 592 541
------ ------
Total interest expense 1,783 1,771
------ ------
Net interest income 1,074 1,040
Provision for losses on loans 12 12
------ ------
Net interest income after provision for
losses on loans 1,062 1,028
------ ------
Non-interest income:
Fees and service charges 99 81
Gain on sale of securities available for sale 3 36
Other 4 7
------ ------
Total non-interest income 106 124
------ ------
Non-interest expense:
Compensation and benefits 335 326
Office property and equipment 98 102
Deposit insurance premiums 16 17
Data processing 50 42
Other 216 205
------ ------
Total non-interest expense 715 692
------ ------
Earnings before taxes on income 453 460
Taxes on income 118 149
------ ------
Net earnings $335 $311
====== ======
Earnings per share - basic $0.31 $0.30
====== ======
Earnings per share - diluted $0.30 $0.28
====== ======
See accompanying notes to consolidated financial statements.
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
Consolidated Statements of Comprehensive Income
(Unaudited)
(In thousands)
Three months ended
March 31,
------------------
1999 1998
------ -------
Net earnings $ 335 $ 311
Other comprehensive income:
Unrealized gains (losses) on securities available
for sale:
Unrealized holding gains (losses) arising during
the period, net of taxes on income of ($48) in
1999 and $13 in 1998 (81) 28
Less: reclassification adjustment for gains
included in net earnings, net of taxes on
income of $1 in 1999 and $12 in 1998 2 24
------ ------
Other comprehensive income, net of tax: $ (83) $ 4
------ ------
Comprehensive income $ 252 $ 315
====== ======
See accompanying notes to consolidated financial statements.
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
Three months ended
March 31,
------------------
1999 1998
------ -------
Cash flows from operating activities:
Net earnings $ 335 $ 311
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Provision for losses on loans 12 12
Gain on sale of securities available for sale (3) (36)
Depreciation 45 42
Amortization of loan fees, premiums and discounts (18) -
Increase in accrued interest receivable (75) (162)
Increase in other assets (193) (24)
Increase (decrease) in accrued interest payable 13 (4)
Increase in accrued expenses and other liabilities 89 100
------ ------
Net cash provided by operating activities 205 239
------ ------
Cash flows from investing activities:
Purchase of securities available for sale (6,955) (15,931)
Purchase of FHLB stock - (175)
Proceeds from maturities of securities available
for sale 1,000 2,000
Proceeds from maturities of securities held to maturity 457 -
Proceeds from sales of securities available for sale 2,014 2,092
Loans purchased (983) (258)
Purchase of mortgage-backed securities held to maturity (2,936) -
Repayment of principal on mortgage-backed securities 1,416 2,422
Decrease (increase) in loans receivable 2,796 (349)
Proceeds from sale of real estate owned, net 231 -
Purchase of office property and equipment (21) (56)
------ -------
Net cash used in investing activities (2,981) (10,255)
------ -------
Cash flows from financing activities:
Increase in deposits 1,552 208
Proceeds from advances from FHLB 3,000 10,500
Repayment of advances from FHLB (2,000) -
Exercise of stock options 69 17
Payment of cash dividends (110) (62)
Net decrease in advances from borrowers for taxes
and insurance (150) (138)
------ ------
Net cash provided by financing activities 2,361 10,525
------ ------
Net (decrease) increase in cash and cash equivalents (415) 509
Cash and cash equivalents at beginning of year 4,088 2,524
------ ------
Cash and cash equivalents at end of period $3,673 $3,033
====== ======
Supplemental disclosures:
Cash paid during the three months for:
Interest $1,769 $1,776
Taxes on income 3 21
Transfers from loans to real estate owned 42 356
====== ======
See accompanying notes to consolidated financial statements.
<PAGE>
MIDWEST BANCSHARES, INC. and SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 1. Significant Accounting Policies
The consolidated financial statements for the three months ended March 31,
1999, and 1998 have not been audited and do not include information or
footnotes necessary for a complete presentation of financial condition,
results of operations and cash flows in conformity with generally accepted
accounting principles. However, in the opinion of management, the
accompanying consolidated financial statements contain all adjustments,
which are of a normal recurring nature, necessary for a fair presentation.
The results of operations for the interim periods are not necessarily
indicative of the results which may be expected for an entire year. The
accounting policies followed by the Company are set forth in Note 1 to the
Company's consolidated financial statements contained in the 1998 Annual
Report to Stockholders on Form 10-KSB and are incorporated herein by
reference.
Note 2. Computation of Per Share Earnings
Basic earnings per share amounts are computed by dividing net earnings by
the weighted average number of common shares outstanding during the period.
Diluted earnings per share amounts are computed by dividing net earnings by
the weighted average number of shares and all dilutive potential shares
outstanding during the period. The following information was used in the
computation of earnings per share on both a basic and diluted basis for the
three months ended March 31, 1999 and 1998.
Three Months
---------------------------
1999 1998
--------- ---------
Basic EPS Computation:
Numerator - Net earnings $ 334,788 $ 310,758
Denominator - Weighted
average shares outstanding 1,095,802 1,026,573
--------- ---------
Basic EPS $ 0.31 $ 0.30
========= =========
Diluted EPS Computation:
Numerator - Net earnings $ 334,788 $ 310,758
--------- ---------
Denominator - Weighted
average shares outstanding 1,095,802 1,026,573
Stock options 15,434 75,444
--------- ---------
1,111,236 1,102,017
--------- ---------
Diluted EPS $ 0.30 $ 0.28
========= =========
Note 3. Merger Agreement
On February 2, 1999, the Company announced the execution of definitive
merger agreement with Mahaska Investment Company. the merger will be
accomplished through a tax-free fixed exchange of one share of Mahaska
Investment Company common stock for each share of outstanding common stock
of the Company. The transaction is expected to be completed in the third
quarter of 1999, after customary regulatory and shareholder approvals
have been received.
<PAGE>
Forward-looking Statements
When used in this Form 10-QSB, the words or phrases "will likely result",
"are expected to", "will continue", "is anticipated", "estimate", "project", or
similar expressions are intended to identify "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements are subject to certain risks and uncertainties including changes in
economic conditions in the Company's market area, changes in policies by
regulatory agencies, fluctuations in interest rates, demand for loans in the
Company's market area and competition, that could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. The Company wishes to caution readers not to place undue reliance on
any such forward- looking statements, which speak only as to the date made. The
Company wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results for
future periods to differ materially from any opinions or statements expressed
with respect to future periods in any current statements. The Company does not
undertake, and specifically disclaims any obligation, to publicly release the
result of any revisions which may be made to any forward-looking statements to
reflect events or circumstances after the date of such statements or to reflect
the occurrence of anticipated or unanticipated events.
Year 2000 Compliance
The Company has conducted a comprehensive review of its computer systems to
identify the systems that could be affected by the "Year 2000" problem. The Year
2000 problem is the result of computer programs using two digits rather than
four to define the year. Any of the Company's programs that are time sensitive
may recognize a date using "00" as the year 1900 rather than the year 2000. This
could result in a major system failure or miscalculations. The enhancements
necessary to prepare the Company's mission critical systems for the year 2000
have been substantially completed.
The Company is also aware of the risks to third parties, including vendors
(and to the extent appropriate, depositors and borrowers) and the potential
adverse impact on the Company resulting from failures by these parties to
adequately address the Year 2000 problem. The Company has been communicating
with its outside data processing service bureau, as well as other third party
service providers, to assess their progress in evaluating and implementing any
corrective measures required by them to be prepared for the year 2000. To date,
the Company has not been advised by any of its primary vendors that they do not
have plans in place to address and correct the Year 2000 problem; however, no
assurance can be given as to the adequacy of such plans or to the timeliness of
their implementation.
The Company has and will continue to incur internal staff costs as well as
consulting and other expenses related to the enhancements necessary to prepare
its systems for the year 2000. Based on the Company's current knowledge, the
expense of the year 2000 project as well as the related potential effect on the
Company's earnings is not expected to have a material effect on the Company's
financial position or results of operations. The Company estimates that it has
spent approximately $22,000 through March 31, 1999 on the awareness, assessment,
renovation, and validation phases of its year 2000 effort. The Company is
nearing completion of the validation (testing) phase with its outside data
processing service bureau with completion expected by the end of the second
quarter of 1999.
The worst-case year 2000 scenario for the Company is that major suppliers
of electricity, communication links, and data processing services may fail in
spite of their best efforts to remediate their systems and in spite of our best
effort to test their systems. The major risk as a result of these possibilities
would be the loss of customer confidence. The Company has developed a business
resumption contingency plan to address these possibilities and minimize the loss
of confidence.
<PAGE>
Results of Operations
Midwest Bancshares, Inc. (the "Company") had net earnings of $335,000, or
$0.30 per share, diluted, for the three months ended March 31, 1999, compared to
net earnings of $311,000, or $0.28 per share, for the three months ended March
31, 1998. The increase in net earnings for the three month period was primarily
a result of an increase in net interest income, an increase in fees and service
charges, and a decrease in taxes on income, partially offset by a decrease in
gain on sales of securities and by an increase in non-interest expense. More
detailed comparisons are discussed below.
Net Interest Income
Net interest income increased $34,000 for the three months ended March 31,
l999, over the comparable period in 1998. The increase in net interest income on
a tax-equivalent basis was approximately $79,000 due to the fact that the 1999
period included more interest income on tax-exempt securities than the 1998
period. (See also the discussion of "Taxes on Income" on page 8). The Company's
net interest rate spread was 2.56% for both the three months ended March 31,
1999 and 1998. The Company's net interest margin on interest-earning assets was
2.85% for the three months ended March 31, 1999, compared to 2.80% for the
comparable period in 1998. The net interest rate spread and net interest margin
ratios have been calculated on a tax-equivalent basis.
Interest income increased by $46,000 for the three months ended March 31,
1999, over the comparable period in 1998, or $91,000 on a tax-equivalent basis.
Average interest-earning assets increased by approximately $8.5 million for the
three months ended March 31, 1999, compared to the same period in 1998. The
increases in average interest-earning assets primarily consisted of increases in
loans and securities and were the result of a planned growth strategy in an
effort to increase net interest income. The average yield on interest-earning
assets, on a tax-equivalent basis, was 7.43% for the three months ended March
31, 1999, compared to 7.61% for the same period in 1998. The Company recorded
$158,000 ($227,000 on a tax-equivalent basis) of interest income on tax-exempt
securities for the three months ended March 31, 1999, with an average balance of
$12.4 million in 1999 compared to $59,000 ($83,000 on a tax-equivalent basis) of
interest income on an average balance of $4.9 million for the three months ended
March 31, 1998.
Interest expense increased by $12,000 for the three months ended March 31,
1999, over the comparable period in 1998. Average interest-bearing liabilities
increased by approximately $6.3 million for the three months ended March 31,
1999 over the comparable period in 1998, primarily due to increases of $4.9
million and $1.4 million, respectively, in average borrowings from the FHLB and
savings deposits. Generally, the Company utilized FHLB advances to fund its new
asset growth because the interest cost of new FHLB advances was substantially
less than the incremental cost of adding new certificate of deposit accounts.
The average rates paid on interest-bearing liabilities decreased eighteen basis
points to 4.87% for the three months ended March 31, 1999, from 5.05% for the
three months ended March 31, 1998.
<PAGE>
Results of Operations (continued)
Provision for Losses on Loans
The provision for losses on loans was $12,000 for the three months ended
March 31, 1999 and 1998. The amount of the provision was a result of the
determination to maintain the allowance for losses on loans at an adequate level
to absorb potential loan losses. At March 31, 1999 and 1998, the Company's
allowance for losses on loans totaled $492,000 and $460,000, respectively, or
0.52% and 0.50% of total loans, and 339.31% and 119.79% of total non-performing
loans. There were no net charge-offs for the three months ended March 31, 1999,
compared to $120,000 of net charge-offs during the three months ended March 31,
1998. The charge-offs in the three months ended March 31, 1998 were due to loans
on two multi-family properties which were transferred to real estate acquired
through foreclosure resulting in charge-offs of $120,000.
Non-interest income
Total non-interest income decreased by $18,000 for the three months ended
March 31, 1999, compared to the same period in 1998. The decrease was primarily
due to a decrease of $33,000 in gain on sales of securities, partially offset by
an $18,000 increase (a 22% increase) in fees and service charges as a result of
increased transaction account activity and increased ATM transaction volumes, in
part as a result of the new in-store branch, located in the Wal-Mart Supercenter
in West Burlington, Iowa, which opened for business on December 8, 1997.
Non-interest expense
Total non-interest expense increased by $23,000 for the three months ended
March 31, 1999 compared to the same period in 1998. The increase was primarily
due to increases of $9,000 in compensation expense, $8,000 in data processing,
and $11,000 in other non-interest expense. The increase in compensation expense
was primarily due to cost of living raises. The increase in data processing was
primarily due to increased transaction volumes processed and year 2000 related
expenditures. The increase in other non-interest expense was primarily due to a
$7,000 increase in expenses related to disposition of real estate owned and a
$6,000 increase in professional fees.
Taxes on Income
Taxes on income was $31,000 less for the three months ended March 31, 1999
than the comparable period in 1998. The decrease was primarily due to the effect
of the increase in interest income from tax-exempt securities. The decrease in
taxes on income would have been minimal if not for the $158,000 of tax-exempt
interest income on securities discussed above under "Net Interest Income".
Financial Condition
The Company's total assets at March 31, 1999 were $165.0 million,
increasing from $162.3 million at December 31, 1998. The increase of
approximately $2.7 million was due to an intentional increase in
interest-earning assets in an effort to increase net interest income and was
primarily due to the purchase of $7.0 million of securities available for sale,
the purchase of $2.9 million of mortgage-backed securities to be held to
maturity, and the purchase of $1.0 million of loans, all of which are guaranteed
by the FmHA, partially offset by a net decrease in loans receivable of $2.8
million, principal repayments of $1.4 million from mortgage-backed securities,
$1.5 million from matured securities, and $2.0 million proceeds from the sale of
securities available for sale. The net increase in total assets was primarily
funded by increases of $1.6 million and $1.0 million of deposits and advances
from the FHLB, respectively.
<PAGE>
Financial Condition (continued)
Total stockholders' equity increased $319,000 due to the $335,000 net
earnings for the three months and $69,000 received from the exercise of stock
options, partially offset by an $83,000 decrease in net unrealized gains on
investments available for sale.
Liquidity and Capital Resources
The Company's principal sources of funds are deposits and advances from the
FHLB, amortization and prepayment of loan principal (including mortgage-backed
securities), sales or maturities of investment securities, mortgage-backed
securities and short-term investments and operations. While scheduled loan
repayments and maturing investments are relatively predictable, deposit flows
and early loan repayments are more influenced by interest rates, general
economic conditions and competition. The Company generally manages the pricing
of its deposits to maintain a steady deposit balance, but has from time to time
decided not to pay deposit rates that are as high as those of its competitors,
and, when necessary, to supplement deposits with longer term and/or less
expensive alternative sources of funds.
Federal regulations require the Association to maintain minimum levels of
liquid assets consisting of cash and other eligible investments. The required
percentage is currently 4% of net withdrawable savings deposits and borrowings
payable on demand or in one year or less during the preceding calendar quarter.
For March 1999, the Association's liquidity ratio was 9.3% compared to 8.5% for
December 1998. The increase was primarily due to the purchase of investment
securities which, because of their maturity term, qualify as liquid investments.
Assuming market interest rates are stable or decrease, a high level of liquidity
may have a negative effect on the Association's interest rate spread due to a
larger amount of the Association's assets earning the then-current lower rates
of interest. However, a high level of liquidity positions the Association to
respond to possible higher interest rates by providing the Association with the
ability to deploy liquid assets into higher yielding assets as rates increase.
The Association intends to deploy liquid assets by increasing its loan
portfolio; however, its ability to do so depends on the loan demand in its
market areas, competition for such loans, to the extent they meet the
Association's underwriting guidelines, and opportunities for participating in
and purchasing loans in nearby markets.
Liquidity management is both a daily and long-term responsibility of
management. The Association adjusts its investments in liquid assets based upon
management's assessment of (i) expected loan demand, (ii) expected deposit
flows, (iii) yields available on interest-bearing deposits, and (iv) the
objectives of its asset/liability management strategy. Excess liquidity is
invested generally in interest-bearing overnight deposits and other short-term
government and agency obligations. If the Association requires funds beyond its
ability to generate them internally, it has additional borrowing capacity with
the Federal Home Loan Bank.
The Association anticipates that it will have sufficient funds available to
meet current loan and purchase commitments. At March 31, 1999, the Association
had outstanding commitments to extend credit totaling $5.9 million.
<PAGE>
Liquidity and Capital Resources (continued)
At March 31, 1999, the Association had tangible and core capital of $11.2
million, or 6.82% of total adjusted assets which exceeded the regulatory
requirements of 1.5% and 3.0%, by $8.7 million and $6.3 million, respectively.
The risk-based capital requirement is currently 8% of risk-weighted assets. As
of March 31, 1999, the Association had risk-weighted assets of $74.1 million, a
risk-based requirement of $5.9 million and risk-based capital of $11.7 million,
or 15.77%, which exceeds the requirement by $5.8 million. The Association's
regulatory capital information is shown in the table below.
Regulatory Capital Table
(In thousands)
Tangible Core Risk-based
Capital Capital Capital
-------- ------- ----------
Association's capital $11,201 $11,201 $11,201
Additional capital -
general allowances --- -- 492
------- ------- --------
Regulatory capital 11,201 11,201 11,693
Minimum capital requirement 2,463 4,925 5,932
------- ------- -------
Excess regulatory capital $ 8,738 $ 6,276 $ 5,761
======= ======= =======
The unrealized appreciation on securities available for sale, which is a
component of stockholders' equity, is a result of the application of Statement
No. 115 of the Financial Accounting Standards Board. At March 31, 1999, the net
unrealized gain of $337,000, down from $420,000 at December 31, 1998, consisted
primarily of the net unrealized market gain, net of tax, on certain
mortgage-backed securities and investment securities, which have been identified
as available for sale by management.
Pending Accounting Pronouncements
The Financial Accounting Standards Board has issued, effective for fiscal
years beginning after June 15, 1999, Statement of Financial Accounting Standards
(SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities".
SFAS 133 establishes accounting and reporting standards for derivative
instruments and for hedging activities. The Company expects to adopt SFAS 133
when required and management believes the adoption will not have a material
effect on the Company's financial statements when adopted.
<PAGE>
MIDWEST BANCSHARES, INC.
PART II. Other Information
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit:
Exhibit 27 Financial Data Schedule
(b) There was one report on Form 8-K filed during the quarter for which
this report is filed which included a press release announcing the
agreement to merge with Mahaska Investment Co.
<PAGE>
Signatures
Pursuant to the requirement 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.
MIDWEST BANCSHARES, INC.
Registrant
Date: May 10, 1999 /s/ William D. Hassel
-------------------- -------------------------------------
William D. Hassel
President and Chief Executive Officer
(Principal Executive Officer)
Date: May 10, 1999 /s/ Robert D. Maschmann
-------------------- -------------------------------------
Robert D. Maschmann
Executive Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
<PAGE>
Index to Exhibits
Sequentially
Numbered Page
Exhibit Where Attached
Number Exhibits are Located
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
"QUARTERLY REPORT ON FORM 10-QSB FOR THE FISCAL QUARTER ENDED MARCH 31, 1999 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> Dec-31-1999 Dec-31-1998
<PERIOD-END> Mar-31-1999 Mar-31-1998
<CASH> 1,144 1,249
<INT-BEARING-DEPOSITS> 2,529 1,784
<FED-FUNDS-SOLD> 0 0
<TRADING-ASSETS> 0 0
<INVESTMENTS-HELD-FOR-SALE> 37,185 39,391
<INVESTMENTS-CARRYING> 23,366 17,845
<INVESTMENTS-MARKET> 23,591 18,105
<LOANS> 94,492 91,512
<ALLOWANCE> 492 460
<TOTAL-ASSETS> 164,983 158,661
<DEPOSITS> 107,534 105,486
<SHORT-TERM> 3,000 19,000
<LIABILITIES-OTHER> 1,095 1,241
<LONG-TERM> 41,000 22,000
<COMMON> 12,354 10,934
0 0
0 0
<OTHER-SE> 0 0
<TOTAL-LIABILITIES-AND-EQUITY> 164,983 158,661
<INTEREST-LOAN> 1,907 1,848
<INTEREST-INVEST> 950 963
<INTEREST-OTHER> 0 0
<INTEREST-TOTAL> 2,857 2,811
<INTEREST-DEPOSIT> 1,191 1,230
<INTEREST-EXPENSE> 1,783 1,771
<INTEREST-INCOME-NET> 1,074 1,040
<LOAN-LOSSES> 12 12
<SECURITIES-GAINS> 3 36
<EXPENSE-OTHER> 715 692
<INCOME-PRETAX> 453 460
<INCOME-PRE-EXTRAORDINARY> 453 460
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 335 311
<EPS-PRIMARY> 0.31 0.30
<EPS-DILUTED> 0.30 0.28
<YIELD-ACTUAL> 2.85 2.80
<LOANS-NON> 145 384
<LOANS-PAST> 0 0
<LOANS-TROUBLED> 0 0
<LOANS-PROBLEM> 0 0
<ALLOWANCE-OPEN> 480 568
<CHARGE-OFFS> 0 120
<RECOVERIES> 0 0
<ALLOWANCE-CLOSE> 492 460
<ALLOWANCE-DOMESTIC> 277 364
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 215 96
</TABLE>
