<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(mark one)
[X] Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 (fee required)
For the Fiscal Year ended December 31, 1997
OR
[ ] Transition Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
(no fee required)
For the Transition period from ________ to _______
Commission File Number 0 - 24024
-----------------
First Community Financial Group, Inc.
------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Washington 91-1277503
- ------------------------------- -------------------------------------
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation or organization)
721 College St. S.E., P.O. Box 3800, Lacey, WA 98503
-----------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number: (360) 459-1100
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $2.50 par value
--------------------------------
(Title of class)
Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes X No
---- ----
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this form 10-KSB [ X ]
State the issuer's revenues for its most recent fiscal year: $25,423,000
------------------
State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days: at December 31, 1997 - $33,436,000
----------------------------------
Number of shares of common stock outstanding as of December 31, 1997: 1,995,426
----------
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive proxy statement (the "Proxy Statement") for use in
connection with the annual meeting of shareholders to be held on May 12, 1998,
are incorporated by reference into Parts II and III of this Annual Report.
<PAGE>
PART I
ITEM 1 - DESCRIPTION OF BUSINESS
First Community Financial Group, Inc. ("FCFG" or "the Company") was incorporated
under the laws of the State of Washington in November 1983 as First Community
Bancorp, Inc. and is a bank holding company. The company's name was changed to
First Community Financial Group in July, 1992. In 1984, pursuant to a plan of
reorganization, FCFG acquired all of the stock of First Community Bank of
Washington ("FCB"), a state banking corporation chartered under the laws of the
State of Washington in 1979.
On November 29, 1995, the Company acquired Northwest Community Bank ("NCB"), a
state banking corporation chartered under the laws of the State of Washington in
1991 and merged it into FCB. The transaction was accomplished through an
exchange of FCFG's stock for shares of NCB stock. The accompanying financial
information has been prepared following the pooling-of-interests method of
accounting and reflects the combined financial position and operating results of
FCFG and NCB for all periods presented.
During 1996, Premises, Inc., a non-bank corporation formed for the purpose of
acquiring and holding properties used by FCFG's banking subsidiaries, was merged
into FCB.
On February 6, 1997 the Company acquired Prairie Security Bank, a three branch
bank headquartered in Yelm, Washington with total assets of approximately $45
million. The purchase price of approximately $7,469,000 was a combination of
cash and FCFG common stock. This in-market merger, accounted for as a purchase,
allowed the Company to consolidate two branches in Yelm, as well as two in
Olympia, Washington in addition to achieving certain other economies typical of
such transactions.
On July 18, 1997, the Bank completed the purchase of four Wells Fargo Bank
branches. This acquisition included $43,200,000 in deposits as well as branch
facilities in Hoquiam, Montesano, Toledo and Winlock, Washington. The branches
in Winlock, Toledo and Montesano represent further expansion of the Company's
market area. The Hoquiam branch represents further penetration into an existing
market.
The principal offices of FCFG, FCB, and Information Management Systems Inc., a
subsidiary of FCFG ("IMS"), are located in Lacey, Washington. FCB is referred
to as "The Bank".
The primary functions of FCFG are strategic planning for FCFG and its
subsidiaries, capital planning and financing and overall financial management.
FCFG also provides analysis of business opportunities including additional bank
services, financial analysis and trends, analysis of potential acquisitions, and
general delivery systems support such as data processing to its subsidiaries.
The Bank engages in general banking business through sixteen branches and a
mortgage production office in Thurston, Grays Harbor, Lewis and Pierce Counties.
The Bank's banking business includes the acceptance of demand, time and savings
deposits and the making of loans. The Bank provides a full range of consumer
banking services including: savings accounts, checking accounts, installment and
commercial lending, safety deposit facilities, time deposits, Visa and
MasterCard and other consumer and business-related financial services including
the sale of non-deposit investment products.
3
<PAGE>
Competition
The financial services industry is highly competitive. The Bank competes
actively with national and state banks, mutual savings banks, savings and loans,
finance companies, credit unions, brokerage houses and other financial
institutions operating in the service area. Many of these financial
institutions have merged or are in process of merging and many are larger in
size than the Bank, with greater resources.
Employees
FCFG and its subsidiaries employed a total of 207 employees, consisting of 171
full time and 36 part time employees at December 31, 1997. Such employees are
not represented by a union organization or other collective bargaining group,
and management considers their relations with their employees to be very good.
4
<PAGE>
BANK SUPERVISION AND REGULATION
The following generally refers to certain significant statutes and regulations
affecting the banking industry. These references are only intended to provide
brief summaries and therefore, are not complete and are qualified by the
statutes and regulations referenced. In addition, due to the numerous statutes
and regulations which apply to and regulate the operation of the banking
industry, many are not referenced below.
The Company
General
As a bank holding company, FCFG is subject to the Bank Holding Company Act of
1956 ("BHCA"), as amended, which places FCFG under the supervision of the Board
of Governors of the Federal Reserve System ("FRB"). In general, the BHCA limits
the business of bank holding companies to owning or controlling banks and
engaging in other activities related to banking. Certain recent legislation
designed to expand interstate branching and relax federal restrictions on
interstate banking has been phased in and may expand opportunities for bank
holding companies (for additional information see below under the heading "The
Bank - Recent Federal Legislation - Interstate Banking and Branching").
However, the impact of this legislation on FCFG is unclear at this time.
Holding Company Structure
FRB Regulation. FCFG must obtain the approval of the FRB: (1) before acquiring
direct or indirect ownership or control of any voting shares of any bank if,
after such acquisition, it would own or control, directly or indirectly, more
than 5% of the bank's voting shares; (2) before merging or consolidating with
another bank holding company; and (3) before acquiring substantially all of the
assets of any additional banks. Until September of 1995, the BHCA also
prohibited the acquisition by FCFG of any such interest in any bank or bank
holding company located in a state other than Washington unless the laws of that
state expressly authorized such acquisition. Now, subject to certain state
laws, such as age and contingency laws, a bank holding company that is
adequately capitalized and adequately managed may acquire the assets of an
out-of-state bank without regard to whether such transaction is prohibited by
the laws of any state.
FCFG files annual and quarterly reports and any other reports the FRB may
require from time to time. In addition, the FRB periodically examines FCFG and
its subsidiary Bank.
Holding Company Control of Nonbanks. With certain exceptions, the BHCA
prohibits bank holding companies from acquiring direct or indirect ownership or
control of voting shares in any company other than a bank or a bank holding
company, unless the FRB finds the company's business activities to be incidental
to the business of banking or managing or controlling banks. When making this
determination, the FRB in part considers whether allowing a bank holding company
to engage in those activities would offer advantages to the public that would
outweigh possible adverse effects.
The Economic Growth and Regulatory Paperwork Reduction Act of 1996 ("Economic
Growth Act") amended the BHCA to eliminate the requirement that a bank holding
company seek FRB approval before engaging de novo in permissible nonbanking
activities, if the holding company is well capitalized and meets certain other
criteria specified in the statute. A bank holding company meeting the
specifications is now required only to notify the FRB within 10 business days
after commencing any activity that is currently or at the time of commencement
included in the FRB's list of acceptable nonbanking activities.
5
<PAGE>
Acceptable nonbanking activities include: (1) operating an industrial loan
company, mortgage company, finance company, trust company, or credit card
company; (2) performing certain data processing operations; and (3) providing
investment and financial advice. In contrast, prohibited nonbanking activities
include real estate brokerage and syndication, land development, property
management, and the underwriting of life insurance not related to credit
transactions. From time to time, the FRB may add to or delete from the list of
activities permissible for bank holding companies.
Transactions With Affiliates. FCFG and the Bank are considered "affiliates"
within the meaning of the Federal Reserve Act, and transactions between
affiliates are subject to certain restrictions. Section 23A of the Federal
Reserve Act limits certain covered transactions. These covered transactions
include, subject to specific exceptions, loans by bank subsidiaries to
affiliates, investments by bank subsidiaries in securities issued by an
affiliate or acceptance of such securities as collateral, and the purchase by a
bank subsidiary of an affiliate's assets. Section 23B of the Federal Reserve
Act, among other things, restricts an institution from engaging in specified
transactions with certain affiliates unless the transactions are on terms
substantially the same, or at least as favorable, to the institution as those
prevailing at the time for comparable transactions with non-affiliated
companies.
Tie-In Arrangements. FCFG and the Bank cannot engage in certain tie-in
arrangements in connection with any extension of credit, sale or lease of
property or furnishing of services. For example, with certain exceptions,
neither FCFG nor the Bank may condition an extension of credit on either (1) a
requirement that the customer obtain additional services provided by it or (2)
an agreement by the customer to refrain from obtaining other services from a
competitor. In 1997, the FRB adopted significant amendments to its anti-tying
rules that: (1) removed FRB-imposed anti-tying restrictions on bank holding
companies and their non-bank subsidiaries; (2) created exemptions from the
statutory restriction on bank tying arrangements to allow banks greater
flexibility to package products with their affiliates; and (3) established a
safe harbor from the tying restrictions for certain foreign transactions. These
amendments are designed to enhance competition in banking and nonbanking
products and allow banks and their affiliates to provide more efficient a
lower-cost service to customers. However, the impact of the amendments on FCFG
and its subsidiaries is unclear at this time.
State Law Restrictions. As a corporation chartered under the laws of the State
of Washington, FCFG is also be subject to certain limitations and restrictions
under applicable Washington corporate laws.
Securities Registration and Reporting. The common stock of FCFG is registered
as a class with the Securities and Exchange Commission ("SEC") under the
Securities Exchange Act of 1934. Thus, FCFG is subject to the periodic
reporting and proxy solicitation requirements and the insider-trading
restrictions of that Act. The periodic reports, proxy statements, and other
information filed by FCFG under that Act can be inspected and copied at or
obtained from the Washington, D.C. office of the SEC. In addition, the
securities issued by FCFG are subject to the registration requirements of the
Securities Act of 1933 and applicable state securities laws, unless exemptions
are available.
6
<PAGE>
Control Transactions
The Change in Bank Control Act of 1978, as amended, requires a person (or group
of persons acting in concert) acquiring "control" of a bank holding company to
provide the FRB with at least 60 days' advance written notice of the proposed
acquisition. Following receipt of this notice, the FRB has 60 days to issue a
notice disapproving the proposed acquisition, but the FRB may extend this time
period for up to an additional 30 days. An acquisition may be completed before
the expiration of the disapproval period if the FRB issues written notice of its
intent not to disapprove the transaction.
In addition, any "company" must obtain the FRB's approval under the BHCA before
acquiring 25% (5% if the company is a bank holding company) or more of the
outstanding shares of FCFG, or otherwise obtaining control over FCFG.
The Bank
General
Despite some recent legislative initiatives to reduce regulatory burdens,
banking remains a highly regulated industry. Legislation enacted from time to
time may increase the cost of doing business, limit or expand permissible
activities, or affect the competitive balance between banks and other financial
and non-financial institutions. Proposals to change the laws and regulations
governing the operations and taxation of financial institutions are frequently
made in Congress, in the Washington State Legislature, and before various bank
regulatory agencies. In addition, Congress continues to consider proposals to
restructure the banking system.
Some of the significant areas of bank regulation are discussed below.
Regulation of State Banks
As a Washington state bank, the Bank is subject to primary regulation and
examination by the Washington Director of Financial Institutions ("Director")
and by the FDIC. Applicable federal and state statutes and regulations
governing a bank's operations relate, among other matters, to capital
requirements, required reserves against deposits, investments, loans, legal
lending limits (see below), interest rates, mergers and consolidations,
borrowings, issuance of securities, payment of dividends, establishment of
branches, and dealings with affiliated persons. The FDIC also may prohibit
banks under its supervision from operating their business in what it considers
to be an unsafe and unsound manner. Washington law allows state banks to
invest, up to a specified amount of assets or net worth (as defined), in the
equity securities of any business entity except an insurance or travel agency.
This and certain other powers of state banks have been limited by federal
legislation (for additional information see below, "Federal Legislation -
Interstate Banking and Branching").
Loans to One Borrower. Washington law limits the amount of funds that a bank
may lend to a single borrower to 20% of capital and surplus. For this purpose,
capital includes (1) the amount of common stock outstanding and unimpaired, (2)
the amount of preferred stock outstanding and unimpaired, and (3) capital notes
or debentures issued pursuant to RCW 30.36. Surplus includes capital surplus,
reflecting the amounts paid in excess of the par or stated value of capital
stock, or amounts contributed to the bank other than for capital stock, and
undivided profits. As of the end of FCFG's fiscal year for 1997, the Bank s
lending limit was approximately $5,500,000.
7
<PAGE>
Regulation of Management
Federal law establishes the circumstances under which officers or directors of a
bank may be removed by the institution's federal supervisory agency, limits
loans by a bank to its executive officers, directors, or principal shareholders,
and prohibits management personnel of a bank from serving in managerial
positions for another financial institution whose assets exceed a specified
amount or which has an office within a specified geographic area.
Control of Financial Institutions
No person may acquire "control" of a bank unless the appropriate federal agency
has been given 60 days' advance written notice and within that time the agency
has not disapproved the acquisition. State banking laws further require that 30
days prior to the acquisition of control, as defined, the acquiring party must
file with the Director an application containing certain specified information.
Acquisitions of control in violation of the statute are deemed void, and
substantial monetary penalties may be imposed.
Federal Legislation - Interstate Banking and Branching
The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
("Interstate Act") generally permits nationwide interstate banking and
branching. Subject to certain state laws, such as age and contingency laws, the
Interstate Act allows adequately capitalized and adequately managed bank holding
companies to purchase the assets of out-of-state banks, effective as of
September 29, 1995. Additionally, as of June 1, 1997, the Interstate Act
permits interstate bank mergers, subject to these state laws, unless the home
state of either merging bank has "opted-out" of these provisions by enacting
"opt-out" legislation. States may also have "opted-in" early to these bank
merger provisions by enacting non-discriminatory "opting-in" legislation to
permit interstate mergers within their own borders before June 1, 1997. States
may still impose certain conditions on interstate bank mergers within their
borders; for example, states may require that the in-state merging bank exist
for up to five years before the interstate merger. Under the Interstate Act,
states may also "opt-in" to de novo branching, allowing out-of-state banks to
establish de novo branches within the state.
In 1996, Washington enacted "opting in" legislation authorizing interstate
mergers pursuant to the Interstate Act. Accordingly, as of June 6, 1996, an
out-of-state bank holding company may now acquire more than 5% of the voting
shares of a Washington-based bank, regardless of reciprocity, provided such bank
or its predecessor has been doing business for at least five years prior to the
acquisition. Further, an out-of-state bank may engage in banking in Washington
if the requirements of Washington s interstate banking statute are met, and the
bank either (1) was lawfully engaged in banking in Washington on June 6, 1996,
(2) resulted from an interstate combination pursuant to Washington law, (3)
resulted from a relocation of a head office of a state bank or a main office of
a national bank pursuant to federal law, or (4) resulted from the establishment
of a savings bank branch in compliance with applicable Washington law.
Additionally, the Director may approve interstate combinations if the basis for
such approval does not discriminate against out-of-state banks, out-of-state
holding companies, or their subsidiaries.
8
<PAGE>
Under its interstate banking statute, the State of Washington permits
out-of-state banks meeting the above requirements to maintain and operate the
Washington branches of a Washington bank with which the out-of-state bank
engaged in an interstate combination. The out-of state bank may also operate
additional branches in Washington to the same extent as any Washington bank may
under applicable federal and state law. Unless prohibited by the laws of the
out-of-state bank s home state, the out-of-state bank may exercise any powers
that are authorized under Washington law for Washington banks. If additional
powers are authorized under the laws of its home state, the out-of-state bank
may seek written authorization from the Director to exercise such powers, if the
exercise of the additional powers (1) will not threaten the safety and soundness
of banks in Washington, and (2) will serve the convenience and needs of
Washington consumers.
Washington laws applicable to Washington state banks regarding community
reinvestment, consumer protection, fair lending, and the establishment of
intrastate branches apply to any Washington branch of an out-of-state bank to
the same extent as such laws apply to a Washington state bank.
Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA").
FDICIA requires federal banking regulators to adopt regulations in a number of
areas to ensure bank safety and soundness. As such, numerous regulations have
been adopted by federal bank regulatory agencies, including the following: (1)
federal bank regulatory authorities have established five different capital
levels for banks and, as a general matter, enable banks with higher capital
levels to engage in a broader range of activities; (2) the FRB has issued
regulations requiring standardized disclosures with respect to interest paid on
deposits; (3) the FDIC has imposed restrictions on the acceptance of brokered
deposits by weaker banks; (4) the FDIC has implemented risk-based deposit
insurance premiums; and (5) the FDIC has issued regulations requiring
state-chartered banks to comply with certain restrictions with respect to equity
investments and activities in which the banks act as a principal.
FDICIA recapitalized the Bank Insurance Fund ("BIF") and required the FDIC to
maintain the BIF and Savings Association Insurance Fund ("SAIF") at 1.25% of
insured deposits by increasing deposit insurance premiums as necessary to
maintain such ratio. (See "FDIC Insurance" below).
The full effect FDICIA will have on financial institutions is not known at this
time and cannot be predicted with certainty. However, FDICIA and similar
legislation and regulatory requirements have historically increased the cost of
doing business, and it is clear that this legislation places a premium on the
maintenance of a strong capital position.
The Financial Institutions Reform, Recovery and Enforcement Act of 1989
("FIRREA"). FIRREA became effective on August 9, 1989. Among other things,
this legislation: (1) phased in significant increases in the FDIC insurance
premiums paid by commercial banks; (2) created two deposit insurance pools
within the FDIC, one to insure commercial bank and savings bank deposits and the
other to insure savings association deposits; (3) for the first time, permitted
bank holding companies to acquire healthy savings associations; (4) permitted
commercial banks that meet certain housing-related asset requirements to secure
advances and other federal services from their local Federal Home Loan Banks;
and (5) greatly enhanced the regulators' enforcement powers by removing
procedural barriers and sharply increasing the civil and criminal penalties for
violating statutes and regulations.
9
<PAGE>
Restrictions on Capital Distributions
Various federal statutory provisions limit the amount of dividends the Bank is
permitted to pay FCFG without regulatory approval. FRB policy further limits
the circumstances under which bank holding companies may declare dividends. For
example, a bank holding company should not continue its existing rate of cash
dividends on its common stock unless its net income is sufficient to fully fund
each dividend, and its prospective rate of earnings retention appears consistent
with its capital needs, asset quality, and overall financial condition.
If, in the opinion of the applicable federal banking agency, a depository
institution under its jurisdiction is engaged in or is about to engage in an
unsafe or unsound practice (which, depending on the financial condition of the
institution, may include the payment of dividends), the agency may require,
after notice and hearing, that the institution cease and desist from that
practice. In addition, the FRB and the FDIC have issued policy statements which
provide that insured banks and bank holding companies should generally pay
dividends only out of current operating earnings.
Capital Adequacy Requirements
The FRB, the FDIC, and the Office of the Comptroller of the Currency
(collectively, the "Federal Banking Agencies") have adopted risk-based capital
guidelines for banks and bank holding companies that are designed to make
regulatory capital requirements more sensitive to differences in risk profiles
among banks and bank holding companies and to account for off-balance sheet
items. The guidelines are minimums, and the federal regulators have noted that
banks and bank holding companies contemplating significant expansion programs
should not allow expansion to diminish their capital ratios and should maintain
ratios in excess of the minimums. Failure to achieve and maintain required
capital levels may give rise to supervisory action through the issuance of a
capital directive to ensure the maintenance of adequate capital levels. The
Bank has not received any notice indicating that it will be subject to higher
capital requirements.
The current guidelines require all federally-regulated banks to maintain a
minimum risk-based total capital ratio equal to 8%, of which at least 4% must be
Tier 1 capital. Tier 1 capital includes common shareholders equity, qualifying
perpetual preferred stock, and minority interests in equity accounts of
consolidated subsidiaries, but excludes goodwill and most other intangibles and
the allowance for loan and lease losses. Tier 2 capital includes the excess of
any preferred stock not included in Tier 1 capital, mandatory convertible
securities, hybrid capital instruments, subordinated debt and intermediate
term-preferred stock, and general reserves for loan and lease losses up to 1.25%
of risk-weighted assets.
Under these guidelines, banks assets are given risk-weights of 0%, 20%, 50% or
100%. In addition, certain off-balance sheet items are given credit conversion
factors to convert them to asset equivalent amounts to which an appropriate
risk-weight will apply. These computations result in the total risk-weighted
assets. Most loans are assigned to the 100% risk category, except for first
mortgage loans fully secured by residential property and, under certain
circumstances, residential construction loans (both carry a 50% rating). Most
investment securities are assigned to the 20% category, except for municipal or
state revenue bonds (which have a 50% rating) and direct obligations of or
obligations guaranteed by the United States Treasury or United States Government
Agencies (which have a 0% rating).
10
<PAGE>
The Federal Banking Agencies have also implemented a leverage ratio, which is
equal to Tier 1 capital as a percentage of average total assets less
intangibles, to be used as a supplement to the risk-based guidelines. The
principal objective of the leverage ratio is to place a constraint on the
maximum degree to which a bank may leverage its equity capital base. The
minimum required leverage ratio for top-rated institutions is 3%, but most
institutions are required to maintain an additional cushion of at least 100 to
200 basis points. Any institution operating at or near the 3% level is expected
to have well-diversified risk, including no undue interest rate risk exposure,
excellent asset quality, high liquidity and good earnings, and in general, to be
a strong banking organization without any supervisory, financial or operational
weaknesses or deficiencies. Any institutions experiencing or anticipating
significant growth would be expected to maintain capital ratios, including
tangible capital positions, well above the minimum levels.
Regulations adopted by the Federal Banking Agencies as required by FDICIA impose
even more stringent capital requirements. The regulators require the FDIC and
other Federal Banking Agencies to take certain "prompt corrective action" when a
bank fails to meet certain capital requirements. The regulations establish and
define five capital levels: (1) "well-capitalized," (2) "adequately
capitalized," (3) "undercapitalized," (4) "significantly undercapitalized" and
(5) "critically undercapitalized." To qualify as "well-capitalized," an
institution must maintain, among other things, at least 10% total risk-based
capital and a leverage ratio of not less than 5%. Increasingly severe
restrictions are imposed on the payment of dividends and management fees, asset
growth and other aspects of the operations of institutions that fall below the
category of "adequately capitalized" (which requires at least 8% risk-based
capital and a leverage ratio of at least 4%). Undercapitalized institutions are
required to develop and implement capital plans acceptable to the appropriate
federal regulatory agency. Such plans must require that any company that
controls the undercapitalized institution must provide certain guarantees that
the institution will comply with the plan until it is adequately capitalized.
As of December 31, 1997, the Bank was not subject to any regulatory order,
agreement, or directive to meet and maintain a specific capital level for any
capital measure.
FDIC Insurance
Generally, customer deposit accounts in banks are insured by the FDIC for up to
a maximum amount of $100,000. The FDIC has adopted a risk-related insurance
assessment system under which depository institutions contribute funds to the
BIF and the SAIF based on their risk classification. The FDIC assigns
institutions a risk classification based on three capital groups and three
supervisory subgroups. The capital groups are "well capitalized," "adequately
capitalized," and "undercapitalized." The three supervisory subgroups are Group
"A" (for financially sound institutions with only a few minor weaknesses), Group
"B" (for those institutions with weaknesses which, if uncorrected, could cause
substantial deterioration of the institution and increase risk to the deposit
insurance fund), and Group "C" (for those institutions with a substantial
probability of loss to the fund absent effective corrective action).
On September 30, 1996, the Deposit Insurance Funds Act of 1996 ("Funds Act") was
enacted. The Funds Act provides, among other things, for the recapitalization
of the SAIF through a special assessment on all depository institutions that
hold SAIF insured deposits. The one-time assessment is designed to place the
SAIF at its 1.25 reserve ratio goal.
11
<PAGE>
The Funds Act, for the three year period beginning in 1997, subjects BIF-insured
deposits to a Financing Corporation ("FICO") premium assessment on domestic
deposits at one-fifth the premium rate (approximately 1.3 basis points) imposed
on SAIF insured deposits (approximately 6.5 basis points). In addition, service
debt funding on FICO bonds for the first half of 1997 is expected to result in
BIF-insured institutions paying .64 cents for each $100 of assessed deposits,
and SAIF insured institutions paying 3.2 cents on each $100 of deposits.
Beginning in the year 2000, BIF insured institutions will be required to pay the
FICO obligations on a pro-rata basis with all thrift institutions; annual
assessments are expected to equal approximately 2.4 basis points until 2017, to
be phased out completely by 2019.
Until further action by the FDIC, BIF premiums will be maintained at their
current level. Accordingly, institutions in the lowest risk category will
continue to pay no premiums, and other institutions will be assessed based on a
range of rates, with those in the highest risk category paying 27 cents for
every $100 of BIF insured deposits. Rates in the SAIF assessment schedule,
previously ranging from 4 to 31 basis points, have recently been adjusted by 4
basis points to a range of 0 to 27 basis points (as of October 1, 1996).
The Funds Act provides for the merger of the BIF and SAIF on January 1, 1999,
only if no thrift institutions exist on that date. It is expected that Congress
will continue to address comprehensive legislation on the merger of the funds
and elimination of the thrift charter.
ITEM 2 - PROPERTIES
First Community Bank owns the property and building on which the Olympia East,
Elma, Hoquiam - Timbermens, Hoquiam - Simpson, Lacey, Yelm, Fircrest,
Eatonville, Winlock, Toledo, Montesano, Centralia and downtown Olympia branches
are situated, as well as the property and building occupied by the Aberdeen
branch, which opened March 9, 1998. The Tumwater branch is operated out of a
building owned by FCB which is situated on leased property. The branch on 74th
Street in South Tacoma is located in leased space in a two story office
building. The Panorama City branch is operated out of leased space.
The Lacey branch is a two story building with a basement and a drive-up, which
has approximately 17,500 square feet and is fully utilized as a branch bank,
administrative offices, operations center and data processing facility. The
Tumwater, Yelm, Olympia East, Eatonville, Winlock, Centralia, Aberdeen and
Hoquiam branches are single story structures with drive-up facilities. The Elma
and Toledo branches are two story structures with drive-up facilities. The
Toledo branch is a single story structure with a walk up ATM. The Downtown
Olympia branch is a two story structure with a drive-up. The Fircrest facility
is an office condominium, of which the Bank occupies approximately one-half.
ITEM 3 - LEGAL PROCEEDINGS
From time to time in the ordinary course of business, FCFG or its subsidiaries
may be involved in litigation. At the present time neither FCFG nor any of its
subsidiaries are involved in any material litigation proceeding.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of the year ended December 31, 1997, no matters were
submitted to the security holders through the solicitation of proxies or
otherwise.
12
<PAGE>
PART II
ITEM 5 - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Market Information
No broker makes a market in FCFG's common stock, and trading has not been
extensive. Trades that have occurred cannot be characterized as amounting to an
active market. The stock is traded by individuals on a personal basis and is
not listed on any exchange or traded on the over-the-counter market. Due to the
limited information available, the following price information may not
accurately reflect the actual market value of FCFG's shares. The following data
includes trades between individual investors and new issues of stock. It does
not include the exercise of stock options or shares issued in the acquisition of
Prairie Security Bank, nor does it include shares purchased by the Company as
discussed in Note 19 of the consolidated financial statements.
<TABLE>
<CAPTION>
# of Shares
Period Traded Price Range
<S> <C> <C>
1995 25,938 $17.60 - $21.00
1996 61,036 $20.00 - $22.00
1997 44,969 $21.00 - $24.50
</TABLE>
At December 31, 1997, options for 398,850 shares of FCFG common stock were
outstanding. See Note 16 of the audited financial statements for additional
information.
Number of Equity Holders
As of December 31, 1997, there were 1,250 holders of record of FCFG's common
stock.
Dividends
There were no cash dividends declared in 1997 or 1996. In 1992, the Board of
Directors adopted a policy to declare a stock dividend each year over the next
five (5) years while FCFG is in a pattern of growth. The amount of the dividend
to be paid will be determined by the Board of Directors and will depend on the
growth experienced by FCFG and the profits generated. Stock dividends of 5%
were issued on March 20, 1996, and April 15, 1997, respectively.
Washington law limits the ability of the Bank to pay dividends to the Company.
Under these restrictions, a bank may not declare or pay any dividend in an
amount greater than its retained earnings without approval of the Division of
Banks. All of the retained earnings of FCB are available for the payment of
dividends to the Company under these restrictions, subject to the federal
capital regulations discussed above.
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Incorporated by reference to the Management's Discussion and Analysis of
Financial Condition and Results of Operations as filed March 31, 1998 in the
Definitive Proxy Statement ("Proxy Statement").
13
<PAGE>
ITEM 7 - FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements of First Community Financial
Group, Inc. as of and for the years ended December 31, 1997 and 1996 are hereby
incorporated by reference to the Definitive Proxy Statement filed March 31,
1998.
ITEM 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Within the 24 months prior to December 31, 1997, FCFG has neither changed
independent accountants, at either FCFG's election or by reason of the
accountant's resignation, nor had any disagreements in regards to matters of
accounting principles, practices or financial statement disclosure.
14
<PAGE>
PART III
ITEM 9- DIRECTORS AND EXECUTIVE OFFICERS; COMPLIANCE WITH SECTION 16(a) OF THE
EXCHANGE ACT
The following table lists the name and certain information as of December 31,
1997 regarding the directors of FCFG or predecessor companies, and executive
officers of FCFG and the Bank.
<TABLE>
<CAPTION>
Year
Became
FCFG FCFG Corporate FCFG
Name and Age Director Principal Occupation Affiliation Term Expires
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Arneson, James F. (37) N/A Executive Vice President/Chief FCFG-Secretary/ N/A
Financial Officer, First Treasurer
Community Financial Group FCB - Secretary/
Treasurer
- ------------------------------------------------------------------------------------------------------------
DeTray, E. Paul (64) 1979 President, DeTray's Quality FCFG - Chairman 1999
Homes FCB - Director
- ------------------------------------------------------------------------------------------------------------
Durney, John D. (49) 1993 V.P./Co-Owner, Durney FCFG - Director 1999
Agency, Inc. FCB - Director
- ------------------------------------------------------------------------------------------------------------
Huber, John A. (53) N/A Executive Vice FCB - Director N/A
President/President Grays
Harbor Region, First Community
Bank
- ------------------------------------------------------------------------------------------------------------
Martin, Patrick (59) 1980 President, Patrick's Decorating FCFG - Director 2000
Center (1) FCB - Director
- ------------------------------------------------------------------------------------------------------------
Murphy, Michael (55) 1993 WA State Deputy Auditor FCFG - Director 1999
FCB - Director
- ------------------------------------------------------------------------------------------------------------
Panowicz, A. Richard (53) 1995 President, Archives Northwest, FCFG - Director 1998
V.P. Tab Northwest (2) FCB - Director
- ------------------------------------------------------------------------------------------------------------
Parsons, Ken F. (52) 1979 President and CEO, First FCFG - Vice Chairman 2000
Community Financial Group FCB - Chairman
- ------------------------------------------------------------------------------------------------------------
Wilcox, Kenneth (68) 1979 Retired Pharmacist FCFG - Director 1998
FCB - Director
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Mr. Martin serves as a director of Carpet Co-op of America, d/b/a
Carpet One, and Leading Edge Marketing, both public companies which
have a class of securities registered under Section 12 or subject to
the requirements of Section 15(d) of the Securities Exchange Act of
1934.
(2) Mr. Panowicz serves as chairman of the board of The Office Planning
Group, Inc., a public company which has a class of securities
registered under Section 12 or subject to the requirements of Section
15(d) of the Securities Exchange Act of 1934.
Compliance with Section 16(a) of the Securities Exchange Act
FCFG has adopted procedures to assist its directors and executive officers with
Section 16(a) of the Securities Exchange Act, which includes assisting the
officer or director in preparing forms for filing with the Securities Exchange
Commission. Based on the review of such forms, FCFG believes that all of its
executive officers and directors complied with all filing requirements
applicable to them.
15
<PAGE>
ITEM 10 - EXECUTIVE COMPENSATION
Incorporated by reference to Executive Compensation, as filed in the Proxy
Statement on March 31, 1998.
ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Incorporated by reference to Ownership of FCFG Common Stock, as filed in the
Definitive Proxy Statement on March 31, 1998.
ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Incorporated by reference to Certain Relationships and Related Transactions, as
filed in the Definitive Proxy Statement on March 31, 1998.
ITEM 13 - INDEX TO EXHIBITS
The following exhibits are filed as part of this report:
(3) a. The Registrant's Articles of Incorporation are hereby incorporated by
reference from Exhibit 3 of Registrant's Registration Statement on
Form S-4, as filed and declared effective November 20, 1992 under
Commission File Number 33-52556.
(3) c. The Registrant's Amendments to the Articles of Incorporation are
referenced from Exhibit 3c of Registrant's Form 10-KSB for the year
ending December 31, 1993 as filed March 29, 1994 under Commission File
Number 33-52556.
(3) d. The Registrant's Bylaws are hereby incorporated by reference from
Exhibit 3 of Registrant's Registration Statement on Form S-4, as
filed and declared effective November 20, 1992 under Commission File
Number 33-52556.
(10) a. The employment contract for Ken F. Parsons is hereby incorporated by
reference from Exhibit 10 of Registrant's Form 10-QSB, as filed for
quarter ended September 1996 under Commission File Number 33-52556.
(10) b. The employment contract for John A. Huber is hereby incorporated by
reference from Exhibit 10 of Registrant's Registration Statement on
Form S-4, as filed and declared effective November 20, 1992 under
Commission File Number 33-52556.
(10) c. Non-compete agreements of the Directors of the Registrant and Citizens
First Bank are hereby incorporated by reference from Exhibit 10 of
Registrant's Registration Statement on Form S-4, as filed and declared
effective November 20, 1992 under Commission File Number 33-52556.
16
<PAGE>
(10) d. The employment contract for John R. Johnson, Sr. is hereby
incorporated by reference from Exhibit 10 of Registrant's Form 10-KSB
for the year ending December 31, 1992, as filed March 29, 1993 under
Commission File Number 33-52556.
(10) e. The Registrant's 1992 Stock Option Plan for Non-employee Directors is
hereby incorporated by reference from Exhibit 10 of Registrant's Form
10-KSB for the year ending December 31, 1992, as filed March 29, 1993
under Commission File Number 33-52556.
(10) f. The Registrant's Second Amended Non-employee Directors Stock Option
Plan is hereby incorporated by reference from Exhibit 10 of
Registrant's Form 10-KSB for the year ending December 31, 1992, as
filed March 29, 1993 under Commission File Number 33-52556.
(10) g. The Registrant's Employee Stock Option and Restricted Stock Award Plan
is hereby incorporated by reference from Exhibit 10 of Registrant's
Form 10-KSB for the year ending December 31, 1992, as filed March 29,
1993 under Commission File Number 33-52556.
(10) h. The Registrant's Executive Supplemental Income Plan is hereby
incorporated by reference from Exhibit 10 of Registrant's Form 10-KSB
for the year ending December 31, 1992, as filed March 29, 1993 under
Commission File Number 33-52556.
(10) i. The Registrant's 1994 Stock Option Plan for Nonemployee Directors is
hereby incorporated by reference from Exhibit 10 of the Registrant's
Form 10-KSB for the year ending December 31, 1994, as filed March 30,
1995 under Commission File Number 0-24024.
(10) j. Purchase and Assumption Agreement between Wells Fargo Bank, N.A. and
First Community Bank of Washington, dated March 5, 1997.
(10) k. Settlement Agreement between First Community Bank of Washington,
Michael D. Edwards and Marieke Edwards, dated August, 1997.
(21) Subsidiaries of Registrant
(24) Powers of Attorney of Directors of First Community Financial Group,
Inc.
(27) Financial Data Schedule.
17
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FIRST COMMUNITY FINANCIAL GROUP, INC.
By:/s/ Ken F. Parsons
------------------------------------------
Ken F. Parsons
President
Chief Executive Officer
By:/s/ James F. Arneson
------------------------------------------
James F. Arneson
Executive Vice President
Chief Financial Officer
Principal Accounting Officer
/s/ Ken F. Parsons President March 28, 1998
- ----------------------------
Ken F. Parsons
/s/ E. Paul DeTray Chairman March 28, 1998
- ----------------------------
E. Paul DeTray*
/s/ John D. Durney Director March 28, 1998
- ----------------------------
John D. Durney*
/s/ A. Richard Panowicz Director March 28, 1998
- ----------------------------
A. Richard Panowicz*
/s/ Patrick L. Martin Director March 28, 1998
- ----------------------------
Patrick L. Martin*
/s/ Michael N. Murphy Director March 28, 1998
- ----------------------------
Michael N. Murphy*
* In accordance with Exhibit 24, Ken F. Parsons and James F. Arneson were
appointed as attorney and agent to act on behalf of the aforementioned director
in executing the 1997 Annual Report and Form 10-KSB to be filed with the
Securities and Exchange Commission, and sign any and all amendments that pertain
to such filings.
18
<PAGE>
Exhibit 21
FIRST COMMUNITY FINANCIAL GROUP, INC.
Subsidiaries Owned at December 31, 1997
<TABLE>
Name of Subsidiary Trade Name State of Incorporation
- ------------------ ---------- ----------------------
<S> <C> <C>
First Community Bank of Washington Same Washington
Information Management Systems, Inc. Same Washington
FCB Financial Services, Inc. Same Washington
</TABLE>
<PAGE>
Exhibit 24
FIRST COMMUNITY FINANCIAL GROUP, INC.
Powers of Attorney
The undersigned Director of First Community Financial Group, Inc.
("Company") appoints each of Ken F. Parsons and James F. Arneson as his true and
lawful attorney and agent, in name and on behalf of the undersigned, to do any
and all acts and things and execute any and all instruments which the attorney
and agent may deem necessary or advisable to cause the 1997 Annual Report on
Form 10-KSB to be filed with the Securities and Exchange Commission, and
likewise to sign any and all amendments (the signing of any such instrument to
be conclusive evidence that the attorney considers such instrument necessary or
desirable), without the other and with full power of substitution and
revocation, and hereby ratifying all that any such attorney or his substitute
may do by virtue hereby.
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Power of Attorney has been signed by the following persons in the capacity
indicated on this 18th day of March, 1998.
By:/s/ E. Paul DeTray
-----------------------------------
E. Paul DeTray, Director
<PAGE>
FIRST COMMUNITY FINANCIAL GROUP, INC.
Powers of Attorney
The undersigned Director of First Community Financial Group, Inc.
("Company") appoints each of Ken F. Parsons and James F. Arneson as his true and
lawful attorney and agent, in name and on behalf of the undersigned, to do any
and all acts and things and execute any and all instruments which the attorney
and agent may deem necessary or advisable to cause the 1997 Annual Report on
Form 10-KSB to be filed with the Securities and Exchange Commission, and
likewise to sign any and all amendments (the signing of any such instrument to
be conclusive evidence that the attorney considers such instrument necessary or
desirable), without the other and with full power of substitution and
revocation, and hereby ratifying all that any such attorney or his substitute
may do by virtue hereby.
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Power of Attorney has been signed by the following persons in the capacity
indicated on this 18th day of March, 1998.
By:/s/ A. Richard Panowicz, Jr.
------------------------------------
A. Richard Panowicz, Jr., Director
<PAGE>
FIRST COMMUNITY FINANCIAL GROUP, INC.
Powers of Attorney
The undersigned Director of First Community Financial Group, Inc.
("Company") appoints each of Ken F. Parsons and James F. Arneson as his true and
lawful attorney and agent, in name and on behalf of the undersigned, to do any
and all acts and things and execute any and all instruments which the attorney
and agent may deem necessary or advisable to cause the 1997 Annual Report on
Form 10-KSB to be filed with the Securities and Exchange Commission, and
likewise to sign any and all amendments (the signing of any such instrument to
be conclusive evidence that the attorney considers such instrument necessary or
desirable), without the other and with full power of substitution and
revocation, and hereby ratifying all that any such attorney or his substitute
may do by virtue hereby.
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Power of Attorney has been signed by the following persons in the capacity
indicated on this 18th day of March, 1998.
By:/s/ Michael N. Murphy
---------------------------
Michael N. Murphy, Director
<PAGE>
FIRST COMMUNITY FINANCIAL GROUP, INC.
Powers of Attorney
The undersigned Director of First Community Financial Group, Inc.
("Company") appoints each of Ken F. Parsons and James F. Arneson as his true and
lawful attorney and agent, in name and on behalf of the undersigned, to do any
and all acts and things and execute any and all instruments which the attorney
and agent may deem necessary or advisable to cause the 1997 Annual Report on
Form 10-KSB to be filed with the Securities and Exchange Commission, and
likewise to sign any and all amendments (the signing of any such instrument to
be conclusive evidence that the attorney considers such instrument necessary or
desirable), without the other and with full power of substitution and
revocation, and hereby ratifying all that any such attorney or his substitute
may do by virtue hereby.
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Power of Attorney has been signed by the following persons in the capacity
indicated on this 18th day of March, 1998.
By:/s/ John D. Durney
----------------------------
John D. Durney, Director
<PAGE>
FIRST COMMUNITY FINANCIAL GROUP, INC.
Powers of Attorney
The undersigned Director of First Community Financial Group, Inc.
("Company") appoints each of Ken F. Parsons and James F. Arneson as his true and
lawful attorney and agent, in name and on behalf of the undersigned, to do any
and all acts and things and execute any and all instruments which the attorney
and agent may deem necessary or advisable to cause the 1997 Annual Report on
Form 10-KSB to be filed with the Securities and Exchange Commission, and
likewise to sign any and all amendments (the signing of any such instrument to
be conclusive evidence that the attorney considers such instrument necessary or
desirable), without the other and with full power of substitution and
revocation, and hereby ratifying all that any such attorney or his substitute
may do by virtue hereby.
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this Power of Attorney has been signed by the following persons in the capacity
indicated on this 18th day of March, 1998.
By:/s/ Patrick L. Martin
---------------------------------
Patrick L. Martin, Director
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<CIK> 0000892449
<NAME> FIRST COMMUNITY FINANCIAL GROUP
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 11620
<INT-BEARING-DEPOSITS> 5648
<FED-FUNDS-SOLD> 1000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 41658
<INVESTMENTS-CARRYING> 959
<INVESTMENTS-MARKET> 1024
<LOANS> 199165
<ALLOWANCE> 2122
<TOTAL-ASSETS> 294474
<DEPOSITS> 263121
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1370
<LONG-TERM> 3818
0
0
<COMMON> 4988
<OTHER-SE> 21177
<TOTAL-LIABILITIES-AND-EQUITY> 294474
<INTEREST-LOAN> 18821
<INTEREST-INVEST> 1503
<INTEREST-OTHER> 836
<INTEREST-TOTAL> 21160
<INTEREST-DEPOSIT> 7884
<INTEREST-EXPENSE> 8039
<INTEREST-INCOME-NET> 13121
<LOAN-LOSSES> 1015
<SECURITIES-GAINS> 6
<EXPENSE-OTHER> 15883
<INCOME-PRETAX> 486
<INCOME-PRE-EXTRAORDINARY> 486
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 719
<EPS-PRIMARY> .38
<EPS-DILUTED> .36
<YIELD-ACTUAL> 9.64
<LOANS-NON> 4381
<LOANS-PAST> 319
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1420
<CHARGE-OFFS> 807
<RECOVERIES> 25
<ALLOWANCE-CLOSE> 2122
<ALLOWANCE-DOMESTIC> 2122
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CIK> 0000892449
<NAME> FIRST COMMUNITY FINANCIAL GROUP
<S> <C> <C> <C> <C>
<C>
<PERIOD-TYPE> YEAR YEAR 3-MOS 6-MOS
9-MOS
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1996 DEC-31-1996 DEC-31-1996
DEC-31-1996
<PERIOD-START> JAN-01-1995 JAN-01-1996 JAN-01-1996 JAN-01-1996
JAN-01-1996
<PERIOD-END> DEC-31-1995 DEC-31-1996 MAR-31-1996 JUN-30-1996
SEP-30-1996
<CASH> 0 0 0 0
0
<SECURITIES> 0 0 0 0
0
<RECEIVABLES> 0 0 0 0
0
<ALLOWANCES> 0 0 0 0
0
<INVENTORY> 0 0 0 0
0
<CURRENT-ASSETS> 0 0 0 0
0
<PP&E> 0 0 0 0
0
<DEPRECIATION> 0 0 0 0
0
<TOTAL-ASSETS> 0 0 0 0
0
<CURRENT-LIABILITIES> 0 0 0 0
0
<BONDS> 0 0 0 0
0
0 0 0 0
0
0 0 0 0
0
<COMMON> 0 0 0 0
0
<OTHER-SE> 0 0 0 0
0
<TOTAL-LIABILITY-AND-EQUITY> 0 0 0 0
0
<SALES> 0 0 0 0
0
<TOTAL-REVENUES> 0 0 0 0
0
<CGS> 0 0 0 0
0
<TOTAL-COSTS> 0 0 0 0
0
<OTHER-EXPENSES> 0 0 0 0
0
<LOSS-PROVISION> 0 0 0 0
0
<INTEREST-EXPENSE> 0 0 0 0
0
<INCOME-PRETAX> 0 0 0 0
0
<INCOME-TAX> 0 0 0 0
0
<INCOME-CONTINUING> 0 0 0 0
0
<DISCONTINUED> 0 0 0 0
0
<EXTRAORDINARY> 0 0 0 0
0
<CHANGES> 0 0 0 0
0
<NET-INCOME> 0 0 0 0
0
<EPS-PRIMARY> .57 1.06 .30 .57
.82
<EPS-DILUTED> .57 .98 .27 .52
.76
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CIK> 0000892449
<NAME> FIRST COMMUNITY FINANCIAL GROUP
<S> <C> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1997 DEC-31-1997
<PERIOD-START> JAN-01-1997 JAN-01-1997 JAN-01-1997
<PERIOD-END> MAR-31-1997 JUN-30-1997 SEP-30-1997
<CASH> 0 0 0
<SECURITIES> 0 0 0
<RECEIVABLES> 0 0 0
<ALLOWANCES> 0 0 0
<INVENTORY> 0 0 0
<CURRENT-ASSETS> 0 0 0
<PP&E> 0 0 0
<DEPRECIATION> 0 0 0
<TOTAL-ASSETS> 0 0 0
<CURRENT-LIABILITIES> 0 0 0
<BONDS> 0 0 0
0 0 0
0 0 0
<COMMON> 0 0 0
<OTHER-SE> 0 0 0
<TOTAL-LIABILITY-AND-EQUITY> 0 0 0
<SALES> 0 0 0
<TOTAL-REVENUES> 0 0 0
<CGS> 0 0 0
<TOTAL-COSTS> 0 0 0
<OTHER-EXPENSES> 0 0 0
<LOSS-PROVISION> 0 0 0
<INTEREST-EXPENSE> 0 0 0
<INCOME-PRETAX> 0 0 0
<INCOME-TAX> 0 0 0
<INCOME-CONTINUING> 0 0 0
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 0 0 0
<EPS-PRIMARY> .24 .34 .74
<EPS-DILUTED> .23 .32 .69
</TABLE>
