SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
SEPTEMBER 30, 1996 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: 0-21108
MARION CAPITAL HOLDINGS, INC.
(Exact name of registrant specified in its charter)
Indiana 35-1872393
- ------------------------------ ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
100 West Third Street
P.O. Box 367
Marion, Indiana 46952
(Address of principal executive offices,
including Zip Code)
(317) 664-0556
(Registrant's telephone number, including area code)
Indicate by check mark 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 report), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
The number of shares of the Registrant's common stock, without par value,
outstanding as of November 7, 1996 was 1,842,642.
<PAGE>
Marion Capital Holdings, Inc.
Form 10-Q
Index
Page No.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements 3
Consolidated Condensed Statement of Financial Condition
as of September 30, 1996 and June 30, 1996
Consolidated Condensed Statement of Income for the
three-month periods ended September 30, 1996 and 1995
Consolidated Condensed Statement of Changes in
Shareholders' Equity for the three months ended
September 30, 1996
Consolidated Condensed Statement of Cash Flows
for the three months ended September 30,
1996 and 1995
Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
2
<PAGE>
MARION CAPITAL HOLDINGS, INC.
AND WHOLLY-OWNED SUBSIDIARY
FIRST FEDERAL SAVINGS BANK
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
September 30, June 30,
1996 1996
------------ ------------
ASSETS
<S> <C> <C>
Cash $1,645,804 $2,365,805
Short-term interest bearing deposits 5,992,802 5,154,518
------------ ------------
Total cash and cash equivalents 7,638,606 7,520,323
Investment securities available for sale 999,750
Investment securities held to maturity
(market value $7,535,138 and $11,496,535) 7,595,230 11,566,476
Mortgage-backed securities (market value $1,044,223
and $1,389,232) 1,056,068 1,491,246
Loans receivable, net 145,080,244 143,164,641
Real estate owned, net 170,089 182,959
Premises and equipment 1,443,218 1,446,025
Stock in Federal Home Loan Bank (at cost
which approximates market) 988,400 988,400
Other assets 10,624,783 10,406,755
------------ ------------
Total assets $174,596,638 $177,766,575
============ ============
LIABILITIES
Deposits $123,666,717 $126,260,010
Advances from FHLB 5,941,474 6,241,474
Advances by borrowers for taxes and
insurance 305,798 392,278
Other liabilities 5,074,757 3,361,739
------------ ------------
Total liabilities 134,988,746 136,255,501
SHAREHOLDERS' EQUITY
Preferred Stock:
Authorized and unissued--2,000,000 shares 0 0
Common stock, without par value:
Authorized--5,000,000 shares
Issued and outstanding--1,842,642 and
1,933,613 shares 12,040,034 13,814,937
Retained earnings 27,887,618 28,128,458
Unrealized loss on securities available for sale 0 (119)
Unearned compensation (319,760) (432,202)
------------ ------------
Total shareholders' equity 39,607,892 41,511,074
------------ ------------
Total Liabilities and Shareholders' Equity $174,596,638 $177,766,575
============ ============
</TABLE>
3
<PAGE>
MARION CAPITAL HOLDINGS, INC.
AND WHOLLY-OWNED SUBSIDIARY
FIRST FEDERAL SAVINGS BANK
CONSOLIDATED CONDENSED STATEMENT OF INCOME
<TABLE>
<CAPTION>
Three Months Ended
September 30,
---------------------------------------
1996 1995
---------- ----------
Interest Income
<S> <C> <C>
Loans $3,183,374 $3,090,063
Mortgage-backed securities 16,687 32,251
Interest-bearing deposits 72,543 41,235
Investment Securities 139,044 235,069
Other interest and dividend income 19,503 18,332
---------- ----------
Total interest income 3,431,151 3,416,950
Interest Expense
Deposits 1,614,238 1,580,407
Advances from FHLB 100,033 119,194
Securities sold under agreement to repurchase 0 12,724
---------- ----------
Total interest expense 1,714,271 1,712,325
---------- ----------
Net interest income 1,716,880 1,704,625
Provision for losses on loans 4,190 0
---------- ----------
Net interest income after
provision for losses on loans 1,712,690 1,704,625
---------- ----------
Other Income
Net loan servicing fees 22,207 19,178
Annuity and other commissions 44,516 44,406
Equity in losses of limited partnerships (60,000) (44,226)
Other income 18,592 37,681
---------- ----------
Total Other Income 25,315 57,039
---------- ----------
Other Expenses
Salaries and employee benefits 685,603 590,525
Occupancy expense 43,949 39,295
Equipment expense 14,301 13,036
Deposit insurance expense 861,651 80,758
Real estate operations, net 8,110 1,465
Other expenses 217,113 189,712
---------- ----------
Total Other Expenses 1,830,727 914,791
---------- ----------
Income (Loss) Before Income Taxes (92,722) 846,873
Income Tax Expense (Benefit) (220,210) 241,045
---------- ----------
Net Income $127,488 $605,828
========== ==========
Per Share
Net income $0.07 $0.29
Dividends $0.20 $0.18
</TABLE>
4
<PAGE>
MARION CAPITAL HOLDINGS, INC.
AND WHOLLY-OWNED SUBSIDIARY
FIRST FEDERAL SAVINGS BANK
CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
Common Stock Unearned Total
------------------------------- Retained Unrealized loss Compensation Shareholders'
Shares Amount Earnings on Securities RRP Equity
------ ------ -------- ------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Balances, July 1, 1996 1,933,613 $13,814,937 $28,128,458 ($119) ($432,202) $41,511,074
Stock repurchases (96,680) (1,965,480) (1,965,480)
Exercise of stock options 5,709 57,090 57,090
Amortization of unearned
compensation 112,442 112,442
Net change in unrealized loss on
securities available for sale 119 119
Net income for the three months
ended September 30, 1996 127,488 127,488
Tax benefit on compensation plans 133,487 133,487
Cash dividends (368,328) (368,328)
--------- ----------- ---------- -- --------- -----------
Balances, September 30, 1996 1,842,642 $12,040,034 27,887,618 $0 ($319,760) $39,607,892
========= =========== =========== ===== ========= ===========
</TABLE>
5
<PAGE>
MARION CAPITAL HOLDINGS, INC.
AND WHOLLY-OWNED SUBSIDIARY
FIRST FEDERAL SAVINGS BANK
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
September 30,
--------------------------------------
1996 1995
--------- ----------
Cash Flows from Operation Activities
<S> <C> <C>
Net income $127,488 $605,828
Adjustments to reconcile net income to
net cash provided by operating activities:
Provision for loan losses 4,190 0
Equity in loss of limited partnerships 60,000 44,226
Amortization of net loan origination fees (65,965) (63,443)
Net amortization (accretion) of investment
securities' premiums and discounts 4,597 5,817
Net amortization (accretion) of mortgage-
backed securities and CMO premiums 750 2,336
Amortization of unearned compensation 112,442 108,943
Depreciation 18,960 19,120
Deferred income tax (108,978) (61,971)
Origination of loans for sale (1,050,000) (1,669,886)
Proceeds from sale of loans 1,050,000 1,669,886
Change in:
Interest receivable (59,244) (91,272)
Interest payable and other liabilities 1,713,018 1,044,515
Cash value of insurance (179,787) (27,000)
Prepaid expense and other assets 229,612 (31,392)
--------- ----------
Net cash provided by operating activities 1,857,083 1,555,707
--------- ----------
Investing Activities
Proceeds from maturity of investment
securities available for sale 1,000,000 1,000,000
Purchase of investment securities
held to maturity (1,000,000) 0
Proceeds from maturity of investment
securities held to maturity 4,962,246
Payments on mortgage-backed securities 434,428 76,433
Net change in loans (2,246,239) (2,975,563)
Proceeds from real estate owned sales 30,722 22,500
Purchases of premises and equipment (16,153) (12,126)
Death benefits received on life insurance 352,687 0
--------- ----------
Net cash provided (used) by investing
activities 3,517,691 (1,888,756)
--------- ----------
</TABLE>
6
<PAGE>
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (continued)
<TABLE>
<CAPTION>
Financing Activities
Net change in:
Noninterest-bearing deposits, NOW
passbook and money market savings
<S> <C> <C>
accounts (1,170,884) (138,774)
Certificates of Deposit (1,422,409) (298,939)
Proceeds from FHLB advances 1,500,000 3,000,000
Repayment of FHLB advances (1,800,000) (3,000,000)
Proceeds from securities sold under
agreement to repurchase 0 2,483,016
Net change in advances by borrowers for
taxes and insurance (86,480) (91,455)
Proceeds from exercise of stock options 57,090 50,850
Stock repurchases (1,965,480) 0
Dividends paid (368,328) (358,447)
--------- ----------
Net cash provided (used) by
financing activities (5,256,491) 1,829,161
--------- ----------
Net Change in Cash and Cash Equivalents 118,283 1,496,112
Cash and Cash Equivalents,
Beginning of Period 7,520,323 3,483,184
--------- ----------
Cash and Cash Equivalents,
End of Period $7,638,606 $4,979,296
========== ==========
Additional Cash Flows and Supplementary
Information
Interest paid $898,991 $961,882
Income tax paid 250,879 77,458
Loan balances transferred to real
estate owned 59,141 58,879
Loans to finance the sale of real
estate owned 38,000 300,000
</TABLE>
7
<PAGE>
MARION CAPITAL HOLDINGS, INC.
AND WHOLLY-OWNED SUBSIDIARY
FIRST FEDERAL SAVINGS BANK OF MARION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A: Basis of Presentation
The unaudited interim consolidated condensed financial statements include the
accounts of Marion Capital Holdings, Inc. (the "Company") and its subsidiary
First Federal Savings Bank of Marion (the "Bank").
The unaudited interim consolidated condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all information and disclosures required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the financial statements reflect all adjustments, comprising only
normal recurring accruals, necessary to present fairly the Company's financial
position as of September 30, 1996, results of operations for the three month
period ended September 30, 1996 and 1995, and cash flows for the three month
period ended September 30, 1996 and 1995.
NOTE B: Dividends and Earnings Per Share
On August 12, 1996, the Board of Directors declared a quarterly cash dividend of
$.20 per share. This dividend was paid on September 13, 1996 to shareholders of
record as of August 30, 1996.
The per share amounts were computed based on 1,913,198 average common and common
equivalent shares outstanding for the three month period ended September 30,
1996 and 2,070,566 average common and common equivalent shares outstanding for
the three month period ended September 30, 1995.
NOTE C: Accounting For Mortgage Servicing Rights
The Company adopted Statement of Accounting Standards ("SFAS") No. 122,
Accounting for Mortgage Servicing Rights, on July 1, 1996. Mortgage servicing
rights on originated loans are capitalized by allocating the total cost of the
mortgage loans between the mortgage servicing rights and the loans based on
their relative fair values. Capitalized servicing rights are amortized in
proportion to and over the period of estimated servicing revenues. The adoption
of SFAS No. 122 did not have a material effect on the Company's financial
statements.
8
<PAGE>
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations.
General:
The Company's total assets were $174.6 million at September 30, 1996 compared to
$177.8 million at June 30, 1996. Cash and cash equivalents remained relatively
unchanged from June 30, 1996 to September 30, 1996, and investment securities
declined to $7.6 million at September 30, 1996, a 39.6% decrease from $12.6
million on June 30, 1996 as the Company used funds to meet new loan
originations, fund deposit outflows, and repurchase common stock. Loans
receivable were $145.1 million at September 30, 1996, an increase of $1.9
million, or 1.3%, from June 30, 1996. This increase is due primarily to
originations of 1-4 family loans. Real estate owned decreased to $170,000 at
September 30, 1996, compared to $183,000 at June 30 1996, a 7.0% decrease.
Deposits decreased to $123.7 million at September 30, 1996 compared to $126.3
million at June 30, 1996, a 2.1% decrease. This $2.6 million decrease
represented a $1.2 million decrease in passbook and transaction accounts and an
approximate $1.4 million decline in certificate of deposit accounts. Management
believes the savings outflows are the result of changing market interest rates.
The Bank continues to pay competitive rates on its savings products compared to
other financial institutions in its market area.
Advances from the Federal Home Loan Bank declined by $300,000 as the Bank repaid
maturing advances from liquid funds.
Other liabilities increased from $3.4 million at June 30, 1996 to $5.1 million
at September 30, 1996 as a result of an increase in accrued interest payable on
savings deposits and recording of a liability for the special SAIF assessment of
$777,000. A majority of the Bank's savings accounts are credited interest on
June 30 and December 31 of each year resulting in a larger accrued interest
payable at September 30, compared to June 30.
Shareholders' equity was $39.6 million at September 30, 1996, compared to $41.5
million at June 30, 1996.
During the quarter ended September 30, 1996, the Company completed a stock
repurchase program to repurchase 96,680 shares, or 5% of the Company's
outstanding common stock in the open market. The Company acquired the shares at
an average price of $20.33, or 95% of book value, and reduced the number of
shares outstanding to 1,842,642.
For the three months ended September 30, 1996, net income amounted to $127,488,
a decrease from the earnings of $605,828 for the three months ended September
30, 1995. This decrease in earnings is attributable directly to the signing of
the omnibus appropriations bill on September 30, 1996, which imposes a FDIC
special assessment for all institutions with SAIF-insured deposits. This
assessment amounted to $776,717 and is included in deposit insurance expense for
the three months ended September 30, 1996. The assessment is payable November
27, 1996. The after-tax effect on net income was $469,059 for the three months
ended September 30, 1996. SAIF-insured institutions will likely incur a benefit
from reduction of FDIC premiums beginning January 1, 1997, which should have a
positive effect on earnings in future periods.
9
<PAGE>
Results of Operations Comparison of Three Months Ended September 30, 1996 and
September 30, 1995
Net income for the three months ended September 30, 1996 was $127,488 compared
with $605,828 for the three months ended September 30, 1995. Interest income for
the three months ended September 30, 1996 increased by $14,201 or 0.4% compared
to the same period in the prior year, while interest expense for the three
months ended September 30, 1996 increased $1,946 or 0.1% compared to the same
period in the prior year. These increases reflect the repricing of assets and
liabilities to lower rates and a decrease in deposit balances outstanding. As a
result, net interest income for the three months ended September 30, 1996
amounted to $1,716,880, an increase of $12,255 or 0.7% compared to the same
period in the prior year.
The return on assets for the three months ended September 30, 1996 was .29%
compared to 1.39% for the same period last year. Without the SAIF special
assessment expense, the return on assets would have been 1.35% for the three
months ended September 30, 1996.
The return on equity for the three months ended September 30, 1996, was 1.26%
compared to 5.75% for the same period last year. Without the FDIC special
assessment expense, the return on equity would have been 5.88% for the three
months ended September 30, 1996.
A $4,190 provision for loss on loans for the three months ended September 30,
1996 was made compared to no provision reported in the same period last year.
With non-performing loans decreasing, management believes that the allowance for
loan losses is adequate at this time.
Total other income decreased by $31,724 for the three months ended September 30,
1996, compared to the same period in the prior year. The Company recognized an
increased loss from the limited partnership based on expected operations as a
result of the partnership restructuring its long-term debt.
Total other expenses increased by $915,936 for the three months ended September
30, 1996, compared to the same period in the prior year. Deposit insurance
expense increased by $780,893 as the result of the SAIF special assessment as
discussed above. Salaries and employee benefits increased to $95,078, or 16.1%.
This increase was attributable to the granting of the remaining unvested shares
under the RRP program and expenses attributable to bringing other benefit
programs up to 100% for a deceased director resulting in increased expense of
$88,000.
Income tax benefit for the three months ended September 30, 1996 amounted to
$220,210, compared to tax expenses of $241,045 reported for the three months
ended September 30, 1995. The tax benefit results from the pre-tax operating
loss created by the SAIF special assessment and low-income housing tax credits
from the limited partnership. The Company's effective tax rate for the three
months ended September 30, 1995 was 28.5%.
Allowance for loan losses amounted to $2.0 million at September 30, 1996, which
was unchanged from June 30, 1995 after adjusting for charge-offs and recoveries.
Management considered the allowances for loan and real estate losses at
September 30, 1996, to be adequate to cover estimated losses inherent in those
portfolios at that date, and its consideration included probable losses that
could be reasonably estimated. Such belief is based upon an analysis of loans
currently outstanding, real estate owned, past loss experience, current economic
conditions and other factors and estimates which are subject to change over
time. The following table illustrates the changes affecting the allowance
accounts for the three months ending September 30, 1996.
10
<PAGE>
<TABLE>
<CAPTION>
Allowance For Allowance For Total
loan losses REO losses Allowances
---------- --------- ----------
<S> <C> <C> <C>
Balances at July 1, 1996 ......................... $2,009,250 $16,118 $2,025,368
Provision for losses ............................. 4,190 0 4,190
Recoveries........................................ 0 8,853 8,853
Loans and REO charged off......................... 0 (19,024) (19,024)
---------- --------- ----------
Balances at September 30, 1996.................... $2,013,440 $ 5,947 $2,019,387
========== ========= ==========
</TABLE>
The loan loss reserves to total loans at September 30, 1996 equaled 1.37% of
total loans outstanding, compared to 1.38% of total loans outstanding at June
30, 1996. Total non-performing assets decreased during the three months ended
September 30, 1996, from $1.9 million at June 30, 1996 to $1.7 million at
September 30, 1996. Non-performing assets at September 30, 1996 consisted of
$170,000 in real estate owned and loans delinquent greater than 90 days of $1.5
million.
Total non-performing loans totaled 1.01% of total loans outstanding at September
30, 1996 compared to 1.18% of total loans at June 30, 1996.
The following table further depicts the amounts and categories of the Bank's
non-performing assets. It is the policy of the Bank that all earned but
uncollected interest on all loans be reviewed monthly to determine if any
portion thereof should be classified as uncollectible for any loan past due in
excess of 90 days.
September 30, June 30,
1996 1996
------------- --------
(Dollars in Thousands)
Accruing loans delinquent
more than 90 days ........................... $--- $---
Non-accruing loans:
Residential ................................. 1,428 1,659
Multi-family ................................ -- --
Commercial .................................. 45 47
Consumer .................................... 11 11
Troubled debt restructurings .................... -- --
------ ------
Total non-performing loans .................. 1,484 1,717
Real estate owned, net .......................... 170 183
------ ------
Total non-performing assets ................. $1,654 $1,900
====== ======
Non-performing loans to
total loans, net............................. 1.01% 1.18%
Non-performing assets to
total assets ................................ .95% 1.07%
11
<PAGE>
Average Balances and Interest
The following table presents for the periods indicated the monthly average
balances of the Company's interest-earning assets and interest-bearing
liabilities, the interest earned or paid on such amounts, and the average yields
earned and rates paid. Such yields and costs are determined by dividing income
or expense by the average balance of assets or liabilities for the periods
presented.
<TABLE>
<CAPTION>
Three Months Ended September 30
--------------------------------------------------------------------------
1996 1995
----------------------------------- -----------------------------------
(Dollars in thousands)
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------- -------- ---- ------- -------- ----
<S> <C> <C> <C> <C> <C> <C>
Total interest-
earnings assets.......... $164,604 $3,431 8.34% $163,427 $3,417 8.36%
Total interest-
bearing liabilities...... 130,370 1,714 5.26% 127,959 1,712 5.35%
Net interest income/
interest rate spread.... $1,717 3.08% 1,705 3.01%
===== =====
</TABLE>
Financial Condition
Shareholders' equity at September 30, 1996 was $39,607,892, a decrease of
$1,903,182 or 4.6% from June 30, 1996. The Company's equity to asset ratio was
22.69% at September 30, 1996 compared to 23.35% at June 30, 1996. All fully
phased-in capital requirements are currently met. The following table depicts
the amounts (in thousands) and ratios of the Bank's capital as of September 30,
1996 under each of the three regulatory capital requirements (tangible, core,
and fully phased-in risk based):
Tangible Core Risk-Based
Capital Capital Capital
--------- ------- ----------
Amount . . . . . . . . . . . . . . . . $35,809 $35,809 $37,223
As a percent of assets, as defined . . 21.0% 21.0% 33.1%
Required amount . . . . . . . . . . . 2,557 5,114 9,004
As a percent of assets, as defined . . 1.5% 3.0% 8.0%
Capital in excess of
required amount . . . . . . . . . . $33,252 $30,695 $28,219
Liquidity and Capital Resources
The standard measure of liquidity for savings associations is the ratio of cash
and eligible investments to a certain percentage of net withdrawable savings
accounts and borrowings due within one year. The minimum required ratio is
currently set by the Office of Thrift Supervision regulation at 5%, of which 1%
must be comprised of short-term investments. At September 30, 1996, the Bank's
liquidity ratio was 10.2% of which 6.0% was comprised of short-term investments.
12
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Neither the Company nor the Bank were during the three-month period ended
September 30, 1996, or are as of the date hereof involved in any legal
proceeding of a material nature. From time to time, the Bank is a party to legal
proceedings wherein it enforces its security interests in connection with its
mortgage loans.
Item 6. Exhibits and Reports on Form 8-K
a) Exhibit 27 is the Financial Data Schedule
b) The Company filed no reports on Form 8-K during the quarter ended
September 30, 1996.
13
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MARION CAPITAL HOLDINGS, INC.
Date: November 14, 1996 By: /s/ John M. Dalton
------------------
John M. Dalton,
President
Date: November 14, 1996 By: /s/ Larry G. Phillips
---------------------
Larry G. Phillips,
Vice President,
Secretary and Treasurer
14
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE REGISTRANT'S UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE
MONTHS ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000894372
<NAME> Marion Capital Holdings, Inc.
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-1-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1.000
<CASH> 1,645,804
<INT-BEARING-DEPOSITS> 5,992,802
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 7,595,230
<INVESTMENTS-MARKET> 7,535,138
<LOANS> 147,093,684
<ALLOWANCE> 2,013,440
<TOTAL-ASSETS> 174,596,638
<DEPOSITS> 123,666,717
<SHORT-TERM> 0
<LIABILITIES-OTHER> 11,322,029
<LONG-TERM> 0
<COMMON> 12,040,034
0
0
<OTHER-SE> 27,567,858
<TOTAL-LIABILITIES-AND-EQUITY> 174,596,638
<INTEREST-LOAN> 3,183,374
<INTEREST-INVEST> 228,274
<INTEREST-OTHER> 19,503
<INTEREST-TOTAL> 3,431,151
<INTEREST-DEPOSIT> 1,614,238
<INTEREST-EXPENSE> 1,714,271
<INTEREST-INCOME-NET> 1,716,880
<LOAN-LOSSES> 4,190
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,830,727
<INCOME-PRETAX> (92,722)
<INCOME-PRE-EXTRAORDINARY> 127,488
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 127,488
<EPS-PRIMARY> .07
<EPS-DILUTED> .07
<YIELD-ACTUAL> 8.34
<LOANS-NON> 1,717,000
<LOANS-PAST> 1,717,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,009,250
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 2,013,440
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,013,440
</TABLE>
