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, 1997
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 No. 0-21078
UNION BANKSHARES, LTD.
(Exact name of small business issuer as specified in its charter)
DELAWARE 84-0986148
------------------------------ ------------------
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
1825 LAWRENCE STREET, SUITE 444, DENVER, CO 80202
(Address of principal executive offices)
(Zip Code)
(303) 298-5352
(Issuer's telephone number, including area code)
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Not Changed
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(Former name, former address and former fiscal year, if changed since last
report.)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past twelve 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 .
At April 30, 1997, there were 1,154,457 shares of common stock outstanding.
Transitional Small Business Disclosure Format: Yes No X
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<PAGE>
UNION BANKSHARES, LTD.
INDEX
PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements........................... 1
Item 2. Management's Discussion and Analysis or
Plan of Operation.............................. 7
PART II - OTHER INFORMATION.......................................... 12
SIGNATURES ............................................... 13
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<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
MARCH 31, 1997
UNION BANKSHARES, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CONDITION
<TABLE>
<CAPTION>
March 31,
1997 December 31,
ASSETS (UNAUDITED) 1996
------ ----------- ------------
<S> <C> <C>
Cash and due from banks $ 11,086,000 $ 12,356,000
Federal funds sold - -
------------- -------------
Total cash and cash equivalents 11,086,000 12,356,000
Investment securities:
Held-to-maturity securities 28,857,000 24,634,000
Available-for-sale securities 40,937,000 39,904,000
Other investments 871,000 494,000
------------- -------------
Total investment securities 70,665,000 65,032,000
Loans:
Commercial 71,239,000 70,631,000
Real estate mortgage 4,871,000 5,489,000
Mortgage loans held for sale - -
Real estate construction 6,600,000 5,758,000
Consumer 18,987,000 18,854,000
------------ ------------
Total loans 101,697,000 100,732,000
Less: allowance for loan losses (1,817,000) (1,754,000)
------------ ------------
99,880,000 98,978,000
Excess of investment in subsidiary over net
assets acquired 2,890,000 2,946,000
Furniture, equipment and improvements, net 1,493,000 1,573,000
Accrued interest receivable 1,534,000 1,107,000
Other assets 1,191,000 1,194,000
------------ ------------
TOTAL ASSETS $188,739,000 $183,186,000
============ ============
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<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest -bearing) $ 48,944,000 $ 48,742,000
NOW 16,565,000 15,279,000
Money Market 49,896,000 54,772,000
Savings 11,167,000 10,011,000
Time 31,159,000 27,605,000
------------ ------------
Total deposits 157,731,000 156,409,000
Federal funds purchased 500,000 6,200,000
Notes payable 13,500,000 3,500,000
Accrued interest payable 104,000 95,000
Other liabilities 717,000 950,000
------------ ------------
Total liabilities 172,552,000 167,154,000
Stockholders' equity
Common stock 1,000 1,000
Common stock surplus 9,458,000 9,435,000
Valuation allowance 36,000 348,000
Retained earnings 6,692,000 6,248,000
------------ ------------
Total stockholders' equity 16,187,000 16,032,000
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $188,739,000 $183,186,000
============ ============
</TABLE>
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<PAGE>
UNION BANKSHARES, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31,
-----------------------------
1997 1996
---- ----
<S> <C> <C>
INTEREST INCOME:
Interest and fees on loans $2,495,000 $2,172,000
Interest on investment securities:
U.S. government agencies and corporations 723,000 514,000
States and other political subdivisions 386,000 474,000
Interest on federal funds sold
and interest bearing deposits at other banks 16,000 13,000
----------- -----------
Total interest income 3,620,000 3,173,000
INTEREST EXPENSE:
Interest on deposits 946,000 836,000
Interest on federal funds purchased 28,000 34,000
Interest on notes payable 206,000 135,000
----------- -----------
Total interest expense 1,180,000 1,005,000
----------- -----------
NET INTEREST INCOME BEFORE PROVISION FOR
LOAN LOSS 2,440,000 2,168,000
PROVISION FOR LOAN LOSS 60,000 45,000
----------- -----------
NET INTEREST INCOME AFTER PROVISION FOR
LOAN LOSS 2,380,000 2,123,000
NONINTEREST INCOME:
Service charges 89,000 92,000
Gain (loss) on sale of securities available for sale (3,000) 111,000
Other 107,000 98,000
----------- -----------
Total non interest income 193,000 301,000
----------- -----------
NONINTEREST EXPENSE:
Salaries and employee benefits 1,057,000 966,000
Amortization of investment in subsidiary
over net assets acquired 57,000 57,000
Occupancy and equipment 297,000 313,000
Other 583,000 503,000
----------- -----------
Total non interest expense 1,994,000 1,839,000
----------- -----------
INCOME BEFORE INCOME TAX EXPENSE AND
EXTRAORDINARY ITEM 579,000 585,000
INCOME TAX EXPENSE (Note 3) 135,000 123,000
----------- -----------
INCOME BEFORE EXTRAORDINARY ITEM 444,000 462,000
EXTRAORDINARY ITEM (NET OF TAXES) (Note 5) - (337,000)
----------- -----------
NET INCOME $ 444,000 $ 125,000
=========== ===========
EARNINGS PER COMMON SHARE: (Note 4)
Income per share before extraordinary item $0.36 $0.39
Extraordinary item, net $0.00 ($0.28)
----------- -----------
Net income per share $0.36 $0.11
----------- -----------
Weighted average number of common shares outstanding 1,243,901 1,176,162
=========== ===========
</TABLE>
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<PAGE>
UNION BANKSHARES, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31,
--------------------------------
1997 1996
---- ----
<S> <C> <C>
Net cash provided (used) by operating activities ($ 284,000) $ 6,967,000
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of available-for-sale
securities 3,039,000 2,912,000
Proceeds from maturities of held-to-maturity
securities 818,000 747,000
Proceeds from sale of available-for-sale
securities 239,000 13,322,000
Purchase of available-for-sale securities (9,471,000) (6,599,000)
Purchase of other investments (377,000) -
Net increase in loans (858,000) (4,885,000)
Purchase of furniture and equipment (21,000) (62,000)
------------ ------------
Net cash used in investing activities (6,631,000) 5,435,000
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (decrease) in deposits 1,322,000 1,058,000
Increase (decrease) in fed funds purchased (5,700,000) -
New borrowings long-term debt 10,000,000 4,000,000
Repayments of long-term debt - (6,512,000)
Proceeds from issuance of common stock 23,000 26,000
------------ ------------
Net cash provided by financing activities 5,645,000 (1,428,000)
------------ ------------
Net increase in cash and cash equivalents (1,270,000) 10,974,000
Cash and cash equivalents, beginning of year 12,356,000 1,058,000
---------- -----------
Cash and cash equivalents, end of quarter $11,086,000 $12,032,000
=========== ===========
</TABLE>
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<PAGE>
UNION BANKSHARES, LTD. AND SUBSIDIARY
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1997
NOTE 1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with the instructions to Form 10-QSB and do not include all the
information and note disclosures required by generally accepted accounting
principles for complete financial statements. For further information, refer to
the consolidated financial statements and related footnotes included in the
Company's annual report on Form 10-KSB for the year ended December 31, 1996. In
the opinion of management, the consolidated financial statements presented
herein include all adjustments (consisting of normal recurring accruals)
necessary to present fairly, in all material respects, the consolidated
financial position of Union Bankshares, Ltd. (the "Company") as of March 31,
1997 and the Company's results of operations for the three months ended March
31, 1997 and 1996, and statements of cash flows for the three months ended March
31, 1997 and 1996.
Certain reclassifications have been made to the March 31, 1996 Consolidated
Financial Statements to conform to the March 31, 1997 Consolidated Financial
Statements.
NOTE 2. RESULTS OF OPERATIONS
The results of operations for the three months ended March 31, 1997 are not
indicative of the results to be expected for the full year.
NOTE 3. INCOME TAXES
Income taxes are provided for on the liability method, in accordance with
Financial Accounting Standards Board (FASB) Statement No. 109, whereby deferred
assets are recognized for deductible temporary differences and operating loss
and tax credit carryforwards and deferred tax liabilities are recognized for
taxable temporary differences. Temporary differences are defined as the
differences between the reported amounts of assets and liabilities and their tax
basis. Deferred tax assets are reduced by a valuation allowance when, in the
opinion of management, it is more likely than not that some portion or all of
the deferred tax assets will not be realized. Deferred tax assets and
liabilities are adjusted for the effects of changes in the tax laws and rates on
the date of enactment.
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<PAGE>
NOTE 4. EARNINGS PER COMMON SHARE
Earnings per common share are computed by dividing net income available for
common stockholders by the weighted average number of shares of common stock
outstanding during the period plus the equivalent number of shares purchasable
under common stock options, if dilutive. Earnings per common share were affected
by 90,089 shares purchasable pursuant to exercisable options during the three
months ended March 31, 1997. Earnings per common share were affected by 28,514
shares purchasable pursuant to exercisable options during the three months ended
March 31, 1996.
NOTE 5. EXTRAORDINARY ITEM
On April 1, 1996, the Company redeemed the Convertible Subordinated Notes (the
"Notes"). Pursuant to the terms of the Notes, and as a result of the redemption,
holders of the Notes were entitled to receive from the Company the redemption
price of 101% of the principal amount of the Notes plus accrued interest.
Alternatively, at the option of the holder, the Notes were convertible into
shares of common stock of the Company at the conversion rate of 78.68 shares of
common stock for each $1000 principal amount of Notes redeemed. As a result of
the redemption in 1996, the Company expensed $473,000, the remaining unamortized
balance of the debt issuance costs, and a $65,000 redemption premium. These
amounts, net of $201,000 of applicable income taxes, have been categorized as an
extraordinary loss on the consolidated statement of income.
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<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following commentary presents management's discussion and analysis of the
Company's financial performance and financial condition for the first quarter
ended March 31, 1997. The discussion is a supplement to the Consolidated
Financial Statements and should be read in conjunction with those statements and
footnotes.
RESULTS OF OPERATIONS
OVERVIEW: Union Bankshares, Ltd. (the "Company") reported net income of $444,000
for the quarter ended March 31, 1997, an increase of 255.2% from net income of
$125,000 for the first quarter of 1996. 1997 first quarter earnings were
positively impacted by a $272,000 increase in net interest income and the
absence of a $337,000 (after tax) extraordinary expense relating to the
Company's redemption of its outstanding convertible subordinated notes (the
"Notes") in the first quarter of 1996. These improvements were offset by a
$114,000 decrease in gain on sale of securities available for sale, an increase
of $15,000 in provision for loan loss and an $80,000 increase in noninterest
expense for the quarter ended March 31, 1997. Net income per share was $.36 for
the three months ended March 31, 1997 compared to $.11 ($.39 before
extraordinary item) for the same period in 1996. Return on average assets and
average equity were .95% and 10.98%, respectively, for the first quarter of 1997
compared to .30% (1.12% before extraordinary item) and 3.33% (12.32% before
extraordinary item), respectively, for the first quarter of 1996.
During the first quarter of 1997, the Bank's loan portfolio increased $1.0
million and its deposits increased $1.3 million. In addition, the Company's long
term debt increased $10.0 million as a result of the Bank borrowing $10.0
million from the Federal Home Loan Bank of Topeka (the " FHLB").
INTEREST INCOME: Interest income increased $447,000, or 14.1%, to $3,620,000 for
the first quarter of 1997 from $3,173,000 for the comparable 1996 period. This
increase results from the increase in the Company's interest earning assets. The
Company's net yield on interest earning assets on a fully tax equivalent basis
was 8.79% for the first quarter of 1997, which reflects a decrease of 19 basis
points (each basis point equals 1/100 of 1%) from the comparable 1996 period.
The average yield on loans decreased from 10.42% in the 1996 period to 9.94% in
the 1997 period, and the average yield on securities held by the Company
decreased from 7.29% in the 1996 period to 7.19% in the 1997 period. Interest
income on loans was $323,000 greater in the 1997 period and interest income on
securities increased $121,000 in the 1997 period.
INTEREST EXPENSE: Interest expense increased $175,000, or 17.4%, to $1,180,000
for the quarter ended March 31, 1997 from $1,005,000 for the quarter ended March
31, 1996. This increase is primarily due to the $7.0 million increase in
interest bearing deposit accounts in the 1997 period compared to those in the
1996 period and the $9.5 million increase in notes payable (primarily from
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<PAGE>
the FHLB loan). Average rates paid on interest bearing deposits remained
constant at 3.43% between the first quarter of 1997 and the first quarter of
1996.
NET INTEREST INCOME: Net interest income before provision for loan loss
was $2,440,000 for the quarter ended March 31, 1997, an increase of $272,000, or
12.5%, over the first quarter of 1996. Net interest margin decreased 21 basis
points from 6.24% in the 1996 period to 6.03% in the 1997 period. The increase
in net interest income is primarily due to a $323,000 increase in interest
income on loans and a $121,000 increase in interest income on securities, offset
by a $175,000 increase in interest expense. The Company's average cost of funds
for the quarter ended March 31, 1997 was 6 basis points higher than in the
comparable 1996 period. The Company's average yield on interest earning assets
decreased 19 basis points in the 1997 period compared to the year earlier
period, from 8.98% to 8.79%.
NONINTEREST INCOME: Noninterest income decreased $108,000, or 35.9%, for the
quarter ended March 31, 1997 to $193,000 from $301,000 for the quarter ended
March 31, 1996. This decrease was primarily due to a $114,000 decrease in the
gain on sale of securities available for sale from a $111,000 gain in the first
quarter of 1996 to a $3,000 loss in the first quarter of 1997.
NONINTEREST EXPENSE: Noninterest expense increased $155,000, or 8.4%, for the
first quarter of 1997 to $1,994,000 compared to $1,839,000 in the first quarter
of 1996. This increase is primarily the result of: (i) increases in salaries and
benefits relating primarily to annual merit increases; and (2) an increase in
other noninterest expenses due to recoveries of legal fees and claims made
against the Company which were recovered in 1996.
EXTRAORDINARY ITEM: On March 1, 1996, the Company called the Convertible Notes
for redemption. The redemption on April 1, 1996 caused the Company to accelerate
the amortization of the debt issuance costs and to expense the call premium. The
after tax effect of this transaction was a $337,000 non-cash charge to income in
the first quarter of 1996.
PROVISION FOR LOAN LOSS
The Company charged $60,000 to Provision for Loan Loss in the first quarter of
1997 and $45,000 for the same period in 1996. The ratio of loan loss reserve to
total loans was 1.78% at March 31, 1997 and 1.75% at March 31, 1996. The Company
sets its loan loss reserve at a level considered adequate to provide for
anticipated loan losses based on management's assessment of various factors
affecting the loan portfolio. These factors include a review of problem loans,
business conditions, loan loss experience and an overall evaluation of the
quality of the collateral, holding and disposal costs and costs of capital.
Provision for loan loss is a direct charge against income and is determined by
management based on the adequacy of the loan loss reserve.
LIQUIDITY AND SOURCES OF FUNDS
The Company's total assets increased 3.0% to $188.7 million at March 31, 1997
from $183.2 at December 31, 1996. During the quarter ended March 31, 1997
deposits increased $1.3 million to
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<PAGE>
$157.7 million at March 31, 1997 from $156.4 million at December 31, 1996. None
of the Company's deposits at March 31, 1997 were brokered deposits.
The Loan Agreement with Nationsbanc (formerly Boatmen's) provides for interest
on outstanding amounts to be payable at Nationsbanc's corporate base rate, which
is currently 8.50%. The Loan Agreement provides for a one-year term loan which
is renewable by the Company unless the Company's credit standing is
unsatisfactory based on the criteria set forth below. The Loan Agreement
contains a twelve-year amortization schedule, with interest only for the first
two years, assuming renewal of the loan in accordance with its terms. Annual
renewal of the loan is based on the compliance by the Bank with the following
criteria:
1. Capital Ratio of not less than 6.25%;
2. Return on Average Assets of not below 1.00%;
3. Loan Loss Reserve/Total Loans Ratio of not below 1.00%;
4. Non-Performing Loans/Total Loans Ratio of not greater than
2.00%;
5. Debt Service Coverage Ratio of not less than 2:1; and
6. Absence of regulatory dividend restrictions.
In the event the Bank does not meet any of these criteria calculated as of
December 31 of each year and based on its financial statements, the Company will
have 90 days from the delivery of the financial statements to cure the
situation.
The loan is secured by the pledge of all of the shares of capital stock of the
Bank, and contains standard representations, warranties and covenants.
At December 31, 1996, the Company met all of the above criteria, and the loan
was renewed for another one year term.
The Company has also entered into a revolving line of credit with Nationsbanc in
an amount not to exceed $3,000,000. Any monies advanced under this line would be
used solely for capital needs of the Company or to purchase the stock of banks
or bank holding companies. This line of credit would be available for one year
only, with renewals to be negotiated each year. If any principal is advanced on
this line, the terms of the repayment would also be negotiated depending upon
the use of proceeds. Interest on amounts outstanding under this revolving line
of credit, if any, is due quarterly. At March 31, 1997, this line of credit was
also renewed for an additional one year term.
Management anticipates that the Company will continue to rely primarily on
customer deposits, sales and maturities of investment securities, loan sales and
loan repayments, as well as retained earnings to provide liquidity. These funds
are used to make loans, to acquire investment securities and other assets and to
fund continuing operations. The Company believes that its customer deposits will
continue to provide a strong source of liquidity because of the high percentage
of core deposits, many of which are held as compensating balances under
long-standing loan relationships. As a secondary source of funds, management
uses federal funds and its membership in the FHLB.
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<PAGE>
ASSET QUALITY
The Company's lending activities are guided by its Statement of Lending Policies
and Procedures. These policies are annually reviewed and approved by the Bank's
Board of Directors. The Company supplements its internal supervision and audits
of its lending operation with independent examinations performed by professional
experienced consultants and auditors. The Company monitors concentrations of
loans by collateral, purpose and industry. The Company has no significant
exposure to highly leveraged transactions and has no foreign credits in its loan
portfolio.
Total nonperforming assets were $105,000 and $14,000 at March 31, 1997 and
December 31, 1996, respectively. Other Real Estate Owned (OREO) was $0 at both
March 31, 1997 and December 31, 1996. At March 31, 1997 securities held to
maturity were $28.9 million, or 40.8% of the total portfolio. Securities
available for sale totaled $40.9 million, or 57.9% of the total portfolio. Other
securities (investment in FHLB stock) totaled $.9 million, or 1.3% of the total
portfolio. Securities available for sale are those securities which may be sold
in response to changes in interest rates, changes in the Company's short term
liquidity needs or changes in prepayment risk, and are stated at the lower of
cost or estimated market value. At March 31, 1996, the market value of
investments available for sale exceeded carrying value by approximately $20,000.
Securities held to maturity are considered longer term assets which are normally
held until maturity and are carried at amortized cost. The carrying value of
securities held to maturity exceeded market value by approximately $143,000 at
March 31, 1997. U.S. government securities make up $45.9 million, or 64.9% of
the investment portfolio, and obligations of states and political subdivisions
(municipal securities), comprise $24.8 million, or 35.1% of the portfolio at
March 31, 1997.
As noted in the Company's Form 10-KSB for the year ended December 31, 1996,
management has generally sought to control the exposure of the Company's
securities portfolio to rising interest rates by maintaining a position within a
narrow range around an "earnings neutral position" (i.e. the mix of assets and
liabilities that generate a net interest margin that is least affected by
interest rate changes). The Company uses a measurement tool known as dollar
duration to help maintain an earnings neutral position. As of March 31, 1997,
the dollar duration of the investment portfolio was 3.90 compared to 4.00 at
December 31, 1996. This modest decrease in dollar duration resulted from the
partial replacement of securities which were sold, matured or called during the
first quarter of 1997 with securities with the same or lower yields but with
shorter maturities. The Company may also engage in hedging transactions to
control interest rate risk. The effect of these efforts in any given period may
be to negatively impact reported net non-interest income and the interest earned
on the securities.
CAPITAL RESOURCES
The Company's capital adequacy is a direct measurement of the overall financial
strength of the Company and its ability to absorb adverse market conditions. In
addition, the capital position of the Company provides a mechanism to promote
public confidence in the Company and the Bank.
The Company's total stockholders' equity increased $155,000 to $16.2 million at
March 31, 1997 from $16.0 million at December 31, 1996. This increase in
stockholders' equity was due to the
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<PAGE>
retention of earnings in the current year and the exercise of options to
purchase 2,600 shares of common stock, less the net effect of FAS 115 which
requires financial institutions to mark their available for sale securities
portfolio to market.
The Federal Reserve Board and FDIC guidelines require a minimum of a 4% Tier 1
core capital to risk-weighted assets ratio and an 8% total qualifying capital to
risk-weighted assets ratio. Due to the Company's high level of capital and the
level of risk in its current asset mix, the Company's risk based capital ratios
exceed the regulatory minimum ratios. The Company's core capital to risk
weighted assets was 10.84% at March 31, 1997 and its total qualifying capital to
risk weighted assets was 12.12%. As of March 31, 1997 the Bank also exceeded the
minimum regulatory risk based capital ratios.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995.
Statements which are not historical facts contained in this document are forward
looking statements that involve risks and uncertainties that could cause actual
results to differ from projected results. Factors that could cause actual
results to differ materially include, among others: general economic conditions,
economic conditions in the Denver metropolitan area, the monetary policy of the
Federal Reserve Board, changes in interest rates, inflation, competition in the
banking business, changes in the state and federal regulatory regime applicable
to the Company's and the Bank's operations, the results of financing efforts and
other risk factors detailed in the Company's Forms 10-KSB, 10-QSB and 8-K filed
with the Securities and Exchange Commission.
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<PAGE>
UNION BANKSHARES, LTD.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
27. Financial Data Schedule
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<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the issuer caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
UNION BANKSHARES, LTD.
----------------------------------------------
(Registrant)
May 7, 1997
Bruce E. Hall
----------------------------------------------
Vice President, Treasurer and Secretary
(Authorized Officer and Principal
Financial Officer of the Registrant)
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<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 11,086,000
<INT-BEARING-DEPOSITS> 108,787,000
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 40,937,000
<INVESTMENTS-CARRYING> 70,665,000
<INVESTMENTS-MARKET> 70,543,000
<LOANS> 101,697,000
<ALLOWANCE> (1,817,000)
<TOTAL-ASSETS> 188,739,000
<DEPOSITS> 157,731,000
<SHORT-TERM> 500,000
<LIABILITIES-OTHER> 821,000
<LONG-TERM> 13,500,000
0
0
<COMMON> 9,459,000
<OTHER-SE> 6,692,000
<TOTAL-LIABILITIES-AND-EQUITY> 188,739,000
<INTEREST-LOAN> 2,495,000
<INTEREST-INVEST> 1,125,000
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 3,620,000
<INTEREST-DEPOSIT> 946,000
<INTEREST-EXPENSE> 1,180,000
<INTEREST-INCOME-NET> 2,440,000
<LOAN-LOSSES> 60,000
<SECURITIES-GAINS> (3,000)
<EXPENSE-OTHER> 1,994,000
<INCOME-PRETAX> 579,000
<INCOME-PRE-EXTRAORDINARY> 579,000
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 444,000
<EPS-PRIMARY> .36
<EPS-DILUTED> .36
<YIELD-ACTUAL> 8.79
<LOANS-NON> 105,000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,754,000
<CHARGE-OFFS> 0
<RECOVERIES> 3,000
<ALLOWANCE-CLOSE> 1,817,000
<ALLOWANCE-DOMESTIC> 1,817,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
