Page 2
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 June 30, 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 number: 33-58832
FIRST CENTRAL BANCSHARES, INC.
(Exact name of small business issue as specified in its charter)
Tennessee
(State or other jurisdiction of incorporation or organization)
725 Highway 321 North, Lenoir City, Tennessee
(Address of principal executive office)
62-1482501
(I.R.S. Employer Identification No.)
37771-0230
(Zip Code)
Registrant's telephone number, including area code: (423) 986-1300
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock (par value $1.00 per share)
Indicate by 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 reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [x] No [ ]
Indicate by mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13,
or (15d) of the Securities Exchange Act of 1934 subsequent to
the distribution of securities under a plan confirmed by a
court.
Yes [x] No [ ]
The number of outstanding shares of the registrant's
Common Stock, par value $5.00 per share, was 466,755 on August
8, 1997.
FORM 10-QSB
Index
Page
Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Accountant's Compilation Report 3
Condensed Consolidated Balance Sheets
as of June 30, 1997 and December 31, 1996 4
Condensed Consolidated Statements of Income
for the six months ended June 30, 1997 and 1996 5
Condensed Consolidated Statements of Cash
Flows for the six months ended June 30, 1997
and 1996 6
Notes to Condensed Consolidated Financial
Statements 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8-13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults upon Senior Securities 13
Item 4. Submission of Matters to a Vote
of Securities Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13-14
Signatures 15
ACCOUNTANT'S COMPILATION REPORT
Board of Directors
First Central Bancshares, Inc.
Lenoir City, Tennessee
We have compiled the condensed consolidated balance sheets of
First Central Bancshares, Inc. as of June 30, 1997 and December
31, 1996, and the related condensed consolidated statements of
income and cash flows for the six month periods ended June 30,
1997 and 1996, included in the accompanying prescribed form in
accordance with Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified
Public Accountants.
Our compilation was limited to presenting, in the form
prescribed by the Securities and Exchange Commission,
information that is the representation of management. We have
not audited or reviewed the condensed consolidated financial
statements referred to above and, accordingly, do not express
an opinion or any other form of assurance on them.
These condensed consolidated financial statements (including
related disclosures) which appear on pages 4 through 7 are
presented in accordance with the requirements of the Securities
and Exchange Commission, which differ from generally accepted
accounting principles. Accordingly, these condensed
consolidated financial statements are not designed for those
who are not informed about such matters.
Certified Public Accountants
August 8, 1997
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
FIRST CENTRAL BANCSHARES, INC. AND SUBSIDIARY
Condensed Consolidated Balance Sheets
(Unaudited)
(In Thousands)
June 30, December 31,
1997 1996
- -ASSETS-
Cash and Due from Banks $ 3,265 $ 2,764
Federal Funds Sold -0- 1,430
Total Cash and Cash Equivalents 3,265 4,194
Investment Securities Available for Sale 11,170 11,066
Loans, Net 60,559 55,539
Premises and Equipment, Net 3,621 3,365
Accrued Interest Receivable 522 474
Other Assets 209 209
TOTAL ASSETS $79,346 $74,847
- -LIABILITIES AND STOCKHOLDERS' EQUITY-
Liabilities:
Deposits
Non-Interest Bearing $10,399 $ 9,499
Interest Bearing 60,596 58,375
Total Deposits 70,995 67,874
Federal Funds Purchased 1,035 -0-
Accrued Interest Payable 301 331
Other Liabilities 196 323
Total Liabilities 72,527 68,528
Stockholders' Equity:
Common Stock - Par Value $5.00, Authorized
2,000,000 Shares; Issued and Outstanding
466,755 Shares 2,334 2,334
Capital in Excess of Par Value 3,427 3,427
Retained Earnings 1,100 592
Unrealized Gain (Loss) on Investment
Securities (42) (34)
Total Stockholders' Equity 6,819 6,319
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $79,346 $74,847
See accompanying notes to financial statements.
See Accountant's Compilation Report.
FIRST CENTRAL BANCSHARES, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Income
(Unaudited)
(In Thousands Except
per Share Information)
Six Months Ended
June 30,
1997 1996
INTEREST INCOME:
Loans $2,922 $2,438
Investment Securities and Certificates
of Deposit 366 350
Federal Funds Sold 37 172
Total Interest Income 3,325 2,960
INTEREST EXPENSE 1,471 1,449
Net Interest Income 1,854 1,511
PROVISION FOR LOAN LOSSES 93 118
Net Interest Income After
Provision for Loan Losses 1,761 1,393
OTHER INCOME 270 202
OPERATING EXPENSES 1,207 1,059
INCOME BEFORE INCOME TAXES 824 536
INCOME TAXES 316 209
NET INCOME $ 508 $ 327
EARNINGS PER SHARE $ 1.09 $ 0.72
See accompanying notes to financial statements.
See Accountant's Compilation Report.
FIRST CENTRAL BANCSHARES, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In Thousands)
Six Months Ended
June 30,
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 508 $ 327
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Provision for Loan Losses 93 118
Depreciation 119 109
Amortization 2 2
(Increase) in Interest Receivable (48) (15)
Increase (Decrease) in Interest Payable (30) 31
Amortization of Premiums (Discounts) on
Investment Securities and Certificates
of Deposit, Net 8 8
FHLB Stock Dividends (18) (7)
(Increase) Decrease in Other Assets (2) 54
(Decrease) in Other Liabilities (121) (186)
Total Adjustments 3 114
Net Cash Provided by Operating Activities 511 441
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds From Maturities, Principal Paydowns and
Redemption of Investment Securities Available
for Sale 892 3,108
Purchase of Investment Securities Available
for Sale (1,000) (6,702)
Increase in Loans (5,113) (8,412)
Purchase of Premises and Equipment (375) (237)
Net Cash Used in Investing Activities (5,596) (12,243)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in Deposits 3,121 6,226
Increase in Federal Funds Purchased 1,035 -0-
Net Cash Provided by Financing Activities 4,156 6,226
DECREASE IN CASH AND CASH EQUIVALENTS (929) (5,576)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 4,194 10,726
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,265 $ 5,150
Supplementary Disclosure of Cash Flow Information:
Cash Paid During the Period For:
Interest $ 1,501 $ 1,391
Income Taxes $ 375 $ 362
Supplementary Disclosures of Noncash Investing Activities:
Change in Unrealized Loss on Investment
Securities $ 14 $ 222
Change in Deferred Income Tax Benefit Associated with
Unrealized Loss on Investment Securities $ 6 $ 136
Change in Net Unrealized Loss on Investment
Securities $ 8 $ 356
Issuance of Common Stock Dividend:
Par $ -0- $ 212
Capital in Excess of Par Value $ -0- $ 848
Reduction in Retained Earnings Due to Issuance of
Common Stock $ -0- $ 1,060
See accompanying notes to financial statements.
See Accountant's Compilation Report.
FIRST CENTRAL BANCSHARES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
June 30, 1997 and 1996
NOTE 1 - ORGANIZATION AND BUSINESS
First Central Bancshares, Inc. (the Company) was incorporated
in 1993 for the purpose of becoming a one bank holding company.
On April 3, 1993, the Company acquired 100% of First Central
Bank (the Bank) through a share exchange agreement approved by
the shareholders of the Bank. The investment in First Central
Bank represents virtually all of the assets of First Central
Bancshares, Inc. The Bank operates out of the main office
located in Lenoir City, Loudon County, Tennessee and three
branch offices, one located in Loudon, one in Tellico Village,
Loudon County, Tennessee, and one located in Farragut, Knox
County, Tennessee. In August 1997, the Bank is scheduled to
begin construction of a new full service branch in Kingston,
Tennessee. All offices are full service branches serving an
area approximately 50 miles in radius which encompasses parts
of Knox County, Blount County, Monroe County, Roane County, and
Anderson County. All offices provide typical commercial bank
products such as checking and savings accounts, certificates of
deposit and individual retirement accounts; and a complete
range of loans including commercial, personal, real estate,
home improvement, automobile and other installment loans,
student education loans and single pay loans. Each office also
offers Visa and MasterCard, ATM cards, safe deposit boxes,
travelers checks, money orders, cashiers checks, collection
items, wire transfers and other customary bank services. All
offices have drive-up window facilities and ATM machines. The
ATM cards may be used at all Most and Cirrus network machines.
The consolidated financial statements include the accounts of
First Central Bancshares, Inc. and its wholly owned subsidiary,
First Central Bank. All significant intercompany transactions
and balances have been eliminated.
NOTE 2 - BASIS OF PRESENTATION
The accompanying consolidated financial statements have been
prepared by the Company. Certain information and footnote
disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles
have been condensed or omitted. In the opinion of the
Company's management, the disclosures made are adequate to make
the information presented not misleading, and the consolidated
financial statements contain all adjustments necessary to
present fairly the financial position as of June 30, 1997,
results of operations for the six months ended June 30, 1997
and 1996, and cash flows for the six months ended June 30, 1997
and 1996.
The results of operations for the six months ended June 30,
1997 are not necessarily indicative of the results to be
expected for the full year.
NOTE 3 - COMMON STOCK DIVIDEND
In February 1996, the Company distributed a ten percent (10%)
stock dividend to its stockholders by issuing an additional
42,376 shares of common stock. The Company used a fair market
value of $25.00 per share and credited common stock $5.00 per
share or $211,880, additional paid in capital $20.00 or
$847,520, and charged retained earnings a total of $1,059,400.
No stock dividends were declared during the six months ended
June 30, 1997.
NOTE 4 - ACCOUNTING POLICY CHANGES
In June 1996, the FASB issued SFAS No. 125, Accounting for
Transfers and Service of Financial Assets and Extinguishments
of Liabilities. In December 1996, the FASB subsequently issued
SFAS No. 127, Deferral of the Effective Date of Certain
Provisions of SFAS No. 125 as an amendment of SFAS statement
No. 125. The adoption of these FASBs are not expected to
materially impact the consolidated financial statements.
See Accountant's Compilation Report.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
BALANCE SHEET ANALYSIS - COMPARISON AT JUNE 30, 1997 TO
DECEMBER 31, 1996
Assets totalled $79.3 million as of June 30, 1997, as compared
to $74.8 million as of December 31, 1996, an increase of 6.02%.
INVESTMENT SECURITIES
Investment securities were $11.2 million or 14.08% of total
assets, as of June 30, 1997 a increase of $100,000 from $11.1
million as of December 31, 1996. During the six-month period
there were $898 thousand in calls, maturities, and principal
paydowns offset by the purchase of $1 million in agency
securities.
The investment portfolio is comprised of U.S. Government and
federal agency obligations and mortgage-backed securities
issued by various federal agencies. Mortgage-backed issues
comprised 15.58% of the portfolio as of June 30, 1997 and
17.31% as of December 31, 1996.
As of June 30, 1997 and December 31, 1996, the Bank's entire
investment portfolio was classified as available for sale and
reflected in the condensed consolidated balance sheets at fair
value with unrealized gains and losses excluded from earnings
and reported as a separate component of stockholders' equity.
The net unrealized loss on securities available for sale, net
of tax was approximately $42,000 as of June 30, 1997, a change
of approximately $8,000 from December 31, 1996, a result of
deterioration in the bond market. The fair value of securities
fluctuates with the movement of interest rates. Generally,
during periods of decreasing interest rates, the fair values
increase whereas the opposite may hold true during a rising
interest rate environment.
LOANS
During the first six months of 1997, total gross loans
outstanding increased by approximately $5,297,000 to $62.8
million as of June 30, 1997 from $57.5 million as of December
31, 1996 attributable primarily to $16.7 million in originated
loans offset by amortization and payoffs. As of June 30, 1997
and December 31, 1996, net loans outstanding represented 76%
and 74% of total assets, respectively. Table 1 summarizes the
Bank's loan portfolio by major category as of June 30, 1997 and
December 31, 1996.
Table 1 - Loan Portfolio by Category
(In Thousands)
June 30, December 31,
1997 1996
Loans secured by real estate:
Commercial properties $15,589 $15,745
Construction and land development 9,951 7,781
Residential and other properties 18,811 16,816
Total loans secured by real estate 44,351 40,342
Commercial and industrial loans 4,684 5,500
Consumer loans 12,797 10,719
Other loans 931 906
62,763 57,467
Less: Allowance for loan losses (608) (563)
Unearned interest (1,537) (1,303)
Unearned loan fees (59) (62)
Loans, Net $60,559 $55,539
As of June 30, 1997, there were outstanding commitments to
advance construction funds and to originate loans in the amount
of $11.6 million and commitments to advance existing home
equity, letters of credit and other credit lines in the amount
of $7.1 million.
Loans are carried net of the allowance for loan losses. The
allowance is maintained at a level to absorb possible losses
within the loan portfolio. As of June 30, 1997 and December 31,
1996, the allowance had a balance of approximately $608,000 and
$563,000, respectively. There were no loans on which the
accrual of interest had been discontinued as of June 30, 1997
or at December 31, 1996, and there were no loans specifically
classified as impaired as defined by SFAS No. 114. Table 2
summarizes the allocation of the loan loss reserve by major
categories and Table 3 summarizes the activity in the loan loss
reserve for the six month period.
Table 2 - Allocation of the Loan Loss Reserve (in Thousands)
6-30-97 % to 12-31-96 % to
Balance applicable to: $ Amount Total $ Amount Total
Commercial, financial, and
agricultural $ 70 11.51%$ 64 11.37%
Real Estate - Construction 100 16.45% 78 13.85%
Real Estate - Mortgages 140 23.03% 169 30.02%
Installment - Consumers 128 21.05% 108 19.18%
Other 14 2.30% -0- .00%
Other Unallocated 156 25.66% 144 25.58%
Total $608 100.00% $563 100.00%
Table 3 - Analysis of Loan Loss Reserve
(In Thousands) 6-30-97 6-30-96
Balance, at beginning of period $563 $434
Charge-offs:
Commercial, financial, and agricultural 2 -0-
Real estate - construction -0- -0-
Real estate - mortgage -0- -0-
Installment - Customers 74 70
Other -0- -0-
Recoveries:
Commercial, financial, and agricultural -0- 5
Real estate - construction -0- -0-
Real estate - mortgages -0- -0-
Installment - consumers 28 24
Other -0- -0-
Net charge-offs 48 41
Additions to loan loss reserve 93 118
Balance at end of period $608 $511
Ratio of net charge-offs to average loans outstanding.04% .06%
DEPOSITS
Deposits increased by $3.1 million to $71.0 million as of June
30, 1997 from $67.9 million as of December 31, 1996, an
increase of 4.57%. Demand deposits, which include regular,
money market, NOW and demand deposits, were $35.4 million, or
49.86% of total deposits, at June 30, 1997. Core deposits were
33.0% of total deposits at December 31, 1996. During the six-
month period, the Bank was successful in increasing the
balances in the demand deposit category as a result of its
efforts to restructure the deposit portfolio from higher
yielding term deposits to lower yielding demand deposits.
Certificate accounts were $35.6 million at June 30, 1997, a
decrease of $2.4 million over the $38.0 million as of December
31, 1996. Table 4 summarizes the Bank's deposits by major
category as of June 30, 1997 and December 31, 1996.
Table 4 - Deposits by Category
(In Thousands)
June 30, December 31,
1997 1996
Demand Deposits:
Noninterest-bearing accounts $10,386 $ 9,499
NOW and MMDA accounts 21,899 16,916
Savings accounts 3,088 3,437
Total Demand Deposits 35,373 29,852
Term Deposits:
Less than $100,000 $27,627 $29,051
$100,000 or more 7,995 8,971
35,622 38,022
$70,995 $67,874
CAPITAL
During the six month period ended June 30, 1997, stockholders'
equity increased by $500,000 to $6.8 million, due to net income
for the period of $508,000 offset by the decrease in the value
of securities available for sale.
LIQUIDITY AND CAPITAL RESOURCES
The Bank's primary sources of liquidity are deposit balances,
available-for-sale securities, principal and interest payments
on loans and investment securities, FHLB advances, and federal
funds purchased.
As of June 30, 1997, the Bank held $11.2 million in available-
for-sale securities and during the first six months of 1997 the
Bank received $898,000 in proceeds from maturities, redemptions
and principal payments on its investment portfolio. Deposits
increased by $3.1 million during the same six month period.
The Bank is a member of the Federal Home Loan Bank of
Cincinnati (FHLB) and is eligible to obtain both short and long
term credit advances. Borrowing capacity is limited to the
Bank's available qualified collateral which consists primarily
of certain 1-4 family residential mortgages and certain
investment securities. The Bank had advances outstanding from
the FHLB of approximately $44,000 at June 30, 1997.
The Bank can also enter into repurchase agreement transactions
should the need for additional liquidity arise. At June 30,
1997, the Bank had no repurchase agreements outstanding.
As of June 30, 1997, the Bank had federal funds purchased of
$1,035,000.
As of June 30, 1997, the Bank had capital of $6.8 million, or
8.6% of total assets, as compared to $6.3 million, or 8.4%, at
December 31, 1996. Tennessee chartered banks that are insured
by the FDIC are subject to minimum capital requirements.
Regulatory guidelines define the minimum amount of qualifying
capital an institution must maintain as a percentage of risk-
weighted assets and total assets.
Table 5 - Regulatory Capital
(Dollars in Thousands)
Minimum
June 30, December 31, Regulatory
1997 1996 Ratios
Tier 1 Capital as a Percentage
of Risk-Weighted Assets 10.9% 10.9% 4.00%
Total Capital as a Percentage
of Risk-Weighted Assets 11.9% 11.9% 8.00%
Leverage Ratio 8.8% 8.4% Up to 5.00%
Total Risk-Weighted Assets $62,336 $58,125
As of June 30, 1997 and December 31, 1996, the Bank exceeded
all of the minimum regulatory capital ratio requirements.
RESULTS OF OPERATIONS FOR THE SIX MONTH PERIODS ENDED JUNE 30,
1997 AND 1996
GENERAL
The Bank reported net income of $508,000, or $1.09 per share
for the six month period ended June 30, 1997 as compared with
$327,000 or $0.72 per share for the same period in 1996, an
increase of 55.35%.
NET INTEREST INCOME
Net interest income increased by $343,000 to $1,854,000, for
the six month period in 1997 from the comparable period in
1996. Contributing to this increase was an increase in average
interest earning assets. Average interest earning assets, at a
yield of 9.26% totalled $71.8 million as of June 30, 1997. In
comparison in 1996, average interest earning assets, at a yield
of 8.98%, totalled $65.9 million.
Interest and dividend income increased by $365,000 for the six
month period in 1997 compared to the same period in 1996. This
improvement is primarily attributable to an increase of
approximately $3.8 million, or 5.4%, in the volume of average
earning assets during the six month period ended June 30, 1997
compared to the six month period ended June 30, 1996. Interest
income on loans increased by $484,000 over the same two periods
primarily as a result of an increase of approximately $7.4
million in average loans outstanding. Over the same two
periods, interest and dividends on investments increased only
by $16,000 due to an increase of approximately $93,000 or .92%
in the volume of investments during the six month
period. Interest income on Federal Funds Sold decreased by
$135,000 due to a decrease of approximately $5.2 million in
average Federal Funds Sold outstanding during the six month
period as compared to $172,000 during the same period in 1996.
Total interest expense increased $22,000 for the six month
period ended June 30, 1997 compared to the same period in 1996.
Interest on deposits decreased by $21,000 as a result of lower
weighted average rates paid on deposits. Interest paid on
Federal Home Loan Bank advances for the two comparable periods
was unchanged. The average rate on interest-bearing
liabilities decreased to 4.92% for the six month period in 1997
from 5.19% in the comparable period of 1996.
Table 6 - Average Balances, Interest and Average Rates
June 30,
1997 (in thousands) 1996
Average Average Average Average
Balance Interest Rate Balance Interest Rate
Assets:
Federal Funds Sold $ 1,340 $ 37 5.52% $ 6,531 $ 172 5.27%
Investments:
Securities--Taxable 10,951 366 6.68% 10,859 350 6.45%
Non-Taxable -0- -0- N/A -0- -0- N/A
Total Loans, Including
Fees 59,499 2,922 9.82% 48,544 2,438 10.04%
Total Interest Earning
Assets 71,790 3,325 9.26% 65,934 2,960 8.98%
Cash and Due From
Banks 2,344 2,475
All Other Assets 4,100 3,637
Loan Loss Reserve/
Unearned Fees (2,096) (1,377)
TOTAL ASSETS $76,138 $70,669
Liabilities and Stockholders Equity:
Interest Bearing Deposits:
Time Deposits $36,533 $1,016 5.56% $41,664 $1,225 5.88%
Other 23,146 452 3.90% 14,128 222 3.14%
FHLB Advances 45 2 9.77% 47 2 8.51%
Federal Funds
Purchased 36 1 5.56% -0- -0- 0.00%
Total Interest-Bearing
Liabilities 59,760 1,471 4.92% 55,839 1,449 5.19%
Net Interest Income 1,854 1,511
Non-Interest Bearing
Deposits 9,365 8,705
Total Cost of Funds 4.26% 4.49%
All Other Liabilities 482 520
Stockholders Equity 6,607 5,665
Unrealized Gain/Loss on
Securities (76) (60)
TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY $76,138 70,669
Net Interest Yield 4.34% 3.79%
Net Interest Margin 5.17% 4.58%
Table 7 - Interest Rate Sensitivity
(In Thousands)
June 30, 1997
Less One Year Greater Non-
Than Through Than Interest
1 Year 5 Years 5 Years Bearing Total
Assets:
Federal Funds Sold $ -0- -0- -0- -0- $ -0-
Investments 251 $ 4,550 $ 6,369 -0- 11,170
Loans - Fixed Rate 10,760 32,321 102 -0- 43,183
Floating Rate 19,580 -0- -0- -0- 19,580
Non-Interest Earning Assets
and Unearned Assets/Loan
Loss Reserve -0- -0- -0- 5,406 5,406
30,591 36,871 6,471 5,406 79,339
Liabilities and Stockholders' Equity:
Interest-Bearing Deposits 52,767 7,842 -0- 60,609
Non-Interest Bearing Deposits 10,386 10,386
Federal Funds Purchased 1,035 -0- -0- -0- 1,035
FHLB Advances 44 44
Noninterest Bearing Liabilities
and Stockholders' Equity 7,265 7,265
Total 53,802 7,842 44 17,651 79,339
Interest Rate Sensitivity
Gap (23,211) 29,029 6,427 (12,245) -0-
Cumulative Interest Rate
Sensitivity Gap $(23,211)$ 5,818 $ 12,245 $ -0- $ -0-
OTHER INCOME
Total other income was $270,000 for the six month period ended
June 30, 1997 as compared to $202,000 for the same period in
1996, an increase of $68,000. Other income is comprised
primarily of customer service fees and other items.
Contributing to the increase in other income was growth of
$65,000 in checking service fees and NSF charges resulting
primarily from an increase in the number of checking accounts.
OPERATING EXPENSES
Total operating expenses were $1,207,000, or an annualized
3.18% of average total assets, for the six month period ended
June 30, 1997 as compared to $1,059,000, or 3.00% for the same
period in 1996. Both the salaries and employee benefits and
occupancy and equipment categories of expenses increased when
comparing the two periods. Salaries and employee benefits
increased by $37,000 or 8.51% over the first six months of 1997
due to normal salary increases. Occupancy and equipment
expenses increased approximately $27,000 when compared to
expenses at June 30, 1996, an increase of 13.37%.
INCOME TAXES
The Bank recognizes income taxes using the Financial Accounting
Standards Board Statement No. 109, Accounting for Income Taxes.
Under this method, deferred tax assets and liabilities are
established for the temporary differences between the
accounting basis and the tax basis of the Bank's assets and
liabilities at enacted tax rates expected to be in effect when
the amounts related to such temporary differences are realized
or settled. The Bank's deferred tax asset is reviewed quarterly
and adjustments to such asset are recognized as deferred income
tax expense or benefit based on management's judgment relating
to the realizability of such asset.
During the six month period ended June 30, 1997, the Bank
recorded $316,000 in tax expense which resulted in an
approximate effective rate of 38%. Comparably, in 1996, the
Bank recorded $209,000 in tax expense, resulting in an
approximate effective rate of 39%.
FIRST CENTRAL BANCSHARES, INC. AND SUBSIDIARY
PART 1 - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2.Changes in Securities
None.
Item 3.Defaults Upon Senior Securities
None.
Item 4.Submission of Matters to a Vote of Security Holders
None.
Item 5.Other Information
None.
Item 6.Exhibits and Reports on Form 8-K
(a) Exhibits 27 - Financial Data Schedule.
Exhibit 27 - Financial Data Schedule
6-30-97
Amount (In Thousands)
Cash $3,265
Interest-Bearing Deposits 60,596
Federal Funds Sold -0-
Trading Assets -0-
Investments AFS 11,170
Investments HTM -0-
Investments-Market -0-
Loans 62,763
Allowance for Losses 608
Total Assets 79,346
Deposits 70,995
Short-Term Borrowings -0-
Other Liabilities 189
Long-Term Debt 44
Preferred Stock-Mandatory -0-
Preferred-Non Mandatory -0-
Common Stock 2,334
Other Stockholders Equity 3,427
Total Liab.-Stockh. Equity 79,346
Interest on Loans 2,922
Interest on Investments 366
Other Interest Income 37
Total interest Income 3,325
Interest on Deposits 1,468
Total Interest Expense 1,471
Net Interest Income 1,854
Provision-Loan Losses 93
Securities-Gain/Loss -0-
Other Expenses 1,207
Income Before Tax 824
Income Before Extraordinary 824
Extraordinary Less Tax -0-
Cumul. Change Acct. Principal -0-
Net Income 508
Earnings Per Share-P 1.09
Earnings Per Share-D 1.09
Net Interest Yield-EA 4.34
Loans-Non Accrual -0-
Loans Past Due > 90 Days -0-
Troubled Debt Restructuring -0-
Potential Problem Loans -0-
Allowance-Beginning 563
Total Charge-Offs 76
Total Recoveries 28
Allowance End of Period 608
Loan Loss-Domestic 608
Loan Loss-Foreign -0-
Loan Loss-Unallocated 156
(b) Reports on Form 8-K, None.
FORM IO-QSB(A)
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
FIRST CENTRAL BANCSHARES, INC.
Date: By:_____________________________________________
Ed. F. Bell Chairman, President and Chief
Executive Officer
Date: By:______________________________________________
Willard D. Price Executive Vice President and
Chief Financial Officer
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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Page 1
Exhibit 27 - Financial Data Schedule
6-30-97
Amount (In Thousands)
Cash $3,265
Interest-Bearing Deposits 60,596
Federal Funds Sold -0-
Trading Assets -0-
Investments AFS 11,170
Investments HTM -0-
Investments-Market -0-
Loans 62,763
Allowance for Losses 608
Total Assets 79,346
Deposits 70,995
Short-Term Borrowings -0-
Other Liabilities 189
Long-Term Debt 44
Preferred Stock-Mandatory -0-
Preferred-Non Mandatory -0-
Common Stock 2,334
Other Stockholders Equity 3,427
Total Liab.-Stockh. Equity 79,346
Interest on Loans 2,922
Interest on Investments 366
Other Interest Income 37
Total interest Income 3,325
Interest on Deposits 1,468
Total Interest Expense 1,471
Net Interest Income 1,854
Provision-Loan Losses 93
Securities-Gain/Loss -0-
Other Expenses 1,207
Income Before Tax 824
Income Before Extraordinary 824
Extraordinary Less Tax -0-
Cumul. Change Acct. Principal -0-
Net Income 508
Earnings Per Share-P 1.09
Earnings Per Share-D 1.09
Net Interest Yield-EA 4.34
Loans-Non Accrual -0-
Loans Past Due > 90 Days -0-
Troubled Debt Restructuring -0-
Potential Problem Loans -0-
Allowance-Beginning 563
Total Charge-Offs 76
Total Recoveries 28
Allowance End of Period 608
Loan Loss-Domestic 608
Loan Loss-Foreign -0-
Loan Loss-Unallocated 156
(b) Reports on Form 8-K, None.
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