<PAGE>
U.S. 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, 2000
[ ] Transition Report Under Section 13 or 15(d) of the Exchange Act
For the transition period from ________________ to ____________________
Commission File Number : 0-28394
MOUNTAIN BANK HOLDING COMPANY
(Exact Name of Small Business Issuer as Specified in Its Charter)
WASHINGTON 91-1602736
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
501 ROOSEVELT AVENUE
ENUMCLAW, WASHINGTON 98022
(Address of Principal Executive Offices)
(360) 825-0100
(Issuer's Telephone Number, Including Area Code)
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 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
--- ---
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: 924,013 (March 31, 2000)
------------------------
Transitional Small Business Disclosure Format: Yes X No
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<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following Consolidated Financial Statements are presented for the
Registrant, Mountain Bank Holding Company, and its wholly owned subsidiary, Mt.
Rainier National Bank.
PAGE:
1. Consolidated Balance Sheets for March 31, 2000, and December 31, 1999
2. Consolidated Statements of Income for the three months ended March 31, 2000
and 1999
3. Consolidated Statements of Shareholders' Equity for the three months ended
March 31, 2000 and 1999
4. Consolidated Statements of Cash Flows for the three months ended March 31,
2000 and 1999
5. Notes to consolidated financial statements
PART II - Other Information
6. Item 4 Submission of Matters to a Vote of Security Holders
7. Item 6 Exhibits and Reports on Form 8-K
8. Signatures
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MOUNTAIN BANK HOLDING COMPANY AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
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<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
------------------------
(IN THOUSANDS)
<S> <C> <C>
Assets
Cash and due from banks $ 4,015 $ 3,240
Federal funds sold and interest bearing deposits in banks 2,162 3,563
Securities available for sale 24,602 27,043
Loans held for sale 294 294
Loans 59,865 54,051
Less allowance for possible credit losses (621) (607)
------------------------
Loans, net 59,244 53,444
------------------------
Premises and equipment 3,289 3,345
Accrued interest receivable and other assets 768 812
------------------------
Total assets $ 94,374 $ 91,741
========================
Liabilities
Deposits:
Non-interest bearing $ 14,335 $ 14,678
Savings and interest-bearing demand 39,418 37,526
Time 30,013 29,042
------------------------
Total deposits 83,766 81,246
------------------------
Long-term debt 41 42
Accrued interest payable and other liabilities 411 291
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Total liabilities 84,218 81,579
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Shareholders' Equity
Common stock (2000 - no par value; 1999 - par value $1); authorized 10,000,000
shares; issued and outstanding: 2000 - 1,848,026 shares;
1999 - 924,013 shares 924 924
Paid-in capital 6,785 6,785
Retained earnings 2,932 2,703
Accumulated other comprehensive loss (485) (250)
------------------------
Total shareholders' equity 10,156 10,162
------------------------
Total liabilities and shareholders' equity $ 94,374 $ 91,741
========================
</TABLE>
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MOUNTAIN BANK HOLDING COMPANY AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
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<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------------------------
2000 1999
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C>
Interest Income
Loans $ 1,373 $ 1,103
Securities available for sale 390 382
Federal funds sold and interest bearing deposits in banks 25 83
--------------------------------------
Total interest income 1,788 1,568
Interest Expense
Deposits 638 594
Note Payable 1 --
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Total interest expense 639 594
Net interest income 1,149 974
Provision for credit losses 14 --
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Net interest income after provision for credit losses 1,135 974
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Noninterest income
Service charges on deposit accounts 126 116
Origination fees and gains on loans sold 31 40
Gain(loss) on sales of securities available for sale (3) 1
Other 60 40
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Total noninterest income 214 197
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Noninterest expense
Salaries and employee benefits 564 538
Occupancy and equipment 144 137
Other 299 343
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Total noninterest expenses 1,007 1,018
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Income before income taxes 342 153
Income taxes (113) (37)
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Net income $ 229 $ 116
======================================
Per share data:
Basic earnings per share $ 0.12 $ 0.06
Diluted earnings per share $ 0.12 $ 0.06
Weighted average number of common shares outstanding,
including dilutive stock options 1,954,672 1,940,610
Return on average assets 1.00% 0.54%
</TABLE>
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<PAGE>
MOUNTAIN BANK HOLDING COMPANY AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
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<TABLE>
<CAPTION>
ACCUMULATED
OTHER
COMMON PAID-IN RETAINED COMPREHENSIVE
STOCK CAPITAL EARNINGS INCOME TOTAL
<S> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1998 $ 907 $ 6,694 $ 1,999 $ 91 $ 9,691
Comprehensive income:
Net income -- -- 116 -- 116
Other comprehensive income,
net of tax:
Unrealized loss on securities,
net of reclassification adjustment (59) (59)
COMPREHENSIVE INCOME 57
BALANCE AT MARCH 31, 1999 $ 907 $ 6,694 $ 2,115 $ 32 $ 9,748
</TABLE>
<TABLE>
<CAPTION>
ACCUMULATED
OTHER
COMMON PAID-IN RETAINED COMPREHENSIVE
STOCK CAPITAL EARNINGS INCOME TOTAL
<S> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1999 $ 924 $ 6,785 $ 2,703 $ (250) $ 10,162
Comprehensive income:
Net income -- -- 229 229
Other comprehensive income,
net of tax:
Unrealized loss on securities,
net of reclassification adjustment (235) (235)
COMPREHENSIVE LOSS (6)
BALANCE AT MARCH 31, 2000 $ 924 $ 6,785 $ 2,932 $ (485) $ 10,156
</TABLE>
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MOUNTAIN BANK HOLDING COMPANY AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
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<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
-----------------------
2000 1999
(IN THOUSANDS)
<S> <C> <C>
Net income $ 229 $ 116
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for possible credit losses 14 --
Depreciation 90 94
(Gain)losses on sales of securities available for sale 3 (1)
Amortization, net of accretion 17 31
Gain on loans sold (31) (40)
Originations of loans held for sale (1,602) (1,810)
Proceeds from sales of loans 1,633 1,839
Other 284 (44)
-----------------------
Net cash provided by operating activities 637 185
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Cash Flows from Investing Activities
Net decrease in Federal funds sold 1,401 5,221
Purchase of securities available for sale (1,002) (7,442)
Proceeds from maturities and sales of securities available for sale 3,068 5,489
Increase in loans, net of principal collections (5,814) (745)
Additions to premises and equipment (34) (252)
-----------------------
Net cash used in investing activities (2,381) 2,271
-----------------------
Cash Flows from Financing
Net increase/(decrease) in deposits 2,520 (1,157)
Repayment of note payable (1)
-----------------------
Net cash provided by (used in) financing activities 2,519 (1,157)
-----------------------
Net increase in cash 775 1,299
Cash and due from Banks
Beginning of period 3,240 3,369
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End of period $ 4,015 $ 4,668
=======================
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid $ 614 $ 594
Income taxes paid $ 113 $ 37
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Fair value adjustment of securities available for sale, net of tax (235) (59)
</TABLE>
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
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NOTE 1 - BASIS OF PRESENTATION
The unaudited consolidated financial statements include the accounts of
Mountain Bank Holding Company (the Company) and its wholly owned subsidiary, Mt.
Rainier National Bank (the Bank). The consolidated financial statements have
been prepared in conformity with generally accepted accounting principles for
interim financial information and with general practice within the banking
industry. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. Significant intercompany transactions and amounts have been
eliminated. In the opinion of management, all adjustments (consisting only of
recurring accruals) necessary for a fair presentation are reflected in the
financial statements. Reference is hereby made to the notes to consolidated
financial statements contained in the Company's Annual Report on Form 10-KSB for
the year ended December 31, 1999. The results of operations for the three months
ended March 31, 2000, are not necessarily indicative of the results which may be
obtained for the full year ending December 31, 2000.
NOTE 2 - STOCK SPLIT
On March 28, 2000, the Board of Directors announced a two-for-one stock
split payable to shareholders of record as of April 10, 2000. In connection with
the stock split, the par value of the Company's common stock was changed from
$1.00 per share to no par value and the number of authorized shares was
increased from 5,000,000 to 10,000,000. The number of shares outstanding at
March 31, 2000, and the average share and per share information for the periods
ended March 31, 2000 and 1999, have been adjusted to show the effect of this
stock split.
NOTE 3 - EARNINGS PER COMMON SHARE
Basic earnings per share are based on the average number of common shares
outstanding, assuming no dilution. Diluted earnings per common share are
computed assuming the exercise of stock options. All share amounts have been
adjusted to show the effect of the two for one stock split discussed in Note 2.
<TABLE>
<CAPTION>
Net Income Shares Per Share
(Numerator) (Denominator) Amount
<S> <C> <C> <C>
THREE MONTHS ENDED MARCH 31, 2000
Basic earnings per share:
Net Income $ 229 1,848,026 $ 0.12
Effect of dilutive securities:
Options -- 106,646 -0-
Diluted earnings per share:
Net Income $ 229 1,954,672 $ 0.12
THREE MONTHS ENDED MARCH 31, 1999
Basic earnings per share:
Net Income $ 116 1,814,964 $ 0.06
Effect of dilutive securities:
Options -- 125,646 -0-
Diluted earnings per share:
Net Income $ 116 1,940,610 $ 0.06
</TABLE>
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<PAGE>
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) Mountain Bank Holding Company's Annual Shareholders' Meeting was held on
March 28, 2000.
(b) The information in response to this item is located in the Company's Annual
Meeting Proxy Statement dated March 13, 2000.
(c) A brief description of each matter voted upon at the Annual Shareholders'
Meeting held on March 28, 2000, and number of votes cast for, against or
withheld, including a separate tabulation with respect to each nominee for
office is presented below:
1) Election of (3) Directors for terms expiring in 2003 or until their
successors have been elected and qualified.
Director:
Roy T. Brooks
Votes cast for: 634,409
Votes cast against: 1,756
Votes withheld: 0
Susan Bowen-Hahto
Votes cast for: 634,515
Votes cast against: 1,650
Votes withheld: 0
Steve W. Moergeli
Votes cast for: 636,165
Votes cast against: 0
Votes withheld: 0
2) Ratification of the appointment of Knight Vale & Gregory PLLC,
Certified Public Accountants, as the independent auditors for the
Company and its subsidiaries for the 2000 fiscal year.
Votes cast for: 633,200
Votes cast against: 1,746
Votes withheld: 1,219
(d) None
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) Reports on Form 8-K:
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MOUNTAIN BANK HOLDING COMPANY
(Registrant)
Dated: April 14, 2000 /s/ Roy T. Brooks
---------------------------------------------
Roy T. Brooks, President and Chief
Executive Officer
Dated: April 14, 2000 /s/ Sheila Brumley
---------------------------------------------
Sheila Brumley, Chief Financial Officer
Page 7
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 4,015
<INT-BEARING-DEPOSITS> 2,162
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 24,602
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 59,865
<ALLOWANCE> 621
<TOTAL-ASSETS> 94,374
<DEPOSITS> 83,766
<SHORT-TERM> 0
<LIABILITIES-OTHER> 411
<LONG-TERM> 41
0
0
<COMMON> 924
<OTHER-SE> 9,232
<TOTAL-LIABILITIES-AND-EQUITY> 94,374
<INTEREST-LOAN> 1,373
<INTEREST-INVEST> 390
<INTEREST-OTHER> 25
<INTEREST-TOTAL> 1,788
<INTEREST-DEPOSIT> 638
<INTEREST-EXPENSE> 639
<INTEREST-INCOME-NET> 1,149
<LOAN-LOSSES> 14
<SECURITIES-GAINS> (3)
<EXPENSE-OTHER> 1,007
<INCOME-PRETAX> 342
<INCOME-PRE-EXTRAORDINARY> 342
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 229
<EPS-BASIC> 0.12
<EPS-DILUTED> 0.12
<YIELD-ACTUAL> 5.41
<LOANS-NON> 24
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 607
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 621
<ALLOWANCE-DOMESTIC> 621
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
