<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
------------- -------------
Commission file Number 33-58936
Dimeco, Inc.
------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2250152
----------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
820 Church Street
-----------------
Honesdale, PA 18431
--------------------
(Address of principal executive offices)
(570) 253-1970
--------------------
(Issuer's Telephone Number)
Not Applicable
----------------------------------------------------
(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
Sections 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
--- ---
As of April 30, 1999, there were 659,283 shares outstanding of the issuer's
common stock with an aggregate market value of approximately $23,404,539.<PAGE>
<PAGE>
Dimeco, Inc.
INDEX
PART I - FINANCIAL INFORMATION Page
----
Item 1. Financial Statements
Consolidated Balance Sheet (unaudited) as of
March 31, 1999 and December 31, 1998 3
Consolidated Statement of Income (unaudited) for
the three months ended March 31, 1999 and 1998 4
Consolidated Statement of Changes in Stockholders'
Equity (unaudited) for the three months ended
March 31, 1999 5
Consolidated Statement of Cash Flows (unaudited)
for the three months ended March 31, 1999 and 1998 6
Notes to Consolidated Financial Statements (unaudited) 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults Upon Senior Securities 13
Item 4. Submissions of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
2
<PAGE>
Dimeco, Inc.
CONSOLIDATED BALANCE SHEET (Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
------------- -------------
<S> <C> <C>
Assets
Cash and due from banks $ 1,748,327 $ 1,528,650
Interest-bearing deposits in other banks 5,929,831 3,636,326
Federal funds sold and securities purchased
under agreement to resell 13,430,000 945,000
------------- -------------
Total cash and cash equivalents 21,108,158 6,109,976
Mortgage loans held for sale 1,878,655 923,449
Investment securities available for sale 28,250,147 36,360,618
Investment securities held to maturity
(market value $3,523,916 and $2,967,741) 3,487,127 2,923,222
Loans (net of unearned income of $739,397
and $807,570) 124,902,578 124,960,697
Less allowance for loan losses 1,769,100 1,681,735
------------- -------------
Net loans 123,133,478 123,278,962
Premises and equipment, net 3,769,571 3,820,704
Other real estate 317,464 274,894
Accrued interest receivable 1,002,091 910,750
Other assets 1,936,331 1,871,109
------------- -------------
Total Assets $ 184,883,022 $ 176,473,684
============= =============
Liabilities
Deposits
Noninterest-bearing $ 13,934,251 $ 14,378,252
Interest-bearing 147,766,480 140,514,277
------------- -------------
Total deposits 161,700,731 154,892,529
Short-term borrowings 4,963,522 3,612,876
Accrued interest payable 958,787 902,614
Other liabilities 814,281 913,074
------------- -------------
Total Liabilities 168,437,321 160,321,093
------------- -------------
Stockholder's Equity
Common stock, $.50 par value; 3,000,000
shares authorized, 732,168 and
730,518 shares issued 366,084 365,259
Capital surplus 2,891,638 2,823,152
Retained earnings 13,276,868 12,969,112
Accumulated other comprehensive income (12,889) (4,932)
Less treasury stock (2000 shares at cost) (76,000) -
------------- -------------
Total Stockholders' Equity 16,445,701 16,152,591
------------- -------------
Total Liabilities and
Stockholders Equity $ 184,883,022 $ 176,473,684
============= =============
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
3
<PAGE>
Dimeco, Inc.
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1999 1998
---- ----
<S> <C> <C>
Interest Income
Interest and fees on loans $2,732,601 $2,426,765
Interest-bearing deposits in other banks 68,434 61,131
Federal funds sold and securities purchased
under agreements to resell 108,026 128,777
Investment securities:
Taxable 381,609 274,849
Exempt from federal income tax 15,973 51,511
---------- ----------
Total interest income 3,306,643 2,943,033
---------- ----------
Interest Expense
Deposits 1,451,654 1,312,593
Short-term borrowings 25,997 10,775
---------- ----------
Total interest expense 1,477,651 1,323,368
---------- ----------
Net Interest Income 1,828,992 1,619,665
Provision for loan losses 112,500 89,500
---------- ----------
Net Interest Income After Provision
For Loan Losses 1,716,492 1,530,165
---------- ----------
Noninterest Income
Service charges on deposit accounts 53,525 47,728
Mortgage loans held for sale,
gains (losses) net (21,919) 72,692
Other income 142,225 117,079
---------- ----------
Total noninterest income 173,831 237,499
---------- ----------
Noninterest Expense
Salaries and employee benefits 569,177 511,925
Occupancy expense, net 119,285 87,530
Furniture and equipment expense 105,031 82,917
Other operating expenses 364,339 364,085
---------- ----------
Total noninterest expense 1,157,832 1,046,457
---------- ----------
Income Before Income Taxes 732,491 721,207
Income taxes 241,693 234,135
---------- ----------
NET INCOME $ 490,798 $ 487,072
========== ==========
Earnings Per Share $ .67 $ .67
========== ==========
Average shares outstanding 731,807 726,483
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
4
<PAGE>
Dimeco, Inc.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited)
<TABLE>
<CAPTION>
Accumulated
Other Total
Common Capital Retained Comprehensive Treasury Stockholders' Comprehensive
Stock Surplus Earnings Income Stock Equity Income
------ ------- -------- ------------- -------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1998 $ 365,259 $ 2,823,152 $12,969,112 $ (4,932) $ - $16,152,591
Net income 490,798 490,798 $ 490,798
Other comprehensive income:
Net unrealized loss on
available for sale securities (7,957) (7,957) (7,957)
----------
Comprehensive income $ 482,841
==========
Dividend reinvestment plan 825 68,486 69,311
Purchase treasury stock (76,000) (76,000)
Cash dividends ($.25 per share) (183,042) (183,042)
--------- ---------- ----------- -------- --------- -----------
Balance, March 31, 1999 $ 366,084 $2,891,638 $13,276,868 $(12,889) $ (76,000) $16,445,701
========= ========== =========== ======== ========= ===========
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
5
<PAGE>
Dimeco, Inc.
STATEMENT OF CASH FLOWS (Unaudited)
<TABLE>
<CAPTION>
For the three months ended March 31, 1999 1998
- ------------------------------------ ---- ----
<S> <C> <C>
Operating Activities
Net income $ 490,798 $ 487,072
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses 112,500 89,500
Depreciation 102,708 83,081
Amortization of premium and discount
on investment securities (209,440) (133,865)
Loss on loans held for sale 24,600 -
Net decrease (increase) in loans held
for sale (979,806) (1,613,242)
Increase in interest receivable (91,341) (176,968)
Increase in interest payable 56,173 50,531
Amortization of net deferred loan
origination fees (9,318) (8,862)
Other, net (261,086) 25,518
---------- ----------
Net cash used for by
operating activities (764,212) (1,197,235)
---------- ----------
Investing Activities:
Investment securities available for sale:
Proceeds maturities or paydown 37,217,869 26,867,245
Purchases (28,907,075) (20,190,555)
Investment securities held to maturity:
Proceeds from the maturities or paydown 775,000 100,000
Purchases (1,341,846) (1,932,927)
Decrease in loans,net 92,872 758,367
Purchase of premises and equipment (51,575) (35,133)
Proceeds from sale of other real estate owned 7,620 -
---------- ----------
Net cash provided by
investing activities 7,792,865 5,566,997
---------- ----------
Financing Activities:
Increase in deposits, net 6,808,202 2,317,688
Increase (decrease) in short-term borrowings 1,350,646 (712,896)
Proceeds from dividend reinvestment plan 69,311 62,858
Purchase of treasury stock (76,000) -
Cash dividends paid (182,630) (144,938)
---------- ----------
Net cash provided by financing
activities 7,969,529 1,522,712
---------- ----------
Increase in cash and cash equivalents 14,998,182 5,892,474
Cash and cash equivalents January 1, 6,109,976 4,480,550
---------- ----------
Cash and cash equivalents March 31, $21,108,158 $10,373,024
========== ==========
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.
6
<PAGE>
Dimeco, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The consolidated financial statements include the accounts of Dimeco, Inc.
(the "Company") and its wholly-owned subsidiary The Dime Bank (the "Bank").
All significant intercompany balances and transactions have been eliminated in
the consolidation.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-QSB and, therefore, do
not necessarily include all information that would be included in audited
financial statements. The information furnished reflects all adjustments
which are, in the opinion of management, necessary for a fair statement of the
results of operations. All such adjustments are of a normal recurring nature.
The results of operations for the interim periods are not necessarily
indicative of the results to be expected for the full year.
Certain comparative amounts for prior periods have been reclassified to
conform with current year presentation. The reclassifications did not effect
net income or equity capital.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Financial Condition
Total assets at March 31, 1999 increased $8,409,000 or 4.8% for the first
quarter of 1999. Management believes that this growth is the result of the
Company's continuing efforts in the area of business development.
Cash and cash equivalents increased $14,998,000 or 245.5% with increased
balances of interest-bearing deposits in other banks, federal funds sold and
securities purchased with agreements to resell as compared to December 31,
1998. With significant maturities of commercial paper during the first
quarter and decreasing interest rates available on this type investment,
management held funds received from these maturities in liquid form while
seeking investments which would provide credit quality combined with interest
rate spread. At the same time, mortgage loans held for sale increased
$955,000 or 103.4% with management choosing to temporarily retain these loans
rather than sell them in the secondary market and invest the proceeds in lower
earning liquid funds.
Investment securities decreased $7,547,000 or 19.9% due to maturities of
short-term commercial paper and US Government agencies. The funds received
from commercial paper maturities were not fully reinvested in like kind
instruments due to lower interest rates available. Management did choose to
invest in several issues of US Government agency securities with maturities of
two and three years.
The loan portfolio increased $810,000 or 0.6% from December 31, 1998 to March
31, 1999. There was no significant activity in any one type of loan product.
Noninterest-bearing deposits decreased $444,000 or 3.1% from December 31, 1998
to March 31, 1999. Management has been developing a cash management program
for commercial customers in order to solidify these relationships. Customer
funds which were previously in demand accounts are now invested in securities
sold under agreements to repurchase. With enhancement of this product to our
customer base, management feels that we are seeing an increase in other type
deposit accounts from these customers. Time deposits have increased
$4,649,000 or 5.7% during the first quarter with many of these deposits coming
from customers who are now using the cash management program. In addition, we
believe that, through competitive pricing of all deposit products and the
advantage of providing personalized service to all customers, we are receiving
increased deposits.
The short-term borrowings consist of our cash management accounts as mentioned
previously. These accounts show an increase of $1,866,000 or 3.3% from
December 31, 1998 with business development emphasis given to these products.
Stockholders' Equity increased $293,000 or 1.8% which was mainly due to
earnings of $491,000 which was offset by the dividend declaration of $0.25 per
share which decreased equity by $183,000. Participation in the dividend
reinvestment contributed $69,000 during the quarter. Management monitors
risk-based capital and leverage capital ratios in order to assess compliance
with regulatory guidelines. At March 31, 1999 the Company had total
risk-based capital of 13.1% which exceeded the requirement of 8.0%. Tier I
risk-based capital was 11.8%, well within the guideline of at least fifty
percent of total risk-based capital. The company's leverage ratio, which by
requirement must be at least 3%, was 8.9%.
8
<PAGE>
Results of Operations
Comparison of the three months ended March 31, 1999 and 1998
Net income for the three months ended March 31, 1999 was $491,000 which
represents a slight increase of .8% over the same quarter in 1998.
Interest and fees earned on loans increased $306,000 or 12.6% from 1998 to
1999 with an increase in the average loan portfolio of $17,744,000 or 16.1%.
The average rate earned on the portfolio decreased .26% to 8.36% from 8.62%
the previous year due to refinances and originations during the year at the
current, lower rates. Interest earned on other interest-earning assets
increased $58,000 or 18.9% due to an increase in the average portfolio of
$7,609,000 or 19.8% which was offset by a decrease of .39% in the average rate
received on these assets to 4.98% as compared to 5.37% in 1998.
Interest expense increased $154,000 or 11.7% based upon an increase in average
liabilities of $25,421,000 or 18.6% offset by a decrease in the average
interest rate paid from 3.87% to 3.64%. In a decreasing interest rate
environment, time deposits tend to reprice at a slower rate and are therefore
now beginning to show the effects of lower interest rates in general.
The provision for loan losses increased $23,000 or 25.7% from 1998 to 1999.
Management's analysis of the allowance for loan loss identifies the
appropriate charge to the provision for losses. The 1999 increase in expense
is the result of the larger loan portfolio coupled with increased expense
associated with risks related to the commercial lending activity over the past
year.
Gains (losses) on mortgage loans held for sale decreased $95,000 or 130.1% due
to the inability in 1999 to match gains on loan sales during the first quarter
of 1998. Interest rates were decreasing more rapidly in 1998 and therefore
the Company was able to take advantage of this changing interest rate
environment when selling loans in the secondary market. During the first
quarter of 1999 interest rates were slightly lower for a period of time and
then rebounded to earlier rates. Loans which were originated at market rates
during this period and held in portfolio were valued lower when interest rates
increased slightly.
Salaries and employee benefits increased $57,000 or 11.2% due to normal annual
salary increases combined with additional staffing related to increased asset
size.
Furniture and equipment expense increased $22,000 or 26.7% due to additional
expense associated with depreciation on furniture and equipment purchased in
the fourth quarter of 1998 for the operations center and for leases on
computer hardware updates.
Occupancy expense increased $32,000 or 36.3% from 1998 to 1999 with the
majority of this increase attributable to expenses associated with the
operations center which was opened in October 1998. In addition, building
maintenance expenses associated with snow plowing were higher in 1999 that in
1998 due to a greater number of snowfalls in 1999.
9
<PAGE>
Results of Operations (Continued)
Other operating expense remained stable from 1998 to 1999. There was an
increase of $13,000 or 51.9% associated with advertising expense due to the
use of a consultant on a regular part-time basis. Bank supplies showed an
increase of $12,000 or 41.1% based on increased supply usage due to the
increased size of the Company and timing differences in purchases. Expenses
associated with the operation of other real estate decreased $30,000 or 92.8%
with the main change of a 1998 payment of delinquent real estate taxes on a
property which was added to Other real estate in the first quarter of 1998
(1999 had no such expense). The remainder of additional expense is not
significant in any one account but small increases and decreases were noted in
various accounts.
Liquidity and Cash Flows
To ensure that the Company can satisfy customer credit needs for current and
future commitments and deposit withdrawal requirements, the Bank manages the
liquidity position by ensuring that there are adequate short-term funding
sources available for those needs. Liquid assets consists of cash and due
from banks, federal funds sold, interest-bearing deposits with other banks and
investment securities maturing in one year or less. The following table shows
these liquidity sources, minus short-term borrowings, as of March 31, 1999
compared to December 31, 1998:
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
---- ----
<S> <C> <C>
(dollars in thousands)
Cash and due from banks $ 1,748 $ 1,529
Interest-bearing deposits with other banks 5,930 3,636
Mortgage loans held for sale 1,879 923
Federal funds sold 13,430 945
Investment securities maturing in
one year or less 16,305 31,457
------ ------
39,292 38,490
Less short-term borrowings 4,964 3,613
------ ------
Net liquidity position $34,328 $34,877
====== ======
As a percent of total assets 18.6% 19.8%
===== =====
</TABLE>
Management monitors liquidity on a consistent basis and feels that liquidity
levels are adequate. In addition to these liquidity sources, the Bank also
has a maximum borrowing capacity with the Federal Home Loan Bank of
approximately $29.5 million. Management feels that with this line of credit
available, it is more prudent to invest available funds in longer maturity
investments in order to increase profits while not hampering liquidity.
Management is not aware of any known trends, events or uncertainties that will
have or is reasonably likely to have a material effect on the Company's
liquidity, capital resources or operations, nor is management aware of any
current recommendations by regulatory authorities which, if implemented, would
have such an effect.
10
<PAGE>
Risk Elements
The table below presents information concerning nonperforming assets including
nonaccrual loans, renegotiated loans, loans 90 days or more past due, other
real estate loans and repossessed assets at March 31, 1999 and December 31,
1998. A loan is classified as nonaccrual when, in the opinion of management,
there are doubts about collectability of interest and principal. At the time
the accrual of interest is discontinued, future income is recognized only when
cash is received. Renegotiated loans are those loans which terms have been
renegotiated to provide a reduction or deferral of principal or interest as a
result of the credit quality deterioration of the borrower.
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
---- ----
<S> <C> <C>
(dollars in thousands)
Loans on nonaccrual basis $ 590 $ 525
Loans past due 90 days or more 913 941
Renegotiated loans 984 822
----- -----
Total nonperforming loans 2,487 2,288
Other real estate 317 275
Repossessed assets 3 -
----- -----
Total nonperforming assets $2,807 $2,563
===== =====
Nonperforming loans as a percent of total loans 2.3% 1.8%
==== ====
Nonperforming assets as a percent of total assets 1.5% 1.5%
==== ====
Allowance for loan loss as a percent of loans 1.42% 1.35%
===== =====
</TABLE>
Management believes the level of the allowance for loan losses at March 31,
1999 is sufficient. The relationship between the allowance for loan loses and
outstanding loans is a function of the credit quality and known risk
attributed to the loan portfolio. The on-going loan review program and credit
approval process is used to determine the adequacy of the allowance for loan
losses.
Included in total loans are loans of $871,670 which management has classified
as impaired under the terms of Financial Accounting Standards Board Statement
No. 114, "Accounting by Creditors for Impairment of a Loan - Income
Recognition and Disclosure". The related allowance for loan losses on these
loans amounted to $150,854. There were no impaired loans without a related
allowance for loan losses. The average balance of impaired loans for the
period was $872,894.
Management does not believe that loans classified as loss, doubtful
substandard or special mention for internal or regulatory purposes (i)
represent or result from trends or uncertainties which management reasonably
expects will materially impact future operating results, liquidity, or capital
resources, or (ii) represent material loans about which management is aware of
any information which causes management to have serious doubts as to the
ability of such borrowers to comply with the loan repayment terms.
11
<PAGE>
Year 2000
COMPANY'S STATE OF READINESS
The year 2000 ("Y2K") problem is associated with the inability of some computer
programs to distinguish between the year 1900 and the year 2000 because of
software programs that were written with a two digit year field instead of a
four digit field. If not correctly programmed or rewritten, some computer
applications could fail to operate or may create erroneous results when the
year changes to 2000 or other key dates in the first quarter of the year 2000.
This could cause entire system failures, miscalculations and disruptions of
normal business operations. As the banking industry is heavily dependent on
computer systems, the effects of this problem could be the temporary inability
to process transactions, generate statements and billings or engage in normal
day to day business activities. The extent of the potential impact of this
problem is not known and if not timely corrected could affect the global
economy.
The Company has assessed the extent of its vulnerability to the Y2K problem
and believes that our core processing systems will not be affected. The
Company uses the Jack Henry and Associates Silverlake software system run on
an IBM AS/400 mainframe computer. The Silverlake software was certified by
the Information Technology Association of America on March 16, 1998 and the
IBM AS/400 received the first Year 2000 certification by that organization.
Internal testing of these primary mission critical systems was successfully
completed in December 1998 and the validation of that testing was completed
during March 1999. The remaining mission critical software systems have
either been tested by the Company or have been tested by outside agencies and
have been found to be substantially compliant.
RISK ASSESSMENT OF THE YEAR 2000
We believe that with modifications to existing software and conversions to
new software, the Y2K problem will not pose a significant operational problem
for the Company. However, because most computer systems are, by their very
nature, interdependent, it is possible that noncompliant third party computers
could impact the Company's computer systems. In addition, we have contacted
third parties, such as wire transfer systems, debit card systems, telephone
systems, public utilities and other vendors with which we transact business in
order to request status reports on their Y2K projects. If any of these agents
are unsuccessful in their attempt to deal with the Y2K problem, it could
aversely affect the Company. We have contacted all of the Bank's large
commercial loan customers in order to attempt to assess their readiness for
the Year 2000 and determine the possible effects on the commercial loan
portfolio.
COST OF YEAR 2000
We do not anticipate that the cost of the Y2K problem will have a significant
effect on the Company's financial position or results of operations in 1999.
As described above, our primary systems are Year 2000 compliant, therefore we
believe that little programming costs will be incurred. The majority of
costs associated with this issue are related to planning, testing and
validating the results internally and are expected to amount to $50,000 of
which $25,000 are for capital items. These expenses will be incurred in
1999. There is no guarantee that our estimates of compliance with the Y2K
problem will be achieved and actual results could differ materially from
those planned. Specific factors that might cause such material differences
include, but are not limited to, the availability and cost of personnel
trained in this area, the replacement of noncompliant third party vendors or
similar uncertainties.
CONTINGENCY PLANS
Management is in the process of preparing contingency plans in the event that
our assessment is not correct or that third party affiliate systems are not
operational. Our preliminary plan involves the creation of a back up system
for every critical application, which in certain cases will be a manual
operation. Our goal is to be ready for every possible situation with the
specific intent to have no interruption in service to our customers or our
shareholders.
12
<PAGE>
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings
NONE
Item 2 - Changes in the rights of the Company's security holders
NONE
Item 3 - Defaults by the Company on its senior securities
NONE
Item 4 - Results of votes of security holders
The following represents the results of matters submitted
to a vote of the shareholders at the annual meeting held
on April 22, 1999:
Election of Directors:
The following directors were elected with terms to
expire April, 2000:
For Withhold Authority
--- ------------------
Joseph J. Murray 406,093.6247 13,328.8538
Thomas A. Peifer 406,093.6247 13,328.8538
Robert E.Genirs 405,975.5867 13,446.8918
S.R. Snodgrass was elected as the Company's Independent
Auditors for the year ending December 31, 1999 by the
following vote:
For 417,651.9404
Against 0.0000
Abstain 1,770.5381
Item 5 - Other Information
NONE
Item 6 - Exhibits and Reports on Form 8-K
NONE
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused the report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DIMECO, INC.
Date: May 4, 1999 By:
-------------------------------
Joseph J. Murray
Executive Vice President and
Chief Executive Officer
Date: May 4, 1999 By:
-------------------------------
Maureen H. Beilman
Chief Financial Officer
14
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 1,748,327
<INT-BEARING-DEPOSITS> 5,929,831
<FED-FUNDS-SOLD> 13,430,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 28,250,147
<INVESTMENTS-CARRYING> 3,487,127
<INVESTMENTS-MARKET> 3,523,916
<LOANS> 124,902,578
<ALLOWANCE> 1,769,100
<TOTAL-ASSETS> 184,883,022
<DEPOSITS> 161,700,731
<SHORT-TERM> 4,963,522
<LIABILITIES-OTHER> 1,773,068
<LONG-TERM> 0
0
0
<COMMON> 366,084
<OTHER-SE> 16,079,617
<TOTAL-LIABILITIES-AND-EQUITY> 184,883,022
<INTEREST-LOAN> 2,732,601
<INTEREST-INVEST> 397,582
<INTEREST-OTHER> 176,460
<INTEREST-TOTAL> 3,306,643
<INTEREST-DEPOSIT> 1,451,654
<INTEREST-EXPENSE> 1,477,651
<INTEREST-INCOME-NET> 1,828,992
<LOAN-LOSSES> 112,500
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,157,832
<INCOME-PRETAX> 732,491
<INCOME-PRE-EXTRAORDINARY> 732,491
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 490,798
<EPS-PRIMARY> .67
<EPS-DILUTED> .67
<YIELD-ACTUAL> 8.34
<LOANS-NON> 590,000
<LOANS-PAST> 913,000
<LOANS-TROUBLED> 984,000
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,681,735
<CHARGE-OFFS> 36,855
<RECOVERIES> 11,720
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<ALLOWANCE-DOMESTIC> 1,769,100
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,769,100
</TABLE>
