<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1999 Commission File Number 06253
------------------ -----
SIMMONS FIRST NATIONAL CORPORATION
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Arkansas 71-0407808
- -------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
501 Main Street Pine Bluff, Arkansas 71601
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 870-541-1000
----------------
Not Applicable
- -------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period) and (2) has been
subject to such filing requirements for the past 90 days.
YES X NO
--- ---
Indicate the number of shares outstanding of each of issuer's classes of common
stock.
Class A, Common 7,313,775
Class B, Common None
<PAGE>
SIMMONS FIRST NATIONAL CORPORATION
INDEX
Part I: Summarized Financial Information
Consolidated Balance Sheets --
September 30, 1999 and December 31, 1998 3-4
Consolidated Statements of Income --
Three months and nine months ended
September 30, 1999 and 1998 5
Consolidated Statements of Cash Flows --
Nine months ended September 30, 1999 and 1998 6
Consolidated Statements of Changes in Stockholders' Equity
Nine months ended September 30, 1999 and 1998 7
Notes to Consolidated Financial Statements 8-17
Management's Discussion and Analysis of Financial
Condition and Results of Operations 18-22
Review by Independent Certified Public Accountants 23
Part II: Other Information 24-25
<PAGE>
Part I: Summarized Financial Information
<TABLE>
<CAPTION>
Simmons First National Corporation
Consolidated Balance Sheets
September 30, 1999 and December 31, 1998
ASSETS
September 30, December 31,
(In thousands) 1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
Cash and non-interest bearing balances due from banks $ 46,765 $ 56,649
Interest bearing balances due from banks 4,415 28,469
Federal funds sold and securities purchased
under agreements to resell 16,540 54,165
--------- ---------
Cash and cash equivalents 67,720 139,283
Investment securities 424,026 416,408
Mortgage loans held for sale 9,969 12,641
Assets held in trading accounts 1,245 78
Loans 1,096,671 1,034,462
Allowance for loan losses (17,580) (16,812)
--------- ---------
Net loans 1,079,091 1,017,650
Premises and equipment 40,004 37,834
Foreclosed assets held for sale, net 1,210 2,156
Interest receivable 16,541 15,481
Intangible assets, net 27,849 28,513
Other assets 17,498 16,966
--------- ---------
TOTAL ASSETS $1,685,153 $1,687,010
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Simmons First National Corporation
Consolidated Balance Sheets
September 30, 1999 and December 31, 1998
LIABILITIES AND STOCKHOLDERS' EQUITY
September 30, December 31,
(In thousands) 1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
(Unaudited)
LIABILITIES
<S> <C> <C>
Non-interest bearing transaction accounts $ 170,249 $ 180,621
Interest bearing transaction accounts and savings deposits 432,722 442,765
Time deposits 762,947 757,617
--------- ---------
Total deposits 1,365,918 1,381,003
Federal funds purchased and securities sold
under agreements to repurchase 89,239 78,367
Short-term debt 8,450 1,624
Long-term debt 47,416 49,899
Accrued interest and other liabilities 16,638 25,733
--------- ---------
Total liabilities 1,527,661 1,536,626
--------- ---------
STOCKHOLDERS' EQUITY
Capital stock
Class A, common, par value $1 a share, authorized
30,000,000 shares 7,313,775 issued and outstanding
at 1999 and 7,239,022 at 1998 7,314 7,239
Surplus 50,748 48,271
Undivided profits 101,497 93,383
Accumulated other comprehensive income
Unrealized (depreciation) appreciation on available-for-sale
securities, net of income tax credit of $1,240 at 1999 and
income taxes of $848 at 1998 (2,067) 1,491
--------- ---------
Total stockholders' equity 157,492 150,384
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,685,153 $1,687,010
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Simmons First National Corporation
Consolidated Statements of Income
Three Months and Nine Months Ended September 30, 1999 and 1998
Three Months Ended Nine Months Ended
September 30, September 30,
(In thousands, except per share data) 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
INTEREST INCOME
<S> <C> <C> <C> <C>
Loans $ 23,992 $ 23,931 $ 69,818 $ 68,457
Federal funds sold and securities purchased
under agreements to resell 150 720 1,542 2,867
Investment securities 5,958 6,127 17,818 18,846
Mortgage loans held for sale, net of unrealized gains (losses) 182 148 559 381
Assets held in trading accounts 15 11 48 71
Interest bearing balances due from banks 106 92 450 323
------- ------- ------- -------
TOTAL INTEREST INCOME 30,403 31,029 90,235 90,945
------- ------- ------- -------
INTEREST EXPENSE
Deposits 12,250 13,688 37,029 40,724
Federal funds purchased and securities sold
under agreements to repurchase 739 693 2,112 2,147
Short-term debt 74 54 116 150
Long-term debt 943 1,037 2,872 3,126
------- ------- ------- -------
TOTAL INTEREST EXPENSE 14,006 15,472 42,129 46,147
------- ------- ------- -------
NET INTEREST INCOME 16,397 15,557 48,106 44,798
Provision for loan losses 1,619 1,467 4,962 6,588
------- ------- ------- -------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 14,778 14,090 43,144 38,210
------- ------- ------- -------
NON-INTEREST INCOME
Trust income 1,239 1,021 3,491 2,922
Service charges on deposit accounts 1,749 1,740 5,208 4,992
Other service charges and fees 407 504 1,383 1,423
Income on sale of mortgage loans, net of commissions 533 596 1,591 1,677
Income on investment banking, net of commissions 34 (38) 274 779
Credit card fees 2,704 2,463 7,402 6,981
Mortgage servicing fees -- 420 -- 3,030
Other income 790 652 1,759 1,576
Gain on sale of mortgage servicing -- -- -- 3,273
Loss on sale of securities, net -- (61) -- (12)
------- ------- ------- -------
TOTAL NON-INTEREST INCOME 7,456 7,297 21,108 26,641
------- ------- ------- -------
NON-INTEREST EXPENSE
Salaries and employee benefits 8,177 7,978 24,369 24,169
Occupancy expense, net 946 1,013 2,683 2,967
Furniture and equipment expense 1,294 1,072 3,712 3,252
Loss on foreclosed assets 117 135 297 675
Merger-related 1,448 0 1,843 0
Other operating expenses 4,839 4,909 14,127 16,026
------- ------- ------- -------
TOTAL NON-INTEREST EXPENSE 16,821 15,107 47,031 47,089
------- ------- ------- -------
INCOME BEFORE INCOME TAXES 5,413 6,280 17,221 17,762
Provision for income taxes 1,600 1,762 5,131 5,195
------- ------- ------- -------
NET INCOME $ 3,813 $ 4,518 $ 12,090 $ 12,567
======= ======= ======= =======
BASIC EARNINGS PER SHARE $ 0.53 $ 0.63 $ 1.66 $ 1.74
======= ======= ======= =======
DILUTED EARNINGS PER SHARE $ 0.52 $ 0.62 $ 1.64 $ 1.71
======= ======= ======= =======
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Simmons First National Corporation
Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1999 and 1998
September 30, September 30,
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES (Unaudited)
<S> <C> <C>
Net income $ 12,090 $ 12,567
Items not requiring (providing) cash
Depreciation and amortization 4,705 5,318
Provision for loan losses 4,962 6,588
Net accretion of investment securities (96) (218)
Deferred income taxes (707) (1,514)
Provision for foreclosed assets 163 239
Gain on sale of mortgage servicing -- (3,273)
Loss on sale of securities, net -- 12
Changes in
Interest receivable (1,060) (577)
Mortgage loans held for sale 2,672 (445)
Assets held in trading accounts (1,167) (9,912)
Other assets (532) (834)
Accrued interest and other liabilities (6,377) 3,026
Income taxes payable (906) (1,030)
-------- --------
Net cash provided by operating activities 13,747 9,947
-------- --------
CASH FLOW FROM INVESTING ACTIVITIES
Net originations of loans (66,868) (59,205)
Sale of mortgage servicing -- 11,677
Purchase of premises and equipment, net (5,029) (5,357)
Proceeds from sale of foreclosed assets 1,248 888
Proceeds from sale of available-for-sale securities -- 1,500
Proceeds from maturities of available-for-sale securities 109,941 162,029
Purchases of available-for-sale securities (119,854) (162,562)
Proceeds from maturities of held-to-maturity securities 40,639 53,783
Purchases of held-to-maturity securities (41,806) (48,829)
-------- --------
Net cash used in investing activities (81,729) (46,076)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in deposits (15,085) (12,797)
Net proceeds (repayments) of short-term debt 6,826 (3,316)
Dividends paid (3,976) (3,072)
Proceeds from issuance of long-term debt 1,300 305
Repayments of long-term debt (3,783) (4,159)
Net increase in federal funds purchased and
securities sold under agreements to repurchase 10,872 6,275
Issuance of common stock, net 265 261
-------- --------
Net cash used in financing activities (3,581) (16,503)
-------- --------
DECREASE IN CASH AND
CASH EQUIVALENTS (71,563) (52,632)
CASH AND CASH EQUIVALENTS,
BEGINNING OF YEAR 139,283 146,802
-------- --------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 67,720 $ 94,170
======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Simmons First National Corporation
Consolidated Statements of Changes in Stockholders' Equity
Nine Months Ended September 30, 1999 and 1998
Accumulated
Other
Common Comprehensive Undivided
(In thousands, except per share data) Stock Surplus Income Profits Total
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1997, $ 6,191 $ 46,015 $ 1,216 $ 67,590 $ 121,012
as previously reported
Adjustment for pooling-of-interest 1,030 1,995 (133) 14,224 17,116
--------- --------- -------- -------- --------
Balance, December 31, 1997, as restated 7,221 48,010 1,083 81,814 138,128
Comprehensive income
Net income -- -- -- 12,567 12,567
Change in unrealized appreciation on
available-for-sale securities, net of
income taxes of $386 -- -- 679 -- 679
--------
Comprehensive income 13,246
Exercise of stock options--17,200 shares 17 284 -- -- 301
Other stock transaction of pooled
institution prior to pooling -- (17) -- -- (17)
Securities exchanged under stock option plan -- (23) -- -- (23)
Cash dividends declared
Common stock ($0.47 per share) -- -- -- (2,696) (2,696)
Pooled institutions prior to pooling -- -- -- (376) (376)
-------- -------- -------- -------- --------
Balance, September 30, 1998 7,238 48,254 1,762 91,309 148,563
Comprehensive income
Net income -- -- -- 3,920 3,920
Change in unrealized appreciation on
available-for-sale securities, net of
income tax credit of $154 -- -- (271) -- (271)
--------
Comprehensive income 3,649
Exercise of stock options--1,500 shares 1 17 -- -- 18
Cash dividends declared
Common stock ($0.17 per share) -- -- -- (1,058) (1,058)
Pooled institutions prior to pooling -- -- -- (788) (788)
-------- -------- -------- -------- --------
Balance, December 31, 1998 7,239 48,271 1,491 93,383 150,384
Comprehensive income
Net income -- -- -- 12,090 12,090
Change in unrealized appreciation on
available-for-sale securities, net of
income tax credit of $2,135 -- -- (3,558) -- (3,558)
--------
Comprehensive income 8,532
Exercise of stock options--18,100 shares 18 258 -- -- 276
Securities exchanged under stock option plan -- (11) -- -- (11)
Common stock issued in connection with the
purchase of the minority shares of the
Bank of Lincoln - 56,997 shares 57 2,230 -- -- 2,287
Cash dividends declared
Common stock ($0.53 per share) -- -- -- (3,600) (3,600)
Pooled institutions prior to pooling -- -- -- (376) (376)
-------- -------- -------- -------- --------
Balance, September 30, 1999 $ 7,314 $ 50,748 $ (2,067) $ 101,497 $ 157,492
======== ======== ======== ======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
SIMMONS FIRST NATIONAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1: ACCOUNTING POLICIES
The consolidated financial statements include the accounts of Simmons First
National Corporation and its subsidiaries. Significant intercompany accounts and
transactions have been eliminated in consolidation. All financial information
has been restated for the mergers with American Bancshares of Arkansas, Inc
("ABA"), Lincoln Bankshares, Inc. ("LBI"), and NBC Bank Corp. ("NBC"), which
were accounted for as poolings-of-interests.
All adjustments made to the unaudited financial statements were of a normal
recurring nature. In the opinion of management, all adjustments necessary for a
fair presentation of the results of interim periods have been made. Certain
prior year amounts are reclassified to conform to current year classification.
The accounting policies followed in the presentation of interim financial
results are presented on pages 28-30 of the 1998 Annual Report to shareholders.
Earnings Per Share
Basic earnings per share is computed based on the weighted average number
of common shares outstanding during each year. Diluted earnings per share is
computed using the weighted average common shares and all potential dilutive
common shares outstanding during the period.
The computation of per share earnings for the nine months ended September
30, 1999 and 1998 is as follows:
<TABLE>
<CAPTION>
(In thousands, except per share data) 1999 1998
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Income $ 12,090 $ 12,567
------- -------
Average common shares outstanding 7,304 7,230
Average common share stock options outstanding 72 117
------- -------
Average diluted common shares 7,376 7,347
------- -------
Basic earnings per share $ 1.66 $ 1.74
======= =======
Diluted earnings per share $ 1.64 $ 1.71
======= =======
</TABLE>
<PAGE>
NOTE 2: ACQUISITIONS
On December 8, 1998, the Company and ABA merged in a pooling-of-interests
transaction. Shareholders of ABA received 464,885 shares of Simmons First
National Corporation stock in exchange for ABA shares in the transaction. ABA
owned American State Bank, Charleston, Arkansas with assets, as of December 8,
1998 of $89 million. The Company merged American State Bank into Simmons First
National Bank during the first quarter of 1999.
On January 15, 1999, the Company acquired all the common stock of LBI.
Stockholders of LBI received 301,823 shares of Simmons First National
Corporation stock in exchange for LBI shares in the transaction. LBI owned the
Bank of Lincoln, Lincoln, Arkansas with assets, as of January 15, 1999, of $75
million. This acquisition was accounted for as a pooling-of-interests, except
for the acquisition of the minority shares (17.9%) of the Bank of Lincoln, which
were accounted for on a purchase accounting basis. The Company merged the Bank
of Lincoln into Simmons First Bank of Northwest Arkansas during the second
quarter of 1999.
On July 9, 1999, the Company acquired all the common stock of NBC in
exchange for 784,887 shares of the Company's common stock. NBC owned National
Bank of Commerce, El Dorado, Arkansas with assets of $155 million, as of July 9,
1999. The Company changed the name of National Bank of Commerce to Simmons First
Bank of El Dorado, N.A. The Company will operate Simmons First Bank of El
Dorado, N.A. as a separate community bank with the same board of directors,
management and staff. This acquisition was accounted for as a
pooling-of-interests.
NOTE 3: INVESTMENT SECURITIES
The amortized cost and fair value of investment securities that are
classified as held-to-maturity and available-for-sale are as follows:
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------------------------------------- -----------------------------------------
Gross Gross Estimated Gross Gross Estimated
Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair
(In thousands) Cost Gains (Losses) Value Cost Gains (Losses) Value
- ---------------------------------------------------------------------------------------------------------------
Held-to-Maturity
- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury $ 15,585 $ 52 $ (49) $ 15,588 $ 25,116 $ 424 $ (1) $ 25,539
U.S. Government
agencies 39,639 109 (690) 39,058 35,770 474 (48) 36,196
Mortgage-backed
securities 17,449 2 (196) 17,255 19,756 113 (170) 19,699
State and political
subdivisions 110,674 886 (1,050) 110,510 110,096 2,752 (99) 112,749
Other securities 562 14 -- 576 993 17 (1) 1,009
-------- -------- -------- -------- -------- -------- -------- --------
$ 183,909 $ 1,063 $ (1,985) $ 182,987 $ 191,731 $ 3,780 $ (319) $ 195,192
======== ======== ======== ======== ======== ======== ======== ========
Available-for-Sale
- ------------------
U.S. Treasury $ 45,202 $ 269 $ (52) $ 45,419 $ 51,796 $ 1,081 $ -- $ 52,877
U.S. Government
agencies 173,346 19 (4,165) 169,200 131,996 486 (147) 132,335
Mortgage-backed
securities 9,809 4 (149) 9,664 25,256 58 (230) 25,084
State and political
subdivisions 5,409 1 (146) 5,264 4,816 57 (9) 4,864
Other securities 9,666 1,246 (342) 10,570 8,246 1,523 (252) 9,517
--------- -------- -------- -------- -------- -------- -------- --------
$ 243,432 $ 1,539 $ (4,854) $ 240,117 $ 222,110 $ 3,205 $ - (638) $ 224,677
======== ======== ======== ======== ======== ======== ======== ========
</TABLE>
<PAGE>
The carrying value, which approximates the market value, of securities
pledged as collateral, to secure public deposits and for other purposes,
amounted to $249,196,000 at September 30, 1999 and $239,070,000 at December 31,
1998.
The book value of securities sold under agreements to repurchase amounted
to $42,264,000 and $33,384,000 for September 30, 1999 and December 31, 1998,
respectively.
Income earned on securities for the nine months ended September 30, 1999
and 1998 is as follows:
<TABLE>
<CAPTION>
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------------------
Taxable
<S> <C> <C>
Held-to-maturity $ 3,273 $ 4,933
Available-for-sale 10,389 10,114
Non-taxable
Held-to-maturity 3,989 3,677
Available-for-sale 167 122
-------- --------
Total $ 17,818 $ 18,846
======== ========
</TABLE>
Maturities of investment securities at September 30, 1999 are as follows:
<TABLE>
<CAPTION>
Held-to-Maturity Available-for-Sale
-------------------- ---------------------
Amortized Fair Amortized Fair
(In thousands) Cost Value Cost Value
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
One year or less $ 18,816 $ 18,870 $ 38,913 $ 39,082
After one through five years 76,245 76,062 121,407 119,274
After five through ten years 64,540 63,601 58,411 56,416
After ten years 23,746 23,878 15,035 14,775
Other securities 562 576 9,666 10,570
---------- ---------- ---------- ----------
Total $ 183,909 $ 182,987 $ 243,432 $ 240,117
========== ========== ========== ==========
</TABLE>
The gross realized gains of $0 and $49,000 and gross realized losses of $0
and $61,000 at September 30, 1999 and 1998, respectively, were the result of
sales and/or calls of available-for-sale securities in 1998. Proceeds from sales
of available-for-sale securities in 1998 were $1,500,000.
Most of the state and political subdivision debt obligations are non-rated
bonds and represent small, Arkansas issues, which are evaluated on an ongoing
basis.
<PAGE>
NOTE 4: LOANS AND ALLOWANCE FOR LOAN LOSSES
The various categories are summarized as follows:
<TABLE>
<CAPTION>
September 30, December 31,
(In thousands) 1999 1998
- ----------------------------------------------------------------------------------------------------------
Consumer
<S> <C> <C>
Credit cards $ 167,767 $ 165,622
Student loans 67,462 66,134
Other consumer 175,940 155,767
Real estate
Construction 54,783 63,037
Single family residential 200,322 194,174
Other commercial 237,306 223,368
Commercial
Commercial 133,702 112,800
Agricultural 52,741 40,706
Financial institutions 2,850 5,656
Other 3,798 7,198
------------ ------------
Total loans before allowance for loan losses $ 1,096,671 $ 1,034,462
============ ============
</TABLE>
During the first nine months of 1999, foreclosed assets held for sale
decreased $946,000 to $1,210,000 and are carried at the lower of cost or fair
market value. Other non-performing assets, non-accrual loans and other
non-performing loans for the Company at September 30, 1999, were $25,000
$7,930,000 and $2,695,000, respectively, bringing the total of non-performing
assets to $11,860,000.
<PAGE>
Transactions in the allowance for loan losses are as follows:
<TABLE>
<CAPTION>
September 30, December 31,
(In thousands) 1999 1998
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Balance, beginning of year $ 16,812 $ 15,215
Additions
Provision charged to expense 4,962 6,588
------- -------
21,774 21,803
Deductions
Losses charged to allowance, net of recoveries
of $1,030 and $692 for the first nine months of
1999 and 1998, respectively 4,194 4,408
------- -------
Balance, September 30 $ 17,580 $ 17,395
======= -------
Additions
Provision charged to expense 1,721
-------
19,116
Deductions
Losses charged to allowance, net of recoveries
of $367 for the last nine months of
1998 2,304
-------
Balance, end of year $ 16,812
=======
</TABLE>
At September 30, 1999 and December 31, 1998, impaired loans totaled
$13,219,000 and $13,312,000, respectively, all of which had reserves allocated.
An allowance of $3,049,000 and $2,894,000 for possible losses related to those
loans at September 30, 1999 and December 31, 1998, respectively.
Interest of $419,000 and $410,000 was recognized on average impaired loans
of $13,518,000 and $12,138,000 as of September 30, 1999 and 1998, respectively.
Interest recognized on impaired loans on a cash basis during the first nine
months of 1999 and 1998 was immaterial.
<PAGE>
NOTE 5: TIME DEPOSITS
Time deposits include approximately $211,606,000 and $217,892,000 of
certificates of deposit of $100,000 or more at September 30, 1999, and December
31, 1998, respectively.
NOTE 6: INCOME TAXES
The provision for income taxes is comprised of the following components:
<TABLE>
<CAPTION>
September 30, September 30,
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
Income taxes currently payable $ 5,838 $ 6,709
Deferred income taxes (707) (1,514)
--------------- ---------------
Provision for income taxes $ 5,131 $ 5,195
=============== ===============
</TABLE>
The tax effects of temporary differences related to deferred taxes shown on
the balance sheet are shown below:
<TABLE>
<CAPTION>
September 30, December 31,
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------
Deferred tax assets
<S> <C> <C>
Allowance for loan losses $ 6,264 $ 5,294
Valuation of foreclosed assets 223 332
Deferred compensation payable 648 650
Deferred loan fee income 478 591
Mortgage servicing reserve 469 477
Available-for-sale securities 1,240 --
Vacation compensation 462 388
Other 320 295
Total deferred tax assets --------------- ---------------
10,104 8,027
--------------- ---------------
Deferred tax liabilities
Accumulated depreciation (1,195) (930)
Available-for-sale securities -- (848)
Stock dividends (355) (193)
Other (522) (819)
--------------- ---------------
Total deferred tax liabilities (2,072) (2,790)
--------------- ---------------
Net deferred tax assets included in other
assets on balance sheets $ 8,032 $ 5,237
=============== ===============
</TABLE>
<PAGE>
A reconciliation of income tax expense at the statutory rate to the
Company's actual income tax expense is shown below:
<TABLE>
<CAPTION>
September 30, September 30,
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
Computed at the statutory rate (35%) $ 6,027 $ 6,217
Increase (decrease) resulting from:
Tax exempt income (1,485) (1,305)
Other differences, net 589 283
--------------- ---------------
Actual tax provision $ 5,131 $ 5,195
=============== ===============
</TABLE>
NOTE 7: LONG-TERM DEBT
Long-term debt at September 30, 1999 and December 31, 1998, consisted of
the following components,
<TABLE>
<CAPTION>
September 30, December 31,
(In thousands) 1999 1998
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
7.32% note due 2007, unsecured $ 16,000 $ 18,000
9.75% note due 2008, secured by land and building 931 972
5.36% to 8.41% FHLB advances due 1999 to 2018,
secured by residential real estate loans 13,235 13,677
Trust preferred securities 17,250 17,250
--------------- ---------------
$ 47,416 $ 49,899
=============== ===============
</TABLE>
The Company owns a wholly owned grantor trust subsidiary (the Trust) to
issue preferred securities representing undivided beneficial interests in the
assets of the respective Trust and to invest the gross proceeds of such
preferred securities into notes of the Company. The sole assets of the Trust are
$17.8 million aggregate principal amount of the Company's 9.12% Subordinated
Debenture Notes due 2027 which are redeemable beginning in 2002. Such securities
qualify as Tier 1 Capital for regulatory purposes.
<PAGE>
Aggregate annual maturities of long-term debt at September 30, 1999 are:
<TABLE>
Annual
(In thousands) Year Maturities
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
1999 $ 378
2000 3,490
2001 3,404
2002 3,316
2003 3,277
Thereafter 33,551
---------------
Total $ 47,416
===============
</TABLE>
NOTE 8: CONTINGENT LIABILITIES
A number of legal proceedings exist in which the Company and/or its
subsidiaries are either plaintiffs or defendants or both. Most of the lawsuits
involve loan foreclosure activities. The various unrelated legal proceedings
pending against the subsidiary banks in the aggregate are not expected to have a
material adverse effect on the financial position of the Company and its
subsidiaries.
NOTE 9: UNDIVIDED PROFITS
The subsidiary banks are subject to a legal limitation on dividends that
can be paid to the parent company without prior approval of the applicable
regulatory agencies. The approval of the Comptroller of the Currency is
required, if the total of all dividends declared by a national bank in any
calendar year exceeds the total of its net profits, as defined, for that year
combined with its retained net profits of the preceding two years. Arkansas bank
regulators have specified that the maximum dividend limit state banks may pay to
the parent company without prior approval is 75% of current year earnings plus
75% of the retained net earnings of the preceding year. At September 30, 1999,
the bank subsidiaries had approximately $10 million available for payment of
dividends to the Company without prior approval of the regulatory agencies.
The Federal Reserve Board's risk-based capital guidelines include the
definitions for (1) a well-capitalized institution, (2) an
adequately-capitalized institution, and (3) an undercapitalized institution. The
criteria for a well-capitalized institution are: a 5% "Tier l leverage capital"
ratio, a 6% "Tier 1 risk-based capital" ratio, and a 10% "total risk-based
capital" ratio. As of September 30, 1999, each of the eight subsidiary banks met
the capital standards for a well-capitalized institution. The Company's "total
risk-based capital" ratio was 14.5% at September 30, 1999.
<PAGE>
NOTE 10: STOCK OPTIONS AND RESTRICTED STOCK
As of September 30, 1999, 295,600 shares of common stock of the Company had
been granted through an employee stock option incentive plan. There were 153,820
exercisable options at the end of the third quarter of 1999. Seventy thousand
four hundred shares have been issued upon exercise of options. As of September
30, 1999, nine thousand shares of common stock of the Company had been granted
and issued as Bonus Shares of restricted stock.
NOTE 11: ADDITIONAL CASH FLOW INFORMATION
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
(In thousands) 1999 1998
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Interest paid $ 43,484 $ 46,363
Income taxes paid $ 6,744 $ 7,739
</TABLE>
Approximately, $9,000,000 of investment securities previously classified as
held-to-maturity was reclassified as available-for-sale during the second
quarter of 1999. This was the result the Company merging the Bank of Lincoln
into Simmons First Bank of Northwest Arkansas during the second quarter of 1999.
NOTE 12: CERTAIN TRANSACTIONS
From time to time the Company and its subsidiaries have made loans and
other extensions of credit to directors, officers, their associates and members
of their immediate families, and from time to time directors, officers and their
associates and members of their immediate families have placed deposits with the
Company's subsidiary banks. Such loans, other extensions of credit and deposits
were made in the ordinary course of business, on substantially the same terms
(including interest rates and collateral) as those prevailing at the time for
comparable transactions with other persons and did not involve more than normal
risk of collectibility or present other unfavorable features.
<PAGE>
NOTE 13: COMMITMENTS AND CREDIT RISK
The eight affiliate banks of the Company grant agribusiness, commercial,
consumer, and residential loans to their customers. Included in the Company's
diversified loan portfolio is unsecured debt in the form of credit card
receivables that comprised approximately 15.3% and 16.0% of the portfolio, as of
September 30, 1999 and December 31, 1998, respectively.
Commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since a portion of the commitments may expire
without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements. Each customer's creditworthiness is
evaluated on a case-by-case basis. The amount of collateral obtained, if deemed
necessary, is based on management's credit evaluation of the counterparty.
Collateral held varies, but may include accounts receivable, inventory,
property, plant and equipment, commercial real estate, and residential real
estate.
At September 30, 1999, the Company had outstanding commitments to extend
credit aggregating approximately $263,870,000 and $113,492,000 for credit card
commitments and other loan commitments, respectively. At December 31, 1998, the
Company had outstanding commitments to extend credit aggregating approximately
$152,946,000 and $109,038,000 for credit card commitments and other loan
commitments, respectively.
Letters of credit are conditional commitments issued by the bank
subsidiaries of the Company, to guarantee the performance of a customer to a
third party. Those guarantees are primarily issued to support public and private
borrowing arrangements, including commercial paper, bond financing, and similar
transactions. The credit risk involved in issuing letters of credit is
essentially the same as that involved in extending loans to customers. The
Company had total outstanding letters of credit amounting to $6,545,000 and
$6,511,000 at September 30, 1999 and December 31, 1998, respectively, with terms
ranging from 90 days to one year.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
Operating earnings (net income excluding merger-related expenses) for the
quarter ended September 30, 1999, were $4,800,000, compared to earnings of
$4,518,000 for the same period in 1998. This represents a $282,000, or 6.2%
increase in the 1999 earnings over 1998. Diluted operating earnings per share
increased 4.8% to $0.65 in the third quarter of 1999 from $0.62 in the same
period of 1998. The Company's operating return on average assets and operating
return on average stockholder's equity for the three-month period ended
September 30, 1999 was 1.15% and 12.06%, compared to 1.09% and 12.18%,
respectively, for the same period in 1998. In connection with the merger of NBC
Bank Corp. ("NBC"), during the third quarter of 1999, after tax merger-related
expenses totaled $987,000, or $0.13 per share. After merger-related expenses,
Simmons First's third quarter 1999 earnings were $3,813,000 or $0.52 diluted
earnings per share. All financial information has been restated for the mergers
with American Bancshares of Arkansas, Inc. ("ABA"), Lincoln Bankshares, Inc.
("LBI") and NBC, which were accounted for as poolings-of-interests.
Operating earnings for the nine-month period ended September 30, 1999, were
$13,472,000, or an increase of $905,000 over the September 30, 1998 earnings of
$12,567,000. Diluted operating earnings per share increased 7.0% to $1.83 for
the nine-month period ended September 30, 1999 from $1.71 in the same period of
1998. Operating return on average assets and operating return on average
stockholders' equity for the nine-month period ended September 30, 1999, was
1.08% and 11.51%, compared to 1.02% and 11.68%, respectively, for the same
period in 1998. In connection with the mergers of LBI and NBC, during nine-month
period ended September 30, 1999 after tax merger-related expenses totaled
$1,382,000, or $0.19 per share. After merger-related expenses, Simmons First's
nine-month period ended September 30, 1999 earnings were $12,090,000 or $1.64
diluted earnings per share.
Diluted cash operating earnings (net income excluding amortization of
intangibles and merger-related expenses) for the third quarter of 1999 were
$0.71 per share compared with $0.67 for the third quarter of 1998, reflecting a
6.0% increase. Year-to-date diluted cash operating earnings on a per share basis
as of September 30, 1999 were $1.99 compared to $1.87 at September 30, 1998,
reflecting a 6.4% increase. Cash operating return on average assets was 1.20%
and cash operating return on average stockholders' equity was 12.71% for the
nine-month period ended September 30, 1999, compared with 1.14% and 12.83%,
respectively, for the same period in 1998.
Net interest income, the difference between interest income and interest
expense, for the three-month period ended September 30, 1999, increased
$840,000, or 5.4%, when compared to the same period in 1998. During the third
quarter, interest income decreased $626,000, or 2.0%, while interest expense
decreased $1,466,000 or 9.5%, when compared to the same period in 1998. For the
nine-months ended September 30, 1999 and 1998, net interest income was
$48,106,000 and $44,798,000 respectively. This represents an increase of
$3,308,000, or 7.4%. Year-to-date interest income for the nine-month periods
ended September 30, 1999 and 1998 decreased $710,000, to $90,235,000, over the
$90,945,000 reported as for September 30, 1998, which signifies a 0.8% decrease.
Year-to-date interest expense at September 30, 1999 and 1998, were $42,129,000
and $46,147,000, respectively, which equates to an 8.7% decrease. These figures
reflect growth in the loan portfolio (September 30, 1998 to September 30, 1999)
and an increase in fees on loans offset by a decline in average interest rates
from 1998 to 1999.
<PAGE>
The provision for loan losses for the third quarter of 1999 was $1,619,000,
compared to $1,467,000 for the same period of 1998, resulting in a $152,000 or
10.4%, increase. The provision in the third quarter of 1999 was increased as a
result of growth in loans. For the nine months ended September 30, 1999 and
1998, the provision was $4,962,000 and $6,588,000, respectively, resulting in a
$1,626,000 decrease. The provision in 1998 was increased as a result of growth
in loans, increased indirect lending, unfavorable weather conditions during the
crop production period, general market conditions in the agriculture industry
and an increased level of consumer bankruptcies.
Non-interest income for the third quarter ended September 30, 1999, was
$7,456,000, a 2.2% increase over the $7,297,000 reported for the same period in
1998. For the nine-months ended September 30, 1999, non-interest income was
$21,108,000, a 20.8% decrease from the $26,641,000 reported for the same period
in 1998. . This decrease is primarily due to the sale of the Company's mortgage
servicing portfolio on June 30, 1998. Total recurring non-interest income for
the nine-month period ended September 30, 1999 was up 3.7% when compared with
the same period in 1998.
During the three months ended September 30, 1999, non-interest expense
(excluding merger-related expenses) increased $266,000, or 1.8%, over the same
period in 1998. This increase is attributable to the normal increase in the cost
of doing business. Year-to-date non-interest expense was $47,031,000 at
September 30, 1999, compared to $47,089,000, for the same period ended September
30, 1998. This $58,000 decrease reflects the sale of the Company's mortgage
servicing portfolio and $500,000 of Year 2000 expenses during 1998 offset by the
normal increase in the cost of doing business and $1,843,000 in merger-related
expenses during 1999.
On June 30, 1998, Simmons First National Bank sold its residential
mortgage-servicing portfolio resulting in a $3.3 million gain. The portfolio
consisted of approximately $1.2 billion in residential mortgage loans. The
portfolio sale will not have a material impact on future earnings of the
Company.
FINANCIAL CONDITION
- -------------------
Total assets for the Company at September 30, 1999, were $1.685 billion, a
decrease of $2 million, or 0.1%, over the same figure at December 31, 1998.
Deposits at September 30, 1999, totaled $1.366 billion, an increase of $15
million, or 1.1% from the same figure at December 31, 1998. Stockholders' equity
at the end of the third quarter was $157,492,000, an increase of $7,108,000, or
4.7%, from the December 31, 1998 figure.
Asset quality remains strong with the allowance for loan losses as a
percent of total loans at 1.60% as of September 30, 1999, compared to 1.63% at
December 31, 1998. As of September 30, 1999, non-performing loans equaled 0.99%
of total loans, while the allowance for loan losses equaled 162% of
non-performing loans.
Generally speaking, the Company's banking subsidiaries rely upon net
inflows of cash from financing activities, supplemented by net inflows of cash
from operating activities, to provide cash used in their investing activities.
As is typical of most banking companies, significant financing activities
include: deposit gathering; use of short-term borrowing facilities, such as
federal funds purchased and repurchase agreements; and the issuance of long-term
debt. The banks' primary investing activities include loan originations and
purchases of investment securities, offset by loan payoffs and investment
maturities.
<PAGE>
Liquidity represents an institution's ability to provide funds to satisfy
demands from depositors and borrowers, by either converting assets into cash or
accessing new or existing sources of incremental funds. It is a major
responsibility of management to maximize net interest income within prudent
liquidity constraints. Internal corporate guidelines have been established to
measure liquid assets as well as relevant ratios concerning earning asset levels
and purchased funds. Each bank subsidiary is also required to monitor these same
indicators and report regularly to its own senior management and board of
directors. At September 30, 1999, each bank was within established guidelines
and total corporate liquidity was strong. At September 30, 1999, cash and due
from banks, securities available for sale and held in trading accounts, federal
funds sold and securities purchased under agreements for resell, and mortgage
loans held for sale were 18.9% of total assets.
ACQUISITIONS
- ------------
In December 1998, the Company and ABA merged in a pooling-of-interests
transaction. Stockholders of ABA received 464,885 shares of Simmons First
National Corporation stock in exchange for ABA shares in the transaction. ABA
owned American State Bank ("ASB"), Charleston, Arkansas with assets, as of
December 31, 1998, of $90 million. The Company merged ASB into Simmons First
National Bank during the first quarter of 1999.
On January 15, 1999, the Company and LBI merged in a pooling-of-interests
transaction, except for the acquisition of the minority shares (17.9%) of the
Bank of Lincoln, which were accounted for on a purchase accounting basis.
Stockholders of LBI received 301,823 shares of Simmons First National
Corporation stock in exchange for LBI shares in the transaction. LBI owned the
Bank of Lincoln ("BOL"), Lincoln, Arkansas with assets, as of January 15, 1999,
of $75 million. The Company merged BOL into Simmons First Bank of Northwest
Arkansas during the second quarter of 1999.
On July 9, 1999, the Company acquired all the common stock of NBC Bank
Corp. in exchange for 784,887 shares of the Company's common stock. NBC Bank
Corp. owned National Bank of Commerce, El Dorado, Arkansas with assets of $155
million, as of July 9, 1999. The Company changed the name of National Bank of
Commerce to Simmons First Bank of El Dorado, N.A. The Company will operate
Simmons First Bank of El Dorado, N.A. as a separate community bank with the same
board of directors, management and staff. This acquisition will be accounted for
as a pooling-of-interests.
<PAGE>
IMPACT OF THE YEAR 2000 ISSUE
- -----------------------------
General
The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Many computer
systems, software, and embedded computer chips may be unable to distinguish
between 1900 and 2000. If not corrected, this problem could create system errors
and failure resulting in the disruption of normal business operations.
In 1996, as part of its strategic plan to provide quality customer service,
introduce new products, and improve operating efficiencies, the Company began
converting all of its core banking related software and hardware systems to
state-of-the-art technology. These conversions were completed in 1998. As a
byproduct of this effort, the Year 2000 issue was addressed.
State of Readiness
The Company has identified the following key phases for addressing the Year
2000 issues: analysis, testing, remediation and implementation. The Company
completed the Year 2000 analysis by identification of mission critical systems,
vendors, large borrowers and large depositors requiring assessment and testing.
The Company utilized both internal and external resources to test its software
systems for Year 2000 compliance. The Company's internal missions critical
testing is complete. The testing with vendors, payment system providers and
third party suppliers is substantially complete. The replacement of
non-compliant systems is complete. During the remainder of 1999, the Company
will ensure that new systems or subsequent changes to certified systems are
compliant with Year 2000 requirements. The Company has substantially completed
all phases, in accordance with guidelines established by the Federal Financial
Institutions Examination Council (FFIEC).
Costs
During the nine-month period ended September 30, 1999, the Company had no
significant expenses related to the Year 2000 issue. The Company is utilizing
internal personnel to complete all work associated with the Year 2000 project.
Therefore, management believes completion of the Year 2000 modifications and
subsequent testing will not have a material effect on the Company's future
consolidated results of operations or financial position.
<PAGE>
Risks
Although the Company's Year 2000 readiness is directed at reducing its
exposure, there can be no assurance that these efforts will fully mitigate the
effect of Year 2000 issues. In the event the Company fails to identify or
correct a material Year 2000 problem, there could be disruptions in normal
business operations, which could have a material adverse effect on the Company's
results of operations, liquidity or financial condition. Additionally, the
Company is subject to credit risk to the extent borrowers fail to adequately
address Year 2000 issues and to liquidity risk to the extent of deposit
withdrawals and to the extent its lenders are unable to provide the Company with
funds due to Year 2000 issues. Although it is not possible to quantify the
potential impact of these risks at this time, in future years, there may be
increases in problem loans, credit losses, and liquidity problems, as well as
the risk of litigation and potential losses from litigation related to the
foregoing.
Contingency Plans
The Company has existing disaster recovery plans that address its response
to disruptions to business due to natural disasters, civil unrest, utility
outages or other occurrences. The Company has modified the disaster recovery
plans to specifically address Year 2000 issues. The Company has completed these
contingency plans. The contingency plans have been tested and validated.
<PAGE>
REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
BAIRD, KURTZ & DOBSON
Certified Public Accountants
200 East Eleventh
Pine Bluff, Arkansas
Board of Directors
Simmons First National Corporation
Pine Bluff, Arkansas
We have made a review of the accompanying consolidated condensed financial
statements, appearing on pages 3 to 17 of the accompanying Form 10-Q, of SIMMONS
FIRST NATIONAL CORPORATION and consolidated subsidiaries as of September 30,
1999 and for the three-months and nine-months ended September 30, 1999 and 1998,
in accordance with standards established by the American Institute of Certified
Public Accountants.
A review of interim financial information consists principally of obtaining
an understanding of the system for the preparation of interim financial
information, applying analytical review procedures to financial data, and making
inquiries of persons responsible for financial and accounting matters. It is
substantially less in scope than an examination in accordance with generally
accepted auditing standards, the objective which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the condensed financial statements referred to above for them
to be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1998, and the
related consolidated statements of income, cash flows and changes in
stockholders' equity for the year then ended (not presented herein), and in our
report dated February 2, 1999, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth in
the accompanying condensed consolidated balance sheet as of December 31, 1998,
is fairly stated in all material respects in relation to the consolidated
balance sheet from which it has been derived.
/s/ Baird, Kurtz & Dobson
BAIRD, KURTZ & DOBSON
Pine Bluff, Arkansas
November 5, 1999
<PAGE>
Part II: Other Information
Item 2. Changes in Securities.
Recent Sales of Unregistered Securities. The following transactions are
sales of unregistered shares of Class A Common Stock of the registrant which
were issued to executive and senior management officers upon the exercise of
rights granted under either the Simmons First National Corporation Incentive and
Non-qualified Stock Option Plan or the Simmons First National Corporation
Executive Stock Incentive Plan. No underwriters were involved and no
underwriter's discount or commissions were involved. Exemption from registration
is claimed under Section 4(2) of the Securities Act of 1933 as private
placements. Unless noted otherwise, the registrant received cash as the
consideration for the transaction.
<TABLE>
<CAPTION>
Number
Identity Date of Sale of Share Price(1) Type of Transaction
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 Officer September 13, 1999 1,500 8.2917 Incentive Stock Option
<FN>
Notes:
1. The per share price paid for incentive stock options represents the fair
market value of the stock as determined under the terms of the Plan on the
date the incentive stock option was granted to the officer.
</FN>
</TABLE>
<PAGE>
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.
SIMMONS FIRST NATIONAL CORPORATION
----------------------------------
(Registrant)
Date: November 5, 1999 /s/ J. Thomas May
------------------------------- -------------------------------
J. Thomas May, Chairman,
President and Chief Executive Officer
Date: November 5, 1999 /s/ Barry L. Crow
------------------------------- -------------------------------
Barry L. Crow, Executive Vice President
and Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C> <C> <C>
<PERIOD-TYPE> 9-MOS 6-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1999 DEC-31-1999
<PERIOD-START> JAN-01-1999 JAN-01-1999 JAN-01-1999
<PERIOD-END> SEP-30-1999 JUN-30-1999 MAR-31-1999
<CASH> 46,765 57,015 57,894
<INT-BEARING-DEPOSITS> 4,415 7,060 24,795
<FED-FUNDS-SOLD> 16,540 12,635 64,675
<TRADING-ASSETS> 1,245 10,529 3,057
<INVESTMENTS-HELD-FOR-SALE> 243,432 246,925 232,439
<INVESTMENTS-CARRYING> 183,909 179,514 180,437
<INVESTMENTS-MARKET> 182,987 179,580 183,300
<LOANS> 1,096,671 1,038,481 1,012,588
<ALLOWANCE> 17,580 17,231 16,595
<TOTAL-ASSETS> 1,685,153 1,648,281 1,674,271
<DEPOSITS> 1,365,918 1,356,901 1,390,794
<SHORT-TERM> 8,450 7,227 1,218
<LIABILITIES-OTHER> 105,877 78,534 78,230
<LONG-TERM> 47,416 49,783 49,526
0 0 0
0 0 0
<COMMON> 7,314 7,312 7,306
<OTHER-SE> 150,178 148,524 147,197
<TOTAL-LIABILITIES-AND-EQUITY> 1,685,153 1,648,281 1,674,271
<INTEREST-LOAN> 69,818 45,826 22,720
<INTEREST-INVEST> 17,818 11,860 5,902
<INTEREST-OTHER> 2,599 2,146 1,331
<INTEREST-TOTAL> 90,235 59,832 29,953
<INTEREST-DEPOSIT> 37,029 24,779 12,605
<INTEREST-EXPENSE> 42,129 28,123 14,445
<INTEREST-INCOME-NET> 48,106 31,709 15,508
<LOAN-LOSSES> 4,962 3,343 1,652
<SECURITIES-GAINS> 0 0 0
<EXPENSE-OTHER> 47,031 30,210 15,245
<INCOME-PRETAX> 17,221 11,808 5,360
<INCOME-PRE-EXTRAORDINARY> 12,090 8,277 3,708
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 12,090 8,277 3,708
<EPS-BASIC> 1.66 1.13 0.51
<EPS-DILUTED> 1.64 1.12 0.50
<YIELD-ACTUAL> 0 0 0
<LOANS-NON> 7,930 7,132 8,470
<LOANS-PAST> 2,695 3,206 2,855
<LOANS-TROUBLED> 0 0 0
<LOANS-PROBLEM> 0 0 0
<ALLOWANCE-OPEN> 16,812 16,812 16,812
<CHARGE-OFFS> 5,224 3,460 2,107
<RECOVERIES> 1,030 536 238
<ALLOWANCE-CLOSE> 17,580 17,231 16,595
<ALLOWANCE-DOMESTIC> 17,580 17,231 16,595
<ALLOWANCE-FOREIGN> 0 0 0
<ALLOWANCE-UNALLOCATED> 0 0 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 56,649
<INT-BEARING-DEPOSITS> 28,469
<FED-FUNDS-SOLD> 54,165
<TRADING-ASSETS> 78
<INVESTMENTS-HELD-FOR-SALE> 224,677
<INVESTMENTS-CARRYING> 191,731
<INVESTMENTS-MARKET> 195,192
<LOANS> 1,034,462
<ALLOWANCE> 16,812
<TOTAL-ASSETS> 1,687,010
<DEPOSITS> 1,381,003
<SHORT-TERM> 1,624
<LIABILITIES-OTHER> 104,100
<LONG-TERM> 49,899
0
0
<COMMON> 7,239
<OTHER-SE> 143,145
<TOTAL-LIABILITIES-AND-EQUITY> 1,687,010
<INTEREST-LOAN> 92,290
<INTEREST-INVEST> 24,735
<INTEREST-OTHER> 5,015
<INTEREST-TOTAL> 122,040
<INTEREST-DEPOSIT> 54,242
<INTEREST-EXPENSE> 61,574
<INTEREST-INCOME-NET> 60,466
<LOAN-LOSSES> 8,309
<SECURITIES-GAINS> (165)
<EXPENSE-OTHER> 62,474
<INCOME-PRETAX> 23,153
<INCOME-PRE-EXTRAORDINARY> 16,487
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 16,487
<EPS-BASIC> 2.28
<EPS-DILUTED> 2.24
<YIELD-ACTUAL> 4.17
<LOANS-NON> 6,959
<LOANS-PAST> 2,972
<LOANS-TROUBLED> 118
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 15,215
<CHARGE-OFFS> 7,771
<RECOVERIES> 1,059
<ALLOWANCE-CLOSE> 16,812
<ALLOWANCE-DOMESTIC> 16,812
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,280
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C> <C> <C>
<PERIOD-TYPE> 9-MOS 6-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1998 DEC-31-1998
<PERIOD-START> JAN-01-1998 JAN-01-1998 JAN-01-1998
<PERIOD-END> SEP-30-1998 JUN-30-1998 MAR-31-1998
<CASH> 42,506 62,379 61,286
<INT-BEARING-DEPOSITS> 4,744 4,500 13,516
<FED-FUNDS-SOLD> 46,920 54,110 105,320
<TRADING-ASSETS> 10,361 42 961
<INVESTMENTS-HELD-FOR-SALE> 212,561 227,866 240,740
<INVESTMENTS-CARRYING> 193,647 190,636 198,601
<INVESTMENTS-MARKET> 197,478 193,136 201,191
<LOANS> 1,019,782 1,005,185 965,978
<ALLOWANCE> 17,395 17,386 15,264
<TOTAL-ASSETS> 1,623,987 1,641,241 1,687,536
<DEPOSITS> 1,350,547 1,361,308 1,400,326
<SHORT-TERM> 2,619 6,749 3,331
<LIABILITIES-OTHER> 71,995 75,826 89,540
<LONG-TERM> 50,263 53,103 53,178
0 0 0
0 0 0
<COMMON> 7,238 7,236 7,230
<OTHER-SE> 141,325 137,019 133,931
<TOTAL-LIABILITIES-AND-EQUITY> 1,623,987 1,641,241 1,687,536
<INTEREST-LOAN> 68,457 44,526 22,084
<INTEREST-INVEST> 18,846 12,719 6,291
<INTEREST-OTHER> 3,642 2,671 1,487
<INTEREST-TOTAL> 90,945 59,916 29,862
<INTEREST-DEPOSIT> 40,724 27,036 13,510
<INTEREST-EXPENSE> 46,147 30,675 15,323
<INTEREST-INCOME-NET> 44,798 29,241 14,539
<LOAN-LOSSES> 6,588 5,121 1,278
<SECURITIES-GAINS> (12) 49 34
<EXPENSE-OTHER> 47,089 31,982 15,629
<INCOME-PRETAX> 17,762 11,482 5,364
<INCOME-PRE-EXTRAORDINARY> 12,567 8,049 3,751
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 12,567 8,049 3,751
<EPS-BASIC> 1.74 1.11 0.52
<EPS-DILUTED> 1.71 1.09 0.51
<YIELD-ACTUAL> 0 0 0
<LOANS-NON> 6,371 6,781 6,928
<LOANS-PAST> 2,610 2,365 2,526
<LOANS-TROUBLED> 0 0 0
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