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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended: March 31, 1997
Commission file number: 0-22220
Name of Small Business Issuer: TRI-COUNTY BANCORP, INC.
State of Incorporation or Organization: WYOMING
I.R.S. Employer Identification No.: 83-0304855
Address of Offices: 2201 MAIN STREET, TORRINGTON, WY 82240
Issuer's Telephone Number, Including Area Code: (307) 532-2111
Check whether the issuer: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 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
The number of shares outstanding of each of the issuer's classes of common
stock as of May 12, 1997.
Class: $.10 par value common stock
Outstanding: 608,749 shares
Transitional Small Business Disclosure Format (check one):
Yes No X
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TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
INDEX
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated statements of Financial
Condition as of March 31, 1997 (unaudited)
and December 31, 1996 3
Condensed Consolidated Statements of Operations
for the Three Months Ended March 31, 1997
and 1996 (unaudited) 4
Condensed Consolidated Statements of Stockholder's Equity
for the Three Months Ended March 31, 1997 (unaudited) 5
Condensed Consolidated Statements of Cash Flows
for the Three Months Ended March 31, 1997
and 1996 (unaudited) 6
Notes to Condensed Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis or Plan
of Operation 9
PART II OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 2. Changes in Securities 15
Item 3. Default Upon Senior Securities 15
Item 4. Submissions of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
SIGNATURES 16
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PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
Mar 31, 1997 Dec 31, 1996
(unaudited)
------------ ------------
ASSETS
Cash $ 885,532 $ 537,194
Interest earning deposits at other
financial institutions 1,376,232 1,751,397
Securities available-for-sale 36,821,777 36,393,415
Securities held-to-maturity, market value
of $10,049,701 (1997) and $10,589,409 (1996) 9,844,839 10,319,706
Loans receivable, net 35,240,322 35,266,702
Loans held for resale 185,223 90,000
Office property and equipment, net 908,670 921,681
Prepaid expenses and other assets 712,144 609,923
----------- -----------
Total Assets $85,974,739 $85,890,018
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Demand deposits $ 401,836 $ 367,480
Savings and NOW deposits 12,853,504 12,199,233
Other time deposits 35,655,088 35,966,345
----------- -----------
Total Deposits 48,910,428 48,533,058
Advances from Federal Home Loan Bank 23,098,617 23,460,492
Advances by borrowers for taxes and insurance 153,585 105,811
Accounts payable and accrued expenses 328,432 234,653
Deferred income taxes 316,582 410,440
----------- -----------
Total Liabilities 72,807,644 72,744,454
----------- -----------
Stockholders' Equity
Preferred stock, $.10 par value, 5,000,000
shares authorized, none issued 0 0
Common stock, 10,000,000 shares of $.10 par value
authorized, 608,749 (1997) and 608,749 (1996)
shares issued and outstanding 74,750 74,750
Additional paid in capital 7,041,864 7,029,604
Retained earnings - substantially restricted 8,491,256 8,353,630
Unearned compensation relating to Management
Stock Bonus Plan and ESOP (485,887) (506,725)
Unrealized gain/(loss) on securities
available-for-sale, net of tax 90,426 239,619
Treasury stock, 138,751 (1997) and 138,751 (1996)
shares, at cost (2,045,314) (2,045,314)
----------- -----------
Total Stockholders' Equity 13,167,095 13,145,564
----------- -----------
Total Liabilities and Stockholders' Equity $85,974,739 $85,890,018
=========== ===========
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TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Three Months Ended
March 31,
1997 1996
---------- ----------
Interest Income
Loans $ 738,497 $ 578,020
Securities available-for-sale 585,425 382,409
Securities held-to-maturity 190,584 281,195
Other interest earning assets 11,975 9,945
---------- ----------
Total Interest Income 1,526,481 1,251,569
---------- ----------
Interest Expense
Deposits 546,818 528,608
Advances and other borrowings 316,022 141,788
---------- ----------
Total Interest Expense 862,840 670,396
---------- ----------
Net Interest Income 663,641 581,173
Provision for credit losses 0 0
---------- ----------
Net Interest Income After Provision
for Credit Losses 663,641 581,173
---------- ----------
Non-interest Income
Gain on sale of loans 9,951 7,080
Gain (loss) on sale of available-for-sale
investments 0 (1,593)
Service charges on deposits 28,180 24,061
Other, net 4,461 6,097
Total Non-interest Income 42,592 35,645
---------- ----------
Non-interest expense
Compensation and benefits 189,600 180,189
Occupancy and equipment 75,792 72,749
Federal deposit insurance premium 7,351 25,690
Other, net 89,300 101,298
---------- ----------
Total Non-interest Expense 362,043 379,926
---------- ----------
Earnings Before Income Taxes 344,190 236,892
Income taxes 115,252 79,100
---------- ----------
Net Earnings $ 228,938 $ 157,792
========== ==========
Earnings Per Common Share - Primary $ 0.38 $ 0.25
Cash Dividends Per Common Share $ 0.15 $ 0.27
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TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
For the Three Months Ended March 31, 1997 (unaudited)
<TABLE>
<CAPTION>
Unrealized
Employee Gain on
Additional Stock MSPB Securities
Common Paid-in Retained Ownership Unearned Available-for- Treasury
Stock Capital Earnings Plan Compensation sale Stock Total
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE - December 31, 1996 $74,750 $7,029,604 $8,353,630 $(403,650) $(103,075) $239,619 $(2,045,314) $13,145,564
Net earnings -- -- 228,938 -- -- -- -- 228,938
Repayment of ESOP debt -- -- -- 6,113 -- -- -- 6,113
Allocation of ESOP shares -- 12,260 -- -- -- -- -- 12,260
Amortization of deferred
compensation -- -- -- -- 14,725 -- -- 14,725
Change in unrealized gain
on securities available-
for-sale, net of tax -- -- -- -- -- (149,193) -- (149,193)
Dividends paid -- -- (91,312) -- -- -- -- (91,312)
Treasury stock purchased -- -- -- -- -- -- -- --
------- ---------- ---------- --------- -------- ------- ----------- -----------
BALANCE - March 31, 1997 $74,750 $7,041,864 $8,491,256 $(397,537) $(88,350) $90,426 $(2,045,314) $13,167,095
======= ========== ========== ========= ======== ======= =========== ===========
</TABLE>
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TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
Three Months Ended
March 31,
1997 1996
---------- ----------
Net Cash Provided by Operations $ 167,942 $ 184,224
---------- ----------
Investing Activities
Principal payments received on
held-to-maturity securities 476,736 4,481,000
Purchase of held-to-maturity securities - -
Purchase of available-for-sale securities (1,001,900) (10,155,917)
Sale of available-for-sale securities - 200,000
Principal payments received on
held-to-maturity securities 356,638 171,130
Net decrease (increase) in loans 302,462 (1,503,665)
Purchase of loans (310,449) (1,256,232)
Proceeds from sale of real estate owned 18,025 77,191
Investment in property and equipment and
real estate owned (14,353) (5,126)
---------- ----------
Net Cash Provided (Used) By Investing Activities (172,841) (7,991,619)
---------- ----------
Financing Activities
Net increase (decrease) in deposits 377,368 1,278,815
Net increase (decrease) in advances from
borrowers for taxes and insurance 47,774 53,905
FHLB borrowings 11,750,000 6,800,000
Repayment of FHLB advance (12,111,874) -
Payments received from ESOP 6,114 7,475
Treasury stock purchased - (181,312)
Cash dividends paid (91,312) (160,197)
---------- ----------
Net Cash Provided (Used) By Financing Activities (21,930) 7,798,686
---------- ----------
Increase (Decrease)in Cash and Cash Equivalents (26,829) (8,709)
Cash and cash equivalents - beginning of period 2,288,592 908,732
---------- ----------
Cash and cash equivalents - end of period $2,261,763 $ 900,023
========== ==========
Supplemental Disclosures
Cash paid for:
Interest $862,833 $648,021
Income taxes 7,000 -
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TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997
(unaudited)
NOTE 1 - BASIS OF PRESENTATION
The unaudited condensed consolidated financial statements include the accounts
of Tri-County Bancorp, Inc. (the "Company"), Tri-County Federal Savings Bank
(formerly Tri-County Federal Savings and Loan Association) (the "Bank") and
First Tri-County Services, Inc. All significant intercompany balances and
transactions have been eliminated in consolidation.
The accompanying unaudited condensed consolidated financial statements were
prepared in accordance with generally accepted accounting principles for
interim financial information and with instructions for Form 10-QSB and Article
10 of Regulation S-X. Accordingly, they do not include all information and
disclosures required by generally accepted accounting principles for complete
financial statements. The accompanying consolidated financial statements do
not purport to contain all the necessary financial disclosures required by
generally accepted accounting principles that might otherwise be necessary in
the circumstances and should be read together with the 1996 consolidated
financial statements and notes thereto of Tri-County Bancorp, Inc. and
Subsidiaries included in the Company's Annual Report on Form 10-KSB for the
yearended December 31, 1996. However, all normal recurring adjustments have
been made which, in the opinion of management, are necessary to the fair
presentation of the financial statements.
The results of operations for the three-month period ended March 31, 1997 are
not necessarily indicative of the results which may be expected for the year
ending December 31, 1997 or any other period.
See Notes 2, 3 and 4.
NOTE 2 - EARNINGS PER SHARE
Earnings per share for the three months ended March 31, 1997 and 1996, are
computed on a primary basis. Primary earnings per share is computed using the
weighted average number of common shares outstanding, net of unallocated ESOP
shares and the potentially dilutive effect of stock options. See Exhibit 11.
NOTE 3 - INVESTMENTS
Effective January 1, 1994, the Company adopted SFAS No. 115, Accounting for
Certain Investments in Debt and Equity Securities. In accordance with SFAS No.
115, the Company classified its investment securities and mortgage-backed
securities as either "held-to-maturity," "available-for-sale," or "trading."
Management has determined that all applicable securities are either "held-to-
maturity" or "available-for-sale."
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Investment and mortgage-backed securities designated as held-to-maturity are
stated at cost adjusted for amortization of the related premiums and accretion
of discounts, computed using the level yield method. The Company has the
positive intent and ability to hold these securities to maturity.
Investment and mortgage-backed securities designated as available-for-sale are
stated at estimated market value. Unrealized gains and losses are aggregated
and reported as a separate component of equity capital, net of deferred taxes.
These securities are acquired with the intent to hold them to maturity, but
they are available for disposal in the event of unforeseen liquidity needs.
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PART I - FINANCIAL INFORMATION
Item 2 - Management's Discussion and Analysis or Plan of Operation
GENERAL
Tri-County Bancorp, Inc. (the "Company") was incorporated on June 15, 1993, and
is the holding company of Tri-County Federal Savings Bank (the "Bank"). On
September 28, 1993, the Bank completed its conversion from a mutual savings and
loan association to a stock form of ownership at which time the Company issued
747,500 shares of Common Stock and utilized a portion of the proceeds to
acquire all of the issued shares of the Bank.
The Company is headquartered in Torrington, Wyoming and its principal business
currently consists of the operation of its wholly owned subsidiary, Tri-County
Federal Savings Bank. The Bank's primary business is attracting retail
deposits from the general public and investing those deposits and other
borrowed funds in various loan products, including mortgage-backed and
mortgage-related securities, federal agency securities and other investment
securities.
The Company's results of operations are dependent primarily on its net interest
income, which is the difference between the interest earned on its assets,
primarily its loans and securities portfolios, and its cost of funds, which
consists of the interest paid on its deposits and borrowings. The Company's
net income also is affected by its provision for loan losses as well as non-
interest income, compensation and benefits, occupancy expenses, Federal deposit
insurance premiums, other non-interest expenses, and income tax expense. Other
non-interest expenses consist of real estate lending operations, legal
expenses, accounting services and other miscellaneous costs. The earnings of
the Company are significantly affected by general economic and competitive
conditions, particularly changes in market interest rates, government policies
and actions of regulatory authorities.
CHANGES IN FINANCIAL CONDITION
ASSETS
The total assets of the Bank increased by $84,721 during the first quarter of
1997.
Securities available-for-sale increased by $428,362 during the first quarter of
1997. A $1,000,000 security was purchased with funds borrowed from FHLB. This
purchase was partially offset by principal payments and prepayments of $356,638
on mortgage-backed securities and an overall decrease in the market value of
the portfolio of $226,051.
Securities held-to-maturity decreased by $474,867. The decrease was the result
of principal payments and prepayments on the Bank's portfolio of mortgage-
backed securities.
Loans receivable decreased $26,380 during the first quarter of 1997. During
this period the Bank originated or purchased portfolio residential mortgage
loans totaling $914,020, consumer loans totaling $519,814, and a short-term
commercial loan in the amount of $155,700. By the end of the quarter, the Bank
had received full repayment of the short-term commercial loan and repayments
totaling $1,465,216 on other loans. Of the total mortgage loans originated or
purchased during the quarter, $430,000 were adjustable rate and $484,000 were
fixed rate loans. Because of a lack of demand for certain types of loans in the
Bank's primary lending area, purchased or participation loans totaled 33.97% of
mortgage lending during the quarter. The majority of purchased loans are
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residential real estate loans in Colorado mountain-resort communities and non-
residential real estate loans in western New Mexico. Purchased or
participation loans are subjected to the same underwriting standards and loan
terms as those originated by the Bank for its portfolio.
LIABILITIES
Deposit balances increased by $377,370 and consisted of increases of $34,356
and $654,271 in checking and savings deposits, respectively, and a decrease of
$311,257 in time deposits.
Advances from FHLB decreased by $361,875 during the three-month period ended
March 31, 1997. As previously discussed, an advance totaling $1,000,000 was
obtained to purchase securities classified as available-for-sale. The advance
has a term of approximately one-year and was used to purchase a Federal Home
Loan Bank callable security. The advance's maturity date coincides with the
first call date of the security. The Bank was able to lock in a positive
spread over the initial term of the advance. A decision to renew the advance
and hold the security if not called, or sell the security and payoff the
advance will be made on or near the maturity date of the advance.
Deferred income taxes decreased by $93,858 during the first three months of
1997 and was mainly the result of the application of SFAS No. 115, Accounting
for Certain Investments in Debt and Equity Securities, which requires
unrealized gains and losses on available-for-sale securities to be reported,
net of deferred income taxes, as a separate component of stockholders' equity.
The market value of these securities decreased $226,031 during the period,
which resulted in a decrease in deferred income taxes. Also, legislation was
passed in August of 1996 which requires the Bank to establish tax reserves for
bad debts and compute additions thereto using a six-year moving average of the
Bank's actual loss experience (the "Experience Method"). The additions to the
tax reserves computed using the Experience Method can, within specified
limitations, be deducted in arriving at taxable income. However, the Bank had
established reserves for loan losses totaling $415,000 at March 31, 1997, which
will be charged with any subsequent loan losses. Therefore, the Bank will have
a difference in the treatment of loan losses for book and tax purposes and a
deferred tax asset is being established for this difference.
STOCKHOLDERS' EQUITY
The increase in additional paid-in capital of $12,260 was caused by the
application of an accounting standard which requires charging current expense
for the fair value of shares of stock committed to be released by the Bank's
Employee Stock Ownership Plan and crediting the difference between the fair
value and the cost of the shares to paid-in capital.
The increase in retained earnings was the result of net earnings totaling
$228,938 which more than offset the decrease in retained earnings caused by the
payments of dividends of $0.15 per share totaling $91,312.
As discussed earlier, SFAS No. 115 requires unrealized gains and losses on
securities classified available-for-sale to be shown as a separate component of
stockholders' equity in an amount net of deferred income taxes. The market
value of securities classified as available-for-sale decreased during the first
three months of 1997, which resulted in a decrease, net of deferred income tax,
of $149,193.
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COMPARISON OF THE OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1997
AND 1996
NET INCOME
Net income increased $71,146 or 45.09% during the first quarter of 1997 when
compared to the same period of 1996. Net interest income increased by $82,468,
non-interest income increased by $6,947 and non-interest expense decreased by
$17,883. The provision for income taxes increased by $36,152 or 45.70%.
INTEREST INCOME
Interest income from loans increased $160,477 or 27.76% for the quarter ended
March 31, 1997 as compared to the same period in 1996. The increase was the
result of an increase in the average balance of loans outstanding of $7,293,654
and a slight increase in yield on the loans from 8.20% to 8.23%. The increase
in yield was primarily the result of the slight increase in average lending
rates during 1997 when compared to the average rates in the previous year.
The increase of $203,016 in interest on securities available-for-sale was the
result of an increase in the average balance of securities of $13,052,987 which
offset a slight decrease in the average yield on the portfolio from 6.34% to
6.30%.
Interest on securities held-to-maturity decreased $90,611, which was caused by
a decrease in the average balance of the portfolio of $6,180,321, which offset
an increase in the yield on the portfolio from 7.15% to 7.45%. The increase
in yield was the result of the maturity of securities, which, on average, had
a lower yield than the yield on the entire portfolio. The proceeds of the
maturities were used to fund loans and purchase available for sale securities.
The increase in income from other interest-earning assets of $2,030 was
primarily caused by an increase in the average balance of these assets. This
category of assets consists primarily of interest earning demand and time
deposits held at FHLB.
INTEREST EXPENSE
Interest expense on deposits increased $18,210 during the first three months of
1997. This increase was the result of an increase of $3,163,334 in the average
balance of deposits which more than offset the slight decrease in the average
cost of deposits from 4.66% to 4.55%.
The Bank took advantage of a relatively inexpensive source of funding available
through the FHLB to purchase financial instruments that yield a slightly higher
return than the rate charged on advances. The average balance of these
borrowings was $12,103,667 greater during the first quarter of 1997 than during
the first quarter of 1996 and the average cost increased 5.07% to 5.42%, which
resulted in an increase of $174,234 in interest expense. The cost of advances
taken or renewed after the first quarter of 1996 was generally higher than the
costs for the same period of the previous year.
PROVISION FOR LOAN LOSSES
No provision for loan losses was made during the first three months of 1997.
The allowance for loan losses is based on Management's evaluation of the risk
inherent in its loan portfolio after giving due consideration to the changes in
general market conditions and in the nature and volume of the Bank's loan
activity. The Bank intends to continue to provide for loan losses based on its
periodic review of the loan portfolio and general market conditions. The
allowance for loan losses amounted to $415,000 at March 31, 1997. While the
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Bank maintains its allowance for loan losses at a level which it considers
adequate to provide for potential losses, there can be no assurances that
further additions will not be made to the loss allowance and that such losses
will not exceed the estimated amounts.
NON-INTEREST INCOME
Non-interest income increased $6,947 or 19.49% during the first quarter of 1997.
The increase in the gain on sale of loans was the result of an increase in the
dollar amount of loans sold. During the previous year, shares in a mutual fund
were redeemed at a $1,591 loss whereas there have been no redemptions during
the current year. The increase in service charges on deposits was primarily
caused by an increase in the number of accounts subject to service charges.
Other non-interest income decreased by $1,636 and was caused by many factors.
NON-INTEREST EXPENSE
Overall, non-interest expense decreased $17,883 during 1997.
Compensation and benefits increased by $9,411 in 1997 and was primarily caused
by an increase in medical insurance costs and an increase in overall salaries.
Occupancy and equipment expense increased $3,043 and was primarily caused by an
increase in data processing costs.
The Bank paid an annualized assessment for deposit insurance equal to $0.65 per
$1,000 in deposits for the first quarter of 1997 which was $18,339 less than
the amount paid for the first quarter of 1996. This decrease was due to
legislation passed in the third quarter of 1996 which significantly reduced
premiums for deposit insurance.
Other net expenses decreased by $18,339 and was primarily the result of the
discontinuance of a consulting agreement that provided an analysis of the
Bank's balance sheet and advice on possible restructuring strategies and the
decrease in legal fees incurred in the previous year for services to enhance
shareholder value.
INCOME TAXES
The provision for income taxes increased $36,152 for the quarter ended March 31,
1997. This increase was caused primarily by an increase in pre-tax income of
$107,298. Also, because the Bank had established reserves for loan losses
which will be charged with any subsequent loan losses and because the Bank will
be allowed a deduction for losses incurred on loans foreclosed after December
31, 1995 for tax purposes, the Bank will have a difference in the treatment of
loan losses for tax and financial purposes. As previously stated, a deferred
tax asset is being established by the Bank and the effect of this change in the
first quarter of 1997 was a reduction in the expense for income taxes totaling
$17,600 which offset an additional accrual of tax for the year ended December
31, 1996 in the amount of $12,952.
LIQUIDITY AND CAPITAL RESOURCES
The Bank is required to maintain minimum levels of liquid assets as defined by
the Office of Thrift Supervision regulations. This requirement, which may
vary from time to time, depends upon, among other things, economic conditions
and the amount of cash flows needed for operations and is based upon a
percentage of deposits and short-term borrowings. The required ratio currently
is 5%. The Bank's liquidity averaged 31.85% during the first quarter of 1997.
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The Bank adjusts its liquidity levels in order to meet funding needs for
deposit outflows, payment of real estate taxes from escrow accounts on mortgage
loans, repayment of borrowings, when applicable, and loan funding commitments.
The Bank also adjusts its liquidity level as appropriate to meet its asset/
liability objectives.
The Bank's primary sources of funds are deposits, amortization and prepayments
of loans and mortgage-backed securities, FHLB advances, sales and maturities of
investments and funds provided from operations. While scheduled loan
amortization and maturing investment securities are a relatively predictable
source of funds, deposit flow and loan prepayments are greatly influenced by
market interest rates, economic conditions and competition. The Bank manages
the pricing of its deposits to maintain a steady deposit balance. In
addition, the Bank invests its excess funds in short- term time deposits that
provide liquidity to meet lending requirements. Interest-bearing deposits at
March 31, 1997 amounted to $1,376,232. The Bank's liquidity, represented by
cash and cash equivalents, is a product of its operating, investing and
financing activities. These activities are summarized as follows:
3 Months Ended
March 31,
(in thousands)
1997 1996
---------- ----------
Cash and cash equivalents at beginning of year $2,289 $ 909
---------- ----------
OPERATING ACTIVITIES:
Net Income 229 158
Adjustments to reconcile net income to net cash
provided by operation activities (61) 26
---------- ----------
Net cash provided by operating activities 168 184
Net cash provided (used) by investing activities (173) (7,992)
Net cash provided (used) by financing activities (22) 7,799
---------- ----------
Net increase (decrease) in cash and cash equivalents (27) (9)
---------- ----------
Cash and cash equivalents at end of period $ 2,262 $ 900
========== ==========
Liquidity management is both a daily and long-term function of business
management. Excess liquidity is generally invested in short-term investments
such as Federal funds and interest-bearing deposits. If the Bank requires
funds beyond its ability to generate them internally, borrowing agreements
exist with the FHLB, which provides an additional source of funds.
The Bank anticipates it will have sufficient funds available to meet its
current loan commitments. At March 31, 1997, the Bank had outstanding
commitments of $2,364,885. Certificates of deposit scheduled to mature in one
year or less at March 31, 1997 totaled $29,410,902. Based on past experience,
management believes that a substantial portion of such deposits will remain
with the Bank.
The following table sets forth the Bank's capital position at March 31, 1997,
as compared to the minimum regulatory requirements:
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Percent Of
Adjusted
Amount Assets
(Dollars in thousands)
TANGIBLE CAPITAL:
Required $ 1,272 1.50%
Actual 10,737 12.61%
---------- ----------
Excess $ 9,465 11.11%
========== ==========
CORE CAPITAL:
Required $ 2,543 3.00%
Actual 10,737 12.61%
---------- ----------
Excess $ 8.194 9.57%
========== ==========
RISK BASED CAPITAL:
Required $ 2,614 8.00%
Actual 11,146 34.11%
---------- ----------
Excess $ 8,532 26.11%
========== ==========
IMPACT OF INFLATION AND CHANGING PRICES
The consolidated financial statements of the Company and notes thereto,
presented elsewhere herein, have been prepared in accordance with generally
accepted accounting principles ("GAAP"), which require the measurement of
financial position and operating results in terms of historical dollars
without considering the change in the relative purchasing power of money over
time due to inflation. The impact of inflation is reflected in the increased
cost of the Company's operations. Unlike most industrial companies, nearly all
the assets and liabilities of the Company are financial. As a result, interest
rates have a greater impact on the Company's performance than do the effects of
general levels of inflation. Interest rates do not necessarily move in the
same direction or to the same extent as the prices of goods and services.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Neither the Company nor the Bank was engaged in any legal proceeding of a
material nature at March 31, 1997. From time to time, the Bank is a party to
legal proceedings in the ordinary course of business wherein it enforces its
security interest in loans.
Item 2. Changes in Securities
Not Applicable.
Item 3. Defaults Upon Senior Securities
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable.
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 11: Statement regarding computation of earnings per share.
Exhibit 27: FDS (in electronic filing only)
(b) Reports on Form 8-K
None
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<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.
TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
Date: May 12, 1996 /s/ Robert L. Savage
President and Chief Executive Officer
Date: May 12, 1996 /s/ Tommy A. Gardner
Vice President and Chief Financial Officer
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<PAGE>
<PAGE>
EXHIBIT 11
TRI-COUNTY BANCORP, INC. AND SUBSIDIARIES
STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE
Three Months Ended
March 31,
1997 1996
---------- ----------
EARNINGS PER SHARE
Net earnings available for common shares and
common stock equivalent shares deemed to have
a dilutive effect $228,940 $157,792
========== =========
Primary earnings per share $0.38 $0.25
========== =========
Fully diluted earnings per share $0.38 $0.25
========== =========
Shares used in primary earnings per share computation
Weighted average common shares outstanding 607,124 628,524
========== =========
Shares used in fully diluted earnings per share
computation
Weighted average common shares outstanding 607,335 629,980
Additional potentially dilutive effect of stock options 32,971 30,755
---------- ---------
640,306 660,735
========== =========
The weighted average common shares outstanding has been computed net of ESOP
shares of 34,385 (1997) and 40,365 (1996).
-17-
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<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 885,532
<INT-BEARING-DEPOSITS> 1,376,232
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 36,821,777
<INVESTMENTS-CARRYING> 9,844,839
<INVESTMENTS-MARKET> 10,049,701
<LOANS> 35,240,322
<ALLOWANCE> 414,997
<TOTAL-ASSETS> 85,974,739
<DEPOSITS> 48,910,428
<SHORT-TERM> 20,867,625
<LIABILITIES-OTHER> 23,897,216
<LONG-TERM> 2,230,992
0
0
<COMMON> 74,750
<OTHER-SE> 13,092,345
<TOTAL-LIABILITIES-AND-EQUITY> 85,974,739
<INTEREST-LOAN> 738,497
<INTEREST-INVEST> 776,009
<INTEREST-OTHER> 11,975
<INTEREST-TOTAL> 1,526,481
<INTEREST-DEPOSIT> 546,818
<INTEREST-EXPENSE> 862,840
<INTEREST-INCOME-NET> 663,641
<LOAN-LOSSES> 0
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<EXPENSE-OTHER> 42,592
<INCOME-PRETAX> 344,190
<INCOME-PRE-EXTRAORDINARY> 228,938
<EXTRAORDINARY> 0
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<NET-INCOME> 228,938
<EPS-PRIMARY> 0.38
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<LOANS-NON> 0
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<LOANS-PROBLEM> 157,798
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<ALLOWANCE-CLOSE> 414,997
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