SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 12 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
Commission file number 0-22536
Monocacy Bancshares, Inc.
(Exact Name of Registrant as Specified in its Charter)
Maryland 52-1824297
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
222 E. Baltimore Street
Taneytown, Maryland 21787
(Address of Principal Executive (Zip Code)
Offices)
(410) 756-2655
(Registrant's Telephone Number, Including Area Code
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 that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
---- ----
Indicate the number of shares outstanding of each of the classes of common
stock, as of the latest practical date.
1,465,886 shares of Common Stock, $5 par value per share, were outstanding as of
November 12, 1996.
<PAGE>
MONOCACY BANCSHARES, INC.
Index to Form 10-QSB Report
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets . . . . . . . . . . . .1
Consolidated Income Statements . . . . . . . . . . 2
Consolidated Statements of Stockholders' Equity . .3
Consolidated Statements of Cash Flow . . . . . . . 4
Notes to Consolidated Financial Statements . . . . 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . .6
PART II - OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . .10
Item 2. Changes in Securities . . . . . . . . . . . . . . . . . . . 10
Item 3. Defaults Upon Senior Securities . . . . . . . . . . . . . . 10
Item 4. Submission of Matters to a Vote of Security Holders . . . . 10
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . . 10
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . .10
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
<PAGE>
Part I
Item 1. Financial Statements
Monocacy Bancshares, Inc. and Subsidiary
Consolidated Balance Sheets
<TABLE>
<CAPTION>
Assets September 30, December 31,
------ 1996 1995
------------------- -------------------
(unaudited)
<S> <C>
Cash and due from banks $ 10,373,296 $ 10,734,907
Federal funds sold - 36,408,708
Interest-bearing deposits with other banks 577,237 804,820
Securities available for sale 65,652,070 53,840,610
Investment securities (approximate fair value of
$23,388,809 and $15,260,585) 24,045,967 15,523,954
Loans held for sale 153,100 -
Loans, less allowance for loan losses of
$2,142,608 and $1,904,168 150,477,920 137,222,322
Bank premises and equipment 7,880,962 6,233,342
Other real estate owned 1,320,300 1,310,842
Deferred income taxes 983,960 520,297
Accrued interest receivable 1,974,071 1,663,410
Other assets 904,878 1,930,407
------------------- -------------------
Total assets $ 264,343,761 $ 266,193,619
=================== ===================
Liabilities and Stockholders' Equity
Liabilities:
Non-interest bearing deposits $ 26,984,728 $ 21,317,312
Interest bearing deposits 192,289,735 202,094,532
------------------- -------------------
219,274,463 223,411,844
Federal funds purchased 5,750,000 -
Other borrowings 16,933,427 19,633,051
Accrued interest and other expenses payable 1,323,324 752,270
Dividends payable 146,341 132,356
Other liabilities 379,949 1,096,017
------------------- -------------------
Total liabilities 243,807,504 245,025,538
Stockholders' Equity:
Common stock 7,317,490 6,617,775
Common stock dividend to be distributed - 2,845,643
Surplus 9,029,814 6,777,176
Retained earnings 5,749,192 4,908,739
Net unrealized gain (loss) on
securities available for sale (1,560,239) 18,748
------------------- -------------------
Total stockholders' equity 20,536,257 21,168,081
------------------- -------------------
Total liabilities and stockholders' equity $ 264,343,761 $ 266,193,619
=================== ===================
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
1
<PAGE>
Monocacy Bancshares, Inc. and Subsidiary
Consolidated Income Statements
For the nine and three month periods ended September 30, 1996 and 1995
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended September 30, Three Months Ended September 30,
1996 1995 1996 1995
------------- ------------- ------------- -------------
<S> <C>
Interest income:
Loans, including fees $ 10,232,738 $ 10,086,406 $ 3,594,822 $ 3,355,456
Interest-bearing deposits with other banks 45,000 86,353 2,661 32,153
Federal funds sold 136,893 64,996 961 26,408
Securities available for sale 3,310,492 518,118 1,093,378 242,334
Investment securities 851,548 1,997,972 222,464 731,866
------------ ------------ ------------ -----------
Total interest income 14,576,671 12,753,845 4,914,286 4,388,217
------------ ------------ ------------ -----------
Interest expense:
Deposits 6,976,809 5,032,118 2,258,407 1,838,750
Federal funds purchased 62,708 33,356 45,720 33,356
Other borrowings 814,323 662,832 305,794 200,688
------------ ------------ ------------ -----------
Total interest expense 7,853,840 5,728,306 2,609,921 2,072,794
------------ ------------ ------------ -----------
Net interest income 6,722,831 7,025,539 2,304,365 2,315,423
Provision for loan losses 225,000 450,000 75,000 150,000
------------ ------------ ---------------- -----------
Net interest income after provision for loan losses 6,497,831 6,575,539 2,229,365 2,165,423
------------ ------------ ------------ -----------
Noninterest income:
Service charges on deposit accounts 308,119 239,785 113,240 81,875
Loan service charges 492,154 349,970 154,739 135,629
Trust department fees 109,254 116,862 30,703 31,020
Gains and fees on sales of loans 644,412 61,742 364,478 16,721
Gains on sales of securities 18,286 54,488 (3,469) 42,939
Other 87,379 198,333 30,355 33,335
------------ ------------ ------------ -----------
Total noninterest income 1,659,604 1,021,180 690,046 341,519
------------ ------------ ------------ -----------
Noninterest expense:
Salaries & employee benefits 3,648,925 2,834,875 1,273,858 942,844
Occupancy 456,610 325,720 155,709 118,632
Equipment 528,593 505,749 177,406 171,774
Deposit insurance 369,705 132,545 310,716 (59,046)
Professional fees 251,178 222,297 83,180 102,004
Other 1,160,443 882,464 387,733 282,624
------------ ------------ ------------ -----------
Total noninterest expense 6,415,454 4,903,650 2,388,602 1,558,832
------------ ------------ ------------ -----------
Income before income taxes 1,741,981 2,693,069 530,809 948,110
Provision for income taxes 463,338 801,471 222,365 299,128
------------ ------------ ------------ -----------
Net income $ 1,278,643 $ 1,891,598 $ 308,444 $ 648,982
============ ============ ============ ===========
Net income per common share $ 0.88 $ 1.43 $ 0.21 $ 0.49
============ ============ ============ ===========
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
2
<PAGE>
Monocacy Bancshares, Inc. and Subsidiary
Consolidated Statements of Stockholders' Equity
(Information for the nine months ended September 30, 1996 is unaudited)
<TABLE>
<CAPTION>
Net Unrealized
Common Stock Gain (Loss) on Total
Common Dividend to be Retained Securities Stockholders'
Stock Distributed Surplus Earnings Available for Sale Equity
------------ ------------- ----------- ----------- ------------------ ------------
<S> <C>
Balance at December 31, 1993 $ 6,561,000 - 6,561,000 4,077,477 89,878 $ 17,289,355
Net income - - - 2,222,130 - 2,222,130
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 13,145 - 49,009 - - 62,154
Cash dividend - - - (367,714) - (367,714)
Decrease in fair value of securities
available for sale - - - - (596,242) (596,242)
------------ ------------- ----------- ----------- ------------- ------------
Balance at December 31, 1994 6,574,145 - 6,610,009 5,931,893 (506,364) 18,609,683
Net income - - - 2,350,776 - 2,350,776
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 43,630 - 167,167 - - 210,797
Cash dividend - - - (528,287) - (528,287)
10% stock dividend to be distributed - 2,845,643 - (2,845,643) - -
Increase in fair value of securities
available for sale - - - - 525,112 525,112
------------ ------------- ----------- ----------- ------------- ------------
Balance at December 31, 1995 6,617,775 2,845,643 6,777,176 4,908,739 18,748 21,168,081
Net income - - - 1,278,643 - 1,278,643
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 39,310 - 67,400 - - 106,710
Issuance of 10% common stock dividend 660,405 (2,845,643) 2,185,238 -
Cash dividend - - - (438,190) - (438,190)
Decrease in fair value of securities
available for sale - - - - (1,578,987) (1,578,987)
============ ============= =========== =========== ============= ============
Balance at September 30, 1996 $ 7,317,490 - 9,029,814 5,749,192 (1,560,239) $ 20,536,257
============ ============= =========== =========== ============= ============
</TABLE>
3
<PAGE>
Monocacy Bancshares, Inc. and Subsidiary
Consolidated Statements of Cash Flows
For the nine and three month periods ended September 30, 1996 and 1995
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended September 30, Three Months Ended September 30,
1996 1995 1996 1995
------------ ------------- ------------- -------------
<S> <C>
Cash flows from operating activities:
Net income $ 1,278,643 $ 1,891,598 $ 308,444 $ 648,982
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,038,777 855,119 1,014,810 265,999
Provision for loan losses 225,000 450,000 75,000 150,000
Deferred income taxes (1,195,593) (17,900) (1,203,025) 52,293
Gains on sales of securities available for sale (18,286) (54,488) 3,469 (42,939)
Proceeds from sales of loans originated for sale 29,926,111 15,728,910 20,909,991 2,969,543
Disbursements for loans originated for sale (29,281,699) (15,667,167) (20,545,513) (2,952,821)
Gains on sale of loans (644,412) (61,742) (364,478) (16,721)
Increase in unearned income, net of origination costs 667,522 181,351 352,112 90,610
Gain on sale of other real estate owned - (19,763) - -
(Increase)decrease in accrued interest receivable (310,661) (187,749) 271,886 (219,921)
Increase in accrued interest and other
expenses payable 571,054 648,279 341,121 447,554
Other, net 216,461 (123,391) 343,829 (216,141)
------------ ------------ ------------ ------------
Net cash provided by operating activities 2,472,917 3,623,057 1,507,646 1,176,438
------------ ------------ ------------ ------------
Cash flows from investing activities:
Net (increase)decrease in interest-bearing
deposits with other banks 227,583 (591,259) (329,337) (410,809)
Proceeds from maturities of investment securities 6,999,448 4,152,937 4,216 3,961,160
Proceeds from sales of securities available for sale 14,253,496 4,973,968 4,928,535 2,671,812
Proceeds from maturities of securities available for sale 2,719,845 1,883,452 - 1,883,452
Purchases of securities available for sale (29,613,572) (19,479,251) - (11,874,445)
Purchases of investment securities (15,521,461) (97,841) - (97,841)
Sales of loan participations - 155,843 - -
Purchases of loan participations - - - -
Loan originations, net of principal repayments (14,866,941) (3,451,754) (4,759,602) (4,832,572)
Purchases of bank premises and equipment (2,120,676) (387,570) (860,842) (125,672)
Additions to real estate owned (68,163) - (51,931) -
Proceeds from real estate owned 58,705 - 38,431 -
------------ ------------ ------------ ------------
Net cash used in investing activities (37,931,736) (12,841,475) (1,030,530) (8,824,915)
------------ ------------ ------------ ------------
Cash flows from financing activities:
Net increase(decrease) in deposits (4,137,381) 11,284,349 1,551,769 301,830
Proceeds from issuance of other borrowings 23,167,000 2,150,000 - 2,150,000
Repayments of other borrowings (25,866,624) (3,289,328) (3,813,110) (463,109)
Issuance of common stock 67,386 71,502 53,727 11,320
Dividends paid on common stock (291,881) (271,594) (69,649) (90,944)
------------ ------------ ------------ ------------
Net cash provided by (used in) financing activities (7,061,500) 9,944,929 (2,277,263) 1,909,097
------------ ------------ ------------ ------------
Net increase (decrease) in cash and cash equivalents (42,520,319) 726,511 (1,800,147) (5,739,380)
Cash and cash equivalents at beginning of period 47,143,615 6,311,742 6,423,443 12,777,633
============ ============ ============ ============
Cash and cash equivalents at end of period $ 4,623,296 $ 7,038,253 $ 4,623,296 $ 7,038,253
============ ============ ============ ============
Supplemental disclosures of cash flow information:
Interest paid on deposits and borrowings $ 6,959,495 $ 4,981,833 $ 2,323,423 $ 1,751,971
Income taxes paid 319,334 577,210 150,700 192,010
Transfers of loans to other real estate owned 114,000 999,439 114,000 599,439
Securitization of residential mortgage loans - 7,784,483 - -
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
4
<PAGE>
MONOCACY BANCSHARES, INC. AND SUBSIDIARY
Notes to Consolidated Financial Statements
(Information as of and for the three and nine months
ended September 30, 1996 is unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared
in accordance with the instructions for Form 10-QSB and, therefore, do
not include all information and notes necessary for a fair presentation
of financial condition, results of operations and cash flows in
conformity with generally accepted accounting principles. The
consolidated financial statements should be read in conjunction with
the audited financial statements included in the Monocacy Bancshares,
Inc., (the "Company") 1995 Annual Report on Form 10-KSB.
The consolidated financial statements include the accounts of the
Company's subsidiary, Taneytown Bank & Trust Company (the "Bank). All
significant intercompany balances and transactions have been
eliminated.
The consolidated financial statements as of September 30, 1996, and for
the three and nine month periods ended September 30, 1996 and 1995 are
unaudited but include all adjustments (consisting only of normal
recurring adjustments) which the Company considers necessary for a fair
presentation of financial position and results of operations for those
periods. The Consolidated Statements of Income for the three and nine
months ended September 30, 1996 are not necessarily indicative of the
results that will be achieved for the entire year.
NOTE 2 - EARNINGS PER COMMON SHARE
Earnings per common share are based upon the weighted average number of
common shares outstanding during the periods, adjusted by any common
stock equivalents and giving retroactive effect to stock dividends.
NOTE 3 - ALLOWANCE FOR LOAN LOSSES
The Allowance for Loan Losses is established through a provision for
loan losses charged to expenses. Loans are charged against the
allowance when management believes that the collectibility of the
principal is unlikely. The allowance is an amount that management
believes will be adequate to absorb possible losses on existing loans
that may become uncollectible, based on evaluations of the
collectibility of loans and prior loan loss experience. While
management uses available information to recognize losses on loans,
future additions to the allowance may be necessary based on changes in
economic conditions. In addition, various regulatory agencies, as an
integral part of their examination process, periodically review the
Bank's allowance for loan losses. Such agencies may require the Bank to
recognize additions to the allowance based on their judgments about
information available to them at the time of their examinations.
NOTE 4 - ACQUISITIONS
On April 19, 1996, Royal Oak Savings Bank ("the Savings Bank"), a
separate subsidiary of Monocacy Bancshares, Inc., was merged into the
operations of the Bank, with the Savings Bank's branches becoming
branches of the Bank. The two (2) new branch offices are located in
Eldersburg, Maryland and Randallstown, Maryland. As of the date of the
merger, the Savings Bank had total assets of approximately $46 million
and total deposits of approximately $38 million.
On April 1, 1996, the Bank acquired Classic Mortgage Company, a
mortgage-banking operation. The mortgage company is being operated as a
division of the Bank.
5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (dollars in thousands)
FINANCIAL CONDITION
Total assets at September 30, 1996, were $264,344 a .69% or $1,850 decrease from
December 31, 1995. The decrease in assets from December 31, 1995 occurred
primarily in liquid assets as the Bank experienced a $4,138 or 1.85% decline in
deposits due to anticipated run-off in deposits acquired in the Royal Oak
transaction. In addition, the funds received in the December 31, 1995
acquisition of the Savings Bank that were invested in federal funds sold as of
December 31, 1995 were re-invested in higher yielding securities during the
first quarter of 1996 causing a significant redistribution of funds between the
Bank's investment portfolios. The securities portfolios totaled $89,698 at
September 30, 1996, which was $20,333 above the December 31, 1995 level,
reflecting a 341.15% increase. Net loans were $150,478, which reflects a 9.66%
increase from December 31, 1995.
ALLOWANCE FOR LOAN LOSSES
The allowance for loan losses was $2,143 at September 30, 1996, which was 1.40%
of loans. During the first nine months of 1996, Monocacy had a $225 provision
for loan losses and had net recoveries of $14. At December 31, 1995, the
allowance for loan losses was $1,904 or 1.37% of loans.
Table 1, "Non-Performing Assets and Past Due Loans" for Monocacy shows total
non-performing assets of $2,620 at September 30, 1996. The allowance for loan
losses is 164.85% of non-performing loans and 81.79% of non-performing assets at
September 30, 1996, indicating substantial coverage.
Based upon the latest quarterly analysis of the loan portfolio, Management
considers the allowance for loan losses to be adequate to absorb any reasonable,
foreseeable loan losses.
Table 2, "Changes in the Allowance for Loan Losses" shows the activity in the
allowance for loan losses for the three and nine month periods ended September
30, 1996 and 1995.
LIQUIDITY
Liquidity describes the ability of the Company to meet financial obligations,
including lending commitments and contingencies, that arise during the normal
course of business. Liquidity is primarily needed to meet the borrowing and
deposit withdrawal requirements of the customers of the Company, as well as to
meet current and planned expenditures.
The Company's liquidity is derived primarily from its deposit base and equity
capital. Core deposits, defined as all deposits except certificates of deposit
of $100 or more, totaled $212,160 or 96.76% of total deposits at September 30,
1996.
Liquidity is also provided through the Company's portfolios of cash and interest
bearing deposits in other banks, federal funds sold, investment securities due
within one year and securities available for sale. Such assets totaled $74,450
or 28.16% of total assets at September 30, 1996.
In addition, the Bank has established lines of credit totaling $30,000 with the
Federal Home Loan Bank of Atlanta (the "FHLB") as an additional source of
liquidity. At September 30, 1996, the Bank had $16,933 outstanding with the FHLB
and had sufficient collateral necessary to borrow the full amount available
under the lines of credit.
CAPITAL RESOURCES
The Federal Reserve Board has adopted risk-based capital guidelines for bank
holding companies. As of September 30, 1996, the required minimum ratio of
capital to risk-adjusted assets (including certain off-balance sheet items, such
as standby letters of credit) was 8%. At least half of the total capital must be
comprised of common equity, retained earnings and a limited amount of perpetual
preferred stock, after subtracting goodwill and making certain other adjustments
("Tier I capital").
6
<PAGE>
The remainder may consist of perpetual debt, mandatory convertible debt
securities, a limited amount of subordinated debt, remaining preferred stock and
a limited amount of loan loss reserves ("Tier 2 capital"). The maximum amount of
supplementary capital elements that qualify as Tier 2 capital is limited to 100%
of Tier 1 capital net of goodwill and certain other intangible assets. The
Federal Reserve Board also has adopted a minimum leverage ratio (Tier 1 capital
to assets) of 3% for bank holding companies that meet certain specified
criteria, including having the highest regulatory rating. The rule indicates
that the minimum leverage ratio should be at least 1.0% to 2.0% higher for
holding companies that do not have the highest rating or that are undertaking
major expansion programs. Failure to meet the capital guidelines could subject a
banking institution to a variety of enforcement remedies available to federal
regulatory authorities.
The table below presents the Company's capital position relative to its various
minimum statutory and regulatory capital requirements at September 30, 1996.
Minimum
Monocacy Bancshares, Inc. Regulatory
September 30, 1996 Requirements
Risk-based capital ratios
Tier I capital 10.78% 4.00%
Total capital 12.07% 8.00%
Leverage capital ratio 6.91% 3.00%
RESULTS OF OPERATIONS
Net income was $1,279 for the first nine months of 1996, down from $1,892 or
32.40% for the same period last year. Net interest income was down by $303 for
the first nine months of 1996, a result of the lower net interest margin because
of the changing mix of earning assets and interest-bearing liabilities and the
interest rate environment. The provision for loan losses was $225 for the first
nine months of 1996 and $450 for the same period last year. Net income, net
interest income and the provision for loan losses were $308, $2,304, and $75,
respectively for the three month period ended September 30,1996.
Non-interest income increased by $639 or 62.59% for the first nine months of
1996 with higher loan service charges, loan servicing fees and more gains
realized on the sales of loans. Mortgage-banking activities were more profitable
during the nine month period ended September 30, 1996, as evidenced by a 176.06%
increase in servicing fees and gains on sales of loans for that period over the
same period in 1995. A significant portion of this increase is attributable to
fees earned on the servicing portfolio acquired in the Royal Oak transaction.
Taneytown Bank's April 1, 1996 acquisition of Classic Mortgage Company also
contributed significantly to the increased profitability of the mortgage-banking
operations. Gains recognized on sales of securities available for sale were $18
for the nine months ended September 30, 1996 as compared to gains of $55 for the
same period in 1995. Non-interest expenses grew by $1,511 or 30.81% for the nine
month period ended September 30, 1996, with higher staff levels and related
costs and continuing investments in additional technology. In addition, in late
September, 1996, Congress passed legislation to recapitalize the Savings
Association Insurance Fund (SAIF) of the FDIC. This legislation called for a one
time special assessment of 65.7 basis points on thrift deposits as of March 31,
1995. Royal Oak Savings Bank, which the Company acquired on December 31, 1995,
is included in this assessment . Accordingly, third quarter earnings reflect
this assessment of approximately $276,000. Non-interest income was $690 for the
three months ended September 30, 1996, as compared to $342 for the same period
in 1995. Non-interest expenses were $2,389 for the three months ended September
30, 1996, as compared to $1,559 for the same period in 1995.
Income taxes were $463 for an effective tax rate of 26.58% in the first nine
months of 1996. The effective tax rate for the first nine months of 1995 was
29.74%. The decreased effective tax rate is due primarily to the increased
investment in tax-exempt municipal securities by the Company. Income taxes were
$222 for the three month period ended September 30, 1996.
7
<PAGE>
Table 1
Monocacy Bancshares, Inc.
Non-Performing Assets and Past Due Loans
<TABLE>
<CAPTION>
September 30, September 30, December 31,
1996 1995 1995
----------------- ----------------- -----------------
<S> <C>
Non-accrual loans:
Real Estate
Commercial mortgage $ 968 $ 222 $ 1,042
Residential mortgage - 343 -
Commercial 329 234 210
Consumer 3 6 6
----------------- ----------------- -----------------
Total non-accrual loans 1,300 805 1,258
Foreclosed properties 1,320 1,295 1,311
================= ================= =================
Total non-performing assets $ 2,620 $ 2,100 $ 2,569
================= ================= =================
Allowance for loan losses to:
Non-accrual loans 164.85% 241.99% 151.35%
================= ================= =================
Non-performing assets 81.79% 92.76% 74.11%
================= ================= =================
Accruing loans past due
90 days or more $ 257 $ 805 $ 174
================= ================= =================
Allowance for loan losses $ 2,143 $ 1,948 $ 1,904
================= ================= =================
</TABLE>
8
<PAGE>
Table 2
Monocacy Bancshares, Inc.
Allowance For Loan Losses
<TABLE>
<CAPTION>
Nine months ended September 30, Three months ended September 30,
1996 1995 1996 1995
---------------- ----------------- ----------------- -----------------
<S> <C>
Allowance for loan losses
at beginning of period $ 1,904 $ 1,902 $ 2,031 $ 1,797
Provision for loan losses 225 450 75 150
Charge-offs (32) (425) (6) (8)
Recoveries 46 21 43 9
Allowance for loan losses
================= ================= ================= =================
at end of period $ 2,143 $ 1,948 $ 2,143 $ 1,948
================= ================= ================= =================
Allowance for loan losses
as a percentage of loans
receivable, net of
unearned income 1.40% 1.38%
================= =================
</TABLE>
9
<PAGE>
PART II
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
On September 30, 1996, the Board of Directors of the Company declared a
$.10 per share cash dividend to common stockholders of record on
October 14, 1996, payable October 28, 1996.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No.
11.0 Information used in the computation Page 12
of net income per share
27.0 Financial Data Schedule Page 13
(b) Reports on Form 8-K
* Exhibits incorporated by reference
10
<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.
MONOCACY BANCSHARES, INC.
Registrant
Principal Executive Officer:
By: /s/ Frank W. Neubauer
---------------------------------
Frank W. Neubauer, President/CEO
Date: November 12, 1996
Principal Financial and Accounting Officer:
By: /s/ Michael K. Walsch
-------------------------------------
Michael K. Walsch, Executive Vice President/CFO
Date: November 12, 1996
11
MONOCACY BANCSHARES, INC. AND SUBSIDIARY EXHIBIT 11.0
Information used in the computation
of net income per common share
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C>
Net income $1,278,643 $1,891,597 $308,444 $648,982
========== =========== ======== ========
Weighted average common shares outstanding 1,459,958 1,318,973 1,462,734 1,321,166
========= ========= ========= =========
Net income per common share $.88 $1.43 $.21 $.49
==== ===== ==== ====
</TABLE>
12
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0
0
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</TABLE>
