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 March 31, 1998
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.
1,798,509 shares of Common Stock, $5 par value per share, were outstanding as of
May 7, 1998.
<PAGE>
MONOCACY BANCSHARES, INC.
Index to Form 10-QSB Report
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . .1
Consolidated Statements of Income and Comprehensive Income . . . . . . . 2
Consolidated Statements of Stockholders' Equity . . . . . . . . . . . . .3
Consolidated Statements of Cash Flows. . . . . . . . . . . . . . . . . . 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>
March 31, December 31,
Assets 1998 1997
------ ------------------- -------------------
(unaudited)
<S> <C>
Cash and due from banks $ 7,206,893 $ 7,081,321
Federal funds sold 12,570,259 12,613,708
Interest-bearing deposits with other banks 5,528,583 1,184,481
Loans held for sale 4,997,111 4,940,424
Securities available for sale 90,685,241 95,164,265
Loans, less allowance for loan losses of
$2,709,134 and $2,538,853 157,907,115 155,715,968
Bank premises and equipment 8,061,616 8,170,589
Other real estate owned 487,296 137,296
Deferred income taxes 1,028,669 771,011
Accrued interest receivable 1,563,132 2,151,978
Other assets 1,553,307 2,309,380
------------------- -------------------
Total Assets $291,589,222 $290,240,421
=================== ===================
Liabilities and Stockholders' Equity
Liabilities:
Non-interest bearing deposits $ 29,040,185 $ 25,224,565
Interest bearing deposits 202,970,624 203,645,080
------------------- -------------------
232,010,809 228,869,645
Federal funds purchased - -
Other borrowings 33,899,376 35,658,153
Accrued interest and other expenses payable 677,855 1,270,535
Dividends payable 215,806 179,137
Other liabilities 22,854 94,663
------------------- -------------------
Total liabilities 266,826,700 266,072,133
Stockholders' Equity:
Common stock 8,991,930 8,142,610
Common stock dividend to be distributed - 4,033,720
Surplus 15,410,522 11,862,866
Retained earnings 675,435 66,301
Accumulated other comprehensive income (315,365) 62,791
------------------- -------------------
Total stockholders' equity 24,762,522 24,168,288
------------------- -------------------
Total liabilities and stockholders' equity $291,589,222 $290,240,421
=================== ===================
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
1
<PAGE>
MONOCACY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
For the three months ended March 31, 1998 and 1997
(unaudited)
<TABLE>
<CAPTION>
1998 1997
------------------- -------------------
<S> <C>
Interest income:
Loans, including fees $3,860,289 $4,000,968
Interest-bearing deposits with other banks 25,714 6,553
Federal funds sold 170,111 27,141
Securities available for sale 1,375,539 714,297
Investment securities - 288,683
------------------- -------------------
Total interest income 5,431,653 5,037,642
------------------- -------------------
Interest expense:
Deposits 2,345,911 2,330,620
Federal funds purchased - 5,629
Other borrowings 510,501 178,199
------------------- -------------------
Total interest expense 2,856,412 2,514,448
------------------- -------------------
Net interest income 2,575,241 2,523,194
Provision for loan losses 106,400 180,000
------------------- -------------------
Net interest income after provision for loan losses 2,468,841 2,343,194
------------------- -------------------
Noninterest income:
Service charges on deposit accounts 166,710 106,406
Other service charges 171,653 155,015
Trust department fees 33,309 38,375
Gains and fees on sales of loans 307,683 353,400
Gains (losses) on sales of securities 724,173 (2,550)
Other 47,071 126,348
------------------- -------------------
Total noninterest income 1,450,599 776,994
------------------- -------------------
Noninterest expense:
Salaries & employee benefits 1,556,799 1,360,655
Occupancy 173,898 200,834
Equipment 199,856 186,822
Deposit insurance 15,000 15,000
Professional fees 120,527 94,502
Other 407,753 444,958
------------------- -------------------
Total noninterest expense 2,473,833 2,302,771
------------------- -------------------
Income before income taxes 1,445,607 817,417
Provision for income taxes 411,389 150,176
------------------- -------------------
Net income 1,034,218 667,241
------------------- -------------------
Other comprehensive income, net of tax:
Unrealized gains (losses) on securities (315,365) (349,306)
Reclassification of gains included in income (62,791) -
------------------- -------------------
Other comprehensive income (378,156) (349,306)
------------------- -------------------
Comprehensive income $ 656,062 317,935
=================== ===================
Net income per common share - basic $ 0.58 $ 0.37
=================== ===================
Net income per common share - diluted $ 0.56 $ 0.36
=================== ===================
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
2
<PAGE>
MONOCACY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Information for the three months ended March 31, 1998 is unaudited)
<TABLE>
<CAPTION>
Common Stock
Common Dividend to be Retained
Stock Distributed Surplus Earnings
-------------- ------------------- --------------- -------------
<S> <C>
Balance at December 31, 1995 $6,617,775 $2,845,643 $ 6,777,176 $4,908,739
Net income - - - 1,610,804
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 63,440 - 182,778 -
Issuance of 10% common stock dividend 660,405 (2,845,643) 2,185,238
Cash dividend - - - (585,020)
10% stock dividend to be distributed - 3,699,159 - (3,699,159)
Other comprehensive income - - - -
-------------- ------------------- --------------- -------------
Balance at December 31, 1996 7,341,620 3,699,159 9,145,192 2,235,364
Net income - - - 2,117,723
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 66,855 - 221,615 -
Issuance of 10% common stock dividend 734,135 (3,699,159) 2,496,059 461,483
Cash dividend - - - (714,549)
10% stock dividend to be distributed - 4,033,720 - (4,033,720)
Other comprehensive income - - - -
-------------- ------------------- --------------- -------------
Balance at December 31, 1997 8,142,610 4,033,720 11,862,866 66,301
Net income for three months - - - 1,034,218
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans 35,085 - 128,171 -
Issuance of 10% common stock dividend 814,235 (4,033,720) 3,419,485 (200,000)
Cash dividend - - - (225,084)
Other comprehensive income - - - -
============== =================== =============== =============
Balance at March 31, 1998 $8,991,930 $ - $15,410,522 $ 675,435
============== =================== =============== ============= ===
<CAPTION>
Accumulated
Other Total
Comprehensive Stockholders'
Income Equity
---------------- ----------------
<S> <C>
Balance at December 31, 1995 $ 18,748 $21,168,081
Net income - 1,610,804
Issuance of shares of common stock
in connection with employee benefit
and dividend reinvestment plans
Issuance of 10% common stock dividend - 246,218
Cash dividend -
10% stock dividend to be distributed - (585,020)
Other comprehensive income - -
(791,698) (791,698)
Balance at December 31, 1996 ---------------- ----------------
(772,950) 21,648,385
Net income
Issuance of shares of common stock - 2,117,723
in connection with employee benefit
and dividend reinvestment plans
Issuance of 10% common stock dividend
Cash dividend - 288,470
10% stock dividend to be distributed - (7,482)
Other comprehensive income - (714,549)
- -
Balance at December 31, 1997 835,741 835,741
---------------- ----------------
Net income for three months 62,791 24,168,288
Issuance of shares of common stock
in connection with employee benefit - 1,034,218
and dividend reinvestment plans
Issuance of 10% common stock dividend
Cash dividend
Other comprehensive income - 163,256
- -
Balance at March 31, 1998 - (225,084)
(378,156) (378,156)
================ ================
(315,365) $24,762,522
================ ================
</TABLE>
See the accompanying Notes to Consolidated Financial Statements.
3
<PAGE>
Monocacy Bancshares, Inc. and Subsidiary
Consolidated Statements of Cash Flows
For the three month periods ended March 31, 1998 and 1997
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
1998 1997
----------------- -----------------
<S> <C>
Cash flows from operating activities:
Net income $ 1,034,218 $ 667,241
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 252,077 204,608
Provision for loan losses 106,400 180,000
Deferred income taxes (62,850) (191,080)
(Gains)losses on sales of securities available for sale (724,173) 2,550
Proceeds from sales of loans originated for sale 4,529,246 12,844,622
Disbursements for loans originated for sale (4,278,250) (5,162,095)
Gains on sale of loans (307,683) (353,400)
Decrease in unearned income, net of origination costs 531,293 (75,507)
Writedown of other real estate owned - 5,500
Decrease in accrued interest receivable 588,846 76,755
Increase (decrease) in accrued interest and other
expenses payable (556,011) 770,620
Other, net 630,109 (62,517)
----------------- -----------------
Net cash provided by operating activities 1,743,222 8,907,297
----------------- -----------------
Cash flows from investing activities:
Net increase in interest-bearing deposits with other banks (4,344,102) (301,761)
Proceeds from maturities of investment securities - 4,304
Proceeds from sales of securities available for sale 43,015,834 1,383,549
Proceeds from maturities of securities available for sale 34,257,247 1,591,416
Purchases of securities available for sale (72,642,848) (4,408,914)
Purchases of participations in loans (1,480,000) -
Sales of participations in loans 2,044,000 -
Loan originations, net of principal repayments (3,742,840) (4,353,991)
Purchases of bank premises and equipment (88,949) (206,612)
----------------- -----------------
Net cash used in investing activities (2,981,658) (6,292,009)
----------------- -----------------
Cash flows from financing activities:
Net increase in deposits 3,141,164 715,025
Repayments of other borrowings (1,758,777) (6,631,889)
Issuance of common stock 163,256 90,748
Dividends paid on common stock (225,084) (154,305)
----------------- -----------------
Net cash provided by (used in) financing activities 1,320,559 (5,980,421)
----------------- -----------------
Net increase (decrease) in cash and cash equivalents 82,123 (3,365,133)
Cash and cash equivalents at beginning of period 19,695,029 12,373,937
================= =================
Cash and cash equivalents at end of period $19,777,152 $9,008,804
================= =================
Supplemental disclosures of cash flow information:
Interest paid on deposits and borrowings $ 2,537,210 $2,167,329
Income taxes paid 1 -
</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 months
ended March 31, 1998 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") 1997 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 March 31, 1998, and for the
three month periods ended March 31, 1998 and 1997 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 months
ended March 31, 1998 are not necessarily indicative of the results that
will be achieved for the entire year.
NOTE 2 - EARNINGS PER COMMON SHARE
Basic earnings per common share are based upon the weighted average
number of common shares outstanding during the periods, giving
retroactive effect to stock dividends. Diluted earnings per 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.
5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (DOLLARS IN THOUSANDS)
FINANCIAL CONDITION
Total assets at March 31, 1998, were $291,589 a 0.46% or $1,349 increase from
December 31, 1997. The increase in assets from December 31, 1997 occurred
primarily in the loan portfolio. Net loans at March 31, 1998 were $157,907,
compared to $155,716 at December 31, 1997. The majority of the loan increase was
a result of growth in the commercial real estate, residential construction and
residential mortgage portfolios. The securities portfolio decreased to $90,685
at March 31, 1998 from $95,164 at December 31, 1997. Deposits increased $3,141
or 1.37% from December 31, 1997, primarily in the non-interest bearing deposit
category, which increased $3,815 from December 31, 1997. The Company had $33,899
outstanding in borrowings at March 31, 1998 compared to $35,658 at December 31,
1997.
ALLOWANCE FOR LOAN LOSSES
The allowance for loan losses was $2,709 at March 31, 1998, which was 1.69% of
loans. During the first three months of 1998, Monocacy had a $106 provision for
loan losses and had net recoveries of $64. At December 31, 1997, the allowance
for loan losses was $2,539 or 1.60% of loans.
Table 1, "Non-Performing Assets and Past Due Loans" for Monocacy shows total
non-performing assets of $1,976 at March 31, 1998, a decrease of 5.82% from the
December 31, 1997 level of $2,098. 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. The allowance for
loan losses is 181.93% of non-accrual loans and 137.10% of non-performing assets
at March 31, 1998.
Table 2, "Changes in the Allowance for Loan Losses" shows the activity in the
allowance for loan losses for the three month periods ended March 31, 1998 and
1997.
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 $224,690 or 96.84% of total deposits at March 31, 1998.
Liquidity is also provided through the Company's portfolios of cash and interest
bearing deposits in other banks, federal funds sold, loans held for sale,
investment securities due within one year and securities available for sale.
Such assets totaled $120,898 or 41.46% of total assets at March 31, 1998.
In addition, the Bank has established lines of credit totaling $45,000 with the
Federal Home Loan Bank of Atlanta (the "FHLB") as an additional source of
liquidity. At March 31, 1998, the Bank had $33,558 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 March 31, 1998, 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 nine months 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").
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
6
<PAGE>
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 March 31, 1998.
Minimum
Monocacy Bancshares, Inc. Regulatory
March 31, 199 Requirements
------------------------- ------------
Risk-based capital ratios:
Tier I capital 11.98% 4.00%
Total capital 13.23% 8.00%
Leverage capital ratio 7.32% 3.00%
RESULTS OF OPERATIONS
Net income was $1,034 for the first three months of 1998, up from $667 or 55.02%
for the same period last year. Net interest income was up by $52 for the first
three months of 1998, a result of the higher net interest margin because of the
increased volume of loans and investment securities as well as the changing mix
of earning assets and interest-bearing liabilities and the interest rate
environment. The provision for loan losses was $106 for the first three months
of 1998 and $180 for the same period last year. The provision for loan losses
was higher in 1997 due to an intense credit effort in 1997 dealing with the
recognition and disposition of loan relationships that management had concluded
no longer fit our long term objectives. These relationships generally involved
credit quality and service quality. These initiatives have been concluded and,
accordingly, reserves have been decreased to a level that management believes is
sufficient, taking into consideration our improved credit culture.
Non-interest income increased by $674 or 86.74% for the first three months of
1998 with higher deposit service charges, loan servicing fees and more gains
realized on the sales of securities.
Mortgage-banking activities were more profitable during the three month period
ended March 31, 1998, as evidenced by a 3.5% increase in servicing fees. This
increase is attributable to the improved performance of the Bank's mortgage
banking division, Classic Mortgage Company.
The Company realized gains on sales of securities available for sale of $724 for
the three months ended March 31, 1998 as compared to losses of $3 for the same
period in 1997. These security gains occurred with the sale of securities
related to the Bank's overall asset/liability management practices and were
taken to reposition the Bank's securities portfolio for funding loan growth and
interest rate considerations.
Non-interest expenses grew by $171 or 7.43% for the three month period ended
March 31, 1998, with higher staff levels and related costs and the additional
investments in other resources made in late 1996 and early 1997. Professional
fees are up 27.37% primarily due to the expenses related to workouts of credits
and to the litigation noted in Note 13 to the Company's Consolidated Financial
Statements in the Company's 1997 Annual Report to Stockholders.
Income taxes were $411 in the first three months of 1998 as compared to $150 for
the first three months of 1997. The increased effective tax rate is due
primarily to the decreased investment in tax-exempt municipal securities by the
Company.
7
<PAGE>
Table 1
MONOCACY BANCSHARES, INC.
NON-PERFORMING ASSETS AND PAST DUE LOANS
<TABLE>
<CAPTION>
March 31, March 31, December 31,
1998 1997 1997
----------------- ----------------- -----------------
<S> <C>
Non-accrual loans:
Real Estate
Commercial mortgage $ 853 $ 618 $1,330
Residential mortgage 329 94 319
Commercial 284 158 289
Consumer 23 2 23
----------------- ----------------- -----------------
Total non-accrual loans 1,489 872 1,961
Foreclosed properties 487 650 137
================= ================= =================
Total non-performing assets $ 1,976 $1,522 $2,098
================= ================= =================
Allowance for loan losses to:
Non-accrual loans 181.93% 258.03% 129.47%
================= ================= =================
Non-performing assets 137.10% 147.83% 121.02%
================= ================= =================
Accruing loans past due
90 days or more $ 445 $1,119 $ 760
================= ================= =================
Allowance for loan losses $ 2,709 $2,250 $2,539
================= ================= =================
</TABLE>
8
<PAGE>
Table 2
MONOCACY BANCSHARES, INC.
ALLOWANCE FOR LOAN LOSSES
Three months ended March 31,
1998 1997
----------------- -----------------
Allowance for loan losses
at beginning of period $ 2,539 $ 2,100
Provision for loan losses 106 180
Charge-offs (12) (33)
Recoveries 76 3
Allowance for loan losses ================= =================
at end of period $ 2,709 $ 2,250
================= =================
Allowance for loan losses
as a percentage of loans
receivable, net of
unearned income 1.69% 1.38%
================= =================
9
<PAGE>
PART II
Item 1. Legal Proceedings
As previously reported, the Bank was named as a defendant in a legal
proceeding in the circuit Court for Baltimore City, wherein it was
alleged that the Bank permitted the improper withdrawal or transfer of
funds from a deposit account containing escrow monies at the Bank. The
Bank was also alleged to have misapplied certain sums of money by
depositing them in an unrelated account holder's deposit account. The
complaint initially sought recovery against the Bank in the amount of
$482,000 and was later amended to seek an amount in excess of $1
million. In March, 1998, the Bank, with the approval of the Court,
executed a Settlement Agreement and Mutual Release. Under the terms,
the Bank paid $230,000 and released any claims against other parties.
In return, the Bank received a General Release from all parties to the
litigation.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
At the Company's Annual Meeting of Stockholders held on April 27, 1998,
directors were elected and the independent auditors' were approved.
Item 5. Other Information
On March 30, 1998, the Board of Directors of the Company declared a
$.12 per share cash dividend to common stockholders of record on April
13, 1998, payable April 27, 1998.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No.
-----------
11.0 Information used in the computation Page 12
of earnings per share
27.0 Financial Data Schedule Page 13
(b) Reports on Form 8-K
None.
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: ___________________________________________
Frank W. Neubauer, President/CEO
Date: May 7, 1998
Principal Financial and Accounting Officer:
By:
___________________________________________
Michael K. Walsch, Executive Vice President
Date: May 7, 1998
11
EXHIBIT 11.0
MONOCACY BANCSHARES, INC. AND SUBSIDIARY
Information used in the computation
of net income per common share
Three Months Ended
March 31,
----------------------
1998 1997
---- ----
Basic:
Net income $1,034,218 $667,241
========== ========
Weighted average common shares outstanding 1,795,314 1,809,678
========= ==========
Net income per common share - basic $.58 $.37
==== ====
Diluted:
Net income $1,034,218 $667,241
========== ========
Weighted average common shares outstanding 1,795,314 1,809,678
Adjustment for common stock equivalents 50,475 29,696
---------- ---------
Weighted average common shares outstanding 1,845,789 1,839,374
========= =========
Net income per common share - diluted $.56 $.36
==== ====
12
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C> <C>
<PERIOD-TYPE> YEAR YEAR
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1997
<PERIOD-END> MAR-31-1998 MAR-31-1997
<CASH> 7,207 8,459
<INT-BEARING-DEPOSITS> 0 410
<FED-FUNDS-SOLD> 0 550
<TRADING-ASSETS> 4,997 2,785
<INVESTMENTS-HELD-FOR-SALE> 90,685 47,000
<INVESTMENTS-CARRYING> 0 24,038
<INVESTMENTS-MARKET> 0 23,648
<LOANS> 160,616 163,189
<ALLOWANCE> 2,709 2,250
<TOTAL-ASSETS> 291,589 257,861
<DEPOSITS> 232,011 225,754
<SHORT-TERM> 14,184 2,023
<LIABILITIES-OTHER> 917 1,529
<LONG-TERM> 19,735 6,684
0 0
0 0
<COMMON> 8,992 8,096
<OTHER-SE> 15,771 13,775
<TOTAL-LIABILITIES-AND-EQUITY> 291,589 21,871
<INTEREST-LOAN> 3,860 4,001
<INTEREST-INVEST> 1,376 1,003
<INTEREST-OTHER> 196 34
<INTEREST-TOTAL> 5,432 5,038
<INTEREST-DEPOSIT> 2,346 2,331
<INTEREST-EXPENSE> 2,856 2,514
<INTEREST-INCOME-NET> 2,575 2,523
<LOAN-LOSSES> 106 180
<SECURITIES-GAINS> 724 (3)
<EXPENSE-OTHER> 2,474 2,303
<INCOME-PRETAX> 1,446 817
<INCOME-PRE-EXTRAORDINARY> 0 817
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,034 667
<EPS-PRIMARY> 0.58 0.37
<EPS-DILUTED> 0.56 0.36
<YIELD-ACTUAL> 8.26 4.45
<LOANS-NON> 1,489 872
<LOANS-PAST> 0 650
<LOANS-TROUBLED> 0 0
<LOANS-PROBLEM> 0 0
<ALLOWANCE-OPEN> 2,539 2,100
<CHARGE-OFFS> 12 33
<RECOVERIES> 76 3
<ALLOWANCE-CLOSE> 2,709 2,250
<ALLOWANCE-DOMESTIC> 2,382 2,250
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 327 270
</TABLE>
