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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of
1934
Date of Report (Date of earliest event reported) July 15, 1997
NORTH BANCSHARES, INC.
(Exact name of Registrant as specified in its Charter)
Delaware 0-22800 36-3915073
(State or other (commission file number) (IRS Employer
jurisdiction of Identification
incorporation) number)
100 West North Avenue, Chicago, Illinois 60610
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 664-4320
N/A
Former name or former address, if changed since last report)
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Item 5. Other Events
On July 15, 1997, the Registrant issued the attached press
release.
Item 7. Financial Statements and Exhibits
(a) Exhibits
1. Press Release, dated July 15, 1997, regarding
second quarter 1997 earnings, declaration of dividend, and stock
repurchase program.
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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 hereunto duly authorized.
NORTH BANCSHARES, INC.
(Registrant)
Date: July 15, 1997 /S/ Joseph A. Graber
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Joseph A. Graber
President
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EXHIBIT
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NORTH BANCSHARES, INC NEWS RELEASE
RELEASE: IMMEDIATE DATE: July 15, 1997
CONTACT: Joseph A. Graber, President
Victor E. Caputo, Executive Vice-President
(312) 664-4320
NORTH BANCSHARES, INC.
ANNOUNCES
SECOND QUARTER EARNINGS INCREASES BY 32%
QUARTERLY DIVIDEND DECLARED
STOCK REPURCHASE PROGRAM
Chicago, Illinois, July 15, 1997, - North Bancshares, Inc., (NASDAQ-NBSI), the
holding company for North Federal Savings Bank, announced net income increased
by 32% from $133,000 for the quarter ended June 30, 1996 to $175,000 for the
quarter ended June 30, 1997. Earnings per share increased by 50% from $.12
per primary share for the quarter ended June 30, 1996 to $.18 per primary
share for the quarter ended June 30, 1997.
Concurrent with this earnings release the Board of Directors of the Company
has declared a quarterly dividend of $.12 per share to be paid on August 15,
1997 to stockholders of record on August 1, 1997.
In addition, the Company announces its intention to repurchase 50,000 shares
of its common stock in open market transactions or in privately negotiated
transactions over a period of one year upon completion of the current
repurchase program. This will be the eighth stock repurchase program
initiated by the Company and amounts to approximately 5.0% of the outstanding
shares.
Net interest income for the quarter ended June 30, 1997, before provision for
loan losses, increased by $50,000 or 5.4% from $920,000 for the quarter
ended June 30, 1996 to $970,000 for the quarter ended June 30, 1997. The
increase was attributable to a $239,000 increase in interest on loans
receivable, partially offset by a $167,000 decrease in interest on investment
securities, mortgage-backed securities, and interest bearing deposits. In
addition, there was a $35,000 increase in total interest expense.
Non-interest income increased by $11,000 or 19.3% from $57,000 for the quarter
ended June 30, 1996 to $68,000 for the quarter ended June 30, 1997. The
increase was primarily attributable to a $15,000 increase in fees and service
charges related to an increase in the total number of checking accounts and
interchange fees resulting from foreign ATM transactions and MasterCard
Master Money transactions.
Non-interest expense increased by $28,000 or 3.6% from $768,000 for the
quarter ended June 30, 1996 to $796,000 for the quarter ended June 30, 1997.
The increase was primarily attributable to a $90,000 increase in compensation
and benefits expense, and occupancy expense, partially offset by a $75,000
decrease in advertising and federal deposit insurance premium expense. The
increase in compensation and benefits expense is primarily attributable to a
$49,000 increase in ESOP expense related to an increase in teh value of
shares to be released to teh ESOP. In addition, there was an increase in
staff related to the expansion of the hours of operation at the Chicago
office. Although the Company is required to record compensation expense for
the increase in the value of the shares, an offsetting entry to additional
paid in capital is recorded on the consolidated statements of financial
condition and therefore total stockholders' equity and book value are
unaffected.
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Total assets increased by $2.1 million or 1.8% from $117.5 million at December
31, 1996 to $119.6 million at June 30, 1997. The increase was primarily
attributable to a $6.6 million increase in net loans receivable and
investment securities partially offset by a $3.8 million decrease in cash and
cash equivalents.
Net loans receivable increased $4.0 million or 5.4% from $73.4 million at
December 31, 1996 to $77.4 million at June 30, 1997. The increase was
attributable to increased mortgage broker activity and the marketing of a
mini-jumbo loan product for small income producing properties.
Deposit accounts decreased by $2.0 million or 2.7% from $73.6 million at
December 31, 1996 to $71.6 million at June 30, 1997. The decrease can be
attributed to savers seeking higher returns in teh equity and mutual fund
markets that have in the past year and more recently achieved all time highs.
Mary Ann Hass, Chairman and Chief Executive Officer, commented:
"We are pleased with the continued core earnings growth we have achieved
during this second quarter and are continuing to develop new products and
services that will supplement that growth. In this regard, we introduced a
new Bridge Loan Program and will introduce a Home Equity Line of Credit
product during the third quarter. We also installed an ATM at the Gold
Coast Multi-Plex on North Clark street. Our "Easy-Retrieve" voice response
system is now answering approximately 1.200 calls per month. We have
declared a regular quarterly dividend of $.12 per share to be paid August
15th and today we announce our eighth stock repurchase program. We will
continue to focus on all the elements of our business plan in order to
position the Company for future earnings growth, and to improve per share
earnings and our return on equity."
"We have recently expanded our Chicago office hours of operation to include
Wednesdays. We recognized that a full service community financial
institution needs to be responsive to customer demands. The influx of new
business checking accounts, and their daily requirements for cash and deposit
services requires us to be open six days a week. Our branch office in
Wilmette has also adjusted their hours of operation to provide more
convenient service for their customers."
North Federal Savings Bank primarily serves the North Side of Chicago from its
home office and operates a branch office in Wilmette, Illinois. The bank has
received a five star rating for 35 consecutive quarters from Bauer Financial
Reports, Inc., and is rated one of the best in the nation by Sheshunoff
Information Services, Inc. Visit our Web site at http://www.northfederal.com
to read previous press releases, examine filings withe the SEC, read about
our history, and check our our products, services and interest rates.
North Bancshares, Inc. common stock is traded on The Nasdaq Stock Market under
the symbol: "NBSI."
(FINANCIAL STATEMENTS ATTACHED)
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<TABLE>
NORTH BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION(IN THOUSANDS)
<CAPTION>
ASSETS JUNE 30, 1997 DEC 31, 1996
(UNAUDITED)
<S> <C> <C>
Cash and due from banks $ 651 $ 618
Interest-bearing deposits 2,075 2,644
Federal funds sold 525 4,800
Investment in dollar denominated mutual funds 1,571 547
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TOTAL CASH AND CASH EQUIVALENTS 4,822 8,609
Investment securities available for sale 26,964 24,426
Mortgage-backed securities held-to-maturity 6,694 7,465
Loans receivable, net of allowance for loan
losses of $208 at June 30, 1997 and
at December 31, 1996 77,448 73,378
Accrued interest receivable 1,145 1,025
Premises and equipment, net 1,062 1,061
Stock in Federal Home Loan Bank of Chicago 1,390 1,205
Other assets 61 304
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TOTAL ASSETS $119,586 $117,473
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LIABILITIES AND STOCKHOLDERS' EQUITY
Deposit accounts $ 71,633 $73,611
Borrowed funds 27,800 24,100
Advance payments by borrowers for
taxes and insurance 1,309 1,203
Other liabilities 1,940 736
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TOTAL LIABILITIES 102,682 99,650
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value. 500,000
shares authorized; none outstanding - -
Common stock, $.01 par value. 3,500,000
shares authorized; 1,437,501 shares issued,
996,585 outstanding at June 30, 1997 and
1,057,950 outstanding at December 31, 1995 14 14
Additional paid-in capital 13,604 13,688
Retained earnings, substantially restricted 11,141 10,988
Treasury stock at cost (440,916 shares at
June 30, 1997 and 379,551 shares at
December 31, 1996) (6,651) (5,340)
Unrealized loss on securities
available for sale, net of tax effect (454) (678)
SFAS No. 87 adjustment, net of tax (108) (108)
Common stock acquired by Employee Stock
Ownership Plan (611) (667)
Deferred compensation (31) (74)
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TOTAL STOCKHOLDERS' EQUITY 16,904 17,823
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $119,586 $117,473
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</TABLE>
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<TABLE>
NORTH BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS(UNAUDITED)
(IN THOUSANDS)
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans receivable $1,487 $1,248 $2,936 $2,381
Interest-bearing deposits and federal funds sold 34 66 82 152
Investment securities available for sale 512 635 977 1,123
Investment securities held-to-maturity - - - 2
Mortgage-backed securities available for sale - - - 90
Mortgage-backed securities held-to-maturity 121 133 246 292
Dollar denominated mutual funds 18 12 52 32
Dividends on FHLB of Chicago stock 23 16 45 29
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TOTAL INTEREST INCOME 2,195 2,110 4,338 4,101
INTEREST EXPENSE
Deposit accounts 779 855 1,552 1,686
Borrowed funds 446 335 847 595
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TOTAL INTEREST EXPENSE 1,225 1,190 2,399 2,281
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NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 970 920 1,939 1,820
PROVISION FOR LOAN LOSSES - - - 8
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NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 970 920 1,939 1,812
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NON-INTEREST INCOME
Gain on sale of investment securities available for sale 6 9 54 8
Fees and service charges 57 42 103 87
Other 5 6 9 12
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TOTAL NON-INTEREST INCOME 68 57 166 107
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NON-INTEREST EXPENSE
Compensation and benefits 418 342 812 677
Occupancy expense 117 103 230 201
Professional fees 48 62 86 103
Data processing 43 32 85 59
Advertising and promotion 32 66 63 97
Federal deposit insurance premium 11 52 23 104
Recognition and retention plan 23 18 42 37
Other 104 93 201 156
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TOTAL NON-INTEREST EXPENSE 796 768 1,542 1,434
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INCOME BEFORE TAXES 242 209 563 485
INCOME TAX EXPENSE 67 76 159 165
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NET INCOME $ 175 $ 133 $ 404 $ 320
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EARNINGS PER SHARE PRIMARY $.18 $.12 $.40 $.28
EARNINGS PER SHARE FULLY DILUTED $.18 $.12 $.40 $.28
WEIGHTED AVERAGE SHARES OUTSTANDING 999,183 1,109,206 1,014,175 1,146,736
</TABLE>
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SELECTED FINANCIAL RATIOS AND OTHER DATA (UNAUDITED):
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Performance Ratios:
Return on assets (ratio of net income
to average total assets) (1) .58% .45% .68% .56%
Interest Rate Spread Information:
Average during period (1) 2.54 2.36 2.52 2.37
End of period (1) 2.57 2.31 2.57 2.31
Net interest margin (1) 3.32 3.23 3.32 3.26
Operating expenses to average assets(1) 2.66 2.63 2.59 2.50
Ratio of average interest-earning assets
to average interest-bearing
liabilities 118.45 120.70 119.34 121.88
</TABLE>
JUNE 30, 1997 DEC. 31, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Asset Quality Ratios:
Non-performing assets to total assets
at end of period N/A N/A
Allowance for loan losses to non-performing loans N/A N/A
Allowance for loan losses to loans receivable (net) 0.27 0.28
Capital ratios:
Stockholders' equity to total assets 14.14 15.12
Average Stockholders' equity to average assets 14.63 16.32
Return on Stockholders' equity (ratio of net
income to average equity) (1) 4.64 2.59
Shares outstanding-actual number 996,585 1,057,950
Book value per share $16.96 $16.85
Number of full service offices 2 2
(1) Annualized for the three month and six month periods presented.
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