<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 25049
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
------------------------------------------
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
---------------- ----------------------
Commission File Number 0-22734
-------
KS BANCORP, INC.
----------------
(Exact name of registrant as specified in its charter)
North Carolina 56-1842707
-------------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
207 West Second Street
P. O. Box 219
Kenly, North Carolina 27542
---------------------------
(Address of principal executive office) (Zip code)
(919)-284-4157
--------------
(Registrant's telephone number)
N/A
---
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check (X) whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities and 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
--------- ---------
As of November 1, 1996 there were issued and outstanding 663,263 shares of the
Registrant's common stock, no par value.
<PAGE>
KS Bancorp, Inc. and Subsidiary
CONTENTS
PART I-FINANCIAL INFORMATION Pages
-----
Item 1. Financial Statements
Consolidated statements of financial condition
at September 30, 1996 (Unaudited) and December 31, 1995 1-2
Consolidated statements of income for the three months
ended September 30, 1996 and September 30, 1995 (Unaudited) 3
Consolidated statements of income for the nine months
ended September 30, 1996 and September 30, 1995 (Unaudited) 4
Consolidated statements of cash flows for the nine months
ended September 30, 1996 and September 30, 1995 (Unaudited) 5-6
Notes to consolidated financial statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-10
PART II-OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 12
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
September 30, 1996 and December 31, 1995
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1996 1995
- -----------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
Cash and short-term cash investments:
Interest-bearing $ 3,596,132 $ 3,707,373
Noninterest-bearing 483,011 376,041
Investment securities:
Held to maturity, at cost 2,493,117 2,302,701
Available for sale, at fair value 5,649,586 7,093,610
FHLB stock and other nonmarketable equity
securities 752,200 752,200
Mortgage-backed securities, held to
maturity, at cost 1,400,818 1,876,157
Loans receivable, net 79,058,874 70,098,830
Accrued interest receivable:
Loans 473,356 388,214
Investment securities 99,309 109,713
Property and equipment, net 1,635,264 1,254,374
Real estate held for sale 214,647 214,647
Prepaid expenses and other assets 141,035 58,582
Refundable income taxes 152,897 41,783
--------------------------------
Total Assets $ 96,150,246 $ 88,274,225
================================
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
September 30, December 31,
LIABILITIES AND STOCKHOLDERS' EQUITY 1996 1995
- --------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
Liabilities:
Deposits $ 77,123,181 $ 70,737,836
Advances from Federal Home Loan Bank 4,000,000 3,000,000
Accounts payable and accrued expenses 644,889 126,738
Advance payments by borrowers for taxes
and insurance 79,999 51,576
Deferred income taxes 487,213 494,357
-------------------------------------
Total liabilities 82,335,282 74,410,507
-------------------------------------
Stockholders' equity:
Preferred stock, no par value,
authorized 5,000,000 shares;
none issued - -
Common stock, no par value,
authorized 20,000,000 shares;
issued 663,263 shares in 1996
and 683,263 in 1995 - -
Additional paid-in capital 5,151,579 5,495,371
Note receivable, ESOP (312,000) (312,000)
Unrealized gain on securities
available for sale, net of
tax effect 393,227 360,795
Retained earnings, substantially
restricted 8,582,158 8,319,552
-------------------------------------
Total stockholders' equity 13,814,964 13,863,718
-------------------------------------
Total liabilities and
stockholders' equity $ 96,150,246 $ 88,274,225
=====================================
</TABLE>
See Notes to Consolidated Financial Statements.
2
<PAGE>
<TABLE>
<CAPTION>
KS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended September 30, 1996 and 1995
1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Interest and dividend income:
Loans $ 1,721,568 $ 1,538,060
Investment securities 131,862 176,418
Mortgage-backed securities 23,423 30,144
Interest-bearing deposits 21,566 22,383
------------------------------------
Total interest income 1,898,419 1,767,005
Interest expense:
Deposits 965,852 889,243
Borrowings 52,478 60,712
------------------------------------
Total interest expense 1,018,330 949,955
------------------------------------
Net interest income 880,089 817,050
Provision for loan losses 20,500 -
------------------------------------
Net interest income after
provision for loan losses 859,589 817,050
Other income 40,794 23,166
------------------------------------
900,383 840,216
------------------------------------
Noninterest expense:
Compensation and employee benefits 274,794 240,351
Occupancy 18,988 22,379
Equipment maintenance and expense 14,839 26,318
Data processing and outside service fees 38,361 34,912
Insurance 43,319 43,560
Special SAIF assessment 436,548 -
Other 56,333 59,658
------------------------------------
883,182 427,178
------------------------------------
Income before income taxes 17,201 413,038
------------------------------------
Income taxes (credits):
Current (19,455) 148,872
Deferred 25,300 11,532
------------------------------------
5,845 160,404
------------------------------------
Net income $ 11,356 $ 252,634
====================================
Primary earnings per share $ 0.02 $ 0.33
====================================
</TABLE>
See Notes to Consolidated Financial Statements.
3
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Nine Months Ended September 30, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Interest and dividend income:
Loans $ 4,969,223 $ 4,429,388
Investment securities 423,465 506,328
Mortgage-backed securities 77,151 88,897
Interest-bearing deposits 69,370 52,233
----------------------------------
Total interest income 5,539,209 5,076,846
Interest expense:
Deposits 2,800,031 2,425,511
Borrowings 146,263 105,986
----------------------------------
Total interest expense 2,946,294 2,531,497
----------------------------------
Net interest income 2,592,915 2,545,349
Provision for loan losses 62,500 7,000
----------------------------------
Net interest income after
provision for loan losses 2,530,415 2,538,349
Other income 107,764 62,958
----------------------------------
2,638,179 2,601,307
----------------------------------
Noninterest expense:
Compensation and employee benefits 783,182 683,969
Occupancy 58,001 62,160
Equipment maintenance and expense 45,415 55,573
Data processing and outside service fees 114,628 102,212
Insurance 130,602 130,375
Special SAIF assessment 436,548 -
Other 218,753 215,465
----------------------------------
1,787,129 1,249,754
----------------------------------
Income before income taxes 851,050 1,351,553
----------------------------------
Income taxes:
Current 272,241 450,309
Deferred 27,020 45,688
----------------------------------
299,261 495,997
----------------------------------
Net income $ 551,789 $ 855,556
==================================
Primary earnings per share $ 0.80 $ 1.13
==================================
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
KS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine months ended September 30, 1996 and 1995
1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Operating Activities
Net income $ 551,789 $ 855,556
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 50,621 44,162
Deferred income taxes (27,020) 45,688
Loss on sale of investment securities 7,169 17,401
Provision for loan losses 62,500 7,000
Gain on sale of REO - (7,929)
ESOP compensation expense credited
to paid-in capital 26,208 21,572
Changes in assets and liabilities:
(Increase) decrease in:
Accrued interest receivable (74,738) (21,973)
Prepaid expenses and other assets (82,453) (70,251)
Refundable income taxes (111,114) (9,039)
Increase (decrease) in:
Accrued expenses and other liabilities 518,151 62,866
Income taxes payable - -
Net cash provided by operating ----------------------------------
activities 921,113 945,053
----------------------------------
Cash Flows From Investing Activities
Proceeds from maturities of investments 2,300,000 1,300,000
Proceeds from sale of investments
available for sale 497,500 1,233,126
Purchase of investments (1,482,154) (1,002,344)
Principal repayments of MBS's 458,871 85,133
Mortgage loans, net (9,022,544) (5,759,523)
Proceeds from sale of REO - 63,326
Purchase of property and equipment (431,642) (601,497)
Net cash used in investing --------------------------------
activities (7,679,969) (4,681,779)
---------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
KS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine months ended September 30, 1996 and 1995
1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Financing Activities
Net increase in deposits $ 6,385,345 $ 3,881,995
Advance from Federal Home Loan Bank 1,000,000 2,000,000
Increase in advance payments by
borrowers for taxes and insurance 28,423 24,242
Cash dividends paid (289,183) (248,167)
Repurchase of common stock (370,000) (418,908)
------------------------------------
Net cash provided by financing
activities 6,754,585 5,239,162
------------------------------------
Net increase (decrease) in cash
and cash equivalents (4,271) 1,502,436
Cash and cash equivalents:
Beginning 4,083,414 2,638,510
------------------------------------
Ending $ 4,079,143 $ 4,140,946
====================================
Supplemental Disclosures of Cash Flow
Information
Cash payments for:
Interest $ 2,938,462 $ 2,532,650
===================================
Income taxes $ 444,368 $ 487,837
Cash and cash equivalents: ===================================
Cash and short-term investments:
Interest-bearing $ 3,596,132 $ 3,868,492
Noninterest-bearing 483,011 272,454
-----------------------------------
$ 4,079,143 $ 4,140,946
===================================
</TABLE>
See Notes to Consolidated Financial Statements.
6
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
Note 1. Basis of Presentation
The accompanying unaudited consolidated financial statements (except for the
statement of financial condition at December 31, 1995, which is audited) have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (none of
which were other than normal recurring accruals) necessary for a fair
presentation of the financial position and results of operations for the periods
presented have been included. The results of operations for the three and nine
month periods ended September 30, 1996 are not necessarily indicative of the
results of operations that may be expected for the year ended December 31, 1996.
The accounting policies followed are as set forth in Note 1 of the Notes to
Consolidated Financial Statements in the 1995 KS Bancorp, Inc. annual report.
Note 2. Allowance for Loan Losses
The Bank's allowance for loan losses increased by the related provisions charged
to operations of $20,500 and $62,500 during the three and nine month periods
ended September 30, 1996, and $-0- $7,000 during the three and nine month
periods ended September 30, 1995, respectively. The Bank did not incur any loan
charge-offs or recoveries during these periods. The allowance at September 30,
1996 is $295,367. The Bank's ratio of nonperforming assets to total assets at
September 30, 1996 and 1995 was .55% and .12%, respectively.
Note 3. Earnings Per Share
KS Bancorp's earnings per share for the three and nine month periods ended
September 30, 1996 were based upon the weighted average number of 692,587 and
693,300 shares of common stock and common stock equivalents assumed to be
outstanding for the periods, respectively. Earnings per share for the three and
nine month periods ended September 30, 1995 were based upon the weighted average
number of 756,621 and 754,454 shares of common stock and common stock
equivalents assumed to be outstanding for the periods, respectively. Stock
options had a dilutive effect on earnings per share in the three and nine month
periods ended September 30, 1996 and September 30, 1995. Earnings per share has
been calculated in accordance with Statement of Position 93-6 "Employers'
Accounting for Employee Stock Ownership Plans."
7
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- --------------------------------------------------------------------------------
The following discussion and analysis is intended to assist readers in
understanding the results of operations and changes in financial position for
the quarter and nine months ended September 30, 1996 of KS Bancorp, Inc. (the
Corporation) and its wholly owned subsidiary, Kenly Savings Bank, SSB (the
Bank). This overview should be read in conjunction with the consolidated
financial statements and supplemental financial data contained herein and with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" included in the Corporation's 1995 annual report on form 10-K.
Overview of Third Quarter Results:
Continuing the trend begun during the first two quarters of 1996, total assets
increased by $2.6 million during the three month period ended September 30, 1996
funded principally from an increase in savings of $1.1 million and $1.0 million
in additional borrowings from the FHLB. Accounts payable and accrued expenses
also increased by $497,000 during the three months ended September 30, 1996,
primarily due to the Bank's accrual of $437,000 for payment of the special SAIF
assessment levied by the FDIC on all SAIF insured institutions. The increase in
savings and borrowings provided funds for the Bank's increase in mortgage loan
activity.
Mortgage loans increased by $2.6 million during the three month period ended
September 30, 1996, building on the $6.4 million increase during the previous
two quarters. The increase resulted primarily from an increase in loan
originations during the quarter brought about by a continued strong loan demand
in the Bank's primary lending areas. The Bank originated these loans for its
portfolio.
Investment securities and short-term interest-bearing deposits decreased by
approximately $257,000 during the three months ended September 30, 1996 after
decreasing by approximately $1.1 million during the previous two quarters. The
portfolio, which amounted to $12.5 million at September 30, 1996, contains
available for sale securities with unrealized gains of $650,000 and unrealized
losses of $16,000, for a net unrealized gain of $634,000.
During the quarter ended September 30, 1996, the Corporation continued
construction on a new branch facility in Kenly, North Carolina, begun during the
previous quarter. Retail banking operations which are conducted in the main
office facility in Kenly will be transferred over to this new branch location
once it is completed, currently expected to be during the fourth quarter.
The Corporation's annualized return on assets for the three and nine month
periods ended September 30, 1996 was .05% and .80%, respectively. For the same
periods in 1995, the annualized return on assets was 1.15% and 1.33%,
respectively. The Corporation's annualized return on equity for the three and
nine month periods ended September 30, 1996 was .33% and 5.32%, respectively,
compared to 6.79% and 7.72% for the same periods in 1995.
During the first quarter of 1996, the Corporation repurchased 20,000 shares of
its stock for a purchase price of $370,000 in accordance with a stock repurchase
plan authorized by the Corporation's Board of
8
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- --------------------------------------------------------------------------------
Directors. No further repurchases were made during the quarters ended June 30,
1996 or September 30, 1996. At September 30, 1996, the Corporation was
authorized to repurchase approximately 3,500 additional shares of stock. During
each of the quarters ended March 31, 1996, June 30, 1996 and September 30, 1996,
the Corporation paid cash dividends of $0.15, amounting to approximately
$98,000, $95,000 and $95,000, respectively. At September 30, 1996, both the
Corporation's and the Bank's capital were significantly in excess of regulatory
capital requirements.
Net income for the three and nine month periods ended September 30, 1996 was
$11,356 ($.02 per share) and $551,789 ($.80 per share), respectively. Net
income for the comparable periods in 1995 was $252,634 ($.33 per share) and
$855,556 ($1.13 per share), respectively. The most significant negative impact
on income for the three and nine months ended September 30, 1996 was the one
time special SAIF assessment levied on all SAIF insured institutions by the FDIC
on September 30, 1996. Designed to bolster the SAIF's reserves, the assessment,
which amounted to $437,000, and levied at 65.7 basis points of the Bank's
March 31, 1995 deposit base, will be paid during the Company's fourth quarter.
Accrual of the assessment, net of the income tax effect, negatively impacted
earnings for the three and nine months ended September 30, 1996 by approximately
$283,000 ($.41 per share).
Net interest income for the three month period ended September 30, 1996 was
approximately $63,000 higher than the comparable period of 1995, while net
interest income for the nine month period ended September 30, 1996 was
approximately $48,000 higher than the comparable period. The small increases
in net interest income resulted from a higher net interest rate spread during
the periods in 1996 as compared to the same periods in 1995 on a slightly lower
level of net interest earning assets (average interest-earning assets less
interest-bearing liabilities). The Bank's interest rate spread increased
primarily because a greater percentage of its interest earning assets in 1996
were comprised of higher yielding loans as compared to the same periods in 1995.
In addition, the Bank's interest earning assets, which typically respond slower
than more rate sensitive deposits to overall market interest rate fluctuations,
continued to adjust upward as rates began to stabilize at slightly higher
levels during the first three quarters of 1996 as compared with the same
quarters in 1995. The Bank's cost of funds was not significantly higher during
the first three quarters of 1996 as compared with the same periods in 1995.
Noninterest expense increased by approximately $456,000 during the three month
period ended September 30, 1996 versus the comparable period in 1995, extending
the difference after the first two quarters of $81,000 to $537,000 for the nine
month period. Of the total increase during the quarter ended September 30,
1996, $437,000 was attributable to the special SAIF assessment. The primary
reason for the remaining increase during the quarter and nine months ended
September 30, 1996, was increased levels of compensation and other expenses
associated with the operations of the branch office in Goldsboro, North
Carolina. This office was opened during the quarter ended March 31, 1995 as a
loan origination office, and continued to function in this manner throughout
1995. During the quarter ended March 31, 1996, renovations were completed on a
new replacement facility in Goldsboro which was opened as a full service branch
office.
9
<PAGE>
KS BANCORP, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
- --------------------------------------------------------------------------------
Asset Quality:
Nonperforming assets, which consist of nonaccrual loans and real estate acquired
through foreclosure, amounted to approximately $533,000 and $111,000 at
September 30, 1996 and 1995, respectively. The ratio of nonperforming assets to
total assets at September 30, 1996 and 1995 was .55% and .12%, respectively. Due
to the slightly higher ratio of nonperforming assets to total assets and an
increased balance of loans outstanding, the Bank added $20,500 to its allowance
for loan losses during the quarter ended September 30, 1996 compared to $-0-
during the quarter ended September 30, 1995, bringing total additions to the
allowance during the nine months ended September 30, 1996 and 1995 to $62,500
and $7,000, respectively. The Bank did not charge-off any loans during the first
nine months of 1996. The balance of the Bank's allowance for loan losses
amounted to approximately $295,000 at September 30, 1996 and is considered
adequate by management to absorb existing losses, either known or inherent in
the portfolio.
Liquidity:
The term "liquidity" generally refers to an organization's ability to generate
adequate amounts of funds to meet its needs for cash. More specifically for
financial institutions, liquidity ensures that adequate funds are available to
meet deposit withdrawals, fund loan and capital expenditure commitments,
maintain reserve requirements, pay operating expenses, and provide funds for
debt service and other institutional commitments. Funds are primarily provided
through financial resources from operating activities, expansion of the deposit
base, borrowings, through the sale or maturity of investments, or maintenance of
shorter term interest-bearing deposits.
The Bank is required by regulations to maintain liquid assets, essentially cash,
short-term interest bearing deposits, substantially all investments, and
mortgage-backed securities, of at least 10% of total assets. A substantial
portion of the Bank's investment portfolio is classified as available for sale,
and liquidation of such portfolio, if need be, would not have accounting
implications on the Corporation's equity under SFAS No. 115. The Bank exceeded
such requirements at September 30, 1996 and management believes that the Bank's
liquidity is adequate to fund all outstanding commitments and other anticipated
cash needs.
Capital Resources and Adequacy:
KS Bancorp, Inc's stockholders' equity was $13,814,964, or 14.37% of total
assets at September 30, 1996. As a state chartered stock savings bank, the Bank
is required to meet three separate capital standards as established by the
Federal Deposit Insurance Corporation and an additional capital requirement
established by the State Administrator of the Savings Institutions Division. The
Bank was substantially in excess of all such capital requirements at
September 30, 1996.
10
<PAGE>
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not engaged in any legal proceedings at the
present time. From time to time, the Bank is a party to legal
proceedings within the normal course of business wherein it
enforces its security interest in loans made by it, and other
matters of a like kind.
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) Not applicable
(b) Not applicable
11
<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.
KS Bancorp, Inc.
Dated November 1, 1996 By: /s/Harold T. Keen
--------------------------------- -----------------------
Harold T. Keen
President and CEO
Dated November 1, 1996 By: /s/Helen B. Pollock
--------------------------------- -----------------------
Helen B. Pollock
Treasurer
12
<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.
KS Bancorp, Inc.
Dated November 1, 1996 By: s/s Harold T. Keen
--------------------- ---------------------
Harold T. Keen
President and CEO
Dated November 1, 1996 By: s/s Helen B. Pollock
--------------------- ---------------------
Helen B. Pollock
Treasurer
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 483,011
<INT-BEARING-DEPOSITS> 3,596,132
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 10,295,721
<INVESTMENTS-MARKET> 10,305,609
<LOANS> 79,058,874
<ALLOWANCE> 295,367
<TOTAL-ASSETS> 96,150,246
<DEPOSITS> 77,123,181
<SHORT-TERM> 4,000,000
<LIABILITIES-OTHER> 1,212,101
<LONG-TERM> 0
0
0
<COMMON> 5,151,579
<OTHER-SE> 8,663,385
<TOTAL-LIABILITIES-AND-EQUITY> 96,150,246
<INTEREST-LOAN> 4,969,223
<INTEREST-INVEST> 423,465
<INTEREST-OTHER> 146,521
<INTEREST-TOTAL> 5,539,209
<INTEREST-DEPOSIT> 2,800,031
<INTEREST-EXPENSE> 2,946,294
<INTEREST-INCOME-NET> 2,592,915
<LOAN-LOSSES> 62,500
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,787,129
<INCOME-PRETAX> 851,050
<INCOME-PRE-EXTRAORDINARY> 551,789
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 551,789
<EPS-PRIMARY> 0.80
<EPS-DILUTED> 0
<YIELD-ACTUAL> 0
<LOANS-NON> 533,000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 232,867
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 295,367
<ALLOWANCE-DOMESTIC> 295,367
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
