UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One) FORM 10-QSB
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the quarterly period ended September 30, 1996
--------------------------------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _____________________ to _______________________
Commission file number 33-70184
--------------------------------------------------------
C&F Financial Corporation
_______________________________________________________________________________
(Exact name of small business issuer as
specified in its charter)
Virginia 54-1680165
State of other jurisdiction of I.R.S. Employer
incorporation of organization) Identification No.)
Eighth and Main Streets West Point VA 23181
(Address of principal executive offices) (Zip Code)
(Issuer's telephone number) (804) 843-2360
----------------------------------------------------
_______________________________________________________________________________
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
[x] Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. [ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each on the issuer's classes of
common equity, as of the latest practicable date:
2,113,041 as of October 31, 1996
-------------------------------------------------------------
Transitional Small Business Disclosure Format (Check one): [ ] Yes [x] No
<PAGE>
TABLE OF CONTENTS
Part I - Financial Information Page
Item 1. Financial Statements
Consolidated Balance Sheet -
September 30, 1996 and December 31, 1995................1
Consolidated Statement of Income -
Three months ended September 30, 1996 and 1995..........2
Consolidated Statement of Income -
Nine months ended September 30, 1996 and 1995...........3
Consolidated Statement of Cash Flows -
Nine months ended September 30, 1996 and 1995...........4
Notes to Consolidated Financial Statements..................5
Item 2. Management's Discussion and Analysis .......................6
Part II - Other Information
Item 1. Legal Proceedings .........................................12
Item 5. Other Information .........................................12
Item 6. Exhibits and Reports on Form 8-K...........................12
Signatures .....................................................13
<PAGE>
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Amounts in thousands of dollars)
<TABLE>
<CAPTION>
ASSETS 9-30-96 12-31-95
<S> <C>
Cash and due from banks $ 7,115 $ 9,789
Interest -bearing deposits in other banks 2,714 3,031
Federal funds sold 630
----------- -----------
Total cash and cash equivalents 9,829 13,450
Investment securities
Available for sale securities at fair value,
amortized cost of $16,387,000 and $23,623,000,
respectively 16,044 23,742
Held to maturity at amortized cost,
fair value of $71,178,000 and $78,606,000,
respectively 71,042 76,896
Loans held for sale 9,785 1,885
Loans (gross) 133,501 111,935
Less: unearned income (7) (9)
Less: allowance for loan losses (1,910) (1,914)
------------ ------------
Net loans 131,584 110,012
Federal Home Loan Bank stock 857 805
Bank premises and equipment 6,150 5,921
Accrued interest receivable 2,215 2,439
Other assets 4,772 4,010
----------- -----------
Total assets $ 252,278 $ 239,160
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Non-interest-bearing demand deposits $ 27,877 $ 28,898
Savings and interest-bearing demand deposits 85,778 84,313
Time deposits 94,990 90,801
----------- -----------
Total deposits 208,645 204,012
Repurchase agreements 1,785
Other borrowings 5,100
Accrued interest payable 645 570
Other liabilities 2,700 2,760
----------- -----------
Total liabilities 218,875 207,342
Shareholders' Equity
Common stock (2,232,844 and 2,230,844 shares 2,233 2,231
outstanding at September 30, 1996 and
December 31, 1995, respectively)
Additional paid-in capital 1,301 1,290
Retained earnings 29,712 27,805
Net unrealized gain on securities
available for sale , net of tax 157 492
----------- -----------
Total shareholders' equity 33,403 31,818
----------- -----------
Total liabilities and
shareholders' equity $ 252,278 $ 239,160
=========== ===========
</TABLE>
The Company's notes are an integral part of the consolidated financial
statements.
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands of dollars, except for per share amounts)
<TABLE>
<CAPTION>
Three Months Ended September 30,
INTEREST INCOME 1996 1995
- --------------- ---- ----
<S> <C>
Interest and fees on loans $ 3,108 $ 2,527
Interest on other market investments 128
Interest on fed funds sold 61 43
Interest on investment securities
U.S. Treasury and U.S. Government Agencies 834 1,007
Obligations on states and political sub. 540 442
Other bonds 102 31
--------- ---------
Total interest income 4,645 4,178
INTEREST EXPENSE
Interest on deposits 1,847 1,818
Interest on short-term borrowings 84 7
--------- ---------
Total interest expense 1,931 1,825
Net interest income 2,714 2,353
Provision for loan losses - -
OTHER OPERATING INCOME
Service charges on deposit accounts 260 227
Gain on sale of loans 1,126
Other service charges, commissions, and fees 174 87
--------- ---------
Total other operating income 1,560 314
Realized gains on securities 10
OTHER OPERATING EXPENSES
Salaries and employee benefits 1,868 883
Occupancy expenses 450 269
Other operating expenses 598 401
--------- ---------
Total other operating expenses 2,916 1,553
Income before income taxes 1,358 1,124
Income tax expense 289 183
--------- ---------
Net Income $ 1,069 $ 941
========= =========
PER SHARE DATA
Net Income $ .48 $ .42
Cash Dividends Paid and Declared .16 .15
Weighted average number of shares outstanding 2,232,275 2,228,739
</TABLE>
The Company's notes are an integral part of the consolidated financial
statements.
<PAGE>
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands of dollars, except for per share amounts)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
INTEREST INCOME 1996 1995
- --------------- ---- ----
<S> <C>
Interest and fees on loans $ 8,879 $ 7,089
Interest on fed funds sold 1 103
Interest on market investments 125 128
Interest on investment securities
U.S. Treasury and U.S. Government Agencies 2,688 2,643
Obligations on states and political sub. 1,564 1,294
Other bonds 303 104
--------- ---------
Total interest income 13,560 11,361
INTEREST EXPENSE
Interest on deposits 5,596 4,609
Interest on short-term borrowings 161 19
--------- ---------
Total interest expense 5,757 4,628
Net interest income 7,803 6,733
Provision for loan losses - -
OTHER OPERATING INCOME
Service charges on deposit accounts 718 636
Gain on sale of loans 2,656
Other service charges, commissions,
and fees 681 204
--------- ---------
Total other operating income 4,055 840
Realized gains (losses) on securities (13) 17
OTHER OPERATING EXPENSES
Salaries and employee benefits 5,179 2,280
Occupancy expenses 1,292 716
Other operating expenses 1,759 1,292
--------- ---------
Total other operating expenses 8,230 4,288
Income before income taxes 3,615 3,302
Income tax expense 681 774
--------- ---------
Net income $ 2,934 $ 2,528
========= =========
PER SHARE DATA
Net income $ 1.31 $ 1.13
Cash dividends paid and declared .46 .44
Weighted average number of shares outstanding 2,232,275 2,228,739
</TABLE>
The Company's notes are an integral part of the consolidated financial
statements.
<PAGE>
CONSOLIDATED STATEMENTS ON CASH FLOWS
(Unaudited)
(Amounts in thousands of dollars)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
1996 1995
---- ----
<S> <C>
Cash flows from operating activities:
Net income $ 2,934 $ 2,528
Adjustments to reconcile net income to
net cash provided by (used in) operating activities:
Depreciation 608 402
Amortization of goodwill 202 35
Accretion of discounts and amortization of
premiums on investment securities, net (208) (141)
Net realized gain(loss) on securities (13) (17)
Proceeds from sale of loans 119,161
Origination of loans held for sale (129,717)
Gain on sale of loans 2,656
Change in other assets and liabilities:
Other real estate owned 59
Accrued interest receivable and other assets (484) (869)
Accrued interest payable and other liabilities 1,800 1,178
---------- ----------
Net cash provided by (used in) operating activities (3,061) 3,175
----------- ----------
Cash flows from investing activities:
Proceeds from maturities of investments
held to maturity 13,351 10,826
Proceeds from sales and maturities of
investments available for sale 9,531
Purchase of investment securities (1,975) (31,920)
Purchase of investments available for sale (7,340)
Net decrease (increase) in customer loans (21,572) (6,668)
Purchase of corporate premises and equipment (837) (1,704)
Purchase of Federal Home Loan Bank stock (52) (32)
----------- ----------
Net cash used in investing activities (8,894) (29,498)
----------- -----------
Cash flows from financing activities:
Net increase(decrease) in deposits (3,204) 15,015
Net increase in other borrowings 5,100
Assumption of deposit liabilities in
branch acquisition, net of premium paid 7,452 20,271
Proceeds from exercise of stock options 13 17
Cash dividends (1,027) (981)
----------- -----------
Net cash provided by (used in) financing activities 8,334 34,322
---------- ----------
Net increase (decrease) in cash and cash equivalents (3,621) 7,999
Cash and cash equivalents at beginning of period 13,450 6,995
---------- ----------
Cash and cash equivalents at end of period $ 9,829 $ 14,994
========== ==========
Supplemental disclosure
Interest paid $ 5,610 $ 4,433
Income taxes paid $ 436 $ 722
</TABLE>
The Company's notes are an integral part of the consolidated financial
statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1
In the opinion of C&F Financial Corporation's management, the
accompanying unaudited consolidated financial statements contain all
adjustments, consisting only of normal recurring accruals, necessary to present
fairly the financial position as of September 30, 1996, the results of
operations for the three-month and nine-month periods ended September 30, 1996
and 1995, and cash flows for the nine-month periods ended September 30, 1996 and
1995.
These consolidated financial statements should be read in conjunction
with the consolidated financial statements and notes thereto included in the C&F
Financial Annual Report on Form 10-KSB for the year ended December 31, 1995.
The results of operations for the interim periods are not necessarily
indicative of the results to be expected for the full year.
The consolidated financial statements include the accounts of the Company
and its subsidiaries, with all significant intercompany transactions and
accounts being eliminated in consolidation.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Note 2
Net income per share has been calculated on the basis of the weighted
average number of shares outstanding for the applicable periods. Weighted
average number of shares was 2,232,844 and 2,230,744 for the nine months ended
September 30, 1996 and 1995, respectively.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
The following discussion supplements and provides information about the
major components of the results of operations and financial condition, liquidity
and capital resources of C&F Financial Corporation (the "Company"). This
discussion and analysis should be read in conjunction with the Consolidated
Financial Statements, and supplemental financial data.
Overview
Net income increased 16.1% for the nine month period ended September
30, 1996 compared to the same period of 1995. Net income for the nine month
period ended September 30, 1996 reached $2,934,000 compared to $2,528,000
reached for the same period of 1995. Earnings per share were $1.31 for the nine
month period, up 15.9% from $1.13 per share for nine month ended September 30,
1995. Net income increased 13.6% for the third quarter of 1996 compared to the
third quarter of 1995. Net income for the third quarter of 1996 is $1,069,000
compared to $941,000 for the same period of 1995. Earnings per share were $.48
for the third quarter, up 14.3% from $.42 per share for September 30, 1995.
Profitability as measured by the Company's annualized return on average
assets (ROA) declined at 1.56% for the nine month period ended September 30,
1996, down from 1.67% for the same period of 1995. Another key indicator of
performance, the annualized return on average equity (ROE) for the nine month
period ended September 30, 1996 was 12.14%, compared to 11.40% for the nine
month period ended September 30, 1995.
RESULTS OF OPERATIONS
Net Interest Income
Net interest income represents the principal source of earnings for the
Company. Net interest income equals the amount by which interest income exceeds
interest expense. Changes in the volume and mix of earning assets and
interest-bearing liabilities, as well as their respective yields and rates, have
a significant impact on the level of net interest income.
Net interest income for the nine month period ended September 30, 1996
was $7.80 million, up $1,070,000, or 15.9% from $6.73 million for the nine month
period ended September 30, 1995. Interest income increased $2.20 million, or
19.4%, while interest expense increased $1.13 million, 24.4%, in comparing the
nine months ended September 30, 1996 to the same period of 1995.
Net interest income for the three months ended September 30, 1996 was
$2.71 million, up $361,000, or 15.3% from $2.35 million for the same three
months of 1995. Interest income increased $467,000, or 11.2%, while interest
expense increased $106,000, or 5.8% in comparing the third quarter of 1996 to
the same period of 1995.
The net interest increase shown when comparing September 30, 1996 to
the same period of 1995 is a result of a greater increase in earning assets than
interest-bearing liabilities during 1996. The largest increase in earning assets
is reflected in the net loan category.
Noninterest Income
Non-interest income increased $3.2 million, or 382.7% for the nine
month period ended September 30, 1996 over the same period of 1995. Non-interest
income increased $1.2 million, or 396.8% when comparing three months ended
September 30, 1996 to the same period of 1995. The majority of this increase is
attributed to income generated from the sale of mortgage loans by C&F Mortgage
Corporation, a subsidiary of the Company. C&F Mortgage Corporation began
originating and selling residential mortgages on December 1, 1995. Income from
the sale of loans was $2.7 million for the first nine months of 1996. Other
service charges, commissions, and fees increased $477,000, or 233.8% comparing
September 30, 1996 year-to-date to the same period of 1995. This increase shows
steady growth in other sources of non-interest income, including title insurance
fees from C&F Title Agency, Inc. and income generated from C&F Investment
Services, Inc.
Noninterest Expense
Non-interest expense increased $3.9 million, or 91.9%, for the nine
month period ended September 30, 1996 over the same period of 1995. A similar
increase of 87.8% is reflected when comparing the three month period ended
September 30, 1996 to the same period of 1995. The increase in non-interest
expense when comparing the two periods is attributed to overall growth of the
Company. In April, 1995 the subsidiary C&F Investment Services, Inc. was
organized to offer full-service brokerage services, and the Company opened a
Citizens and Farmers Bank branch in Varina, Virginia. In June, 1995 the Bank
acquired two additional branches in Middlesex and Tappahannock, Virginia. C&F
Mortgage Corporation, a subsidiary of Bank, was organized in September, and
opened for business on December 1, 1995, to originate and sell residential
mortgages. In February, 1996 the deposit liabilities of a West Point, Virginia
branch were acquired. The growth of the Company increased salaries and employee
benefits by $2.9 million, or 127.1% when comparing the first nine months of 1996
to the same period of 1995. Also, related to the recent growth, occupancy
expenses increased $576,000, or 80.4% when comparing September 30, 1996
year-to-date to September 30, 1995.
Income Taxes
Income tax expense for the period ended September 30, 1996 amounted
to $681,000, compared to $774,000 for September 30, 1995.
Asset Quality-Allowance /Provision For Loan Losses
The allowance is to provide for potential losses inherent in the loan
portfolio. Among other factors, management considers the Company's historical
loss experience, the size and composition of the loan portfolio, the value and
adequacy of collateral and guarantors, non-performing credits, and current and
anticipated economic conditions. There are additional risks of future loan
losses which cannot be precisely quantified or attributed to particular loans or
classes of loans. Since those risks include general economic trends as well as
conditions affecting individual borrowers, the allowance for loan losses is an
estimate. The allowance is also subject to regulatory examinations and
determination as to adequacy, which may take into account such factors as the
methodology used to calculate the allowance and the size of the allowance in
comparison to peer banks identified by regulatory agencies.
The Company had no provision expense for the first nine months of 1996
or 1995. Loans charged off amounted to $12,000 in the nine month period ended
September 30, 1996 and $8,000 for the same period of 1995. Recoveries amounted
to $8,000 and $25,000 in the nine month period ended September 30, 1996 and
1995, respectively. The ratio of net charge-offs to average outstanding loans
was .003% for September 30, 1996. The allowance for loan losses was $1.9 million
at September 30, 1996 and September 30, 1995. The allowance approximates 1.4%
and 1.8% of total loans outstanding at September 30, 1996 and 1995,
respectively. Management felt that the reserve was adequate to absorb any losses
on existing loans which may become uncollectible.
Nonperforming Assets
Total non-performing assets, which consist of the Company's non-accrual
loans was $501,000 at September 30, 1996, a decrease of $406,000 from December
31, 1995. Despite the fact that the Company has more non-performing loans than
desired, management believes that losses will be minimal. It is expected that
non-accruing loans will continue to be reduced in 1996.
The Company places a loan on non-accrual status when management
believes, after considering economic and business conditions and collection
efforts, that the borrower's financial condition is such that collection of both
principal and interact is doubtful. Corporate policy is to place loans on
non-accrual status if principal or interest is past due for 90 days or more
unless the debt is both well secured and in the process of being collected.
FINANCIAL CONDITION
Summary
A financial institution's primary sources of revenue are generated by
its earning assets, while its major expenses are produced by the funding of
those assets with interest-bearing liabilities. Effective management of these
sources and uses of funds is essential in attaining a financial institution's
maximum profitability while maintaining a minimum amount of risk.
At September 30, 1996, the Company had total assets of $252.3 million,
up 5.5% from $239.1 million over year-end 1995. The asset growth is attributed
to the continuous expansion and growth of the Company.
Loan Portfolio
At September 30, 1996, loans held for sale amounted to $9.8 million, an
increase over the $1.9 million held at December 31, 1995. In December of 1995,
C&F Mortgage Corporation was newly formed and had not had time to originate many
loans. At September 30, 1996, the Bank's loans net of unearned income and
reserve for loan losses, totals $131.6 million, an increase of 19.6% over the
1995 year-end total of $110.0 million.
The Company's lending activities are a principal source of income. All
loans are attributable to domestic operations. Residential real estate loans,
both construction and permanent, represent the major portion of the Company's
loan portfolio.
Investment Securities
The investment securities portfolio plays a primary role in the
management of interest rate sensitivity of the Company and generates substantial
interest income. In addition, the portfolio serves as a source of liquidity and
is used as needed to meet collateral requirements.
The securities portfolio consists of two components, investment
securities held to maturity and securities available for sale. Securities are
classified as investment securities based on management's intent and the
Company's ability, at the time of purchase, to hold such securities to maturity.
These securities are carried at amortized cost. Securities which may be sold in
response to changes in market interest rates, changes in the securities'
prepayment risk, increases in loan demand, general liquidity needs, and other
similar factors are classified as available for sale and are carried at
estimated fair value.
At September 30, 1996, total investment securities were $87.1 million
compared to $100.6 for December 31, 1995. This decrease is a result of
securities not being reinvested as they mature. Securities of U.S. Government
agencies and corporations represent 47.4% of the total securities portfolio,
obligations of state and political subdivisions were 43.9%, U.S. Treasury
securities were 3.4%, investment-grade corporate bonds totaled .3% and preferred
stocks were 5% at September 30, 1996.
Deposits
The Company's predominate source of funds is depository accounts. The
Company's deposit base is comprised of demand deposits, savings and money market
accounts, and time deposits. The Company's deposits are provided by individuals
and businesses located within the communities served.
Deposits totaled $208.6 million at September 30, 1996 compared to
$204.0 at December 31, 1995. The Company assumed deposit liabilities of $7.8
million in a branch acquisition in February 1996. Not including the acquisition
deposits, the Company shows a decrease in deposits of $3.2 million or 1.6%.
Liquidity
Liquidity represents an institution's ability to meet present and
future financial obligations through either the sale or maturity of existing
assets or the acquisition of additional funds through liability management.
Liquid assets include cash, interest bearing deposits with banks, federal funds
sold, investments and loans maturing within one year. The Company's ability to
obtain deposits and purchase funds at favorable rates determines its liability
liquidity. As a result of the Company's management of liquid assets and the
ability to generate liquidity through liability funding, management believes
that the Company maintains overall liquidity which is sufficient to satisfy its
depositors' requirements and to meet customers' credit needs.
At September 30, 1996, cash, securities classified as available for
sale and interest-bearing deposits were 8.1% of total earning assets. Asset
liquidity is also provided by managing the investment maturities.
Additional resources of liquidity available to the Company include its
subsidiary bank's capacity to borrow additional funds through an established
federal funds line with a regional correspondent bank.
Capital Resources
The assessment of capital adequacy depends on a number of factors such as
asset quality, liquidity, earnings performance, and changing competitive
conditions and economic forces. The adequacy of the Company's capital is
reviewed by management on an ongoing basis. Management seeks to maintain a
capital structure that will assure an adequate level of capital to support
anticipated asset growth and to absorb potential losses.
The Company's capital position continues to exceed regulatory
requirements. The primary indicators relied on by bank regulators in measuring
the capital position are the Tier I capital, total risk-based capital, and
leverage ratios. Tier I capital consist of common and qualifying preferred
shareholders' equity less goodwill. Total capital consist of Tier I risk-based
capital, qualifying subordinated debt, and a portion of the allowance for loan
losses. Risk-based capital ratios are calculated with reference to risk-weighted
assets. The Company's Tier I capital ratio was 22.86% at September 30, 1996,
compared to 23.87% at December 31, 1995. The total risk-based capital ratio was
24.11% at September 30, 1996 compared to 25.12% at December 31, 1995. These
ratios are in excess of the mandated minimum requirements.
Shareholders' equity reached $33.4 million at the end of the third quarter
of 1996 compared to $31.8 million at December 31, 1995. The leverage ratio
consists of Tier I capital divided by quarterly average assets. At September 31,
1996, the Company's leverage ratio was 12.2% compared to 12.4% at December 31,
1995. Each of these exceeds the required minimum leverage ratio of 3%. The
leverage ratio declined primarily due to asset growth outpacing shareholders'
equity growth.
New Accounting Pronouncements
SFAS No. 121 was issued in March, 1995, and requires that long-lived
assets and certain identifiable intangibles to be held and used by an entity are
to be reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable. This
pronouncement was effective for fiscal years beginning after December 15, 1995,
and its adoption has had no material effect on the Company's financial
statements.
SFAS No. 122, "Accounting for Mortgage Servicing Rights", was effective
for fiscal years beginning after December 15, 1995. This pronouncement specifies
how mortgage banking enterprises are to recognize rights to service mortgage
loans for others, however those servicing rights are acquired. The Company sells
substantially all loans originated by its mortgage corporation, the adoption of
this pronouncement has had no material effect on the Company's financial
statements.
In October, 1995, SFAS No. 123, "Accounting for Stock Based Compensation",
was issued and effective for fiscal years beginning after December 15, 1995.
SFAS No. 123 requires expanded disclosures of stock-based compensation
arrangements with employees and encourages (but does not require) compensation
cost to be measured based on the fair value of the equity instrument awarded.
Companies are permitted, however, to continue to apply APB Opinion No. 25, which
recognizes compensation cost based on the intrinsic value of the equity
instrument awarded. Management will continue to apply APB Opinion No. 25 to its
stock based compensation awards to employees. The adoption of SFAS No. 123 has
had no material effect on the Company's financial statements.
Effects of Inflation
The effect of changing prices and financial institutions is typically
different from other industries as the Company's assets and liabilities are
monetary in nature. Interest rates are significantly impacted by inflation, but
neither the timing nor the magnitude of the changes are directly related to
price level indices. Impacts of inflation on interest rates, loan demands, and
deposits are reflected in the consolidated financial statements.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company is
a party or of which the property of the Company is subject.
ITEM 5 - OTHER INFORMATION
Between October 16 and October 25, 1996, the Company repurchased a
total of 119,803 shares of Company common stock from three shareholders in three
independently negotiated transactions at a price of $17.75 per share, below the
present trading price. Management believes this was a unique opportunity to
reduce the outstanding common stock of the Company at a price per share that is
favorable to remaining shareholders. As a result, the Company had a total of
2,113,041 shares of common stock outstanding as of October 31, 1996.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
The Company filed no report on Form 8-K for the quarter ended
September 30, 1996.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
C&F FINANCIAL CORPORATION
------------------------------------------
(Registrant)
Date November 12, 1996 /s/ Larry G. Dillon
------------------- -------------------------------------
Larry G. Dillon, President
and Chief Executive Officer
Date November 12, 1996 /s/ Brad E. Schwartz
------------------- -------------------------------------
Brad E. Schwartz, Treasurer
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 7,115
<INT-BEARING-DEPOSITS> 2,714
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 16,044
<INVESTMENTS-CARRYING> 71,042
<INVESTMENTS-MARKET> 71,178
<LOANS> 131,584
<ALLOWANCE> (1,910)
<TOTAL-ASSETS> 252,278
<DEPOSITS> 208,645
<SHORT-TERM> 0
<LIABILITIES-OTHER> 2,700
<LONG-TERM> 0
0
0
<COMMON> 2,233
<OTHER-SE> 1,301
<TOTAL-LIABILITIES-AND-EQUITY> 252,278
<INTEREST-LOAN> 8,879
<INTEREST-INVEST> 2,688
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 13,560
<INTEREST-DEPOSIT> 5,596
<INTEREST-EXPENSE> 5,757
<INTEREST-INCOME-NET> 7,803
<LOAN-LOSSES> 0
<SECURITIES-GAINS> (13)
<EXPENSE-OTHER> 8,230
<INCOME-PRETAX> 3,615
<INCOME-PRE-EXTRAORDINARY> 3,615
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,934
<EPS-PRIMARY> 1.31
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<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
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</TABLE>
