SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
OR
( ) TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File Number 0-23182
AMB Financial Corp.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 35-1905382
-------- ----------------
(State or other jurisdiction I.R.S. Employer
of incorporation or Identification
organization) Number
8230 Hohman Avenue, Munster, Indiana 46321-1578
- ------------------------------------ ----------
(Address of Principle executive offices) (Zip Code)
Registrant telephone number, include are code: (219) 836-5870
--------------
Check whether the issuer (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 [_]
As of April 27, 2000 there were 1,124,125 shares of the Registrant's common
stock issued and 642,729 shares outstanding.
Transitional Small Business Disclosure Format (check one) : Yes [_] No [X]
<PAGE>
AMB FINANCIAL CORP.
FORM 10-Q
TABLE OF CONTENTS
Part I. FINANCIAL INFORMATION Page
----
Item 1. Financial Statements
Consolidated Statements of Financial Condition at 3
March 31, 2000 (Unaudited) and December 31, 1999
Consolidated Statements of Earnings for the three
months ended March 31, 2000 and 1999
(unaudited) 4
Consolidated Statements of Changes in 5
Stockholders Equity, three months ended
March 31, 2000 (unaudited)
Consolidated Statements of Cash Flow for the
three months ended March 31, 2000 and 1999
(unaudited) 6
Notes to Unaudited Consolidated Financial Statements 7-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9-15
Part II. OTHER INFORMATION 16-17
Signatures 18
Index of Exhibits 19
Earnings Per Share Analysis (Exhibit 11) 20
Financial Data Schedule (Exhibit 27) 21
2
<PAGE>
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Financial Condition
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
---- ----
unaudited
<S> <C> <C>
Assets
Cash and amounts due from depository institutions 3,251,624 4,180,088
Interest-bearing deposits 4,314,212 1,277,649
------------------- -----------------
Total cash and cash equivalents 7,565,836 5,457,737
Investment securities, available for sale, at fair value 5,035,485 5,352,142
Trading securities 1,926,775 1,909,333
Mortgage backed securities, available for sale, at fair value 2,404,970 1,868,001
Loans receivable (net of allowance for loan losses:
$617,889 at March 31, 2000 and
$590,701 at December 31, 1999) 105,114,054 105,909,909
Investment in LTD Partnership 1,305,332 1,327,000
Real Estate Owned 0 0
Stock in Federal Home Loan Bank of Indianapolis 1,383,500 1,383,500
Accrued interest receivable 684,057 642,111
Office properties and equipment- net 496,307 399,867
Prepaid expenses and other assets 3,715,501 3,536,270
------------------- -----------------
Total assets 129,631,817 127,785,870
=================== =================
Liabilities and Stockholders' Equity
Liabilities
Deposits 90,921,784 88,944,925
Borrowed money 24,675,589 24,675,589
Notes Payable 1,333,324 1,333,324
Advance payments by borrowers for taxes and insurance 698,966 431,675
Other liabilities 1,054,772 861,087
------------------- -----------------
Total liabilities 118,684,435 116,246,601
------------------- -----------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Stockholders' Equity
Preferred stock, $.01 par value; authorized
100,000 shares; none outstanding
Common Stock, $.01 par value; authorized 1,900,000 shares;
1,124,125 shares issued and 649,529 shares outstanding
at March 31, 2000 and 703,329 shares at December 31, 1999 11,241 11,241
Additional paid-in capital 10,805,874 10,798,674
Retained earnings, substantially restricted 7,905,294 7,780,655
Accumulated other comprehensive income, net of income taxes (90,354) (79,763)
Treasury stock, at cost (474,596 shares at March 31,2000
and 420,796 shares at December 31, 1999) (6,961,765) (6,219,684)
Common stock acquired by Employee Stock Ownership Plan (539,580) (539,580)
Common stock awarded by Recognition and Retention Plan (183,328) (212,274)
------------------- -----------------
Total stockholders' equity 10,947,382 11,539,269
------------------- -----------------
Total liabilities and stockholders' equity 129,631,817 127,785,870
=================== =================
</TABLE>
3
<PAGE>
AMB FINANCIAL CORP.
AND SUBIDIARIES
Consolidated Statements of Earnings
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
March 31, March 31,
---------------- -----------------
2000 1999
---- ----
unaudited unaudited
<S> <C> <C>
Interest income
Loans 2,007,176 1,762,986
Mortgage-backed securities 34,504 42,314
Investment securities 83,218 92,240
Interest-bearing deposits 26,308 71,695
Dividends on FHLB stock 27,519 26,318
---------- ----------
Total interest income 2,178,725 1,995,553
---------- ----------
Interest expense
Deposits 984,588 872,777
Borrowings 358,146 304,588
---------- ----------
Total interest expense 1,342,734 1,177,365
---------- ----------
Net interest income before
provision for loan losses 835,991 818,188
Provision for loan losses 31,813 31,903
---------- ----------
Net interest income after
provision for loan losses 804,178 786,285
---------- ----------
Non-interest income:
Loan fees and service charges 20,354 33,031
Commission income 7,569 8,425
Deposit related fees 80,985 71,592
Loss on sale of investment
securities available for sale (7,246) --
Gain on sale of trading securities
Unrealized gain (loss) on trading
securities 17,442 (4,365)
Gain (loss) on sale
of real estate owned -- 9,904
Loss from investment
in joint venture (21,668) (3,154)
Loss from disposition of fixed assets (7,822) --
Other income 45,205 42,643
---------- ----------
Total non-interest income 134,819 158,076
---------- ----------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Non-interest expense:
Staffing costs 382,491 350,888
Advertising 14,161 17,100
Occupancy and equipment expense 83,498 75,044
Data processing 98,925 101,684
Federal deposit insurance premiums 4,362 11,753
Other operating expenses 138,212 146,731
---------- ----------
Total non-interest expense 721,649 703,200
---------- ----------
Net income (loss) before income taxes 217,348 241,161
Provision for (benefit from)
federal and state income taxes 43,303 87,929
---------- ----------
Net income (loss) 174,045 153,232
========== ==========
Earnings per share- basic $ 0.28 $ 0.19
Earnings per share- diluted $ 0.28 $ 0.19
</TABLE>
See accompanying notes to Consolidated Financial Statements.
4
<PAGE>
AMB FINANCIAL CORP.
AND SUBIDIARIES
Consolidated Statements of Changes in Stockholders' Equity
(Unaudited)
<TABLE>
<CAPTION>
Accumulated Common Common
Additional Other Stock Stock
Common Paid-in Retained Comprehensive Treasury Acquired Awarded
Stock Capital Earnings Income Stock by ESOP by RRP
--------- ------------ ----------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1999 $ 11,241 10,798,674 7,780,655 (79,763) (6,219,684) (539,580) (212,274)
Comprehensive income:
Net income 174,045
Other comprehensive income,
net of income taxes:
Unrealized holding (loss)
during the period (11,313)
Less: Reclassification
adjustment of gains
included in net income 722
----------- -----------
Total comprehensive income 174,045 (10,591)
Purchase of treasury stock (53,800 shares) (742,081)
Amortization of award of
RRP stock 28,946
ESOP compensation adjustment 7,200
Dividends declared on
common stock ($.08 per share) (49,406)
--------- -------------- ----------- ----------- ----------- ---------- ------------
Balance at March 31, 2000 $ 11,241 10,805,874 7,905,294 (90,354) (6,219,684) (539,580) (183,328)
========= ============== =========== =========== =========== ========== ============
</TABLE>
See accompanying notes to consolidated financial statements
<PAGE>
<TABLE>
<CAPTION>
Total
----------------
<S> <C>
Balance at December 31, 1999 11,539,269
Comprehensive income:
Net income 174,045
Other comprehensive income,
net of income taxes:
Unrealized holding (loss)
during the period (11,313)
Less: Reclassification
adjustment of gains
included in net income 722
----------------
Total comprehensive income 163,454
Purchase of treasury stock (53,800 shares) (742,081)
Amortization of award of
RRP stock 28,946
ESOP compensation adjustment 7,200
Dividends declared on
common stock ($.08 per share) (49,406)
----------------
Balance at March 31, 2000 10,947,382
================
</TABLE>
See accompanying notes to consolidated financial statements
5
<PAGE>
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
Three Months Ending March 31,
---------------------------------
2000 1999
---------------------------------
(unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income $ 174,045 153,232
Items not requiring (providing) cash.
Depreciation 37,123 32,074
Amortization of cost of stock benefit plans 28,946 28,946
Amoritization of premiums and accretion of discounts 8,031 7,852
Provision for loan losses 31,813 31,903
Increase in deferred compensation 20,694 19,092
ESOP compensation 7,200 4,500
Loss on sale of investment securities
available for sale 7,246
Unrealized (gain) loss on trading account securities (17,442) 4,365
Loss from limited partnership 21,668 3,154
Loss on disposal of fixed assets 7,822
Gain on sale of real estate owned (9,904)
Increase (decrease) in deferred income on loans 4,616 (7,072)
Increase in accrued interest receivable (41,946) (16,140)
Increase in accrued interest payable 19,667 27,391
Change in current and deferred income taxes 18,303 50,390
Other, net (42,351) (160,631)
------------- -----------------
Net cash provided by operating activities 285,435 169,152
------------- -----------------
Cash flows from investing activities:
Proceeds from sales of investment securities 302,156
Purchase of investment securities (1,850) (1,478)
Proceeds from repayments of mortgage-backed
securities 80,763 202,085
Proceeds from sale of mortgage-backed securities 361,625
Purchase of mortgage-backed securities (995,936)
Purchase of loans (687,500) (5,452,397)
Loan disbursements (3,613,023) (5,790,830)
Loan repayments 5,064,574 9,244,067
Proceeds from sa le of real estate owned 33,273
Property and equipment expenditures (140,809) (23,625)
------------- -----------------
Net cash provided by (for) investing activities 370,000 (1,788,905)
------------- -----------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Cash flows from financing activities:
Deposit account receipts 41,036,098 36,094,258
Deposit account withdrawals (39,874,909) (33,773,183)
Interest credited to deposit accounts 815,670 612,939
Increase in advance payments by borrowers
for taxes and insurance 267,291 147,668
Purchase of treasury stock (742,081)
Dividends paid on common stock (49,406) (64,550)
------------- -----------------
Net cash provided by financing activities 1,452,663 3,017,132
------------- -----------------
Net change in cash and cash equivalents 2,108,098 1,397,379
Cash and cash equivalents at beginning of period 5,457,738 9,097,416
------------- -----------------
Cash and cash equivalents at end of period $ 7,565,836 10,494,795
============= =================
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 1,323,067 1,149,974
Income taxes 25,000 37,539
Non-cash investing activities:
Transfer of loans to real estate owned -- --
See notes to consolidated financial statements.
</TABLE>
6
<PAGE>
Notes to Consolidated Financial Statements
1. Statement of Information Furnished
The accompanying unaudited consolidated financial statements have been
prepared in accordance with Form 10-Q instructions and Article 10 of
Regulation S-X, and in the opinion of management contains all
adjustments (all of which are normal and recurring in nature) necessary
to present fairly the financial position as of March 31, 2000, the
results of operations for the three months ended March 31, 2000 and 1999
and cash flows for the three months ended March 31, 2000 and 1999. These
results have been determined on the basis of generally accepted
accounting principles. The preparation of financial statements in
conformity with generally accepted principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosures of contingent assets and
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. The attached consolidated
statements are those of AMB Financial Corp. (the "Holding Company") and
its consolidated subsidiaries American Savings, FSB (the "Bank"), the
Bank's wholly owned subsidiary NIFCO, Inc., and the wholly owned
subsidiary of NIFCO, Inc., Ridge Management, Inc. The results of
operations for the three month period ended March 31, 2000 is not
necessarily indicative of the results to be expected for the full year.
2. Mutual to Stock Conversion
In December 1995, the Bank's Board of Directors approved a Plan of
Conversion (the "Conversion"), providing for the Bank's conversion from
a federally chartered mutual savings to a federally chartered stock
savings bank with the concurrent formation of a holding company. The
Holding Company issued 1,124,125 shares of $.01 par value common stock
at $10.00 per share, for an aggregate price of $11,241,250. The
Conversion and sale of 1,124,125 shares of common stock of the Holding
Company was completed on March 29, 1996. Net proceeds to the Company,
after conversion expenses, totaled approximately $10,658,000.
3. Earnings Per Share
Earnings per share for the three month periods ended March 31, 2000 and
1999 were determined by dividing net income for the periods by the
weighted average number of both basic and diluted shares of common stock
and common stock equivalents outstanding (see Exhibit 11 attached).
Stock options are regarded as common stock equivalents and are
considered in diluted earnings per share calculations. Common stock
equivalents are computed using the treasury stock method. ESOP shares
7
<PAGE>
not committed to be released to participants are not considered
outstanding for purposes of computing earnings per share amounts.
4. Industry Segments
The Company operates principally in the banking industry through its
subsidiary bank. As such, substantially all of the Company's revenues,
net income, identifiable assets and capital expenditures are related to
banking operations.
5. Impact of New Accounting Standards
In June 1998, the FASB issued Statement of Financial Accounting
Standards No. 133 ("SFAS 133"), entitled "Accounting for Derivative
Instruments and Hedging Activities", which is effective for fiscal years
beginning after June 15, 1999. SFAS 133 requires all derivatives to be
recorded on the balance sheet at fair value. It also establishes
"special accounting" for hedges of changes in the fair value of assets,
liabilities, or firm commitments (fair value hedges), hedges of the
variable cash flows of forecasted transactions (cash flow hedges), and
hedges of foreign currency exposures of net investments in foreign
operations. To the extent the hedge is considered highly effective, both
the change in the fair value of the derivative and the change in the
fair value of the hedged item are recognized (offset) in earnings in the
same period. Changes in fair value of derivatives that do not meet the
criteria of one of these three hedge categories are included in income.
In September 1999, the FASB issued Statement of Financial Accounting
Standards No. 137 ("SFAS 137"), entitled "Accounting for Derivative
Instruments in Hedging Activities - Deferral of the Effective Date of
FASB Statements no. 133". SFAS 137 defers the effective date of SFAS 133
from years beginning after June 15, 1999 to all fiscal quarters of
fiscal years beginning after June 15, 2000. Management does not believe
that adoption of SFAS 133 will have a material impact on the Company's
consolidated financial condition or results of operations.
The foregoing does not constitute a comprehensive summary of all
material changes or development affecting the manner in which the
Company keeps its books and records and performs its financial
accounting responsibilities. It is intended only as a summary of some of
the recent pronouncements made by the FASB, which are of particular
interest to financial institutions.
8
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations
FINANCIAL CONDITION
March 31, 2000 compared to December 31, 1999
Total assets of the Company increased $1.8 million to $129.6 million at
March 31, 2000 compared to $127.8 million at December 31, 1999. While
the Company intends to grow the balance sheet, management expects that
the recent rise in interest rates and anticipated future tightening
actions by the Federal Reserve may slow housing market activity. This,
in turn, wills likely lead to more moderate balance sheet growth than
was expected.
Cash and cash equivalents increased by $2.1 million to $7.6 million at
March 31, 2000. The Company has accumulated additional short-term funds
to be utilized for either near term loan production or investment, or
possibly to reduce upcoming maturing borrowed money. The increase in the
Company's cash position was primarily funded by an increase in deposits
in the amount of $2.0 million to $90.9 million at March 31, 2000.
Investment securities available for sale decreased $317,000 to $5.0
million at March 31, 2000. The decrease is primarily due to the sale of
$300,000 short-term U.S. Treasury, which was reinvested, in
mortgage-backed securities. Gross unrealized losses in the available for
sale portfolio were $151,000 at March 31, 2000, compared to gross
unrealized losses of $133,000 at December 31, 1999.
Mortgage-backed securities available for sale increased $537,000 to $2.4
million at March 31, 2000. The increase is primarily due to purchases of
$998,000 of fixed rate GNMA securities offset by prepayments and
amortization of $80,000 and sales of $362,000.
Loans receivable decreased $900,000 to $105.1 million at March 31, 2000,
as loan a repayments totaling $5.1 million, exceeded loan originations
of both residential and non-residential loans of $3.6 million and loan
purchases of $687,000. The Company continues to remain focused on an
aggressive lending effort; however, recent higher interest rates have
curtailed the production of longer fixed rate mortgage loans.
Total deposits at March 31, 2000 increased by $2.0 million, or 2.25% to
$90.9 million, due to net deposit receipts of $1.2 million and interest
credited of $800,000. The deposit growth was primarily attributable to
the Company's continued aggressive advertising and competitive rates
with regards to a special 14 month certificate promotion.
9
<PAGE>
Total stockholders' equity decreased $592,000 to $10.9 million at March
31, 2000 from $11.5 million at December 31, 1999. This decrease was
primarily due to the repurchases of common stock in the amount of
$742,000, the payment of dividends on common stock of $49,000 and an
increase of $11,000 in the unrealized loss on securities available for
sale, which was offset by net income of $174,000 and normal amortization
of RRP and ESOP benefits of $36,000. The Company is no longer subject to
regulatory limitations on stock repurchases and intends to continue
modest repurchases of stock.
Results of Operations
The Company's results of operations depend primarily upon the level of
net income, which is the difference between the interest income earned
on its interest-earning assets such as loans and investments, and the
costs of the Company's interest-bearing liabilities, primarily deposits
and borrowings. Net interest income depends upon the volume of
interest-earning assets and interest-bearing liabilities and the
interest rate earned or paid on them, respectively. Results of
operations are also dependent upon the level of the Company's
non-interest income, including fee income and service charges, and
affected by the level of its non-interest expenses, including its
general and administrative expenses.
Comparison of Operating Results for the Quarters
Ended March 31, 2000 and 1999
Net Income
The Company's net income for the three months ended March 31, 2000
increased $21,000 to $174,000, as compared to a $153,000 profit for the
same period in 1999. This increase was due to an increase in net
interest income of $18,000 and a reduction in current period income
taxes of $45,000, offset by a decline in non-interest income of $23,000,
an increase in non-interest expense of $19,000.
Interest Income
Total interest income increased $183,000 or 9.18%, for the three months
ended March 31, 2000 compared to the prior year's quarter. This increase
is chiefly due to the higher volume of interest-earning assets of $9.5
million and to a lesser extent, to an increase in the average yield on
interest-earning assets of three basis points to 7.34%. Interest income on
loans receivable increased by $244,000 for the three months ended March
31, 2000 to $2.0 million and is attributable to the higher yield on loan
receivable which reflects the Company's aggressive lending efforts. During
the quarter ended March 31, 2000, the average yield on loans receivable
decreased to 7.61% from 7.81% during the prior year's quarter. The yield
10
<PAGE>
on average loans receivables has been steadily falling and reflects the
effects of the lower long-term interest rate environment experienced
over the last several years. Although interest rates increased during
the latter half of 1999, the average yield on loans receivables
continues to fall due primarily to the lower-yielding fixed-rate loans
added to the Bank's portfolio during the last several years during the
middle of 1999.
Interest Expense.
Total interest expense increased $166,000 or 14%, for the three months
ended March 31, 2000 compared to the prior year's quarter. The increase
was due primarily to an increase of $12.5 million in the average balance
of both deposits and borrowings and a seven basis point increase in the
average rate paid on deposits and borrowings. Upward repricing on
certificates of deposit accounts began during the latter half of 1999
and will likely lead to an increase in the Bank's cost of deposits in
the near-term.
Provision for Loan Losses.
The determination of the allowance for loan losses involves material
estimates that are susceptible to significant change in the near term.
The allowance for loan losses is maintained at a level deemed adequate
to provide for losses through charges to operating expense. The
allowance is based upon past loss experience and other factors, which,
in management's judgement, deserve current recognition in estimating
losses. Such other factors considered by management include growth and
composition of the loan portfolio, the relationship of the allowance for
losses to outstanding loans, and economic conditions.
A provision for loan losses of $32,000 was recorded during the three
months ended March 31, 2000 compared to $32,000 for the same quarter a
year ago. The provision for losses on loans was due to growth in loans
receivable. Net charge-offs during the current quarter amounted to
approximately $5,000 and relate primarily to credit card receivables.
Non-performing loans at March 31, 2000 amounted to $713,000 or .68% of
net loans receivable as compared to $929,000 or .88% of net loans
receivable at December 31, 1999. The general allowance for loan losses
at March 31, 2000 of $578,000 represents 81.05% of non-performing loans.
The Bank will continue to review its allowance for loan losses and make
future provisions as economic and regulatory conditions dictate.
Although the Bank maintains its allowance for loan losses at a level
that it considers adequate to provide for losses, there can be no
assurance that future losses will not exceed estimated amounts or that
additional provisions for loan losses will not be required in future
periods.
11
<PAGE>
Non-Interest Income
The Company's non-interest income declined during the quarter by $23,000
to $135,000 from $158,000 in the same quarter last year. The decrease in
non-interest is attributable in part to an increase loss of $19,000
related to an investment in a low-income housing joint venture. Loan
fees and service charges declined by $13,000 during the quarter as a
result of lower loan origination activity, primarily due to the recent
increase in interest rates. Also, during the first quarter of 2000, the
Company sold available for sale investment securities and recorded a
loss from the sale of $7,000. These declines in non-interest income were
offset by an increase in unrealized gains on trading securities. The
Company's trading portfolio, which consists of holdings in community
bank and thrift stocks, reported an unrealized gain during the first
quarter of $17,000 as compared to an unrealized loss of $4,000 reported
in the year ago quarter.
Non-Interest Expense.
The Company's non-interest expense increased $19,000, to $722,000 in the
2000 quarter from $703,000 in the prior year's quarter. The increase is
attributable to increases in compensation and benefits of $31,000 and
occupancy and equipment expenses of $8,000. The increase in staffing
costs is primarily due to new hirings and increased benefit costs. The
increase in occupancy costs is directly related to increased
depreciation and maintenance charges.
Provision for Income Taxes.
The provision for income taxes decreased by $45,000 to $43,000 for the
three months ended March 31, 2000 as compared to $88,000 in the prior
year's quarter. This decrease was attributable to the recognition of
$35,000 in low-income housing tax credit provided through an investment
in limited partnership organized to build, own and operate a 56 unit low
income housing apartment complex.
Liquidity and Capital Resources
The Company's principal sources of funds are deposits, proceeds from
principal and interest payments on loans (including mortgage-backed
securities), sales or maturities of investment securities, advances from
the FHLB of Indianapolis and income from operations. While scheduled
loan repayments and maturing investments are relatively predictable,
deposit flows and early loan repayments are more influenced by interest
rates, floors and caps on loan rates, general economic conditions and
competition. The primary business activity of the Company, that of
making conventional mortgage loans on residential housing, is likewise
affected by economic conditions.
12
<PAGE>
Current Office of Thrift Supervision regulations require the Bank to
maintain cash and eligible investments in an amount equal to at least 4%
of short-term customer accounts and borrowings to assure its ability to
meet demands for withdrawals and repayment of short-term borrowings.
Liquid assets for purposes of this ratio include cash, certain time
deposits, U.S. Government, government agency and corporate securities
and other obligations generally having remaining maturities of less than
five years. The Bank has historically maintained its liquidity ratio for
regulatory purposes at levels in excess of those required. At March 31,
2000, the Bank's liquidity ratio for regulatory purposes was 12.47%.
The Company's most liquid assets are cash and cash equivalents, which
consist of interest-bearing deposits and short-term highly liquid
investments with original maturities of less than three months that are
readily convertible to known amounts of cash. The level of these is
dependent on the Company's operating, financing and investing activities
during any given period. At March 31, 2000 and December 31, 1999 cash
and cash equivalents totaled $7.6 million and $5.5 million respectively.
Liquidity management for the Company is both a daily and long-term
function of the Company's management strategy. Excess funds are
generally invested in short-term investments, such as overnight
deposits. If the Company requires funds beyond its ability to generate
them internally, additional funds are available through FHLB advances.
The Company anticipates that it will have sufficient funds available to
meet current commitments. At March 31, 2000 the Company has outstanding
loan commitments totaling $588,000 and unused lines of credit granted
totaling $4.7 million.
Federally insured savings associations, such as the Bank, are required
to maintain a minimum level of regulatory capital. The OTS has
established capital standards, including leverage ratio (or core
capital) requirement and a risk-based capital requirement applicable to
such savings associations. These capital requirements must be generally
as stringent as the comparable capital requirements for national banks.
The OTS is also authorized to impose capital requirements in excess of
these standards on individual associations on a case-by-case basis.
At March 31, 2000, the Bank had core capital equal to $8.3 million, or
6.57% of adjusted total assets, which was $4.5 million above the minimum
leverage ratio requirement of 3% in effect on that date. The Bank had
total capital of $8.9 million (including $8.3 million in core capital
and $600,000 in qualifying supplementary capital) and risk-weighted
assets of $69.8 million at March 31, 2000; or total risk-based capital
of 12.68% of risk-weighted assets at March 31, 2000. This amount was
$3.3 million above the 8% requirement in effect on that date.
13
<PAGE>
Non-Performing Assets
The following table sets forth the amounts and categories of
non-performing assets in the Company's portfolio. Loans are reviewed
monthly and loan whose collectibility is doubtful is placed on
non-accrual status. Loans are placed on non-accrual status when
principal and interest is 90 days or more past due, unless, in the
judgement of management, the loan is well collateralized and in the
process of collection. Interest accrued and unpaid at the time a loan is
placed on non-accrual status is charged against interest income.
Subsequent payments are either applied to the outstanding principal
balance or recorded as interest income, depending on the assessment of
the ultimate collectibility of the loan. Restructured loans include
troubled debt restructuring (which involved forgiving a portion of
interest principal on any loans or making loans at a rate materially
less than the market).
March 31, December 31,
2000 1999
----------------- ------------------
(Dollars in thousands)
Non- accruing loans:
One to four family 214 289
Multi- family --- ---
Non- residential --- ---
Construction 487 479
Consumer 12 161
----------------- ------------------
Total 713 929
----------------- ------------------
Foreclosed assets:
One to four family --- ---
Multi-family --- ---
Non-residential --- ---
Construction --- ---
Consumer --- ---
----------------- ------------------
Total 0 0
----------------- ------------------
Total non- performing assets 713 929
================= ==================
Total as a percentage of total assets 0.55% 0.73%
================= ==================
14
<PAGE>
For the three months period ended March 31, 2000, gross interest, which
would have been recorded, had the non-accruing loans been current in
accordance with their original terms amounted to $15,000.
In addition to the non-performing assets set forth in the table above,
as of March 31, 2000, there were no loans with respect to which known
information about the possible credit problems of the borrowers or the
cash flows of the security properties have caused management to have
concerns as to the ability of the borrowers to comply with present loan
repayment terms and which may result in the future inclusion of such
items in the non-performing asset categories.
Management has considered the Company's non-performing and "of concern"
assets in establishing its allowance for loan losses.
15
<PAGE>
Recent Developments
.
On April 26, 2000 the Company declared a cash dividend of $.08 per share,
payable on May 19, 2000 to shareholders of record on May 5, 2000.
PART 11 - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
From time to time, the Bank is a party to legal
proceedings in the ordinary course of business,
wherein it enforces its security interest. The
Company and the Bank are not engaged in any legal
proceedings of a material nature at the present
time.
Item 2. CHANGES IN SECURITIES
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The Company held its Annual Meeting of Shareholders on April 26,
2000.
(b) The names of each director elected at the Annual Meeting for
three-year terms are as follows:
Clement B. Knapp, Jr.
Donald L. Harle
The names of the other directors whose terms of office continued after
the Annual Meeting, are as follows:
Ronald W. Borto
John C. McLaughlin
John G. Pastrick
Robert Tolley
16
<PAGE>
(c) In addition to the election of directors, the following matter was
voted upon
(i) Ratification of the appointment of Cobitz, VandenBerg &
Fennessy as the Company's independent auditors for the year
ending December 31, 2000:
For Against Abstain
--- ------- -------
500,093 27,830 1,700
Item 5. OTHER INFORMATION
Not applicable.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Computation of earnings per share (Exhibit 11 filed herewith)
(b) Financial Data Schedule (Exhibit 27 filed herewith)
(c) No reports on Form 8-K were filed this quarter
17
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 and 15 (d) of the
Securities and Exchange Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
AMB FINANCIAL CORP.
-------------------
Registrant
Date: April 27, 2000
By: Clement B. Knapp, Jr.
President and Chief Executive Officer
(Duly Authorized Representative)
By: Daniel T. Poludniak
Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
<PAGE>
INDEX TO EXHIBIT
Exhibit No. Page No.
----------- --------
11 Statement re: Computation of Earnings Per Share 19
27 Financial Data Schedule 20
EXHIBIT 11
STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE
Three Months Three Months
Ended Ended
March 31, 2000 March 31, 1999
-------------- --------------
Net Income (Loss) $ 174,045 153,232
============== ==============
Weighted average shares outstanding
for basic EPS computation 665,580 869,829
Reduction for common shares not yet
released by Employee Stock Ownership Plan (53,958) (62,951)
-------------- --------------
Total weighted average common shares
outstanding for basic computation 611,622 806,878
============== ==============
Basic earnings per share $0.28 $0.19
============== ==============
Total weighted average common shares
outstanding for basic computation 611,622 806,878
Common stock equivalents due to
dilutive effect of stock options 4,917 0
-------------- --------------
Total weighted average common shares and
equivalents outstanding for diluted
computation 616,539 806,878
============== ==============
Diluted earnings per share $0.28 $0.19
============== ==============
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS LEDGEND CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FORM 10-Q AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 3,251,624
<INT-BEARING-DEPOSITS> 4,314,212
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 1,926,775
<INVESTMENTS-HELD-FOR-SALE> 7,440,455
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 105,114,054
<ALLOWANCE> 617,889
<TOTAL-ASSETS> 129,631,817
<DEPOSITS> 90,921,784
<SHORT-TERM> 12,000,000
<LIABILITIES-OTHER> 1,753,738
<LONG-TERM> 14,008,913
0
0
<COMMON> 11,241
<OTHER-SE> 10,936,141
<TOTAL-LIABILITIES-AND-EQUITY> 129,631,817
<INTEREST-LOAN> 2,007,176
<INTEREST-INVEST> 171,549
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 2,178,725
<INTEREST-DEPOSIT> 984,588
<INTEREST-EXPENSE> 1,342,734
<INTEREST-INCOME-NET> 835,992
<LOAN-LOSSES> 31,813
<SECURITIES-GAINS> 10,196
<EXPENSE-OTHER> 721,649
<INCOME-PRETAX> 217,348
<INCOME-PRE-EXTRAORDINARY> 217,348
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 174,045
<EPS-BASIC> 0.28
<EPS-DILUTED> 0.28
<YIELD-ACTUAL> 2.82
<LOANS-NON> 713,000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 590,701
<CHARGE-OFFS> 4,625
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 617,889
<ALLOWANCE-DOMESTIC> 617,889
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
