SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934
For the quarterly period ended: October 31, 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: 0-25106
Lakeview Financial Corp.
------------------------
(Exact name of registrant as specified in its charter)
New Jersey 22-3334052
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1117 Main Street Paterson, New Jersey 07503
--------------------------------------------------
(Address of principal executive offices, zip code)
(201) 742-3060
----------------------------------------------------
(Registrant's telephone number, including area code)
NOT APPLICABLE
- --------------------------------------------------------------------------------
(Former name, former address, and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 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
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: October 31, 1996
----------------
Class Outstanding
- ---------------------------- ----------------
$2.00 par value common stock 2,486,643 shares
<PAGE>
LAKEVIEW FINANCIAL CORP. and SUBSIDIARIES
CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page
<S> <C> <C>
Item 1: Financial Statements
Unaudited Consolidated Statements of Financial Condition
as of October 31, 1996 and July 31, 1996 3
Unaudited Consolidated Statements of Income for the Three
Months Ended October 31, 1996 and 1995 4
Unaudited Consolidated Statements of Shareholders' Equity for the
Three Months Ended October 31, 1996 and 1995 5
Unaudited Consolidated Statements of Cash Flows for the Three
Months Ended October 31, 1996 and 1995 6
Notes to Unaudited Consolidated Financial Statements 8
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II - OTHER INFORMATION
Item 1: Legal Proceedings 14
Item 2: Changes in Securities 14
Item 3: Defaults Upon Senior Securities 14
Item 4: Submission of Matters to a Vote of Security Holders 14
Item 5: Other Information 14
Item 6: Exhibits and Reports on Form 8-K 14
Signatures 15
</TABLE>
2
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
- -----------------------------------------
CONSOLIDATED STATEMENTS OF CONDITION
AS OF OCTOBER 31 AND JULY 31, 1996
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
October 1996 July 1996
- ------------------------------------------------------------------------------------ ------------
Assets
<S> <C> <C>
Cash on hand and in banks $3,515,838 $6,902,040
Federal funds sold, net 0 0
- ------------------------------------------------------------------------------------ -------------
Total cash and cash equivalents 3,515,838 6,902,040
Investment securities held to maturity, net 40,828,497 40,821,195
Investment securities available for sale, net 97,757,990 89,967,424
Equity securities restricted for sale, market value of $31,159,800 and 7,806,358 7,806,358
$19,942,272 at October 31, and July 31,1996
Mortgage-backed securities held to maturity, net 117,066,467 121,461,936
Loans receivable, net 179,222,659 163,457,374
Real estate owned, net 1,754,500 1,666,533
Federal Home Loan Bank of New York stock, at cost 2,519,900 2,587,400
Accrued interest receivable, net 4,066,524 3,646,512
Office properties and equipment, net 4,149,460 4,182,639
Excess of cost over fair value of assets acquired 9,846,352 10,176,424
Other assets 4,163,314 5,184,150
- ------------------------------------------------------------------------------------ ------------
Total assets $472,697,859 $457,859,985
==================================================================================== =============
Liabilities and Shareholders' Equity
- ------------------------------------
Deposits $360,988,800 $354,246,770
Borrowings 57,500,000 54,000,000
Borrowings - (ESOP) obligation 687,054 721,429
Advance payments by borrowers for taxes and insurance 1,365,485 1,711,930
Other liabilities 3,741,473 1,420,175
- ------------------------------------------------------------------------------------ -------------
Total liabilities 424,282,812 412,100,304
Shareholders' Equity
- --------------------
Common stock: $2.00 par value; authorized 10,000,000
shares, issued 3,220,752 shares and outstanding
2,486,643 shares at October 31, 1996 6,441,504 5,856,152
Additional paid-in capital 32,603,456 26,186,633
Retained income substantially restricted 23,347,721 29,984,480
Unrealized gain (loss) on securities available for sale,
net of taxes 423,929 (1,884,921)
Treasury stock at cost (10,782,620) (10,655,120)
Common stock acquired by ESOP (2,270,895) (2,306,895)
Common stock acquired by MSBP (1,348,048) (1,420,648)
- ------------------------------------------------------------------------------------ -------------
Total shareholders' equity 48,415,047 45,759,681
- ------------------------------------------------------------------------------------ -------------
Total liabilities and shareholders' equity $472,697,859 $457,859,985
==================================================================================== =============
Stated book value per share $19.47 $18.36
Tangible book value per share $15.51 $14.28
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
- -----------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTH ENDED OCTOBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
- --------------------------------------------------------------------- ------------
(Unaudited) (Unaudited)
1996 1995
- --------------------------------------------------------------------- ------------
Interest income:
<S> <C> <C>
Loans receivable $3,763,828 $3,330,001
Mortgage-backed securities held to maturity 1,967,158 2,847,112
Investment securities held to maturity 841,367 1,220,787
Investment securities available for sale 1,485,717 84,795
- --------------------------------------------------------------------- ------------
Total interest income 8,058,070 7,482,695
Interest expense:
Interest on deposits 3,426,070 3,537,299
Interest on borrowings 782,461 541,046
- --------------------------------------------------------------------- ------------
Total interest expense 4,208,531 4,078,345
Net interest income before provision for loan losses 3,849,539 3,404,350
Provision for loan losses 105,000 184,285
- --------------------------------------------------------------------- ------------
Net interest income after provision for loan losses 3,744,539 3,220,065
Other Income:
Loan fees and service charges 272,468 271,021
Gain on sale of investments 764,050 526,275
Other operating income 577,439 170,877
- --------------------------------------------------------------------- ------------
Total other income 1,613,957 968,173
Other expense:
Employee compensation 1,252,992 1,111,133
Office occupancy 228,799 195,653
Loss from REO operation 19,561 306,153
Other operating expense (note 1) 2,969,922 705,331
Amortization of goodwill 330,072 330,072
- --------------------------------------------------------------------- ------------
Total other expense 4,801,346 2,648,342
Net income before taxes 557,150 1,539,896
Federal and state income taxes 211,000 519,000
- --------------------------------------------------------------------- ------------
Net Income $346,150 $1,020,896
===================================================================== ============
Net income per share $0.13 $0.38
Weighted average numbers of shares 2,570,907 2,671,044
</TABLE>
Note (1) Other expense, in 1996, includes a one time Federal Deposit Insurance
Corporation (FDIC) insurance assessment of $2,218,674, for the
quarter ended October 31, 1996.
4
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
- -----------------------------------------
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
FOR THE THREE MONTHS ENDED OCTOBER 31, 1996
<TABLE>
<CAPTION>
Net Unrealized
Unallocated Unallocated Loss On Total
Common Additional Retained Treasury Shares Shares Securities Shareholders'
Stock Paid-in Cap Income Stock of ESOP of MSBP Available For Sale Equity
---------- ----------- ----------- ----------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at July 31, 1996 $5,856,152 $26,186,633 $29,984,480 ($10,655,120) ($2,306,895) ($1,420,648) ($1,884,921) $45,759,681
Net income - - 346,150 - - - - 346,150
Change in unrealized loss on
securities available for sale,
met of tax - - - - - - 2,308,850 2,308,850
Amortization of ESOP shares - 93,635 - - 36,000 - - 129,635
Amortization of MSBP shares - 67,238 - - 72,600 - 139,838
Cash dividend distribution - - (141,607) - - - - (141,607)
Stock dividend 585,352 6,255,950 (6,841,302) - - - - -
Purchase of treasury stock - - - (127,500) - - - (127,500)
---------- ----------- ----------- ------------ ----------- ----------- ----------- -----------
Balance at October 31, 1996 $6,441,504 $32,603,456 $23,347,721 ($10,782,620) ($2,270,895) ($1,348,048) $423,929 $48,415,047
========== =========== =========== ============ =========== =========== =========== ===========
</TABLE>
5
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
- -----------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED OCTOBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
1996 1995
- -------------------------------------------------------------------------------------- ------------
Cash flows from operating activities:
<S> <C> <C>
Net Income $346,150 $1,020,896
Adjustment to reconcile net income to net cash provided
by operating activities :
Amortization of excess of cost over fair value of assets acquired 330,072 330,072
Amortization of discounts and premiums, net (136,054) (103,808)
Provision for losses on loans 105,000 184,285
Provision for losses on real estate owned 0 122,447
Gain on sale of loans (813) (4,715)
(Gain) loss on sale of real estate owned, net (25,700) 15,032
Net realized gains on sale of investments available for sale (764,050) (526,275)
Increase in accrued interest receivable (420,012) (637,887)
Decrease in deferred loan fees (15,893) (15,877)
Decrease in other assets 1,020,836 821,710
Increase (decrease) in other liabilities 1,023,698 (2,721,317)
Depreciation of office properties and equipment, net 74,157 71,170
- -------------------------------------------------------------------------------------- ------------
Net cash provided by (used in) operating activities: 1,537,391 (1,444,267)
Cash flows from investing activities:
Loan origination net of principal payments (15,977,407) (4,284,615)
Increase in Federal Home Loan Bank stock 67,500 0
Purchase of investment securities available for sale (15,897,555) (14,965,815)
Proceeds from sale of investment securities available for sale 12,035,141 6,545,027
Principal payments on investment securities available for sale 463,479 0
Purchase of investment securities 0 (15,300,000)
Proceeds from maturity of investment securities 0 6,796,117
Purchase of mortgage-backed securities 0 (2,773,214)
Principal payments on mortgage-backed securities 4,444,417 7,975,602
Proceeds from sale of real estate owned 120,233 251,520
Increase in office properties and equipment (40,978) (91,977)
- -------------------------------------------------------------------------------------- ------------
Net cash used in investing activities (14,785,170) (15,847,355)
</TABLE>
6
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
- -----------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
FOR THE THREE MONTHS ENDED OCTOBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
1996 1995
- -------------------------------------------------------------------------------------- ------------
Cash flows from financing activities:
<S> <C> <C>
Increase in deposits, net 6,742,031 3,462,406
Increase in borrowings, net 3,465,625 11,965,625
Decrease in advance payments by borrowers for taxes, net (346,445) (93,326)
Purchase of treasury stock (127,500) (1,497,188)
Amortization of ESOP shares 129,635 103,488
Amortization of MSBP shares 139,838 106,065
Dividend paid (141,607) (148,718)
- -------------------------------------------------------------------------------------- ------------
Net cash provided by financing activities 9,861,577 13,898,352
- -------------------------------------------------------------------------------------- ------------
Net change in cash and cash equivalents (3,386,202) (3,393,270)
Cash and cash equivalents at beginning of period 6,902,040 8,021,666
- -------------------------------------------------------------------------------------- ------------
Cash and cash equivalents at end of period $3,515,838 $4,628,396
====================================================================================== ============
Cash paid during period for:
Interest $3,426,070 $4,634,285
Income Taxes $0 $0
Supplemental disclosures of non-cash investing activities:
Transfer of loans receivable to real estate owned $182,500 $29,921
</TABLE>
7
<PAGE>
LAKEVIEW FINANCIAL CORP. and SUBSIDIARIES
Notes to Unaudited Consolidated Financial Statements
(1) Basis of Presentation
The consolidated financial statements include the accounts of Lakeview Financial
Corp. (the "Company"), its wholly owned subsidiaries, Lakeview Savings Bank (the
"Savings Bank"), Branchview, Inc., and its 90% owned subsidiary, Lakeview
Mortgage Depot, Inc. All significant intercompany balances and transactions have
been eliminated in consolidation.
These consolidated financial statements were prepared in accordance with
instructions for Form 10-Q and therefore, do not include all disclosures
necessary for a complete presentation of the statement of financial condition,
statement of operations, and statement of cash flows in conformity with
generally accepted accounting principles. However, all adjustments which are, in
the opinion of management, necessary for the fair presentation of the interim
financial statements have been included and all such adjustments are of a normal
recurring nature. The results of operations for the three months ended October
31, 1996 are not necessarily indicative of the results that may be expected for
the fiscal year July 31, 1997 or any other interim period.
These statements should be read in conjunction with the consolidated statements
and related notes which are incorporated by reference in the Company's Annual
Report on Form 10-K for the year ended July 31, 1996.
(2) Net Income per Share
Net income per share was computed by dividing net income by the weighted average
number of total common stock shares outstanding during the three month period
ended October 31, 1996 and 1995. The weighted average number of shares includes
an adjustment for the 10% stock dividend during the quarters ended January 31,
1995, January 31, 1996, and October 31, 1996. The weighted average number of
shares outstanding include 54,304 shares committed to be released for the
Savings Bank's ESOP.
8
<PAGE>
(3) Non Performing Loans and the Allowance for Loan Losses
Non performing loans at October 31, 1996, and July 31, 1996, are as follows:
October 31, 1996 July 31,1996
---------------- ------------
Loans delinquent 90 days or more $3,955,087 $2,910,953
As a percentage of total loans 2.2% 1.8%
An analysis of the allowance for loan losses for the three month period ended
October 31, 1996 and 1995 is as follows:
For the three For the three
months ended months ended
October 31, 1996 October 31, 1995
---------------- ----------------
Balance at beginning of period $3,073,158 $2,534,836
Provision charged to operations 105,000 184,285
Charge-offs, (39,965) (60,376)
Recoveries 10,981 62,383
---------- ----------
Balance at end of period $3,149,174 $2,721,128
========== ==========
(4) Accounting for Employee Stock Ownership Plans
The Savings Bank accounts for its ESOP in accordance with Statement of Position
No. 93-6, "Employees' Accounting for Employee Stock Ownership Plans: (SOP 93-6).
SOP 93-6 requires the Savings Bank to record compensation expense equal to the
fair value of shares when shares are committed to be released. The difference
between the fair value of the shares committed to be released and the cost of
those shares is charged or credited to additional paid-in capital.
9
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Overview
- --------
Lakeview Financial Corp. (the "Company") is organized as a unitary savings and
loan holding company and owns all of the outstanding capital stock of Lakeview
Savings Bank (the "Savings Bank"). The business of the Savings Bank and
therefore, the Company, is the acceptance of savings deposits from the general
public and the origination and purchase of mortgage loans in Northern New
Jersey. The Savings Bank has eight office locations located in Bergen and
Passaic Counties, New Jersey. The Company also has investments in two service
corporations, Branchview, Inc. and Lakeview Mortgage Depot, Inc.
Comparison of Operating Results For The Three Months Ended October 31, 1996 and
- --------------------------------------------------------------------------------
1995
- ----
Net Income: Net income decreased $675 thousand, or 66.1%, to $346 thousand, for
the three month period ended October 31, 1996, from $1.0 million, for the same
period last year. The decrease in net income was the result of a $1.4 million
($2.2 million before tax benefit) of a special assessment required to
recapitalize the Savings Association Insurance Fund (SAIF) of the FDIC, which
was offset by an increase in net interest income and other income, net of taxes,
of approximately $346,000 and $426,000, respectively.
Interest Income: Total interest income increased $575 thousand to $8.1 million
for the quarter ended October 31, 1996, compared to $7.5 million for the quarter
ended October 31, 1995. The increase was due to growth in interest earning
assets and an increase in the average yield on interest earning assets from
7.52% to 7.54%. The average balance in interest earning assets for the three
months increased $29.8 million, or 7.5% to $427.7 million from $397.9 million
for the three months ended October 31, 1995.
Interest Expense: Total interest expense increased $130 thousand to $4.2 million
for the quarter ended October 31, 1996, compared to $4.1 million for the quarter
ended October 31, 1995. The increase was due to growth in the level of interest
bearing liabilities, primarily in borrowings, offset by a decrease in the cost.
Average interest bearing liabilities increased $25.6 million or 6.9% to $398.7
million for the quarter ended October 31, 1996, from $373.1 million for the
quarter ended October 31, 1995. The cost decreased 15 basis points to 4.22% for
the three months ended October 31, 1996 from 4.37% for the three months ended
October 31, 1995.
10
<PAGE>
Net Interest Income: Net interest income before provision for loan losses
increased $445 thousand or 13.1%, to $3.8 million for the three months ended
October 31, 1996, from $3.4 million for the three months ended October 31, 1995.
Provision For Loan Losses: For the comparison period, the provision for loan
losses decreased $79,000, or 43.0%, to $105,000 compared to $184,000 for the
same period ended October 31, 1995. Management of the Savings Bank regularly
accesses the credit risk of the loan portfolio based on information available at
such times, including trends in the local real estate market and levels of the
Savings Bank's non-performing loans and assets. The assessment of the adequacy
of the allowance for loan losses involve subjective judgement regarding future
events and thus there can be no assurance that additional provision for loan
losses will not be required in future periods.
Other Income: Other income increased $646 thousand during the comparison period
to $1.6 million or 66.7%, from $968,000. The Company realized gains on
investments available for sale increased from $526 thousand for the quarter
ended October 31, 1995 to $764 thousand for the quarter ended October 31, 1996.
This increase resulted from the sale of U. S. Government obligations, FNMA and
other equity securities. The gains on the sale of securities for the quarter
ended October 31, 1996, are not necessarily indicative of the gains that may be
expected for the entire fiscal year ending July 31, 1997. Other operating income
increased $406 thousand, or 237.8%, to $577 thousand for the quarter ended
October 31, 1996, compared to $171 thousand for the quarter ended October 31,
1995, primarily attributed to the operations of the Company's subsidiary
Lakeview Mortgage Depot, Inc.
Other Expense: For the comparison period, other expense increased $2.2 million,
or 81.3%, to $4.8 million for the three months ended October 31, 1996, from $2.6
million for the three months ended October 31, 1995. Compensation increased
$142,000, or 12.8% to $1,253,000 for the quarter ended October 31, 1996, from
$1,111,000 for the three months ended October 31, 1995, primarily attributed to
increased staffing of the Company's subsidiary, Lakeview Mortgage Depot, Inc.
Other expense increased $2.3 million, or 321.1% to $2,970,000 at October 31,
1996 as compared to $705,000 at October 31, 1995. The increase was primarily the
result of a $2.2 million special assessment required to recapitalize the SAIF.
Offsetting these increases was a decrease in the net loss on real estate owned
operations of $287,000 for the comparison period. Management will continue to
liquidate real estate owned whenever possible.
Comparison of Financial Condition at October 31, 1996 and July 31, 1996
- -----------------------------------------------------------------------
Total assets increased $14.8 million, or 3.2%, to $472.7 million at October 31,
1996, from $457.9 million at July 31, 1996. The increase was primarily due to
increases in loans receivable, net, of $15.8 million, $420 thousand in accrued
interest receivable, $7.8 million in investment securities available for sale,
offsetting declines in cash and
11
<PAGE>
cash equivalents of $3.4 million and $4.4 million in mortgage-backed securities
held to maturity.
Investment securities available for sale ("investment securities") increased
$7.8 million to $97.8 million at October 31, 1996 from $90.0 million at July 31,
1996. The increase was mainly attributable to the purchase of investment
securities in the amount of $15.9 million, an increase in market value of $3.6
million (before tax), offset by sales of $12.0 million, and principal payments
of $463 thousand. Pursuant to SFAS 115, investment securities available for sale
are reported at fair value, with unrealized gains and losses excluded from
earnings and reported net of income tax, as a separate component of equity.
Mortgage backed securities held to maturity decreased $4.4 million, or 3.6%, to
$117.1 million at October 31, 1996, from $121.5 million at July 31, 1996. This
was attributed to principal repayments of $4.4 million.
Loans receivable increased $15.8 million, or 9.6%, to $179.2 million at October
31, 1996, from $163.5 million at July 31, 1996. The increase is the result of
the expansion of the Savings Bank's operations and the resultant higher volume
of loan originations.
Deposits, after interest credited, increased $6.8 million, or 1.9%, to $361.0
million at October 31, 1996, from $354.2 million at July 31, 1996.
Borrowings increased $3.5 million, or 6.5%, to $57.5 million at October 31,
1996, from $54.0 million at July 31, 1996. During the period ended October 31,
1996, the Savings Bank used borrowings to fund the growth in loans receivable.
Shareholders' equity increased $2.7 million, or 5.8%, during the three months
ended October 31, 1996, to $48.4 million. This was primarily due to an increase
in the unrealized gains on securities available for sale, net of tax, of $2.3
million, amortization of ESOP shares of $269 thousand, and net income of $346
thousand, offset by cash dividends of $142 thousand and $128 thousand in
purchase of treasury stock.
Non-Performing Assets
- ---------------------
Loans delinquent 90 days or more increased $1.0 million, or 35.9%, from $2.9
million at July 31, 1996. Delinquent loans 90 days or more past due totaled
2.21% of gross loans at October 31, 1996, compared to 1.78% of gross loans at
July 31, 1996. This increase in 90 days or more delinquent loans is mainly
attributable to one multi-family loan in the amount of $610,000. This
multi-family loan is secured by a first lien on the multi-family unit for which
the Savings Bank believes the allowance for loan losses is adequate at October
31, 1996. The Savings Bank's allowance for loan losses totaled
12
<PAGE>
$3,149,174 at October 31, 1996, as compared to $3,073,158, at July 31, 1996.
Non-performing assets (loans 90 days or more delinquent, non-accrual loans, real
estate owned and other non-performing assets) totaled $5.7 million or 1.2% of
total assets at October 31, 1996, as compared to 1.0% of total assets at July
31, 1996.
Liquidity and Capital Resources
- -------------------------------
The Savings Bank's primary sources of funds includes savings deposits, loan
repayments and prepayments, cash flow from operations and borrowings from the
Federal Home Loan Bank of New York ("FHLB"). The Savings Bank uses its capital
resources principally to fund loan origination and purchases, repay maturing
borrowings, purchase of securities, and for short and long-term liquidity needs.
The Savings Bank expects to be able to fund or refinance, on a timely basis, its
commitments and long-term liabilities.
The Savings Bank's liquid assets consist of cash and cash equivalents, which
include investments in highly liquid short-term investments. The level of these
assets are dependent on the Savings Bank's operating, financing and investment
activities during any given period. At October 31, 1996, cash and cash
equivalents totaled $3,516,000.
The Savings Bank anticipates that it will have sufficient funds available to
meet its current commitments. As of October 31, 1996, the Savings Bank had
commitments to fund loans of $7,868,250.
The Savings Bank had leverage, Tier 1 and risk-based capital ratios of 7.4%,
14.2%, and 15.4% at October 31, 1996, which exceeded the FDIC's respective
minimum requirements of 4.00%, 4.00% and 8.00%. The Savings Bank was classified
as a "well capitalized" institution by the FDIC as of October 31, 1996.
Impact of Inflation and Changing Prices
- ---------------------------------------
The financial statements of the Company and notes thereto, presented elsewhere
herein, have been prepared in accordance with generally accepted accounting
principles, which require the measurement of financial position and operating
results in terms of historical dollars without considering the change in the
relative purchasing power of money over time and due to inflation. The impact of
inflation is reflected in the increased cost of the Company's operations. Unlike
most industrial companies, nearly all the assets and liabilities of the Company
are monetary. As a result, interest rates have a greater impact on the Company's
performance than do the effects of general levels of inflation. Interest rates
do not necessarily move in the same direction or to the same extent as the price
of goods and services.
13
<PAGE>
LAKEVIEW FINANCIAL CORP. AND SUBSIDIARIES
PART II
ITEM 1. LEGAL PROCEEDINGS
From time to time, the Savings Bank is a party to legal
proceedings in the ordinary course of business wherein it
enforces its security interest in loans. Neither the
Registrant nor the Savings Bank was engaged in any legal
proceeding of a material nature at October 31, 1996.
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 MATERIALLY IMPORTANT EVENTS
On October 16, 1996, the Company announced that the
Corporation's Board of Directors had declared a 10% stock
dividend on the Corporation's common stock to shareholders of
record on October 30, 1996, payable on or about November 13,
1996. In addition, on November 18, 1996, the Company
announced a declaration of a cash dividend of $.0625 per
share to shareholders of record on December 2, 1996,
payable on December 16, 1996.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Not applicable.
14
<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.
Lakeview Financial Corp.
Date: December 16, 1996
/s/ Kevin J. Coogan
------------------------
Kevin J. Coogan
President and CEO
(Principal Executive Officer)
/s/ Anthony G. Gallo
------------------------
Anthony G. Gallo
Vice President and CFO
(Principal Financial Officer)
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-END> OCT-31-1996
<CASH> 3,515,838
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 97,757,990
<INVESTMENTS-CARRYING> 168,221,222
<INVESTMENTS-MARKET> 190,837,562
<LOANS> 182,371,833
<ALLOWANCE> 3,149,174
<TOTAL-ASSETS> 472,697,859
<DEPOSITS> 360,988,800
<SHORT-TERM> 58,187,054
<LIABILITIES-OTHER> 5,106,958
<LONG-TERM> 0
0
0
<COMMON> 6,441,504
<OTHER-SE> 41,973,543
<TOTAL-LIABILITIES-AND-EQUITY> 472,697,859
<INTEREST-LOAN> 3,763,828
<INTEREST-INVEST> 4,294,242
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 8,058,070
<INTEREST-DEPOSIT> 3,426,070
<INTEREST-EXPENSE> 4,208,531
<INTEREST-INCOME-NET> 3,849,539
<LOAN-LOSSES> 105,000
<SECURITIES-GAINS> 764,050
<EXPENSE-OTHER> 4,801,346
<INCOME-PRETAX> 557,150
<INCOME-PRE-EXTRAORDINARY> 346,150
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 346,150
<EPS-PRIMARY> 0.13
<EPS-DILUTED> 0
<YIELD-ACTUAL> 3.47
<LOANS-NON> 3,955,087
<LOANS-PAST> 3,955,087
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 3,073,158
<CHARGE-OFFS> 39,965
<RECOVERIES> 10,981
<ALLOWANCE-CLOSE> 3,149,174
<ALLOWANCE-DOMESTIC> 3,149,174
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
