FORM 10Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 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 34-027228
BankAtlantic Bancorp, Inc.
(Exact name of registrant as specified in its Charter)
Florida 65-0507804
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1750 East Sunrise Boulevard
Ft. Lauderdale, Florida 33304
(Address of principal executive offices) (Zip Code)
(954) 760-5000
(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 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days.
YES [X] NO [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
preferred and common stock as of the latest practicable date.
Outstanding at
Title of Each Class May 13, 1996
------------------- ------------
Class A Common Stock, par value $0.01 per share 1,311,803
Class B Common Stock, par value $0.01 per share 10,616,953
<PAGE>
BankAtlantic Bancorp, Inc.
TABLE OF CONTENTS
FINANCIAL INFORMATION Page Reference
Financial Statements.................................. .......................
Consolidated Statements of Financial Condition - March 31, 1996
(Unaudited)and December 31, 1995............................................. 1
Consolidated Statements of Operations - Unaudited for the Three
Month Ended March 31, 1996 and 1995.......................................... 2
Consolidated Statements of Cash Flows - Unaudited for the Three
Months Ended March 31, 1996 and 1995...................................... 3 - 4
Notes to Consolidated Financial Statements - Unaudited................... 5 - 8
Management's Discussion and Analysis of Results of Operations
and Financial Condition.................................................. 9 - 14
OTHER INFORMATION
Exhibits and Reports on Form 8-K............................................. 15
Signatures................................................................... 16
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
BankAtlantic Bancorp, Inc.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
---- ----
(Unaudited)
ASSETS
(In thousands, except share data)
<S> <C> <C>
Cash and due from depository institutions .....................................................$ 61,133 $ 69,867
Investment securities-net, held to maturity, at cost which approximates market value ........... 40,537 49,856
Loans receivable, net .......................................................................... 863,348 828,630
Debt securities available for sale, at market value ............................................ 559,775 691,803
Accrued interest receivable .................................................................... 13,950 14,553
Real estate owned, net ......................................................................... 6,737 6,279
Office properties and equipment, net ........................................................... 42,602 40,954
Federal Home Loan Bank stock, at cost which approximates market value .......................... 8,840 10,089
Mortgage servicing rights ...................................................................... 24,450 20,738
Deferred tax asset, net ........................................................................ 1,828 0
Cost over fair value of net assets acquired .................................................... 10,517 10,823
Other assets ................................................................................... 9,108 7,097
----- -----
TOTAL ASSETS ...................................................................................$ 1,642,825 $ 1,750,689
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits .......................................................................................$ 1,323,229 $ 1,300,377
Advances from FHLB ............................................................................. 63,485 201,785
Federal funds purchased ........................................................................ 0 1,200
Securities sold under agreements to repurchase ................................................. 43,881 66,237
Subordinated debentures and note payable ....................................................... 21,000 21,001
Drafts payable ................................................................................. 546 796
Deferred tax liabilities, net .................................................................. 0 744
Advances by borrowers for taxes and insurance .................................................. 28,918 15,684
Other liabilities .............................................................................. 24,947 22,304
------ ------
TOTAL LIABILITIES .............................................................................. 1,506,006 1,630,128
--------- ---------
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value, 10,000,000 shares authorized: none issued and outstanding .. 0 0
Class A Common Stock, $0.01 par value, authorized 30,000,000 shares; issued and outstanding,
1,150,000 and 0 share.......................................................................... 11 0
Class B Common Stock, $0.01 par value, authorized 15,000,000 shares; issued and outstanding,
10,592,999 shares.............................................................................. 106 106
Additional paid-in capital ..................................................................... 64,685 48,905
Retained earnings .............................................................................. 70,003 65,817
------ ------
Total stockholders' equity before net unrealized appreciation on debt securities available for
sale - net of deferred income taxes ....................................................... 134,805 114,828
Net unrealized appreciation on debt securities available for sale - net of deferred income taxes 2,014 5,733
----- -----
TOTAL STOCKHOLDERS' EQUITY ..................................................................... 136,819 120,561
------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .....................................................$ 1,642,825 $ 1,750,689
============ ===========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED
<TABLE>
<CAPTION>
For the Three Months
(In thousands, except share data) Ended March 31,
- - --------------------------------- ---------------
1996 1995
---- ----
Interest income:
<S> <C> <C>
Interest and fees on loans ......................................... $ 20,333 $ 15,743
Interest on debt securities available for sale ..................... 10,500 1,400
Interest and dividends on investment securities .................... 1,259 3,242
Interest on mortgage-backed securities held to maturity ............ 0 10,067
------ ------
Total interest income .............................................. 32,092 30,452
------ ------
Interest expense:
Interest on deposits ............................................... 12,379 10,333
Interest on advances from FHLB ..................................... 2,027 1,606
Interest on securities sold under agreements to repurchase ......... 718 3,714
Interest on subordinated debentures and other borrowings ........... 496 2
--- ------
Total interest expense ............................................. 15,620 15,655
------ ------
Net interest income ................................................ 16,472 14,797
Provision for loan losses .......................................... 940 176
--- ---
Net interest income after provision for loan losses ................ 15,532 14,621
------ ------
Non-interest income:
Loan servicing and other loan fees ................................. 838 975
Gains on sales of loans originated for resale ...................... 164 65
Unrealized gains on trading account securities ..................... 0 310
Gains on sales of debt securities available for sale ............... 2,292 0
Other .............................................................. 3,540 2,631
----- -----
Total non-interest income .......................................... 6,834 3,981
----- -----
Non-interest expense:
Employee compensation and benefits ................................. 7,368 6,544
Occupancy and equipment ............................................ 2,785 2,594
Federal insurance premium .......................................... 591 687
Advertising and promotion .......................................... 507 612
Foreclosed asset activity, net ..................................... (162) (1,163)
Amortization of cost over fair value of net assets acquired ........ 306 204
Other .............................................................. 3,120 2,397
----- -----
Total non-interest expense ......................................... 14,515 11,875
------ ------
Income before income taxes ......................................... 7,851 6,727
Provision for income taxes ......................................... 3,141 2,346
----- -----
Net income ......................................................... 4,710 4,381
Dividends on non-cumulative preferred stock ........................ 0 220
----- ---
Net income available for common stockholders ....................... $ 4,710 $ 4,161
============ ============
Income per common and common equivalent share ...................... $ 0.42 $ 0.39
Income per common and common equivalent share assuming full dilution $ 0.42 $ 0.39
============ ============
Weighted average number of common and common
equivalent shares outstanding .................................... 11,292,320 10,571,570
Weighted average number of common and common
equivalent shares outstanding assuming full dilution ............ 11,327,570 10,571,570
See Notes to Consolidated Financial Statements - Unaudited
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
---------------
OPERATING ACTIVITIES: 1996 1995
---- ----
<S> <C> <C>
Net income .................................................................. $ 4,710 $ 4,381
Adjustments to reconcile net income to net cash provided by operating
activities:
Provision for loan losses ................................................... 940 176
Provision for (reversal of) losses on real estate owned ..................... 0 (1,000)
Depreciation ................................................................ 858 786
Amortization of mortgage servicing rights .................................. 1,500 1,015
Increase (decrease) in deferred income taxes ............................... (297) 175
Net amortization (accretion) of securities .................................. 5 (275)
Net amortization of deferred loan origination fees .......................... (285) (223)
Unrealized gains on trading account securites................................ 0 (310)
Gains on sales of real estate owned ......................................... (149) (136)
Gains on sales of debt securities available for sale ........................ (2,292) 0
Net loss on disposal of property and equipment .............................. 71 0
Proceeds from loans originated for resale ................................... 15,345 4,636
Fundings of loans for resale ................................................ (12,449) (6,530)
Gains on sales of loans originated for resale ............................... (164) (65)
Provision for (recovery from) tax certificate losses ........................ 125 (92)
Amortization of dealer reserve .............................................. 593 591
Amortization of cost over fair value of net assets acquired ................. 306 204
Net accretion of purchase accounting adjustments ............................ (68) (89)
Amortization of borrowings deferred costs .................................. 26 0
Decrease (increase) in accrued interest receivable .......................... 603 (73)
(Increase) decrease in other assets ......................................... (2,344) 1,404
Increase in other liabilities ............................................... 2,585 1,783
Decrease in drafts payable .................................................. (250) (14)
---- ---
NET CASH PROVIDED BY OPERATING ACTIVITIES ................................... 9,369 6,344
----- -----
INVESTING ACTIVITIES:
Proceeds from redemption of investment securities .......................... 9,414 31,017
Purchase of investment securities ........................................... (220) (11,811)
Proceeds from sale of debt securities available for sale .................... 75,394 0
Proceeds from sale of FHLB stock ............................................ 1,249 0
Principal reduction on loans ................................................ 132,570 87,207
Loan fundings for portfolio ................................................. (169,172) (121,192)
Loans purchased ............................................................. (2,237) 0
Principal collected on mortgage-backed securities ........................... 0 21,137
Principal collected on debt securities available for sale ................... 52,942 3,333
Mortgage-backed securities purchased ........................................ 0 (75,262)
Additions to dealer reserve ................................................. (356) (562)
Proceeds from sales of real estate owned .................................... 548 2,533
Mortgage servicing rights acquired .......................................... (5,212) (1,166)
Repayment of advances to joint ventures ..................................... 0 1,239
Additions to office property and equipment .................................. (2,577) (515)
Purchase of MegaBank, net of cash acquired .................................. 0 (14,733)
------ -------
NET CASH USED BY INVESTING ACTIVITIES ....................................... 92,343 (78,775)
------ -------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
(Continued)
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS FOR CASH FLOWS - UNAUDITED
(CONTINUED)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
---------------
1996 1995
---- ----
<S> <C> <C>
FINANCING ACTIVITIES:
Net increase in deposits ......................................................... $ 12,345 $ 8
Interest credited to deposits .................................................... 10,507 9,023
Repayments of FHLB advances ...................................................... (325,270) (162,050)
Proceeds from FHLB advances ...................................................... 186,970 115,000
Net increase (decrease) in securities sold under agreements to repurchase ....... (22,356) 89,583
Net decrease in federal funds purchased .......................................... (1,200) 0
Proceeds from note payable ...................................................... 0 4,000
Repayment of note payable ........................................................ (1) 0
Issuance of common stock, net .................................................... 15,791 0
Receipts of advances by borrowers for taxes and insurance ........................ 13,234 13,291
Preferred stock dividends paid ................................................... 0 (220)
Common stock dividends paid ...................................................... (466) (398)
---- ----
NET CASH PROVIDED BY FINANCING ACTIVITIES ....................................... (110,446) 68,237
-------- ------
DECREASE IN CASH AND CASH EQUIVALENTS ........................................... (8,734) (4,194)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ................................. 69,867 55,980
------ ------
CASH AND CASH EQUIVALENTS AT END OF PERIOD ....................................... $ 61,133 $ 51,786
========= ==========
SUPPLEMENTARY DISCLOSURE AND NON-CASH INVESTING AND FINANCING ACTIVITIES:
Interest paid on borrowings ...................................................... $ 15,176 $ 14,907
Income taxes paid ................................................................ 0 1,100
Loans transferred to real estate owned ........................................... 856 539
Loan charge-offs ................................................................. 1,854 982
Tax certificate net recoveries ................................................... 142 16
Common stock dividend declared and not paid until April .......................... 524 398
Change in net unrealized appreciation on debt securities available for sale ...... (6,055) 1,473
Change in deferred taxes on net unrealized appreciation on debt securities
available for sale ............................................................. (2,336) 568
Change in stockholders' equity from net unrealized appreciation on debt securities
available for sale, less related deferred income taxes ......................... (3,719) 905
====== ===
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
</TABLE>
<PAGE>
BankAtlantic Bancorp, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
1. PRESENTATION OF INTERIM FINANCIAL STATEMENTS
BankAtlantic Bancorp, Inc. ("BBC") is a unitary savings bank holding
company. BBC's primary asset is the capital stock of BankAtlantic, a Federal
Savings Bank ("BankAtlantic"), its wholly owned subsidiary and BBC's principal
activities relate to the operations of BankAtlantic and BankAtlantic's
subsidiaries. These subsidiaries are primarily utilized to dispose of real
estate acquired through foreclosure. All significant inter-company balances and
transactions have been eliminated in consolidation.
In management's opinion, the accompanying consolidated financial statements
contain such adjustments necessary to present fairly BBC's consolidated
financial condition at March 31, 1996, the consolidated results of operations
and the consolidated cash flows for the three months ended March 31, 1996 and
1995. Such adjustments consisted only of normal recurring items. The
consolidated financial statements and related notes are presented as permitted
by Form 10Q and should be read in conjunction with the notes to consolidated
financial statements appearing in BBC's Annual Report on Form 10K for the year
ended December 31, 1995.
2. CLASS A COMMON STOCK AND CLASS B COMMON STOCK
On February 13, 1996, the stockholders of BBC approved at a special meeting,
an amendment to BBC's Articles of Incorporation (the "Amendment") authorizing
30,000,000 shares of a new class of non-voting common stock designated Class A
Common Stock, and redesignating BBC's existing Common Stock, par value $0.01 per
share, as Class B Common Stock. The Class A Common Stock has no voting rights
except as may be required by Florida law. The two classes of stock generally
have the same economic rights, except Class A Common Stock is entitled to
receive cash dividends equal to at least 110% of any cash dividends declared and
paid on Class B Common Stock. In March 1996, BBC issued 1.15 million shares of
Class A Common Stock in an underwritten public offering at $15.00 per share. Net
proceeds to BBC after underwriting costs and other expenses of $1.2 million and
$247,000, respectively, were $15.8 million. In April 1996 the underwriter
exercised an overallotment option to purchase an additional 161,803 shares of
Class A Common Stock resulting in net proceeds to BBC of $2.3 million.. In March
1996, BBC contributed $14.0 million of the net proceeds to the capital of
BankAtlantic where it was used for general corporate purposes. The net proceeds
retained by BBC are being used for general corporate purposes. As of result of
the above Class A Common Stock issuance BFC Financial Corporation's ("BFC")
ownership in BBC's total outstanding (A and B) common stock was approximately
41% at March 31, 1996, comprised of no shares of Class A Common Stock and 46% of
BBC's outstanding Class B Common Stock.
3. MORTGAGE SERVICING
The lower of cost or market value for mortgage loans originated for resale is
determined on an aggregate basis. In May 1995 the FASB issued Statement of
Financial Accounting Standard No. 122 ("FAS 122") which eliminated the
accounting distinction between rights to service mortgage loans for others that
are acquired through loan origination activities and those acquired through
purchase transactions. FAS 122 requires an entity to recognize as separate
assets rights to service mortgage loans for others, however those servicing
rights are acquired. FAS 122 requires the periodic evaluation of capitalized
mortgage servicing rights for impairment based on fair value. On January 1,
1996, this statement was implemented prospectively. During the three months
ended March 31, 1996 and 1995, BankAtlantic capitalized $5.2 million and $1.2
million respectively of mortgage servicing rights ("MSR's"). All of the 1995
amount and $5.1 million of the 1996 amount was for purchased mortgage servicing
rights ("PMSR's"). The initial valuation of MSR's are on an individual loan
basis. Amortization of MSR's amounted to $1.5 million and $1.0 million for the
1996 and 1995 periods, respectively. Both purchased and originated MSR's are
amortized to expense using the level yield method over the estimated life of the
loan and continually adjusted for prepayments. The fair value of capitalized
mortgage servicing rights at March 31, 1996 was estimated at $29.7 million. For
the purpose of evaluating and measuring impairment of MSR's, BBC stratifies
those rights based on the predominant risk characteristics of the underlying
loans. Those characteristics include loan type, note rate and term. Upon
implementation of FAS 122, no additional valuation allowance was required.
Adjustments to the valuation allowance are reflected in operations.
4. SALE OF MORTGAGE-BACKED SECURITIES
In March 1996 BBC sold $52.6 million of adjustable rate mortgage-backed
securities and $20.5 million of 15 year mortgage-backed securities for a $2.3
million gain. Proceeds of $75.4 million from the sale were used to originate
loans and reduce short term borrowings.
<PAGE>
5. POTENTIAL PURCHASE OF BANK OF NORTH AMERICA BANCORP, INC.
On April 9, 1996, BankAtlantic entered into an agreement to acquire Bank of
North America Bancorp, Inc. ("BNAB") for approximately $54 million in cash. The
acquisition will be accounted for as a purchase for financial reporting
purposes. BNAB's primary asset is its wholly owned subsidiary, Bank of North
America of Florida ("BNA"), a Florida chartered commercial bank. BNA has 13
branches, with 11 located in Broward County, and one each in Dade and Palm Beach
counties. Closing of the acquisition is subject to certain conditions including
receipt of all required regulatory approvals and is expected to occur in the
fourth quarter of 1996.
The following tables present certain selected historical financial
information for BBC and BNAB and selected pro forma combined financial data. The
pro forma amounts included in the tables assume completion of the acquisition
and are based upon the purchase method of accounting. Under this method of
accounting, assets and liabilities of BNAB are recorded at their estimated fair
value and any unallocated portion of the purchase price remaining after fair
value adjustments is recorded as goodwill. Applicable income tax effects for the
difference in the income tax basis and the financial statement basis of BNAB's
accounts result in deferred tax assets and liabilities and correspondingly
adjust the amount recorded as goodwill. The unaudited pro forma combined balance
sheets assume the acquisition had been effective on March 31, 1996 and December
31, 1995, respectively. The combined pro forma statements of operations assume
the acquisition had been effective as of January 1, 1996 and 1995, respectively.
For purposes of the pro forma financial information estimated fair values of
BNAB's assets and liabilities are, except for debt securities available for
sale, based on December 31, 1995 information. Debt securities available for sale
are based on March 31, 1996 information. The unaudited combined pro forma
financial statements do not give effect to anticipated cost savings or the
disposition of certain yet to be identified assets and liabilities.
The resolution of the pending matters pertaining to the assets and
liabilities of BNAB described above, as well as the operations of BNAB
subsequent to March 31, 1996, will affect the allocation of the purchase price.
In addition, changes to the adjustments already included in the unaudited
combined pro forma financial statements and possibly other adjustments are
expected as valuations of assets and liabilities are determined as of the actual
date the acquisition is completed. An increase in the unallocated portion of the
purchase price remaining after fair value adjustments will result in a greater
final allocation to goodwill which will have a corresponding impact on
amortization expense and will reduce tangible common equity. A decrease in the
unallocated portion of the purchase price remaining after fair value adjustments
will have the opposite effect. Accordingly, the final combined pro forma amounts
may differ from those set forth in the unaudited combined pro forma financial
statements.
The pro forma information shown below is presented for comparative purposes
only and is not necessarily indicative of the combined financial position or
results of operations in the future. The pro forma information is also not
necessarily indicative of the combined financial position or results of
operations which would have been realized had the acquisition been consummated
during the periods or as of the dates for which the pro forma financial
information is presented.
<PAGE>
BankAtlantic Bancorp, Inc.
<TABLE>
<CAPTION>
MARCH 31, 1996 December 31, 1995
-------------- -----------------
ADJUST- COMBINED ADJUST- COMBINED
BBC BNAB MENTS PROFORMA BBC BNAB MENTS PROFORMA
--- ---- ----- -------- --- ---- ----- --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Cash ..........................$ 61,133 $ 16,981 $ $ 78,114 $ 69,867 $ 14,606 $ $ 84,473
Investment securities, net .... 40,537 11,533 52,070 49,856 36,854 86,710
Loans receivable, net ......... 863,348 394,970 6,755 (1) 1,265,073 828,630 375,745 6,755 (1) 1,211,130
Debt securities available for
sale........................... 559,775 108,554 (54,000)(2) 614,329 691,803 100,787 (54,000)(2) 738,590
Real estate owned ............. 6,737 1,119 7,856 6,279 1,026 7,305
Office properties and equipment 42,602 8,500 51,102 40,954 8,211 49,165
Federal Home Loan Bank stock .. 8,840 2,775 11,615 10,089 2,775 12,864
Mortgage servicing rights ..... 24,450 2,180 2,823 (1) 29,453 20,738 2,277 2,823 (1) 25,838
Deferred tax asset ............ 1,828 2,061 (2,860)(6) 1,029 0 1,503 (1,503)(6) 0
Cost over fair values of net
assets acquired (3) ........... 10,517 179 13,085 23,781 10,823 204 12,505 23,532
Other Assets .................. 23,058 10,677 33,735 21,650 10,514 32,164
------ ------ ----- ------ ------ ------ ----- ------
TOTAL ASSETS ..................$ 1,642,825 $ 559,529 $(34,197) $2,168,157 $ 1,750,689 $ 554,502 $(33,420) $2,271,771
============= ============ ======== =========== ============ ========== ======== ==========
</TABLE>
<TABLE>
<CAPTION>
MARCH 31, 1996 DECEMBER 31, 1995
-------------- -----------------
ADJUST- COMBINED ADJUST- COMBINED
BBC BNAB MENTS PROFORMA BBC BNAB MENTS PROFORMA
--- ---- ----- -------- --- ---- ----- --------
LIABILITIES AND
STOCKHOLDERS' EQUITY
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Deposits .......................$ 1,323,229 $ 490,095 $ 2,037(1) $ 1,815,361 $ 1,300,377 $ 488,912 $ 2,037 (1) $1,791,326
FHLB advances .................. 63,485 20,000 127(1) 83,612 201,785 20,000 127 (1) 221,912
Subordinated debentures ........ 21,000 0 21,000 21,000 0 21,000
Other borrowings ............... 43,881 989 44,870 67,438 820 68,258
Advances by borrowers for taxes
and insurance ................. 28,918 9,524 38,442 15,684 4,800 20,484
Deferred tax liabilities, net .. 0 0 0 744 0 1,357 2,101
Other liabilities .............. 25,493 1,560 1,000(4) 28,053 23,100 2,029 1,000(4) 26,129
------ ----- ----- ------ ------ ----- ----- ------
Total Liabilities .............. 1,506,006 522,168 3,164 2,031,338 1,630,128 516,561 4,521 2,151,210
--------- ------- ----- --------- --------- ------- ----- ---------
STOCKHOLDERS' EQUITY
Class A Common Stock ........... 11 0 0 11 0 0 0 0
Class B Common Stock ........... 106 0 0 106 106 0 0 106
Additional paid-in capital ..... 64,685 30,100 (30,100) 64,685 48,905 30,100 (30,100) 48,905
Net unrealized appreciation .... 2,014 (1,594) 1,594 2,014 5,733 (459) 459 5,733
Retained earnings .............. 70,003 8,855 (8,855) 70,003 65,817 8,300 (8,300) 65,817
------ ----- ------ ------ ------ ----- ------ ------
TOTAL STOCKHOLDERS' EQUITY ..... 136,819 37,361 (37,361) 136,819 120,561 37,941 (37,941) 120,561
------- ------ ------- ------- ------- ------ ------- -------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY ...........$ 1,642,825 $ 559,529 $(34,197) $ 2,168,157 $ 1,750,689 $ 554,502 $(33,420) $2,271,771
============ ============ ======== =========== ============ ======= ======== ============
</TABLE>
<PAGE>
BankAtlantic Bancorp, Inc.
<TABLE>
<CAPTION>
For the Three Months Ended For the Year Ended
March 31, 1996 December 31, 1995
-------------- -----------------
Adjust- Combined Adjust- Combined
BBC BNAB ments Proforma BBC BNAB ments Proforma
--- ---- ----- -------- --- ---- ----- --------
<S> <C> <C> <C> <C><C> <C> <C> <C> <C> <C><C> <C>
Interest income ........ $ 32,092 $10,313 $(1,340)(1)(2) $ 41,065 $ 130,077 $ 40,552 $ (5,390)(1)(2) $165,239
Interest expense ....... 15,620 5,631 (366)(1) 20,885 65,686 23,016 (1,466)(1) 87,236
Provision for loan
Losses ................. 940 180 0 1,120 4,182 1,150 0 5,332
Noninterest income ..... 6,834 1,181 (208)(1) 7,807 19,388 5,204 (745)(1) 23,847
Noninterest expense .... 14,515 4,802 332 (3) 19,649 51,160 18,299 1,271 (3) 70,730
Provision for income
taxes ................. 3,141 326 (456)(6) 3,011 10,018 1,113 (1,801)(6) 9,330
----- --- ---- ----- ------ ----- ------ -----
Net Income ............. $ 4,710 $ 555 $(1,058) $ 4,207 $ 18,419 $ 2,178 $ (4,139) $ 16,458
========== ====== ======= ============ =========== ========= ======== ==========
Per common share
Primary ................ $ 0.42 $ 0.37 $ 1.51(7) $ 1.33(7)
========== ========== =========== ==========
Fully diluted .......... $ 0.42 $ 0.37 $ 1.50(7) $ 1.32(7)
========== ========== =========== ==========
Average shares
outstanding
Primary ................ 11,292,320 11,292,320 10,830,603 10,830,603
========== ========== ========== ==========
Fully diluted .......... 11,327,570 11,327,570 10,934,120 10,934,120
========== ========== ========== ==========
<FN>
(1) Adjustments to fair value of BNAB's loans receivable, mortgage servicing
rights, deposits, and FHLB advances at December 31, 1995 were $6.8 million,
$2.8 million, $2.0 million, and $127,000, respectively. Adjustments to fair
values are amortized as follows:
Loans receivable 3 years straight line method.
Mortgage servicing rights Based on projected portfolio
cash flows of 26.4% in year one
and 7.4% for the three months
ended 3/31/96.
Deposits Based on estimated time deposit
maturities of 65% in year one
and 16% for the three months
ended March 31, 1996.
FHLB Advances 1 year straight line.
(2) The purchase price of $54.0 million is assumed to be funded through the
sale of debt securities available for sale. The weighted average interest
rate earned on BNAB's debt securities available for sale were 5.81% and
5.76% for the three months ended March 31, 1996 and for the year ended
December 31, 1995, respectively.
(3) Cost over fair values of net assets acquired (goodwill), will, based on the
structure of the acquisition, qualify for amortization for tax
purposes. The useful life is estimated at ten years and is assumed to be
amortized on a straight line basis.
(4) The total purchase price will include other direct acquisition costs, such
as legal, accounting and other professional fees and expenses. For purposes
of the pro forma financial information such other acquisition costs are
estimated at $1.0 million.
(5) The pro forma does not include the effect of any potential expense
reductions, revenue increases or restructuring charges.
(6) The effective income tax rate is assumed to be 38%.
(7) Includes a reduction of $0.13 and $0.12 for primary and fully diluted
earnings per share, respectively, related to the October 1995 Preferred
Stock redemption.
</FN>
</TABLE>
<PAGE>
BankAtlantic Bancorp, Inc.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
BBC's net income available for common stockholders for the quarter ended
March 31, 1996 was $4.7 million or $0.42 primary and fully diluted earnings per
common and common equivalent share compared to $4.2 million or $0.39 primary and
fully diluted earnings per common and common equivalent share for the quarter
ended March 31, 1995.
Net interest income after provision for loan losses was $15.5 million for
the March 31, 1996 quarter compared to $14.6 million for the quarter ended March
31, 1995. During the 1996 quarter, interest income increased by $1.6 million
primarily due to higher interest earned on loans, partially offset by lower
interest income on securities and investments. This increase in loan interest
income reflects higher average balances due to the acquisition of MegaBank as
well as loan originations during 1995 and the first quarter of 1996. The decline
in interest income on securities and investments resulted from lower average
balances primarily due to principal repayments and the sale of $73.1 million of
mortgage-backed securities available for sale. During the three months ended
March 31, 1996 total interest expense was $15.6 million compared to $15.7
million during the comparable 1995 period. Higher interest expenses on deposits
and subordinated debentures was offset by lower interest expense on short term
borrowings (primarily securities sold under agreements to repurchase). The
increase in deposit interest expense resulted from higher time deposit average
balances and rates. The subordinated debenture interest expense resulted from
the $21.0 million issuance of 9% debentures during the latter part of 1995. The
decline in short term borrowings interest expense primarily resulted from lower
average balances and secondarily from lower rates during 1996 compared to 1995.
The provision for loan losses was $940,000 for the three months ended March 31,
1996 compared to $176,000 during the comparable 1995 period. The increased first
quarter 1996 provision resulted from $845,000 of higher net consumer loan
charge-offs in the 1996 period and commercial non-mortgage loan recoveries
during the comparable 1995 period of $491,000 compared to recoveries of $174,000
during the 1996 period. Non-interest income was $6.8 million for the three
months ended March 31, 1996 compared to $4.0 million for the 1995 period. The
$2.8 million increase primarily related to $2.3 million of gains on sales of
mortgage-backed securities available for sale and higher transaction account and
ATM fee income. Non-interest expense for the quarter ended March 31, 1996 was
$14.5 million compared to $11.9 million for the same period in 1995. The net
increase of $2.6 million reflects decreased gains on the sale of foreclosed
assets and higher employee compensation costs, occupancy and equipment expenses,
other expenses, and amortization of cost over fair value of net assets acquired.
These expense increases primarily related to the acquisition of MegaBank and the
opening of six additional branches during 1995. The 1995 provision for income
taxes was reduced by $319,000 due to a reduction in the deferred tax asset
valuation allowance.
<TABLE>
<CAPTION>
NET INTEREST INCOME
FOR THE THREE MONTHS ENDED
MARCH 31,
---------
(in thousands) 1996 1995 CHANGE
- - -------------- ---- ---- ------
<S> <C> <C> <C>
Interest and fees on loans ............................... $ 20,333 $ 15,743 $ 4,590
Interest on debt securities available for sale ........... 10,500 1,400 9,100
Interest and dividends on investment securities .......... 1,259 3,242 (1,983)
Interest on mortgage-backed securities held to maturity .. 0 10,067 (10,067)
Interest on deposits ..................................... (12,379) (10,333) (2,046)
Interest on advances from FHLB ........................... (2,027) (1,606) (421)
Interest on securities sold under agreements to repurchase (718) (3,714) 2,996
Interest on subordinated debt and note payable ........... (496) (2) (494)
---- -- ----
Net interest income ...................................... $ 16,472 $ 14,797 $ 1,675
======== ======== ========
</TABLE>
The increase in interest and fees on loans during 1996 compared to 1995
reflects higher average balances resulting from loan fundings, loan purchases,
and loans acquired with the MegaBank acquisition. As a result, total loans
receivable average balance increased from $658.9 million during the first
quarter of 1995 to $860.2 million during the comparable 1996 period. The
MegaBank acquisition increased commercial mortgage, commercial non-mortgage, and
consumer loans by $39.1 million, $24.5 million, and $52.8 million, respectively.
During the three months ended March 31, 1996 BankAtlantic funded and purchased
$183.9 million of loans compared to $127.7 million of loans during 1995.
Effective December 15, 1995, all mortgage-backed and investment securities,
excluding tax certificates, then classified as held-to-maturity, were
reclassified as available for sale; therefore, during the quarter 1996 there
were no mortgage-backed securities held for investment. The decline in interest
on securities and investments resulted from principal repayments and the sale of
$73.1 million of mortgage-backed securities available for sale. The average
balance of securities and investments declined from $897.1 million during the
three month period in 1995 to $708.9 million during the comparable period in
1996.
The increase in interest on deposits resulted from higher average deposit
balances during 1996, and a change in the deposit mix from transaction accounts
to time deposits. The increased average deposit balances primarily resulted from
$120.2 million of deposits acquired with the acquisition of MegaBank and
increased time deposits. As a result, total average deposits increased from
$1.10 billion for the quarter 1995 to $1.21 billion during 1996. The higher
short term interest rate environment during 1995, compared to previous periods,
contributed to a change in the deposit mix from lower rate transaction accounts
to generally higher rate time deposits. The average deposit mix changed from
51.4% and 48.6% of time deposits and transaction accounts, respectively for the
three months ended March 31, 1995 to 56.5% and 43.5% of time deposits and
transaction accounts, respectively for the same period in 1996. The increase in
interest on advances from FHLB were due to higher average balances partially
offset by lower rates. FHLB advance average balances increased from $112.1
million during 1995 to $145.1 million, during 1996. Furthermore, average FHLB
advance rates declined from 5.81% during the 1995 three month period to 5.60%
during the same period in 1996. Interest on subordinated debentures and note
payable relates to the $21.0 million of Debentures issued in September and
October 1995 and a $4.0 million note issued in March 1995. The decline in
interest on securities sold under agreements to repurchase resulted from lower
average balances during the 1996 quarter as compared to the same period in 1995.
The decline in securities sold under agreements to repurchase average balances
resulted from the higher deposit balances mentioned above.
PROVISION FOR LOAN LOSSES
The provision for loan losses for first quarter 1996 was $940,000 compared
to $176,000 during the comparable 1995 period. The 1996 increase reflects $1.2
million of consumer loan net charge-offs compared to $362,000 during 1995 and
$171,000 of commercial non-mortgage loan net recoveries in 1996 compared to
$491,000 of net recoveries during 1995. The increase in 1996 consumer loan
charge-offs related to a $692,000 increase in indirect automobile loan
charge-offs. BankAtlantic re-entered the indirect consumer lending program upon
acquisition of MegaBank which was active in indirect automobile lending. The
increase in the indirect automobile loans was due to loans acquired in
connection with the MegaBank acquisition as well as subsequent production.
Subject Portfolio charge-offs during 1996 were $278,000 compared to $340,000
during 1995.
The following table presents the amounts of BBC's risk elements and
non-performing assets (in thousands):
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1996 1995
---- ----
<S> <C> <C>
Nonaccrual
Tax certificates ......................... $ 1,709 $ 2,044
Loans .................................... 8,973 11,174
----- ------
10,682 13,218
------ ------
Repossessed Assets:
Real estate owned ........................ 6,737 6,279
Repossessed assets ....................... 528 461
--- ---
7,265 6,740
Contractually past due 90 days or more (1) 1,295 1,536
----- -----
Total non-performing assets .............. 19,242 21,494
Restructured loans ....................... 3,456 2,533
----- -----
Total risk elements ...................... $22,698 $24,027
======= =======
<FN>
(1) The majority of these loans have matured and the borrower
continues to make payments under the matured loan
agreement. BankAtlantic is in the process of renewing or
extending these matured loans.
</FN>
</TABLE>
BankAtlantic's "risk elements" consist of restructured loans and
"non-performing" assets. The classification of loans as "non-performing" is
generally based upon non-compliance with loan performance and collateral
coverage standards, as well as management's assessment of problems related to
the borrower's or guarantor's financial condition. BankAtlantic generally
designates any loan that is 90 days or more delinquent as non-performing.
BankAtlantic may designate loans as non-performing prior to the loan becoming 90
days delinquent, if the borrower's ability to repay is questionable. A
"non-performing" classification alone does not indicate an inherent principal
loss; however, it generally indicates that management does not expect the asset
to earn a market rate of return in the current period. Restructured loans are
loans for which BankAtlantic has modified the loan terms due to the financial
difficulties of the borrower.
The decrease in total risk elements primarily relates to decreases in
non-accruals and loans contractually past due 90 days or more. The above
decreases were partially offset by increases in repossessed assets and
restructured loans. The $2.2 million decrease in nonaccrual loans relates to a
$1.2 million commercial real estate loan restructured during the first quarter
of 1996, and the foreclosure of a $700,000 commercial real estate loan. These
two loans also account for the 1996 increase in real estate owned and
restructured loans. Furthermore, residential, tax certificate nonaccrual
balances and loans contractually past due 90 days or more declined by $328,000,
$335,000, and $241,000, respectively.
<TABLE>
<CAPTION>
NON-INTEREST INCOME
For the Three Months Ended
March 31,
---------
(IN THOUSANDS) 1996 1995 Change
---- ---- ------
<S> <C> <C> <C>
Loan servicing and other loan fees ................. $ 838 $ 975 $ (137)
Gains on sale of loans originated for resale ....... 164 65 99
Gains on sales of debt securities available for sale 2,292 0 2,292
Unrealized gains on trading account securities .... 0 310 (310)
Other .............................................. 3,540 2,631 909
----- ----- ---
Total non-interest income ...................... $ 6,834 $ 3,981 $ 2,853
======= ======= =======
</TABLE>
The decrease in loan servicing and other loan fees during the three month
period in 1996 compared to 1995 resulted from lower net servicing fee income.
The decreased servicing fee income reflects higher amortization of mortgage
servicing rights due to increased residential loan prepayments.
During the three months ended March 31, 1996 and 1995, BankAtlantic sold
$15.2 million and $4.6 million, respectively, of recently originated residential
loans for gains as reported in the above table.
During the three months ended March 31, 1996, BankAtlantic sold from its
available for sale portfolio $52.6 million of adjustable rate mortgage-backed
securities and $20.5 million of 15 year mortgage-backed securities for gains as
reported in the above table.
The unrealized gain on trading account securities during 1995 relates to two
$5.0 million U.S. Treasury Notes acquired upon the exercise of European put
options in 1993. The Treasury Notes were subsequently sold during August 1995.
The increase in other non-interest income during the first quarter of 1996
compared to the 1995 period was due to higher fees earned on checking accounts,
ATM services, lease income, and a $125,000 litigation settlement. Checking
account income and ATM fees were $1.9 million and $668,000 for the first quarter
1996, respectively, compared to $1.6 million and $439,000 during the comparable
1995 period, respectively. Lease income increased from $96,000 during 1995 to
$364,000 during the first quarter 1996. The additional lease income resulted
from a rent settlement relating to a leased property located in Broward County.
<TABLE>
<CAPTION>
NON-INTEREST EXPENSES
For the Three Months Ended
March 31,
---------
(In thousands) 1996 1995 Change
- - -------------- ---- ---- ------
<S> <C> <C> <C>
Employee compensation and benefits ........................$ 7,368 $ 6,544 $ 824
Occupancy and equipment ................................... 2,785 2,594 191
Federal insurance premium ................................. 591 687 (96)
Advertising and promotion ................................. 507 612 (105)
Foreclosed asset activity, net ............................ (162) (1,163) 1,001
Amortization of cost over fair value of net assets acquired 306 204 102
Other ..................................................... 3,120 2,397 723
----- ----- ---
Total non-interest expenses ...............................$ 14,515 $ 11,875 $ 2,640
========== ========== =======
</TABLE>
The increase in employee compensation and benefits for first quarter 1996
resulted from the number of employees increasing from 624 at December 31, 1994
to 746 at December 31, 1995 to 784 at March 31, 1996 as well as annual salary
increases during 1995. The increase in the number of employees primarily relates
to the acquisition of MegaBank effective February 1, 1995 and the opening of six
branches during 1995. Occupancy and equipment expenses increased due to the new
branches mentioned above and the branches acquired with the MegaBank
acquisition. BankAtlantic opened three additional Wal-Mart SuperCenter branches
during the second quarter of 1996. The personnel for those branches were on
staff at March 31, 1996. Depreciation expense increased during the three month
period by $72,000. The additional depreciation expense resulted from the
acquisition of MegaBank and the purchase of $5.5 million and $2.6 million of
fixed assets during the year ended December 31, 1995 and the three months ended
March 31, 1996, respectively.
The amortization of cost over fair value of net assets acquired for the three
months ended March 31, 1996 relates to the acquisition of MegaBank effective
February 1, 1995.
<TABLE>
<CAPTION>
The components of "Foreclosed asset activity, net" were (in thousands):
FOR THE THREE MONTHS ENDED
MARCH 31,
---------
Real estate acquired in settlement of loans: 1996 1995
- - -------------------------------------------- ---- ----
<S> <C> <C>
Operating income, net ................... $ (13) $ (27)
Provision for (reversal of) losses on REO 0 (1,000)
Net gains on sales ...................... (149) (136)
---- ----
Foreclosed asset activity, net ........ $(162) $(1,163)
==== =======
</TABLE>
The lower earnings in foreclosed asset activity, net during the three
months ended March 31, 1996 were primarily due to a $1.0 million reversal of the
allowance for losses on real estate owned during the three months ended March
31, 1995. This reversal reflected the sales of several parcels of vacant land.
The increase in other non-interest expense during 1996 was caused by
$220,000 of higher legal expenses, $217,000 increase in the provision for tax
certificates, $126,000 of higher check losses, and $122,000 of additional
stationery, printing, supplies and telephone expense. The higher legal expenses
related to indirect consumer lending. The provision for tax certificates was
$125,000 during the first quarter of 1996 compared to a $92,000 recovery during
1995. The additional stationery, printing, supplies and telephone expenses
resulted from the additional six branches opened during 1995 and the MegaBank
acquisition.
FINANCIAL CONDITION
BankAtlantic's total assets at March 31, 1996 were $1.64 billion compared
to $1.75 billion at December 31, 1995. Debt securities available for sale and
tax certificates decreased by $132.0 million and $9.3 million, respectively,
whereas loans receivable-net increased $34.7 million. The decline in debt
securities available for sale reflects the sale of $73.1 million of
mortgage-backed securities and $52.9 million of principal repayments. The
decline in tax certificate balances reflects $9.4 million of redemptions during
1996. The increase in loan receivable balances is due to loan fundings,
including loans funded for resale, and loan purchases during 1996 amounting to
$183.9 million, and loan sales and repayments amounting to $147.8 million.
During first quarter 1996 deposits increased by $22.9 million. The increase
in net deposits resulted from time deposit and interest free checking growth.
Time deposits and interest free checking increased from $676.3 million and $99.0
million at December 31, 1995 to $690.0 million and $108 million, respectively,
at March 31, 1996. FHLB advances, securities sold under agreements to
repurchase, and federal funds purchased declined by $138.3 million, $22.4
million and $1.2 million, respectively, from December 1995 balances. The
repayment of FHLB advances, securities sold under agreements to repurchase, and
federal funds purchased were funded through deposit inflows, proceeds from the
sale of debt securities available for sale, proceeds from the issuance of Class
A Common Stock, and investment securities repayments.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
BBC's primary sources of funds during the first three months of 1996 were
from the issuance of the Class A Common Stock and dividends from BankAtlantic.
The primary use of funds is to pay cash dividends to common stockholders and
interest expense on its outstanding debentures. It is anticipated that funds for
such payments will continue to be obtained from BankAtlantic. Additionally, the
ultimate repayment by BBC of its outstanding Debentures may be dependent upon
dividends from BankAtlantic, refinancing of the debt or raising additional
equity capital by BBC. BBC currently anticipates that it will pay regular
quarterly cash dividends on its common stock. Funds for dividend payments and
interest expense on the Debentures are in part dependent upon BankAtlantic's
ability to pay dividends to BBC.
BankAtlantic's primary sources of funds during the first three months of
1996 were from operations, principal collected on loans, mortgage-backed
securities, investment securities, sales of debt securities available for sale,
deposits inflows, proceeds from the capital contribution from BBC and receipts
of advances by borrowers for taxes and insurance. These funds were primarily
utilized for loan fundings, repayments of FHLB advances, securities sold under
agreements to repurchase and federal funds purchased. At March 31, 1996,
BankAtlantic met all applicable liquidity and regulatory capital requirements.
Commitments to originate and purchase loans at March 31, 1996 were $95.4
million compared to $46.2 million at March 31, 1995. BankAtlantic expects to
fund the 1996 loan commitments from loan and mortgage-backed securities
repayments. At March 31, 1996, loan commitments were 11.05% of loans receivable,
net.
<TABLE>
<CAPTION>
At March 31, 1996, BankAtlantic's regulatory capital position was:
TANGIBLE CORE TOTAL RISK-BASED
CAPITAL CAPITAL CAPITAL
------- ------- -------
(DOLLARS IN THOUSANDS) Balance % Balance % Balance %
- - ---------------------- ------- - ------- - ------- -
<S> <C> <C> <C> <C> <C> <C>
Capital calculated under GAAP ...... $ 150,547 $ 150,547 $150,547
Adjustments:
Non-includable subsidiaries ........ (110) (110) (110)
Unrealized holding gains ........... (2,014) (2,014) (2,014)
Non-qualifying intangible assets .. (11,143) (11,143) (11,143)
Allowable allowance for loan and tax
certificate losses ............... 0 0 14,290
--------- ---- -------- ---- ---------- ----
Regulatory capital ................. 137,280 8.45% 137,280 8.45% 151,570 13.32%
Required minimum capital ........... 24,373 1.50% 48,746 3.00% 91,025 8.00%
--------- ---- -------- ---- ---------- ----
Excess regulatory capital .......... $ 112,907 6.95% $ 88,534 5.45% $ 60,545 5.32%
========= ==== ======== ==== ========== ====
</TABLE>
Savings institutions are also subject to the provisions of the Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA"). Regulations
implementing the prompt corrective action provisions of FDICIA define specific
capital categories based on FDICIA's defined capital ratios, as discussed more
fully in BBC's Annual Report on Form 10K for the year ended December 31, 1995.
At March 31, 1996, BankAtlantic's core, Tier 1 risk-based and total risk-based
capital ratios were 8.45%, 12.07% and 13.32%, respectively. Based on these
capital ratios, BankAtlantic meets the definition of a well capitalized
institution.
On August 8, 1995, the FDIC established a reduced deposit insurance
assessment rate schedule of 4 to 31 basis points ($.04 to $.31 for every $100 of
assessable deposits) for BIF members retroactive to May 1995. The FDIC further
reduced the premiums applicable to BIF deposits, effective January 1, 1996, to a
minimum flat fee of $2,000 to a maximum assessment of 27 basis points. Under the
new assessment rate schedule, approximately 92% of BIF members will pay only the
minimum fee while SAIF members retain the existing assessment rate schedule of
23 to 31 basis points. BankAtlantic pays deposit insurance premiums primarily to
the SAIF and secondarily, to the BIF in connection with the deposits it acquired
as a result of the acquisition of MegaBank. At March 31, 1996, BankAtlantic had
approximately $135 million of deposits subject to BIF premiums and $1.2 billion
subject to SAIF premiums.
The disparity in insurance premiums between those required for financial
institutions with all or primarily SAIF insured deposits and those with all or
primarily BIF deposits generally allows BIF members to attract and retain
deposits at a lower effective cost. The resulting competitive disadvantage could
also result in BankAtlantic having to raise its deposit rates to remain
competitive or lose deposits to BIF members who may decide to pay higher rates
of interest on deposits because of the lower deposit insurance premiums.
Although BankAtlantic has other sources of funds, such sources may be more
costly than the cost of deposits.
Several alternatives to mitigate the effect of the BIF/SAIF premium
disparity have been proposed by the U.S. Congress, federal regulators, industry
lobbyists and the Clinton Administration. One plan to recapitalize the SAIF that
has gained support of several sponsors would require all SAIF members
institutions, including BankAtlantic, to pay a one-time fee of approximately 85
basis points on the amount of SAIF-insured deposits held by the member
institution at March 31, 1995. This fee would amount to approximately $6.1
million on an after tax basis to BankAtlantic and, if this proposal is enacted
into law, the effect would most likely be an immediate charge to earnings. BBC
is unable to predict whether this proposal or any similar proposal will be
enacted or whether ongoing SAIF premiums will be reduced to a level equal to
that of BIF premiums.
BBC considered converting BankAtlantic's charter to that of a commercial
bank. If BankAtlantic's charter were to be converted, the impact to the
Consolidated Statement of Operations, under current regulations, in addition to
any potential SAIF exit fees which could be similar to the assessment discussed
above, would be a charge to income of approximately $3.2 million relating to the
recapture of the bad debt deduction for Federal income tax purposes. BBC is not
presently pursuing a conversion of BankAtlantic's charter since it is awaiting
the outcome of the legislative proposals relating to the disparity of the
BIF/SAIF premiums, which include a consideration of the treatment of the
recapture of the bad debt deduction as well as the possible consolidation of
bank and thrift charters.
Except for the residential loan servicing operation, all data processing
functions are currently performed by BankAtlantic. On April 24, 1996,
BankAtlantic signed a contract with M&I Data Services, a division of the
Marshall & Ilsley Corporation, ("M&I") to provide data processing services for
seven years. The conversion to the M&I service bureau is anticipated to be
completed in the fourth quarter of 1996. The purpose of the conversion is to
increase capacity as well as improve customer service. The estimated annual
expenses for the service bureau are approximately $2.4 million. The additional
costs associated with the conversion are anticipated to be $2.1 million,
primarily for computer equipment.
On April 9, 1996, BankAtlantic entered into an agreement to acquire BNAB
for approximately $54.0 million in cash. The acquisition will be accounted for
as a purchase for financial reporting purposes. BNAB's primary asset is its
wholly owned subsidiary, Bank of North America of Florida ("BNA"), a Florida
chartered commercial bank. BNA has 13 branches with 11 located in Broward
county, and one in Dade county and one in Palm Beach county. Closing of the
acquisition is expected to occur in the fourth quarter of 1996, subject to
certain conditions including receipt of all required regulatory approvals.
<PAGE>
OTHER INFORMATION
Item 4: Submission of Matters to a Vote of Security Holders
The registrant held a Special Meeting of Stockholders on February 13,
1996 approving an amendment to BBC's Articles of Incorporation by a vote of
6,813,932 for, 795,864 against and 6,545 abstain. See Note 2 to the consolidated
financial statements herein.
Exhibits and Reports on Form 8K
A report on Form 8K , dated April 19, 1996 was filed with the Securities
and Exchange Commission relating to the execution by BankAtlantic, a Federal
Savings Bank of an agreement to acquire Bank of North America Bancorp, Inc.
together with a copy of the Stock Purchase Agreement relating thereto filed
pursuant to Form 8-K. See Note 3 of the consolidated financial statements
herein.
<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.
BANKATLANTIC BANCORP, INC.
May 14, 1996 By: Alan B. Levan
------------ ----------------
Date Alan B. Levan
Chief Executive Officer/
Chairman
May 14, 1996 By: Jasper R. Eanes
------------ ------------------
Date Jasper R. Eanes
Executive Vice President/
Chief Financial Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND> This schedule contains summary financial information
extracted from the Consolidated Statement of
Financial Condition at March 31, 1996 (Unaudited)
and the Consolidated Statement of Operations for
the three months ended March 31, 1996 (Unaudited)
and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> Jan-01-1996
<PERIOD-END> Mar-31-1996
<EXCHANGE-RATE> 1
<CASH> 61,133
<INT-BEARING-DEPOSITS> 1,215,369
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 559,775
<INVESTMENTS-CARRYING> 40,537
<INVESTMENTS-MARKET> 40,537
<LOANS> 863,348
<ALLOWANCE> 18,700
<TOTAL-ASSETS> 1,642,825
<DEPOSITS> 1,323,229
<SHORT-TERM> 107,366
<LIABILITIES-OTHER> 54,411
<LONG-TERM> 21,000
0
0
<COMMON> 117
<OTHER-SE> 136,702
<TOTAL-LIABILITIES-AND-EQUITY> 1,642,825
<INTEREST-LOAN> 20,333
<INTEREST-INVEST> 11,759
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 32,092
<INTEREST-DEPOSIT> 12,379
<INTEREST-EXPENSE> 15,620
<INTEREST-INCOME-NET> 16,472
<LOAN-LOSSES> 940
<SECURITIES-GAINS> 2,292
<EXPENSE-OTHER> 14,515
<INCOME-PRETAX> 7,851
<INCOME-PRE-EXTRAORDINARY> 7,851
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,710
<EPS-PRIMARY> 0.42
<EPS-DILUTED> 0.42
<YIELD-ACTUAL> 8.18
<LOANS-NON> 8,973
<LOANS-PAST> 1,295
<LOANS-TROUBLED> 3,456
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 19,000
<CHARGE-OFFS> 1,854
<RECOVERIES> 614
<ALLOWANCE-CLOSE> 18,700
<ALLOWANCE-DOMESTIC> 18,700
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 4,378
</TABLE>
