UNITED STATES
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 March 31, 1997
---------------------------
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 0-24668
FFVA FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(exact name of registrant specified in its charter)
Virginia 74-2712490
- --------------------------------------------------------------------------------
(state or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
925 Main Street, Lynchburg, Virginia 24504
- --------------------------------------------------------------------------------
(address of principal executive offices) (Zip Code)
(804) 845-2371
- --------------------------------------------------------------------------------
(Registrant's telephone number including area code)
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 (or for such shorter period that registrant was required
to file such reports), 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
common stock, as of the latest practicable date.
Class $.10 par value common stock 4,520,552 shares outstanding
as of April 30, 1997
- --------------------------------------------------------------------------------
Page 1 of 15 Pages
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
FORM 10-Q
Index
-----
Part I Financial Information Page
- ------ --------------------- ----
Item 1. Financial Statements (unaudited)
Consolidated Statements of Financial Condition as of
March 31, 1997 and December 31, 1996 3
Consolidated Statements of Income for the Three Month
Periods ended March 31, 1997 and 1996 4
Consolidated Statements of Changes in Stockholders'
Equity for the Three Months ended March 31, 1997 and 1996 5
Consolidated Statements of Cash Flows for the Three
Months ended March 31, 1997 and 1996 6
Notes to 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
Signature Page 15
2
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In Thousands)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
--------------- ------------
(unaudited)
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 6,113 $ 6,634
Investment securities, held to maturity (Estimated market of $37,893
at March 31, 1997 and $36,498 at December 31, 1996) 38,267 36,290
Investment securities, available for sale, at market 29,419 21,652
Investment securities, restricted, at cost 3,550 3,268
Mortgage-backed securities, held to maturity (Estimated market of $54,712
at March 31, 1997 and $46,738 at December 31, 1996) 54,918 46,570
Mortgage-backed securities, available for sale, at market 79,372 84,899
Loans receivable, net 325,064 321,528
Foreclosed real estate 29 154
Property and equipment, net 6,256 6,283
Accrued interest receivable 4,103 4,054
Prepaid expenses and other assets 1,102 886
Goodwill 1,578 1,608
--------- ---------
Total assets $ 549,771 $ 533,826
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits $ 406,812 $ 397,435
Advances from Federal Home Loan Bank and other borrowed money 67,990 60,000
Advances from borrowers for taxes and insurance 996 917
Other liabilities 2,631 993
--------- ---------
Total liabilities 478,429 459,345
--------- ---------
Stockholders' equity
Preferred stock, $.10 par value, 500,000 shares authorized, none issued -- --
Common stock, $.10 par value, 11,500,000 shares authorized,
4,520,552 and 4,692,552 outstanding, respectively 452 469
Additional paid-in capital 43,687 45,336
Less unearned ESOP and MSBP shares (3,726) (3,726)
Retained earnings, substantially restricted 30,342 31,220
Unrealized gain on assets available for sale, net of taxes 587 1,182
--------- ---------
Total stockholders' equity 71,342 74,481
--------- ---------
Total liabilities and stockholders' equity $ 549,771 $ 533,826
========= =========
</TABLE>
See Notes to Consolidated Financial Statements
3
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands)
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
1997 1996
------ -----
(unaudited)
<S> <C> <C>
INTEREST INCOME
Loans $ 7,097 $ 6,608
Mortgage-backed securities 2,307 2,098
U. S. Government obligations, agencies, and
other investments including overnight deposits 1,228 1,280
------- -------
Total interest income 10,632 9,986
------- -------
INTEREST EXPENSE
Deposits 4,602 4,639
Borrowed money 914 560
------- -------
Total interest expense 5,516 5,199
------- -------
Net interest income 5,116 4,787
PROVISION FOR CREDIT LOSSES - 60
------- -------
Net interest income after provision for credit losses 5,116 4,727
------- -------
NONINTEREST INCOME
Service charges and fees on loans 117 95
Net gain (loss) on sale of investments 39 91
Other income 187 147
------- -------
Total noninterest income 343 333
------- -------
NONINTEREST EXPENSES
Compensation and other personnel costs 1,524 1,450
Office occupancy and equipment 268 240
Federal insurance of accounts 60 203
Data processing 260 243
Advertising 58 86
Other 321 347
------- -------
Total noninterest expense 2,491 2,569
------- -------
Income before income tax expense 2,968 2,491
Income tax expense 1,074 882
------- -------
Net Income $ 1,894 $ 1,609
======= =======
Primary earnings per share $ .40 $ .30 *
Fully diluted earnings per share $ .40 $ .30 *
Cash dividends paid per common share $ .10 $ .075 *
</TABLE>
See Notes to Consolidated Financial Statements
* Restated to reflect two-for-one stock split paid June 5, 1996
4
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(in thousands)
unaudited
<TABLE>
<CAPTION>
Unrealized
Gain
Additional on Assets Unearned Unearned
Common Paid-In Retained Available ESOP MSBP
Three Months Ended March 31, 1996: Stock Capital Earnings For Sale, Net Shares Shares Total
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1995 $ 285 $ 55,057 $ 35,824 $ 1,508 $ (2,339) $ (2,276) $ 88,059
Net Income - - 1,609 - - - 1,609
Change in unrealized gain on
assets available for sale, net - - - (513) - - (513)
Repurchase of common stock (14) (2,680) (1,564) - - - (4,258)
Cash dividends paid - - (410) - - - (410)
----------------------------------------------------------------------------------------------
Balance at March 31, 1996 $ 271 $ 52,377 $ 35,459 $ 995 $ (2,339) $ (2,276) $ 84,487
==============================================================================================
Three Months ended March 31, 1997:
Balance at December 31, 1996 $ 469 $ 45,336 $ 31,220 $ 1,182 $ (2,000) $ (1,726) $ 74,481
Net Income - - 1,894 - - - 1,894
Change in unrealized gain on
assets available for sale, net - - - (595) - - (595)
Repurchase of common stock (17) (1,649) (2,323) - - - (3,989)
Cash dividends paid - - (449) - - - (449)
----------------------------------------------------------------------------------------------
Balance at March 31, 1997 $ 452 $ 43,687 $ 30,342 $ 587 $ (2,000) $ (1,726) $ 71,342
==============================================================================================
</TABLE>
5
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
<TABLE>
<CAPTION>
Three months Ended March 31,
1997 1996
---------- ---------------
(unaudited)
OPERATING ACTIVITIES
<S> <C> <C>
Net income $ 1,894 $ 1,609
Adjustments to reconcile net income to
net cash provided by operating activities:
Provision for credit losses -- 60
Gain on sale of equipment -- (1)
Provision for depreciation and amortization 157 141
Amortization of premium on sale of loans 4 6
Realized investment security gains (39) (91)
Loss on sale of foreclosed real estate 1 --
Increase in interest receivable (49) (38)
Decrease in other assets 133 112
Increase in other liabilities 1,717 1,225
-------- --------
Net cash provided by operating activities 3,818 3,023
-------- --------
INVESTING ACTIVITIES
Proceeds from maturities of investment securities
held to maturity 23 3,015
Purchases of investment securities held to
maturity and FHLB stock (2,282) (4,170)
Proceeds from sales of investment securities
available for sale 3,042 2,102
Purchases of investment securities available for sale (11,112) (4,365)
Proceeds from collections on mortgage-backed
securities held to maturity 1,789 1,412
Purchases of mortgage-backed securities held to maturity (10,137) (10,129)
Proceeds from sales of and collections on
mortgage-backed securities available for sale 4,925 6,017
Purchases of mortgage-backed securities available for sale -- (9,889)
Net increase in loans receivable (3,540) (5,847)
Purchases of premise and equipment (100) (347)
Proceeds from sale of foreclosed real estate 131 --
Purchases of foreclosed real estate (7) (46)
-------- --------
Net cash used by investing activities (17,268) (22,247)
-------- --------
</TABLE>
(continued)
6
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS, continued
(In Thousands)
<TABLE>
<CAPTION>
Three months Ended March 31,
1997 1996
--------- ------------
(unaudited)
<S> <C> <C>
FINANCING ACTIVITIES
Net increase in deposit accounts $ 9,377 $ 5,204
Proceeds from advances and other borrowed money 27,020 29,184
Repayments of advances and other borrowed money (19,030) (11,539)
Repurchase of common stock (3,989) (4,258)
Payment of cash dividend (449) (410)
-------- --------
Net cash provided by financing activities 12,929 18,181
-------- --------
Decrease in cash and cash equivalents (521) (1,043)
Cash and cash equivalents at beginning of period 6,634 7,683
-------- --------
Cash and cash equivalents at end of period $ 6,113 $ 6,640
======== ========
Supplemental disclosures
Gross unrealized gain on assets available for sale $ 917 $ 1,554
Deferred income tax (330) (559)
-------- --------
Net unrealized gain on assets available for sale $ 587 $ 995
======== ========
Cash paid for:
Interest on deposits and borrowed funds $ 5,327 $ 5,177
Income taxes $ 47 $ -
</TABLE>
See Notes to Consolidated Financial Statements
7
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Three Months Ended March 31, 1997 and 1996
(1) Principles of Consolidation
The accompanying unaudited consolidated financial statements include the
accounts of FFVA Financial Corporation ("the Company") and its wholly owned
subsidiary, First Federal Savings Bank of Lynchburg ("the Bank"). The Company's
business is conducted principally through the Bank. All material intercompany
balances and transactions have been eliminated in the consolidation.
(2) Basis of Presentation
The accompanying unaudited consolidated financial statements were prepared in
accordance with the instructions for Form 10-Q and do not include information or
footnotes necessary for a complete presentation of financial condition, results
of operations and cash flows in conformity with generally accepted accounting
principles. These statements should be read in conjunction with the audited
consolidated financial statements and notes hereto for the year ended December
31, 1996 of FFVA Financial Corporation. In the opinion of management, all
adjustments (consisting only of normal recurring adjustments) necessary for a
fair presentation of the consolidated financial statements have been included.
The results of operations and other data for the three month period ended March
31, 1997 are not necessarily indicative of the results that may be expected for
the entire fiscal year ended December 31, 1997.
(3) Conversion to Stock Ownership
On October 12, 1994, the Company issued 3,151,832 (pre-split) shares of $.10 par
value common stock at $20 per share and became the Parent Company of the Bank.
Net proceeds, after deducting conversion expenses of $2.0 million, were $61.1
million and are reflected as common stock and additional paid in capital in the
accompanying consolidated statements of financial condition.
As part of the conversion to stock form, the Bank formed an Employee Stock
Ownership Plan ("ESOP") for eligible employees. The ESOP purchased 157,467
(pre-split) common shares of the company issued in the conversion, which was
funded by a loan from the Company. There are currently 200,000 shares of
unallocated stock securing the loan. The Company accounts for its ESOP in
accordance with Statement of Position 93-6. Accordingly, the shares pledged as
collateral are reported as a reduction of the stockholders' equity in the
consolidated balance sheet.
(4) Stock Split
On June 5, 1996, the Company's stock split two-for-one as the result of the
payment of a 100% stock dividend. References to the number of shares outstanding
and earnings per share for periods presented prior to the stock split have been
adjusted to reflect the effect of the stock split unless otherwise noted.
(5) Stock Repurchase and Retirement
During the quarter ending March 31, 1997, the Company repurchased 172,000 shares
of common stock at an average price of $23.19 per share. In accordance with the
Laws of Virginia, this stock was retired, resulting in a reduction in the number
of common shares reported as issued and outstanding at March 31, 1997 to
4,520,552 shares. As a result of the repurchase, common stock was reduced
$17,000, additional paid-in capital was reduced $1.6 million and retained
earnings were reduced $2.3 million to reflect the elimination of the shares.
8
<PAGE>
(6) Management and Stock Option Plans
During 1995, the Company formed a Management and Director Stock Bonus Plan
(MSBP). Under the plan, common stock is available for issuance to directors and
personnel in key positions of responsibility. A total of 49,428 (adjusted for
split) shares were distributed on April 27, 1996. As of March 31, 1997, a total
of 196,000 shares remain allocated to directors and personnel with distribution
scheduled annually until April 27, 2000. As of March 31, 1997 the Company held
121,320 shares at an average purchase price of $14.23 for future distribution.
These undistributed shares have been accounted for as a reduction of the
stockholders' equity in the consolidated balance sheet.
The Company also implemented a stock option plan during 1995. This plan provides
for the granting to directors and personnel in key positions of responsibility
630,366 options to purchase common stock at a price of $12.50 per share (the
closing market price of the stock on the date of approval, adjusted for the
effect of the stock split). The options vest over a five year period, with the
first options having vested on April 27, 1996. As of March 31, 1997 there were
118,221 vested options outstanding.
(7) Earnings Per Share
Earnings per share of common stock for the three month periods ended March 31,
1997 and 1996 has been determined by dividing the net income for the periods by
the calculated weighted average number of shares of common stock and common
stock equivalents outstanding. In accordance with Statement of Position 93-6,
shares controlled by the ESOP are not considered in the weighted average number
of shares outstanding until the shares are committed for allocation to an
employee's individual account. Earnings per share amounts for prior periods have
been restated to reflect the two-for-one stock split paid June 5, 1996.
(8) Commitments and Contingencies
At March 31, 1997, the Company had outstanding commitments to originate mortgage
loans of $6.4 million. Unused consumer, equity and commercial lines of credit
available to customers were $20.7 million at March 31, 1997. The undisbursed
portion of loans in process totaled $2.9 million at March 31, 1997 and the
Company had outstanding commitments to purchase $3.0 million fixed-rate mortgage
backed securities. In addition, the Bank is also a party to interest rate swap
agreements with a regional bank totaling $15.0 million.
9
<PAGE>
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Changes in Financial Condition
- ------------------------------
Total assets of the Company increased by $16.0 million, or 3.00%, from $533.8
million at December 31, 1996 to $549.8 million at March 31, 1997. The increase
in total assets during the first three months of 1997 was due primarily to the
purchase of mortgage-backed and investment securities and an increase in the
balance of net loans receivable.
Cash and cash equivalents decreased by $500,000, or 7.58%, to $6.1 million at
March 31, 1997. Investment securities increased by $10.0 million, or 16.34%, to
$71.2 million at March 31, 1997. At March 31, 1997, $41.8 million of the
Company's investment securities (which include restricted securities totalling
$3.6 million) were classified as held to maturity and $29.4 million of
investment securities were classified as available for sale. Mortgage-backed
securities increased by $2.8 million, or 2.13%, to $134.3 million at March 31,
1997. At March 31, 1997, $54.9 million of the Company's mortgage-backed
securities were classified as held to maturity, and $79.4 million of
mortgage-backed securities were classified as available for sale.
Loans receivable, net, increased by $3.6 million, or 1.01%, to $325.1 million at
March 31, 1997 compared to $321.5 million at December 31, 1996. The increase is
largely due to management's increased emphasis on expanding its loan portfolio.
While mortgage loans outstanding remained relatively stable, non-mortgage loans
increased by approximately $3.0 million.
Deposits increased by $9.4 million, or 2.37%, from $397.4 million at December
31, 1996 to $406.8 million at March 31, 1997.
FHLB advances and other borrowed money increased by $8.0 million, or 13.33%, to
$68.0 million at March 31, 1997, compared to $60.0 million at December 31, 1996.
During the period, the Company increased its net outstanding FHLB advances by
$25.0 million and decreased its net reverse repurchase agreements outstanding
with a regional bank by $17.0 million. Funds from the additional borrowings were
used to fund the purchase of mortgage backed and investment securities and to
fund the growth of the company's loan portfolio.
Equity decreased by $3.2 million, or 4.30%, from $74.5 million at December 31,
1996 to $71.3 million at March 31, 1997. The decrease was primarily a result of
the company's decision to repurchase and retire 172,000 shares of common stock,
reducing equity by $4.0 million. This was partially offset by net income of $1.9
million during the three month period. Equity was also decreased due to a
decline in the market value of available for sale securities, net of taxes of
$595,000 during the three month period. Equity decreased $449,000 as the result
of the Company paying a $.10 per share dividend for the first quarter of 1997.
Comparison of Results of Operation for the Three Months ended March 31, 1997 and
1996.
- --------------------------------------------------------------------------------
Net Income
Net income increased $285,000 as the Company reported net income of $1.9 million
for the three month period ended March 31, 1997 compared to $1.6 million for the
three month period ended March 31, 1996. The company reported a $329,000
increase in net interest income, a $60,000 decrease in the provision for credit
losses and a $78,000 decrease in noninterest expense. These were partially
offset by a $192,000 increase in income tax expense.
10
<PAGE>
Net Interest Income
Net interest income increased by $329,000, or 6.9%, in the three months ended
March 31, 1997 to $5.1 million compared to $4.8 million in the same period in
1996. The Company's interest rate spread and net interest margin were 3.40% and
3.92%, respectively, during the three month period ended March 31, 1997. This
compares to an interest rate spread and net interest margin of 3.18% and 3.90%
respectively, for the three month period ended March 31, 1996.
Provision for Credit Losses
Based on managements' evaluation of the loan portfolio, the Company recorded a
provision for credit losses of $60,000 for the three month period ending March
31, 1996. No provision for credit loss was recorded for the three month period
ended March 31, 1997. The allowance for credit losses at March 31, 1997 totaled
$3.3 million or 1.00% of gross loans receivable.
Noninterest Income
Noninterest income remained relatively stable for each of the three month
periods ended March 31, 1997 and 1996.
Noninterest Expense
Noninterest expense decreased $78,000, or 3.04%, for the three month period
ending March 31, 1997 compared to the three month period ended March 31, 1996
from $2.6 million to $2.5 million. The decrease was primarily the result of a
$143,000 decrease in the cost of federal insurance of accounts from $203,000 to
$60,000. This was partially offset by a $74,000 increase in compensation and
other personnel costs.
Income Tax Expense
The company recognized income tax expense of $1.1 million for the three months
ended March 31, 1997 compared to $882,000 for the comparable period in 1996.
Such increases in income tax expenses during the three month period ended March
31, 1997 primarily reflect the increase in the Company's net income before
taxes.
Liquidity and Capital Resources
- -------------------------------
The Bank's liquidity is a product of its operating, investing and financing
activities. The Bank's primary sources of funds are deposits, borrowings,
amortization, prepayments and maturities of outstanding loans and
mortgage-backed securities, maturities of investment securities and funds
provided from operations. While scheduled payments from the amortization of
loans and mortgage-backed securities and maturing investment securities are
relatively predictable sources of funds, deposit flows and loan prepayments are
greatly influenced by general interest rates, economic conditions and
competition. In addition, the Bank invests excess funds in overnight deposits to
fund cash requirements experienced in the normal course of business. The Bank
has been able to generate sufficient cash through its deposits as well as
borrowings (consisting primarily of advances from the FHLB of Atlanta and
reverse repurchase agreements with other banks). At March 31, 1997, the Bank had
$66.0 million of outstanding advances from the FHLB of Atlanta and $2.0 million
of reverse repurchase agreements with other banks. The Bank is also party to an
interest rate swap agreement whereby the Bank pays a fixed rate of interest and
receives a variable rate of interest from the counterparty. The net effect of
this transaction is to effectively convert $7.0 million of variable rate FHLB
advances to a fixed rate of 5.20% until January 1998 and $8.0 million of
variable rate FHLB advances to a fixed rate of 5.27% until February 1999.
11
<PAGE>
Liquidity management is both a daily and long-term function of business
management. Excess cash is generally invested in overnight deposits. On a
longer-term basis, the Bank maintains a strategy of purchasing investment
securities and mortgage-backed securities. The Bank attempts to ladder the
maturities of its investment portfolio to provide an ongoing source of
liquidity. The Bank uses its sources of funds primarily to meet its ongoing
commitments, to pay maturing savings certificates and savings withdrawals, fund
loan commitments and maintain a portfolio of mortgage-backed and investment
securities. At March 31, 1997, the total approved loan commitments outstanding
amounted to $6.4 million. At the same date, commitments under unused lines of
credit amounted to $20.7 million, while the undisbursed balance on construction
loans totalled $2.9 million. Certificates of deposit scheduled to mature in one
year or less at March 31, 1997 totaled $162.4 million. Management believes that
a significant portion of maturing deposits will remain with the Bank. The Bank
had an average liquidity ratio of 13.39% during the quarter ended March 31,
1997, which exceeded the required minimum liquid asset ratio of 5.0%.
At March 31, 1997, the Bank had regulatory capital which was well in excess of
applicable limits. At March 31, 1997, the Bank was required to maintain tangible
capital of 1.5% of adjusted total assets, core capital of 3.0% of adjusted total
assets, and risk-based capital of 8.0% of adjusted risk-weighted assets. At
March 31, 1997, the Bank's tangible capital was $54.7 million, or 9.97% of
adjusted total assets, core capital was $54.7 million, or 9.97% of adjusted
total assets and risk-based capital was $58.0 million, or 20.55% of adjusted
risk-weighted assets, exceeding the requirements by $46.5 million, $38.3
million, and $35.4 million, respectively.
12
<PAGE>
Average Balance Sheet
The following table sets forth certain information relating to the Savings
Bank's statements of financial condition and the statements of income for the
three month periods ended March 31, 1997 and 1996 and reflects the average yield
on assets and average cost of liabilities for the periods indicated. Such yields
and costs are derived by dividing income or expense by the average balance of
assets and liabilities, respectively, for the periods shown. Average balances
are derived from month end balances. Management does not believe that the use of
month end balances instead of average daily balances has caused any material
difference in the information presented. The average balances of loans
receivable include loans on which the Savings Bank has discontinued accruing
interest. The yields and costs include fees which are considered adjustments to
yields. Market value adjustments recorded in compliance with SFAS 115 are not
considered when computing the yields and average balance of securities.
<TABLE>
<CAPTION>
For the Three Months Ended March 31
------------------------------------------------------------------------------
1997 1996
------------------------------------------------------------------------------
Average Average Average Average
Balance Interest Yield/Cost Balance Interest Yield/Cost
------- -------- ---------- ------- -------- ----------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Assets:
Interest-earning assets:
Mortgage loans, net............. $289,539 $6,314 8.72% $273,997 $6,101 8.91%
Consumer and other loans, net... 33,490 783 9.35 21,077 507 9.62
Mortgage-backed and related
securities(1).................. 129,680 2,307 7.12 122,086 2,098 6.87
Overnight and short term deposits 6,303 81 5.14 4,178 59 5.65
Investment securities(1)(2)..... 63,263 1,147 7.25 69,913 1,221 6.99
-------- ------ -------- -----
Total interest-earning assets 522,275 10,632 8.14 491,251 9,986 8.13
------ -----
Noninterest-earning assets........ 19,634 18,215
-------- --------
Total assets................ $541,909 $509,466
======== ========
Liabilities and Equity Capital:
Interest-bearing liabilities:
Deposits:
Transaction accounts........... $ 84,340 559 2.65 $ 81,689 602 2.95
Savings and certificates....... 316,663 4,043 5.11 297,596 4,037 5.43
-------- ------ -------- -----
Total deposits.............. 401,003 4,602 4.59 379,285 4,639 4.89
FHLB advances and other
borrowings...................... 64,008 914 5.71 40,983 560 5.47
-------- ------ ------- -----
Total interest-bearing liabilities 465,011 5,516 4.74 420,268 5,199 4.95
------ -----
Other liabilities................. 3,413 3,219
-------- --------
Total liabilities........... 468,424 423,487
------- --------
Equity capital.................... 73,485 85,979
-------- --------
Total liabilities and equity
capital..................... $541,909 $509,466
======== ========
Net interest income/interest rate
spread(3)......................... $ 5,116 3.40% $ 4,787 3.18%
======= =======
Net earning assets/net interest
margin(4)......................... $57,264 3.92% $70,983 3.90%
======== ========
Ratio of interest-earning assets to
interest-bearing liabilities...... 112.31% 116.89%
======= =======
</TABLE>
- ----------------------------------------------
(1) Includes assets available for sale.
(2) Includes FHLB-Atlanta stock.
(3) Interest-rate spread represents the difference between the average rate on
interest-earning assets and the average cost of interest-bearing
liabilities.
(4) Net interest margin represents the net interest income before the provision
for credit losses divided by average interest-earning assets.
13
<PAGE>
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
PART II-OTHER INFORMATION
Item 1 Legal Proceedings
-----------------
The Company is not engaged in any legal proceedings of a material
nature at the present time. 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.
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
---------------------------------------------------
None
Item 5 Other Information
-----------------
None
Item 6 Exhibits and reports on Form 8-K
--------------------------------
(a) Exhibits:
11 Statement regarding computation of per share earnings
(b) Reports on Form 8-K:
None
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.
FFVA FINANCIAL CORPORATION
Dated: April 30, 1997 /s/ James L. Davidson, Jr.
----------------------- --------------------------------------
James L. Davidson, Jr.
President and Chief Executive Officer
Dated: April 30, 1997 /s/ Ronald W. Neblett,CPA
----------------------- --------------------------------------
Ronald W. Neblett, CPA
Senior Vice-President, Treasurer, and
Chief Financial Officer
15
FFVA FINANCIAL CORPORATION AND SUBSIDIARY
EXHIBIT 11
Statement Regarding Computation of Earnings Per Share
<TABLE>
<CAPTION>
Three Months Ended March 31
1997 1996 (1)
----------- -----------
Primary Earnings per Share:
- ---------------------------
<S> <C> <C>
Weighted average number of shares outstanding 4,617,640 5,532,038
Average unallocated ESOP Shares (200,000) (233,852)
Incremental shares attributed to outstanding options 266,840 100,736
----------- -----------
Weighted average number of common stock
equivalents 4,684,480 5,398,922
=========== ===========
Net Income $ 1,894,000 $ 1,609,000
=========== ===========
Primary earnings per common and common
equivalent share $ .40 $ .30
Earnings Per Share Assuming Full Dilution:
- ------------------------------------------
Weighted average number of shares outstanding 4,617,640 5,532,038
Average unallocated ESOP shares (200,000) (233,852)
Incremental shares attributed to outstanding options 266,840 100,736
----------- -----------
Weighted average number of common stock
equivalents 4,684,480 5,398,922
=========== ===========
Net Income $ 1,894,000 $ 1,609,000
=========== ===========
Fully diluted earnings per common and common
equivalent shares $ .40 $ .30
</TABLE>
The Company accounts for the shares acquired by the Employee Stock Ownership
Plan ("ESOP") in accordance with Statement of Position 93-6: shares controlled
by the ESOP are not considered in the weighted average shares outstanding until
the shares are committed for allocation.
(1) Restated to reflect two-for-one stock split paid June 5, 1996.
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 3,641
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 2,472
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 108,791
<INVESTMENTS-CARRYING> 96,735
<INVESTMENTS-MARKET> 96,155
<LOANS> 328,367
<ALLOWANCE> 3,303
<TOTAL-ASSETS> 549,771
<DEPOSITS> 406,812
<SHORT-TERM> 38,990
<LIABILITIES-OTHER> 3,627
<LONG-TERM> 29,000
0
0
<COMMON> 452
<OTHER-SE> 70,890
<TOTAL-LIABILITIES-AND-EQUITY> 549,771
<INTEREST-LOAN> 7,097
<INTEREST-INVEST> 3,535
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 10,632
<INTEREST-DEPOSIT> 4,602
<INTEREST-EXPENSE> 5,516
<INTEREST-INCOME-NET> 5,116
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 39
<EXPENSE-OTHER> 2,491
<INCOME-PRETAX> 2,968
<INCOME-PRE-EXTRAORDINARY> 2,968
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,894
<EPS-PRIMARY> .40
<EPS-DILUTED> .40
<YIELD-ACTUAL> 8.14
<LOANS-NON> 535
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 3,310
<CHARGE-OFFS> 7
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 3,303
<ALLOWANCE-DOMESTIC> 1,515
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,788
</TABLE>
