<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the Quarterly Period Ended March 31, 1996
-----------------------------------------------
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
For the Transition Period from _______________________ to _____________________
Commission File Number 33-80076
--------------------------------------------------------
SNB BANCSHARES, INC.
- - -------------------------------------------------------------------------------
(Name of Small Business Issuer in its Charter)
GEORGIA 58-2107916
- - ------------------------------------- ------------------------------
State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization Identification No.)
700 WALNUT STREET, MACON, GEORGIA 31208
- - -------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Issuer's Telephone Number (912) 477-6030
-----------------------------------------------------
SAME AS ABOVE
- - -------------------------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last
Report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. X Yes ___ No
---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. ___ Yes ___ No
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
681,400 Shares of $1.00 par value common stock as of March 31, 1996
- - -------------------------------------------------------------------------------
Transitional Small Business Disclosure Format (Check One): ___ Yes ___ No
<PAGE>
SNB BANCSHARES, INC. AND SUBSIDIARY
INDEX
<TABLE>
<CAPTION>
PAGE
NUMBER
--------
<S> <C> <C>
PART I Financial Information
Condensed Consolidated Balance Sheet 1
Condensed Consolidated Statements of Income 2
Condensed Consolidated Statements of Cash Flows 3
Notes to Condensed Consolidated Financial Statements 4
Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II Other Information
ITEM 2 Changes in Securities 10
ITEM 6 Exhibits and Reports on Form 8-K 10
</TABLE>
<PAGE>
PART I, ITEM 1
FINANCIAL INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
<S> <C>
CASH AND DUE FROM BANKS $ 4,584,671
--------------
FEDERAL FUNDS SOLD 2,180,000
--------------
INVESTMENTS SECURITIES 32,888,321
--------------
LOANS 69,673,539
--------------
BANK PREMISES AND EQUIPMENT 2,484,352
--------------
OTHER ASSETS 1,836,870
--------------
TOTAL ASSETS $113,647,753
==============
LIABILITIES AND STOCKHOLDERS' EQUITY
DEPOSITS $ 97,372,964
--------------
BORROWED MONEY 4,497,641
--------------
OTHER LIABILITIES 1,403,512
--------------
103,274,117
--------------
STOCKHOLDERS' EQUITY
Common Stock, Par Value $1 Per Share; Authorized 2,500,000 Shares,
Issued 681,400 Shares 681,400
Paid-In Capital 6,168,700
Retained Earnings 3,556,065
Unrealized Loss on Securities Available for Sale, Net of Tax (32,529)
--------------
10,373,636
--------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $113,647,753
==============
</TABLE>
The accompanying notes are an integral part of this condensed consolidated
balance sheet.
- 1 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
------------ -----------
<S> <C> <C>
INTEREST INCOME $2,336,620 $1,719,806
INTEREST EXPENSE 1,124,400 702,565
------------ -----------
NET INTEREST INCOME 1,212,220 1,017,241
PROVISION FOR LOAN LOSSES 27,000 42,285
------------ -----------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 1,185,220 974,956
NONINTEREST INCOME 239,235 177,691
NONINTEREST EXPENSE 970,579 722,134
------------ -----------
INCOME BEFORE INCOME TAXES 453,876 430,513
INCOME TAXES 124,388 121,792
------------ -----------
NET INCOME $ 329,488 $ 308,721
============ ===========
PRIMARY EARNINGS PER COMMON AND COMMON
EQUIVALENT SHARE $ .45 $ .47
============ ===========
FULLY-DILUTED EARNINGS PER COMMON AND COMMON
EQUIVALENT SHARE $ .45 $ .47
============ ===========
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING 725,733 656,853
============ ===========
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
- 2 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
-------------- ------------
<S> <C> <C>
CASH PROVIDED BY OPERATIONS $ 274,078 $ 290
-------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Sale (Purchase) of Investment Securities 1,484,835 (3,745,657)
Net Loans Made to Customers (6,428,031) (2,520,103)
Purchase of Premises and Equipment (102,047) (62,033)
Cash from Sale of OREO - 60,063
Payment of Dividends (74,954) (60,000)
-------------- ------------
(5,120,197) (6,327,730)
-------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Net Increase in Demand, Interest-Bearing
Demand and Savings Deposits 5,428,315 1,126,924
Net Increase in Time Certificates (1,023,857) 6,032,581
Proceeds from Issuance (Repayment) of
Demand Note to the U.S. Treasury (149,098) (437,142)
Principal Payments on Other Borrowed Money (27,500) -
Proceeds from Issuance of Common Stock 1,750,100 -
-------------- ------------
5,977,960 6,722,363
-------------- ------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 1,131,841 394,923
CASH AND CASH EQUIVALENTS, BEGINNING 5,632,830 4,943,349
-------------- ------------
CASH AND CASH EQUIVALENTS, ENDING $ 6,764,671 $ 5,338,272
============== ============
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
- 3 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(1) BASIS OF PRESENTATION
The consolidated financial statements include SNB Bancshares, Inc. and its
wholly-owned subsidiary, Security National Bank (the Bank), located in Macon,
Georgia. All intercompany accounts have been eliminated in consolidation.
The financial information included herein is unaudited; however, such
information reflects all adjustments which are, in the opinion of management,
necessary to fairly state the financial position and results of operations for
the interim periods presented.
(2) LOANS
Loans as of March 31, 1996 are comprised of the following:
<TABLE>
<S> <C>
Commercial $11,538,078
Real Estate-Construction 3,005,820
Real Estate-Other 50,085,703
Installment Loans to Individuals for Personal Expenditures 6,378,435
-------------
71,008,036
Allowance for Loan Losses (1,155,782)
Unearned Interest and Fees (178,715)
-------------
$69,673,539
=============
</TABLE>
Nonperforming Assets
The following table presents the Company's nonperforming assets as of March 31,
1996:
<TABLE>
<CAPTION>
($ IN
THOUSANDS)
------------
<S> <C>
Impaired and Other Nonaccrual Loans $112
Loans Past Due 90 Days or More and Still Accruing Interest 4
Restructured Loans not Included in the Above -
------------
TOTAL NONPERFORMING LOANS 116
Other Real Estate Owned 348
------------
TOTAL NONPERFORMING ASSETS $464
============
</TABLE>
- 4 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
(2) LOANS (CONTINUED)
Loans are generally reported at principal amount less unearned interest and
fees. On January 1, 1995, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 114, Accounting by Creditors for Impairment of a Loan and
SFAS No. 118, Accounting by Creditors for Impairment of a Loan-Income
Recognition and Disclosures. Impaired loans are loans for which principal and
interest are unlikely to be collected in accordance with the original loan terms
and, generally, represent loans delinquent in excess of 90 days which have been
placed on nonaccrual status and for which collateral values are less than
outstanding principal and interest. Small balance, homogeneous loans are
excluded from impaired loans. Generally, interest payments received on impaired
loans are applied to principal. Upon receipt of all loan principal, additional
interest payments are recognized as interest income on the cash basis. The
adoption of SFAS 114 and 118 did not result in significant changes to the
allowance for loan losses and, accordingly, did not have a material impact on
the financial statements.
Other nonaccrual loans are loans for which payments of principal and interest
are considered doubtful of collection under original terms but collateral values
equal or exceed outstanding principal and interest.
(3) EARNINGS PER SHARE
Earnings per common share and common equivalent share and fully diluted earnings
per share for the three-month period ended March 31, 1996 were computed assuming
all 179,880 outstanding stock options were exercised as of the beginning of
calendar year 1996. The exercise of the option was included in the earnings per
share computation using the treasury stock method and assuming an average market
price for SNB Bancshares, Inc. stock of $21.50 and a closing market price of
$21.50 for the first quarter of 1996. Consequently, 96,202 shares of stock from
the exercise were considered to be common stock equivalents. The excess, if
any, of the proceeds from the assumed exercise over the allowable stock
repurchase under the treasury stock method was assumed to have been used to
reduce short-term debt, with any remaining funds being invested in U.S. Treasury
Notes. The net income component of the period's earnings per share computation
was adjusted for such assumptions.
(4) ALLOWANCE FOR LOAN LOSSES
The allowance method is used in providing for losses on loans. Accordingly, all
loan losses decrease the allowance and all recoveries increase it. The
provision for loan losses is based on factors which, in management's judgment,
deserve current recognition in estimating possible loan losses. Such factors
considered by management include growth and composition of the loan portfolio,
economic conditions and the relationship of the allowance for loan losses to
outstanding loans.
An allowance for loan losses is maintained for all impaired loans. Provisions
are made for impaired loans upon changes in expected future cash flows or
estimated net realizable value of collateral. When determination is made that
impaired loans are wholly or partially uncollectible, the uncollectible portion
is charged off.
- 5 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
(4) ALLOWANCE FOR LOAN LOSSES (CONTINUED)
The following table presents the Company's loan loss experience on all loans for
the three months ending March 31:
<TABLE>
<CAPTION>
($ IN THOUSANDS)
-----------------
1996 1995
-------- -------
<S> <C> <C>
ALLOWANCE FOR LOAN LOSSES, JANUARY 1 $1,128 $1,020
-------- -------
Charge-Offs
Commercial, Financial and Agricultural 9 -
Real Estate - Construction - -
Real Estate - Mortgage - -
Consumer 8 -
-------- -------
17 -
-------- -------
Recoveries
Commercial, Financial and Agricultural 1 6
Real Estate - Construction - 1
Real Estate - Mortgage 14 2
Consumer 3 4
-------- -------
18 13
-------- -------
NET RECOVERIES 1 13
-------- -------
PROVISION FOR LOAN LOSSES 27 42
-------- -------
ALLOWANCE FOR LOAN LOSSES, MARCH 31 $1,156 $1,075
======== =======
RATIO OF NET RECOVERIES TO AVERAGE LOANS 0.00% 0.02%
======== =======
</TABLE>
(5) INVESTMENT SECURITIES
The Bank adopted Statement of Financial Accounting Standards (SFAS) No. 115,
Accounting for Certain Investments in Debt and Equity Securities effective
January 1, 1994. In accordance with the provisions of SFAS 115, the Bank
elected to classify securities individually as either available for sale or held
to maturity. Securities classified as held to maturity are recorded at
amortized cost. Those classified as available for sale are adjusted to market
value through a tax-effected increase or reduction in stockholders' equity.
- 6 -
<PAGE>
PART I, ITEM 1 (CONTINUED)
FINANCIAL INFORMATION
(5) INVESTMENT SECURITIES (CONTINUED)
Investment securities as of March 31, 1996 are summarized as follows:
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
SECURITIES AVAILABLE FOR SALE COST GAINS LOSSES VALUE
-------------- ------------- --------------- --------------
<S> <C> <C> <C> <C>
U.S. Treasuries $ 5,490,910 $ 49,704 $ (1,254) $ 5,539,360
U.S. Government Agencies
Mortgage-Backed 1,066,972 30,948 1,097,920
Other 15,002,725 52,099 (293,977) 14,760,847
State, County and Municipal 4,000,508 121,075 (7,882) 4,113,701
Other 680,200 680,200
-------------- ------------- --------------- --------------
$26,241,315 $253,826 $(303,113) $26,192,028
============== ============= =============== ==============
<CAPTION>
SECURITIES HELD TO MATURITY
<S> <C> <C> <C> <C>
U.S. Government Agencies
Mortgaged-Backed $ 212,467 $ (40) $ 212,427
Other 1,000,000 $ 790 1,000,790
State, County and Municipal 5,483,826 96,040 (22,231) 5,557,635
-------------- ------------- --------------- --------------
$ 6,696,293 $ 96,830 $ (22,271) $ 6,770,852
============== ============= =============== ==============
</TABLE>
The tax-effected change in net unrealized holding losses on securities available
for sale in the amount of $32,529 has been charged to stockholders' equity for
the three months ended March 31, 1996.
(6) NONCASH FINANCING ACTIVITIES
Noncash investing activities for the three months ended March 31 are as follows:
<TABLE>
<CAPTION>
1996 1995
---------- -----------
<S> <C> <C>
Acquisition of Real Estate through Loan Foreclosure $ - $181,285
========== ===========
</TABLE>
(7) ISSUANCE OF COMMON STOCK
During the first quarter of 1996, the Company issued 81,400 shares of additional
common stock to new directors and executive officers joining the Company during
the interim period. These new shares were issued at current market value
resulting in an increase in common stock of $81,400 and an increase in paid-in
capital of $1,668,700.
- 7 -
<PAGE>
PART I, ITEM 2
FINANCIAL INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Management's discussion and analysis of significant factors affecting the
consolidated financial position and operating results during the periods
included in the accompanying financial statements are presented hereafter.
RESULTS OF OPERATIONS
The Company's net income was $329,488 and $308,721 for the quarters ending
March 31, 1996 and 1995, respectively. Net income per weighted average common
and common equivalent share was $0.45 and $0.47, respectively. The decrease in
earnings per share resulted from an increase in weighted average shares
outstanding due, primarily, to the issuance of 81,400 shares during the quarter
ended March 31, 1996. Return on average assets for the Company's sole
subsidiary, Security National Bank, was 1.24 percent for March 31, 1996 and 1.57
percent for March 31, 1995. The Bank's return on average equity was 15.57
percent and 17.58 percent, respectively.
Interest earning assets represented 92.16 percent of total assets as March 31,
1996, compared to 92.02 percent as of March 31, 1995. Loans continue to be the
Company's largest earning asset, posting a 30.10 percent increase since the
first quarter of 1995. Investment securities, the Company's second largest
earning asset, increased by 48.59 percent since March 31, 1995. Deposits and
borrowed funds continue to serve as the primary funding sources for asset
growth, reflected in growth of 33.30 percent and 84.61 percent, respectively,
over the previous year. These growth trends can be attributed to various
factors including the addition in 1995 of the Company's fourth full service
banking office thereby increasing its visibility in the market. This increased
visibility is reflected in an increase in advertising costs, up 150 percent over
first quarter results of 1995. The Company has also enhanced its services with
upgrades in data processing, proof and imaging technology and a new voice
response system. Management is currently reviewing various options for
additional expansion in 1996 in order to better serve the middle Georgia market.
The provision for loan losses represents management's assessment of the amount
necessary to be transferred to the allowance for loan losses to maintain a level
which it considers adequate to absorb future losses which may exist in the loan
portfolio. The amount of additions to the allowance charged to operating
expense is determined through a combination of various methods which include an
ongoing loan review, an analysis of current economic conditions, loan loss
experience, regulatory guidelines and current levels of nonperforming loans.
The Company's provision for loan losses decreased 36.15 percent from $42,285 for
the quarter ended March 31, 1995 to $27,000 for the quarter ended March 31,
1996. The Company's allowance for loan losses decreased 7.56 percent from
$1,074,517 for the first quarter of 1995 to $1,155,782 for the first quarter of
1996. Currently, the allowance for loan losses represents 1.63 percent of
total outstanding loans which the Company regards as adequate to absorb all
future losses inherent in the loan portfolio.
- 8 -
<PAGE>
PART I, ITEM 2 (CONTINUED)
FINANCIAL INFORMATION
LIQUIDITY
The Company manages its liquidity position to ensure adequate cash flow for
deposit withdrawals and credit commitments. Needs are met through loan
repayments, net interest and fee income and the sale or maturity of existing
investments. In addition, liquidity is continuously provided through the
acquisition of new deposits or the renewal of maturing deposits. Through
various asset/liability management strategies, a balance is maintained among
goals of liquidity, safety and earnings potential. The Company has established
an asset/liability committee which continually monitors the relationship of
loans to deposits as it relates to the Company's goals. The Company's loan to
deposit ratio was 72.74 percent as of March 31, 1996. Management considers this
ratio to be satisfactory for liquidity purposes.
CAPITAL RESOURCES
As of March 31, 1996, equity capital equaled 9.13 percent of total assets,
compared to 8.61 percent as of March 31, 1995. Book value per common share
equaled $15.22 as of March 31, 1996 and $12.17 as of March 31, 1995. The
Company issued 81,400 shares of common stock at market value during the first
quarter of 1996, resulting in an additional $1,750,100 of equity capital. Other
changes to equity were net income for the period of $329,488, cash dividends
paid of $74,954 and unrealized losses on investment securities available for
sale (net of tax effect) of $56,674.
Current regulatory standards require bank holding companies to maintain a
minimum risk based capital ratio of qualifying total capital to risk weighted
assets of 8.0 percent, with at least 4.0 percent of the capital consisting of
Tier 1 capital, and a Tier 1 leverage ratio of at least 4.0 percent.
Additionally, the regulatory agencies define a well capitalized bank as one
which has a leverage ratio of at least 5 percent, a Tier 1 capital ratio of at
least 6 percent and a total risk based capital ratio of at least 10 percent. As
of March 31, 1996, the Company's total risk based capital ratio, Tier 1 capital
ratio and Tier 1 leverage ratio were all in compliance at 13.8 percent, 12.5
percent and 9.9 percent, respectively.
- 9 -
<PAGE>
PART II
OTHER INFORMATION
SNB BANCSHARES, INC. AND SUBSIDIARY
ITEM 2
CHANGES IN SECURITIES (LIMITATIONS UPON PAYMENT OF DIVIDENDS)
The information required for limitations upon payment of dividends is
incorporated herein by reference to the Company's annual report of 10-KSB,
Exhibit 99, filed with the Securities and Exchange Commission for the year ended
December 31, 1995 (File No. 33-80076).
ITEM 6
EXHIBITS AND REPORTS ON FORM 8-K
<TABLE>
<CAPTION>
REFERENCE
-----------------------
<S> <C> <C>
(A) EXHIBITS INCLUDED HEREIN AND INCORPORATED BY REFERENCE:
3-Articles of Incorporation and By-Laws Incorporated
by Reference
to 10-KSB for
Year Ended
December 31,
1995
11-Statement Re Computation of Per Share Earnings Page 5,
Footnote 3
</TABLE>
(B) REPORTS ON FORM 8-K
No reports on Form 8-K have been filed by the registrant during the
quarter ended March 31, 1996.
- 10 -
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, SNB Bancshares, Inc. has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized:
SNB BANCSHARES, INC.
_______________________________________________________
Robert C. "Neal" Ham
President/Director/Chief Executive Officer
Date: _________________________________________________
_______________________________________________________
Michael T. O'Dillon
Senior Vice-President/Treasurer/Chief Financial Officer
Date: _________________________________________________
- 11 -
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 4,584,671
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 2,180,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 26,192,028
<INVESTMENTS-CARRYING> 6,696,293
<INVESTMENTS-MARKET> 6,770,852
<LOANS> 71,008,036
<ALLOWANCE> 1,155,782
<TOTAL-ASSETS> 113,647,753
<DEPOSITS> 97,372,964
<SHORT-TERM> 784,541
<LIABILITIES-OTHER> 1,403,512
<LONG-TERM> 3,713,100
681,400
0
<COMMON> 0
<OTHER-SE> 9,692,236
<TOTAL-LIABILITIES-AND-EQUITY> 113,647,753
<INTEREST-LOAN> 1,855,970
<INTEREST-INVEST> 458,130
<INTEREST-OTHER> 22,520
<INTEREST-TOTAL> 2,336,620
<INTEREST-DEPOSIT> 1,053,507
<INTEREST-EXPENSE> 1,124,400
<INTEREST-INCOME-NET> 1,212,220
<LOAN-LOSSES> 27,000
<SECURITIES-GAINS> 26,545
<EXPENSE-OTHER> 970,579
<INCOME-PRETAX> 453,876
<INCOME-PRE-EXTRAORDINARY> 329,488
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 329,488
<EPS-PRIMARY> .45
<EPS-DILUTED> .45
<YIELD-ACTUAL> 9.48
<LOANS-NON> 112,000
<LOANS-PAST> 4,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,128,000
<CHARGE-OFFS> 17,000
<RECOVERIES> 27,000
<ALLOWANCE-CLOSE> 1,156,000
<ALLOWANCE-DOMESTIC> 1,156,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
