<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20552
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended December 31, 1997.
[ ] 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 0-24948
---------------------------------------------------
PVF Capital Corp.
- --------------------------------------------------------------------------
( Exact name of registrant as specified in its charter)
United States 34-1659805
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
25350 Rockside Road, Bedford Heights, Ohio 44146
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(Address of principal executive offices) (Zip Code)
(216) 439-2200
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(Registrant's telephone number, including area code)
Not Applicable
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(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 (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES X NO
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, $0.01 Par Value 2,659,077
- ------------------------------------- ---------------------------------
(Class) (Outstanding at January 31, 1998)
<PAGE>
PVF CAPITAL CORP.
INDEX
Page
Part I Financial Information
Item 1 Financial Statements
Consolidated Statements of Financial
Condition, December 31, 1997 (unaudited)
and June 30, 1997. 1
Consolidated Statements of Operations for
the three and six months ended December 31,
1997 and 1996 (unaudited). 2
Consolidated Statements of Cash Flows for
the six months ended December 31, 1997 and
1996 (unaudited). 3
Notes to Consolidated Financial
Statements (unaudited). 4
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of
Operations 6
Part II Other Information 11
<PAGE>
PART I FINANCIAL INFORMATION
ITEM 1
PVF CAPITAL CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
ASSETS 1997 1997
------ ----------- -----------
<S> <C> <C>
Cash and amounts due from depository institutions $3,248,252 $7,760,029
Interest bearing deposits 348,840 445,401
Federal funds sold 2,875,000 1,375,000
Investment securities held to maturity, at cost 10,995,974 13,995,350
Loans receivable, net 363,917,506 341,402,566
Loans receivable held for sale, net 1,582,704 709,604
Mortgage-backed securities held to maturity, net 3,390,177 511,530
Office properties and equipment, net 1,760,283 1,882,390
Real estate owned, net 1,101,186 0
Real estate in development 917,262 909,758
Investment required by law
Stock in the Federal Home Loan Bank of Cincinnati 2,867,313 2,762,314
Prepaid expenses and other assets 3,209,636 1,327,358
------------ ------------
Total Assets $396,214,133 $373,081,300
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Liabilities
Deposits $316,006,253 $288,269,674
Advances from the Federal Home Loan Bank of Cincinnati 39,865,551 47,405,424
Notes payable 1,710,000 2,310,000
Advances from borrowers for taxes and insurance 4,772,528 4,511,595
Accrued expenses and other liabilities 5,021,402 4,311,191
------------ ------------
Total Liabilities 367,375,734 346,807,884
Stockholders' Equity
Serial preferred stock, none issued 0 0
Common stock 26,591 25,556
Paid in capital 14,525,448 14,522,275
Retained earnings-substantially restricted 14,286,360 11,725,585
------------ ------------
Total Stockholders' Equity 28,838,399 26,273,416
------------ ------------
Total Liabilities and Stockholders' Equity $396,214,133 $373,081,300
------------ ------------
------------ ------------
</TABLE>
See accompanying notes to consolidated financial statements
PAGE 1
<PAGE>
PART I FINANCIAL INFORMATION
ITEM 1
PVF CAPITAL CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
------------------------- --------------------------
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Interest income
Loans $8,227,571 $7,272,036 $16,101,911 $14,302,570
Mortgage-backed securities 43,656 85,084 53,429 265,467
Cash and investment securities 298,193 305,281 609,924 630,603
---------- ---------- ----------- -----------
Total interest income 8,569,420 7,662,401 16,765,264 15,198,640
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Interest expense
Deposits 4,184,766 3,529,625 8,345,511 6,985,822
Borrowings 597,609 569,867 1,119,921 1,129,238
---------- ---------- ----------- -----------
Total interest expense 4,782,375 4,099,492 9,465,432 8,115,060
---------- ---------- ----------- -----------
Net interest income 3,787,045 3,562,909 7,299,832 7,083,580
Provisions for loan losses 50,000 0 95,000 0
---------- ---------- ----------- -----------
Net interest income after provision for loan losses 3,737,045 3,562,909 7,204,832 7,083,580
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Noninterest income, net
Service and other fees 127,413 119,879 264,548 241,592
Mortgage banking activities, net 198,541 151,931 387,256 188,313
Other, net 41,071 23,042 140,657 98,940
---------- ---------- ----------- -----------
Total noninterest income, net 367,025 294,852 792,461 528,845
---------- ---------- ----------- -----------
Noninterest expense
Compensation and benefits 1,147,110 1,081,052 2,252,432 2,166,089
Office, occupancy, and equipment 388,328 414,010 787,545 791,285
Federal deposit insurance special assessment 0 0 0 1,707,867
Other 568,316 572,504 1,069,711 1,157,845
---------- ---------- ----------- -----------
Total noninterest expense 2,103,754 2,067,566 4,109,688 5,823,086
---------- ---------- ----------- -----------
Income before federal income tax provision 2,000,316 1,790,195 3,887,605 1,789,339
Federal income tax provision 699,000 609,000 1,325,000 619,000
---------- ---------- ----------- -----------
Net income $1,301,316 $1,181,195 $ 2,562,605 $ 1,170,339
Basic earnings per share $ 0.50 $ 0.45 $ 0.99 $ 0.45
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Diluted earnings per share $ 0.47 $ 0.43 $ 0.93 $ 0.42
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
</TABLE>
See accompanying notes to consolidated financial statements
PAGE 2
<PAGE>
PART I FINANCIAL INFORMATION
ITEM 1
PVF CAPITAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31ST
-------------------------
1997 1996
---- ----
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $2,562,605 $1,170,339
Adjustments to reconcile net income to net cash provided by operating activities
Accretion of discount on securities (624) (625)
Depreciation and amortization 228,088 237,230
Provision for losses on loans 95,000 0
Provision for lower of cost or market adjustment on loans held for sale 0 81,930
Accretion of unearned discount and deferred loan origination fees, net (601,011) (726,397)
Change in loans receivable held for sale, net (692,529) 9,594,212
Gain on sale of loans, net (180,571) (152,748)
Loss on mortgage-backed securities available for sale, net 0 65,086
Gain on disposal of real estate owned, net (13,009) 0
Change in accrued interest on investments, loans, and borrowings, net (186,627) (216,931)
Change in other assets and other liabilities, net (1,155,940) (317,822)
---------- ----------
Net cash provided by operating activities 55,382 9,734,274
---------- ----------
INVESTING ACTIVITIES
Loan and mortgage-backed securities repayments and originations, net (22,870,170) (44,753,626)
Proceeds from mortgage-backed securities available for sale 0 12,738,470
Mortgage-backed securities held to maturity purchases, net (3,017,178) 0
Investment securities held to maturity purchases (3,000,000) 0
Investment securities maturities 6,000,000 100,000
Disposal of real-estate owned properties 257,815
FHLB stock purchases dividends, net (105,981) (261,121)
Office properties and equipment (purchases) sales, net (104,999) 319,000
Change in real estate in development, net (7,504) (34,551)
---------- ----------
Net cash used in investing activities (22,848,017) (31,891,828)
---------- ----------
FINANCING ACTIVITIES
Net increase in demand deposits, NOW, and passbook savings 2,791,855 488,286
Net increase in time deposits 25,029,937 6,562,589
Net increase (decrease) in FHLB advances (7,539,873) 7,462,462
Repayment of notes payable (600,000) (200,000)
Proceeds from exercise of stock options 4,519 0
Cash paid in lieu of fractional shares (2,141) (1,349)
---------- ----------
Net cash provided by financing activities 19,684,297 14,311,988
---------- ----------
Net decrease in cash and cash equivalents (3,108,338) (7,845,566)
Cash and cash equivalents at beginning of period 9,580,430 13,790,216
---------- ----------
Cash and cash equivalents at end of period $6,472,092 $5,944,650
---------- ----------
---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements
PAGE 3
<PAGE>
Part I Financial Information
Item 1
PVF CAPITAL CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
(UNAUDITED)
1. The accompanying consolidated interim financial statements were prepared
in accordance with regulations of the Securities and Exchange Commission for
Form 10-Q. All information in the consolidated interim financial statements
is unaudited except for the June 30, 1997 consolidated statement of financial
condition which was derived from the Corporation's audited financial
statements. Certain information required for a complete presentation in
accordance with generally accepted accounting principles has been condensed
or omitted. However, in the opinion of management, these interim financial
statements contain all adjustments, consisting only of normal recurring
accruals, necessary to fairly present the interim financial information. The
results of operations for the three and six months ended December 31, 1997
are not necessarily indicative of the results to be expected for the entire
year ending June 30, 1998. The results of operations for PVF Capital Corp.
("PVF" or the "Company") for the periods being reported have been derived
primarily from the results of operation of Park View Federal Savings Bank
(the "Bank"). PVF Capital Corp.'s common stock is traded on the NASDAQ
SMALL-CAP ISSUES under the symbol PVFC.
2. Legislation was signed into law on September 30, 1996 to recapitalize
the Savings Association Insurance Fund ("SAIF") that required SAIF-insured
savings institutions to pay a one-time special assessment of 65.7 cents for
every $100 of deposits. This assessment was charged against earnings for the
quarter ended September 30, 1996 and resulted in a pre-tax charge to the
Company of approximately $1,708,000 and is reflected in the Statement of
Operation for the six-month period ended December 31, 1996.
3. PVF Holdings Inc., a newly formed subsidiary of PVF Capital Corp., made
an investment in a company that will provide professional financial planning
services to both individuals and small businesses throughout the Park View
Federal branch system.
4. Cash and cash equivalents consist of the following:
December 31, 1997 June 30, 1997
----------------- -------------
Cash and amounts due from depository
institutions $ 3,248,252 $ 7,760,029
Interest-bearing deposits 348,840 445,401
Federal funds sold 2,875,000 1,375,000
----------- -----------
$ 6,472,092 $ 9,580,430
----------- -----------
----------- -----------
Page 4
<PAGE>
Part I Financial Information
Item 1
5. Recently Issued Accounting Standards
In February 1997, the FASB issued SFAS No. 128, Earnings per Share, which
supersedes Accounting Principles Board (APB) No. 15, Earnings per Share, and
replaces the presentation of primary and fully diluted earnings per share
with basic and diluted earnings per share. SFAS No. 128 was issued to
simplify the computation of earnings per share and make the U.S. Standard
more compatible with the earnings per share standards of other countries and
that of the International Accounting Standards Committee (ISAC). SFAS No.
128 is effective for financial statements for both interim and annual periods
ending after December 15, 1997.
SFAS No. 130, "Reporting Comprehensive Income" was issued in June, 1997 and
is effective for fiscal years beginning after December 15, 1997. The
Statement requires additional reporting of items that affect comprehensive
income but not net income. Examples of these items relevant to the Company
include unrealized gains and losses on securities. Upon its adoption, this
statement will result in additional financial statement disclosures.
SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information" was issued in June, 1997 and is effective for fiscal years
beginning after December 15, 1997. The statement requires financial
disclosure and descriptive information about reportable operating segments.
Upon its adoption, this statement will result in additional financial
statement disclosures.
Page 5
<PAGE>
Part I Financial Information
Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following analysis discusses changes in financial condition and results
of operations at and for the three-month and six-month periods ended December
31, 1997 for PVF Capital Corp ("PVF" or the "Company") and Park View Federal
Savings Bank (the "Bank"), its principal and wholly-owned subsidiary.
FINANCIAL CONDITION
Consolidated assets of PVF were $396.2 million as of December 31, 1997, an
increase of approximately $23.1 million or 6.2% as compared to June 30, 1997.
The Bank remained in regulatory capital compliance for tangible, core, and
risk-based capital on a fully phased-in basis with capital levels of 7.32%,
7.32% and 10.53% respectively at December 31, 1997.
During the six months ended December 31, 1997, the Company's cash and cash
equivalents, which consist of cash, interest-bearing deposits and federal
funds sold, decreased $3.1 million or 32.4% as compared to June 30, 1997.
The change in the Company's cash and cash equivalents consisted of a decrease
in interest-bearing deposits of $0.1 million, a decrease in cash of $4.5
million and an increase in federal funds sold of $1.5 million.
The net $26.3 million or 7.7% increase in loans receivable and
mortgage-backed securities, during the six months ended December 31, 1997,
resulted from an increase in loans receivable of $23.4 million and an
increase in mortgage-backed securities of $2.9 million. The increase of
$23.4 million in loans receivable included increases of $9.4 million in
single family mortgage loans, $5.8 million in construction loans, $4.8
million in commercial loans, $1.7 million in home equity loans, $1.2 million
in land loans, and a net increase of $0.5 million in all other mortgage and
installment loans. The increase in mortgage-backed securities held to
maturity of $2.9 million was the result of the purchase of a $3.0 million
security less payments received of $0.1 million.
The increase of $1.1 million in real estate owned ("REO")is the result of the
foreclosure on two loans made to one borrower and the subsequent acquisition
into REO of the fully developed building lots securing these loans. The
increase in prepaid expenses and other assets of 1.9 million is primarily the
result of the Bank's investment of $1.3 million in a low income affordable
housing partnership along with a $0.3 million increase
Page 6
<PAGE>
Part I Financial Information
Item 2
FINANCIAL CONDITION CONTINUED
in Federal Reserve Bank adjustments and returned checks relating to NOW
accounts.
During the six months ended December 31, 1997, management decision to compete
aggressively with market savings rates for additional deposits resulted in an
increase of $27.7 million, or 9.6% in deposits. This $27.7 million increase
in deposits along with the maturity of $6.0 million in agency investment
securities and the decrease of $3.1 million in cash and cash equivalents were
used to purchase $3.0 million in agency investment securities and $3.0
million in mortgage-backed securities available for sale, to repay $7.5
million in advances from the Federal Home Loan Bank of Cincinnati and $0.6
million in notes payable, and fund the net growth of $23.4 million in the
loan portfolio.
The increase in advances from borrowers for taxes and insurance of $0.3
million is attributable to timing differences between the collection and
payment of escrow funds. The increase of $0.7 million in accrued expenses
and other liabilities is the result of an obligation by the Bank to make
future installment payments on its investment in the low income affordable
housing limited partnership.
RESULTS OF OPERATIONS Three months ended December 31, 1997,
compared to three months ended
December 31, 1996.
PVF's net income is dependent primarily on its net interest income, which is
the difference between interest earned on its loans and investments and
interest paid on interest-bearing liabilities. Net interest income also
includes amortization of loan origination fees, net of origination costs.
PVF's net income is also affected by the generation of non-interest income,
which primarily consists of loan servicing income, service fees on deposit
accounts, and gains on the sale of loans held for sale and mortgage-backed
securities available for sale. Net interest income is determined by (i) the
difference between yields earned on interest-earning assets and rates paid on
interest-bearing liabilities ("interest-rate spread") and (ii) the relative
amounts of interest-earning assets and interest-bearing liabilities. The
Company's interest-rate spread is affected by regulatory, economic and
competitive factors that influence interest rates, loan demand and deposit
flows. In addition, net income is affected by the level of operating
expenses and loan loss provisions.
The Company's net income for the three months ended December 31,
Page 7
<PAGE>
Part I Financial Information
Item 2
RESULTS OF OPERATION CONTINUED
1997 was $1,301,300 as compared to $1,181,200 for the prior year comparable
period. This represents an increase of $120,100, or 10.2%, when compared
with the prior year comparable period.
Net interest income for the three months ended December 31, 1997 increased by
$224,100 or 6.3%, as compared to the prior year comparable period, primarily
due to an increase of $907,000 or 11.8% in interest income that resulted from
an increase of $46.9 million in the average balance of the loan and
mortgage-backed securities portfolios and an increase in the average balance
of the investment portfolio of $0.3 million. This increased balance was
offset partially by a 17 basis point decrease in the average return on
interest-earning assets from the prior year comparable period. The average
balance on deposits and advances increased by $43.5 million from the prior
year comparable period. This increased balance, along with a 14 basis point
increase in the average cost of funds for the current period, resulted in an
overall increase in interest expense of $682,900 or 16.7%. The Company's net
interest income increased despite a decrease of 31 basis points in the
Company's interest-rate spread during the current period as compared to the
prior year comparable period due to balance sheet growth in both
interest-earning assets and interest-bearing liabilities.
For the three months ended December 31, 1997, a provision for loan losses of
$50,000 was recorded, while no provision was necessary for the three months
ended December 31, 1996. Provisions are based on management's analysis of
the various factors which affect the loan portfolio and management's desire
to maintain the allowance for loan losses at a level considered adequate to
provide for probable future loan losses. During the three months ended
December 31, 1997, management increased its unallocated reserves for loan
losses, based primarily on growth of the loan portfolio, along with
prevailing economic conditions and other factors deemed relevant. At
December 31, 1997, the allowance for loan losses was $2.6 million, which
represented 85.0% of nonperforming loans and 0.7% of net loans.
For the three months ended December 31, 1997, noninterest income increased
$72,200 or 24.5% from the prior year comparable period. This was primarily
attributable to an increase of $46,600 or 30.7% in income from
mortgage-banking activities that resulted from an increase in gains on the
sale of loans held for sale and mortgage-backed securities available for sale
of $55,500 from the prior year comparable period and a decrease in net
servicing income in the current period attributable to the amortization of
the servicing asset resulting from the application of FASB 125, Accounting
for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities. During these periods, PVF
Page 8
<PAGE>
Part I Financial Information
Item 2
RESULTS OF OPERATIONS CONTINUED
pursued a strategy of originating long-term, fixed-rate loans pursuant to
Federal Home Loan Mortgage Corporation ("FHLMC") and Federal National
Mortgage Association ("FNMA") guidelines and selling such loans to the FHLMC
or the FNMA, while retaining the servicing. Other noninterest income, net,
increased by $18,000 or 78.2% from the previous year's comparable period
primarily due to an increase in rental income in the current period.
Noninterest expense for the three months ended December 31, 1997 increased by
$36,200 or 1.8% from the prior year comparable period. This was primarily
the result of a $66,100, or 6.1% increase in compensation and benefits
attributable to increased staffing, employee 401K benefits, incentive bonuses
paid, and salary and wage adjustments.
The federal income tax provision for the three month period ended December
31, 1997 increased to an effective rate of 34.9% for the current period from
an effective rate of 34.00% for the prior year comparable period.
RESULTS OF OPERATIONS Six months ended December 31, 1997,
compared to six months ended
December 31, 1996.
PVF's net income is dependent primarily on its net interest income, which is
the difference between interest earned on its loans and investments and
interest paid on interest-bearing liabilities. Net interest income also
includes amortization of loan origination fees, net of origination costs.
PVF's net income is also affected by the generation of non-interest income,
which primarily consists of loan servicing income, service fees on deposit
accounts, and gains on the sale of loans held for sale and mortgage-backed
securities available for sale. Net interest income is determined by (i) the
difference between yields earned on interest-earning assets and rates paid on
interest-bearing liabilities ("interest-rate spread") and (ii) the relative
amounts of interest-earning assets and interest-bearing liabilities. The
Company's interest-rate spread is affected by regulatory, economic and
competitive factors that influence interest rates, loan demand and deposit
flows. In addition, net income is affected by the level of operating
expenses and loan loss provisions.
The Company's net income for the six months ended December 31, 1997 was
$2,562,600 as compared to $1,170,300 for the prior year comparable period.
This represents an increase of $1,392,300, or 119.0%, when compared with the
prior year comparable period. The
Page 9
<PAGE>
Part I Financial Information
Item 2
RESULTS OF OPERATION CONTINUED
increase in the current period is primarily due to a one-time charge in the
prior period of approximately $1,708,000 or $1,127,000 after tax,
representing a special assessment of 65.7 basis points on the Bank's deposits
held as of March 31, 1995, as a result of the recently enacted legislation to
recapitalize the Savings Association Insurance Fund. The Company's income
excluding this assessment for the six-month period ended December 31, 1996
was $2,297,300. Comparing this amount to earnings from operations for the six
month period ended December 31, 1997 resulted in an increase of $265,300, or
11.5%, for the current year comparable period.
Net interest income for the six months ended December 31, 1997 increased by
$216,300 or 3.0%, primarily due to an increase of $1,566,600 or 10.3% in
interest income that resulted from an increase of $44.4 million in the
average balance of interest earning assets. This increased balance was offset
partially by a 24 basis point decrease in the average return on
interest-earning assets from the prior year comparable period. The average
balance on deposits and advances increased by $40.2 million from the prior
year comparable period. This increased balance along with an 18 basis point
increase in the average cost of funds for the current period resulted in an
overall increase in interest expense of $1,350,300 or 16.6%. Despite a
decrease of 42 basis points in the Bank's interest-rate spread during the
current period, as compared to the prior year comparable period, the Bank's
net interest income increased due to balance sheet growth in both
interest-earning assets and interest-bearing liabilities.
For the six months ended December 31, 1997, a provision for loan losses of
$95,000 was recorded, while no provision was necessary for the six months
ended December 31, 1996. Provisions are based on management's analysis of
the various factors which affect the loan portfolio and management's desire
to maintain the allowance for loan losses at a level considered adequate to
provide for probable future loan losses. During the six months ended
December 31, 1997, management increased its unallocated reserves for loan
losses based primarily on growth of the loan portfolio, along with prevailing
economic conditions and other factors deemed relevant. At December 31, 1997,
the allowance for loan losses was $2.6 million, which represented 85.0% of
nonperforming loans and 0.7% of net loans.
For the six months ended December 31, 1997 noninterest income increased
$263,600 or 49.9% from the prior year comparable period. This was primarily
attributable to an increase of $199,000 or 105.6% in income from
mortgage-banking activities that resulted from an increase in gains on the
sale of loans held for sale and mortgage-backed securities available for sale
of
Page 10
<PAGE>
Part I Financial Information
Item 2
RESULTS OF OPERATIONS CONTINUED
$174,800 from the prior year comparable period and an increase in net
servicing income in the current period. During these periods, PVF pursued a
strategy of originating long-term, fixed-rate loans pursuant to Federal Home
Loan Mortgage Corporation ("FHLMC") and Federal National Mortgage Association
("FNMA") guidelines and selling such loans to the FHLMC or the FNMA, while
retaining the servicing. Other noninterest income, net, increased by $41,700
or 42.2% from the previous year's comparable period primarily due to an
increase in rental income in the current period.
Noninterest expense for the six months ended December 31, 1997 decreased by
$1.7 million or 29.4% from the prior year comparable period. This was the
result of the previously noted federal deposit insurance special assessment
of $1,708,000. In addition, an $86,300 or 4.0% increase in compensation and
benefits was attributable to increased staffing, employee 401K benefits,
incentive bonuses paid, and salary and wage adjustments.
The federal income tax provision for the six-month period ended December 31,
1997 was at an effective rate of 34.1% for the current period as compared to
an effective rate of 34.6% for the prior year comparable period.
LIQUIDITY AND CAPITAL RESOURCES
The Bank is required by federal regulations to maintain specific levels of
"liquid" assets consisting of cash and other eligible investments. The
current level of liquidity required by the Office of Thrift Supervision is 4%
of the sum of net withdrawable savings and borrowings due within one year.
The Bank's liquidity at December 31, 1997 was 5.2%. Management believes the
Bank has sufficient liquidity to meet its operational needs.
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) PVF did not file any reports on Form 8-K
during the quarter ended December 31, 1997.
Page 11
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant had duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PVF Capital Corp.
-----------------
(Registrant)
Date: February 6, 1998 /s/ C. Keith Swaney
------------------ ---------------------------------
C. Keith Swaney
Vice President and Treasurer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENT OF CONDITION AND THE STATEMENT OF OPERATION FOR THE PERIOD ENDED
DECEMBER 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 3,248
<INT-BEARING-DEPOSITS> 349
<FED-FUNDS-SOLD> 2,875
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 10,996
<INVESTMENTS-MARKET> 10,984
<LOANS> 365,500
<ALLOWANCE> 2,767
<TOTAL-ASSETS> 396,214
<DEPOSITS> 316,006
<SHORT-TERM> 18,500
<LIABILITIES-OTHER> 9,795
<LONG-TERM> 23,075
0
0
<COMMON> 27
<OTHER-SE> 28,811
<TOTAL-LIABILITIES-AND-EQUITY> 396,214
<INTEREST-LOAN> 16,155
<INTEREST-INVEST> 610
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 16,765
<INTEREST-DEPOSIT> 8,346
<INTEREST-EXPENSE> 9,465
<INTEREST-INCOME-NET> 7,300
<LOAN-LOSSES> 95
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<INCOME-PRETAX> 3,888
<INCOME-PRE-EXTRAORDINARY> 0
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<CHANGES> 0
<NET-INCOME> 2,563
<EPS-PRIMARY> 0.99
<EPS-DILUTED> 0.93
<YIELD-ACTUAL> 3.520
<LOANS-NON> 2,689
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<ALLOWANCE-CLOSE> 2,767
<ALLOWANCE-DOMESTIC> 2,767
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 2,538
</TABLE>
