SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
July 22, 1998
EAST TEXAS FINANCIAL SERVICES, INC.
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(Exact name of Registrant as specified in its Charter)
Delaware 0-24848 75-2559089
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(State or other (Commission File No.) (IRS Employer
jurisdiction of Identification Number)
incorporation
1200 South Beckham Avenue, Tyler, Texas 75701-3319
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (903) 593-1767
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events
On July 22, 1998, the Registrant issued for publication the press
release attached as Exhibit "99" announcing earnings and quarterly cash dividend
payment for the quarter ended June 30, 1998.
Item 7. Financial Statements and Exhibits
The Exhibit referred to in Item 5 of this Report and listed on the
accompanying Exhibit Index is filed as part of this Report and is incorporated
herein by reference.
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Exhibit Sequential
Number Description Page
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99 Press release, published on July 22, 1998. 6
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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.
EAST TEXAS FINANCIAL SERVICES, INC.
Date: July 22, 1998 By: /s/ GERALD W. FREE
------------------
Gerald W. Free
Vice Chairman, President
And Chief Executive Officer
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EXHIBIT 99
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EAST TEXAS FINANCIAL SERVICES, INC.
1200 South Beckham o P. O. Box 6910 o Tyler, TX 75711-6910 o 903-593-1767
o Fax 903-593-1094
NEWS RELEASE
For verification, contact: Gerald W. Free, Vice Chairman/President/CEO
Derrell W. Chapman, Vice President/COO/CFO
Telephone: (903) 593-1767
Fax: (903) 593-1094
For immediate release, July 22, 1998
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EAST TEXAS FINANCIAL SERVICES, INC.
ANNOUNCES QUARTER END EARNINGS
AND
QUARTERLY CASH DIVIDEND PAYMENT
Tyler, Texas, July 22, 1998, - - - East Texas Financial Services, Inc. (NASDAQ:
ETFS), the holding company for First Federal Savings and Loan Association of
Tyler, Texas, today reported that consolidated net income for the nine months
ended June 30, 1998 was $425,148 or $.29 per share, compared to $559,534 or $.38
per share for the nine month period ended June 30, 1997. For the three month
period ended June 30, 1998, the Company reported net income of $123,049 or $.09
per share, compared to $190,911 or $.13 per share for the three month period
ended June 30, 1997. As a result of the Company's 3 for 2 stock split on March
25, 1998, there was a restatement of per share data for all periods.
Gerald W. Free, Vice Chairman, President and CEO, announced that the Company
would continue its quarterly cash dividend of $.05 per share, to be paid on
August 26, 1998 to stockholders of record as of August 12, 1998. The annual
dividend yield is approximately 1.29% based on a market stock price of $15.50 on
July 15, 1998.
President Free also announced the Company's intention to open an additional full
service office located at S. Broadway and Muller Garden Road in Tyler. "We
continue to be pleased with the economic growth in the Tyler area and felt that
now was the time to expand our operations," stated Free. "Subject to regulatory
approval, we anticipate opening the new office in the fall of 1998. We will
offer all of the current products and services our customers have been
accustomed to, including a full range of checking and deposit accounts and home
mortgage and home equity loans. In addition, the new office will focus on
consumer and commercial banking products and services."
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<PAGE>
Loans receivable totaled $61.7 million at June 30, 1998, a $4.6 million increase
from the $57.1 million reported at September 30, 1997. Total assets were
reported as $122.6 million at June 30, 1998, compared to $115.9 million at
September 30, 1997. Total stockholders' equity was reported as $21.2 million at
June 30, 1998, compared to $20.9 million at September 30, 1997.
Capital levels for the Company's wholly owned subsidiary, First Federal Savings
and Loan Association of Tyler, were reported at June 30, 1998, as 14.9% for both
tangible and core capital ratios, well in excess of the minimum required levels
of 1.5% and 4.0% respectively. The Association's risk-based capital ratio was
39.0% of risk-weighted assets at June 30, 1998, compared to the minimum 8.0%
regulatory requirement. At June 30, 1998, the Association was considered a "well
capitalized" institution.
At June 30, 1998, non-performing assets totaled $502,000 or .41% of total assets
as compared to $310,000 or .27% of total assets at September 30, 1997.
Non-performing loans equaled $297,000 or .48% of loans receivable at June 30,
1998, compared to $310,000 or .54% at September 30, 1997. Classified assets were
reported as $811,000 or .66% of total assets at June 30, 1998, compared to
$904,000 or .78% of total assets at September 30, 1997.
East Texas Financial Services, Inc., is the holding company for First Federal
Savings and Loan Association of Tyler, Texas, which presently operates two full
service offices and two loan agency offices in the Tyler area.
At June 30, 1998, the Company had outstanding 1,539,461 shares of stock and
reported a "book value" per share of $13.76. The Company's stock is traded under
the symbol "ETFS" on the NASDAQ National Market System and is listed in most
daily newspapers as "EasTxFnl".
- selected financial data follows -
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<TABLE>
<CAPTION>
EAST TEXAS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
ASSETS
June 30, 1998 September 30, 1997
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(Unaudited)
<S> <C> <C>
Cash and due from banks ........................................ $ 853,232 $ 508,729
Interest-bearing deposits with banks ........................... 2,161,915 6,422,404
Interest earning time deposits with financial institutions ..... 1,565,617 1,565,573
Federal funds sold ............................................. 0 753,847
Mortgage-backed securities available for sale .................. 10,176,556 4,356,271
Investment securities held-to-maturity (estimated market value
of $29,127,057 at June 30, 1998, and $23,128,073
at September 30, 1997) .................................... 29,046,630 23,058,359
Mortgage-backed securities held-to-maturity (estimated market
value of $12,752,806 at June 30, 1998, and
$18,611,834 at September 30, 1997) ........................ 12,547,113 18,151,765
Loans receivable, net of allowance for credit losses
of $233,670 at June 30, 1998, and $272,851
at September 30, 1997 ..................................... 61,727,067 57,110,029
Accrued interest receivable .................................... 936,782 885,383
Federal Home Loan Bank stock, at cost .......................... 777,400 1,005,700
Premises and equipment ......................................... 1,050,712 1,123,311
Foreclosed real estate, net of allowances of $-0- .............. 204,700 0
Mortgage servicing rights ...................................... 197,418 149,094
Other assets ................................................... 1,348,687 858,147
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Total Assets .......................................... $ 122,593,829 $ 115,948,612
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Demand deposits ........................................... $ 1,965,549 $ 1,882,109
Savings and NOW deposits .................................. 10,862,579 9,771,266
Other time deposits ....................................... 74,845,657 76,897,274
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Total deposits ........................................ 87,673,785 88,550,649
FHLB advances ............................................. 12,322,028 4,195,000
Advances from borrowers for taxes and insurance ........... 615,633 881,685
Federal income taxes
Current ............................................... 89,741 0
Deferred .............................................. 33,612 127,909
Accrued expenses and other liabilities .................... 674,055 1,314,001
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Total Liabilities ..................................... 101,408,854 95,069,244
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</TABLE>
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<TABLE>
<CAPTION>
EAST TEXAS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(continued)
June 30, 1998 September 30, 1997
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(Unaudited)
<S> <C> <C>
Stockholders' equity:
Preferred stock, $0.01 par value, 500,000
shares authorized, none outstanding
Common stock, $0.01 par value, 5,500,000 shares authorized,
1,884,492 shares issued ................................... 12,564 12,564
Additional paid-in capital ................................ 12,203,160 12,196,879
Deferred compensation - RRP shares ........................ (242,461) (329,748)
Unearned employee stock ownership plan shares ............. (650,614) (650,614)
Unrealized gain/(loss) investments - AFS (net) ............ (9,805) 15,512
Retained earnings (substantially restricted) .............. 13,603,148 13,365,792
Treasury stock, 345,031 shares at cost .................... (3,731,017) (3,731,017)
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Stock stockholders' equity ............................ 21,184,975 20,879,368
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Total liabilities and stockholders' equity ............ $ 122,593,829 $ 115,948,612
============= =============
</TABLE>
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<TABLE>
<CAPTION>
EAST TEXAS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF INCOME
Three Months Nine Months
Ended June 30, Ended June 30,
(Unaudited) (Unaudited)
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INTEREST INCOME
Loans receivable:
First Mortgage ............................ $ 1,137,446 $ 1,050,080 $ 3,424,340 $ 3,023,247
Consumer and other loans .................. 60,995 20,378 131,083 61,306
Securities available for sale:
Investment securities ..................... 11,546 9,530 41,859 9,530
Mortgage-backed securities ................ 145,433 0 314,507 0
Securities held to maturity:
Investment securities ..................... 422,663 519,860 1,223,087 1,630,019
Mortgage-backed securities ................ 243,422 354,023 839,190 1,164,609
Deposits with banks ......................... 58,664 0 190,550 0
----------- ----------- ----------- -----------
Total interest income ................... 2,080,169 1,953,871 6,164,616 5,888,711
----------- ----------- ----------- -----------
INTEREST EXPENSE
Deposits .................................... 1,096,740 1,105,921 3,325,875 3,310,523
FHLB advances ............................... 167,030 4,728 350,878 4,728
----------- ----------- ----------- -----------
Total interest expense .................. 1,263,770 1,110,649 3,676,753 3,315,251
----------- ----------- ----------- -----------
Net interest income before
provision for loan losses ............ 816,399 843,222 2,487,863 2,573,460
Provision for loan losses ................... 0 0 0 5,000
----------- ----------- ----------- -----------
Net interest income after
provision for loan losses ............. 816,399 843,222 2,487,863 2,568,460
----------- ----------- ----------- -----------
NONINTEREST INCOME
Gain(loss) on sale of interest-earning assets 37,230 13,050 100,675 44,372
Loan origination and commitment fees ........ 14,245 18,809 56,015 46,102
Loan servicing fees ......................... 19,874 26,860 68,798 73,797
Gain on foreclosed real estate .............. (6,911) 0 (6,351) 0
Other ....................................... 13,692 18,967 35,330 51,382
----------- ----------- ----------- -----------
Total noninterest income ................ 78,130 77,686 254,467 215,653
----------- ----------- ----------- -----------
</TABLE>
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<TABLE>
<CAPTION>
EAST TEXAS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(continued)
Three Months Nine Months
Ended June 30, Ended June 30,
(Unaudited) (Unaudited)
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
NONINTEREST EXPENSE
Compensation and benefits ................... 463,006 425,534 1,415,800 1,271,288
Occupancy and equipment ..................... 47,084 40,769 140,843 112,829
SAIF deposit insurance premium .............. 14,417 15,011 42,862 66,186
Loss on foreclosed real estate .............. 0 (8) 0 5,683
Other ....................................... 173,060 136,337 470,015 438,547
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Total noninterest expense ............... 697,567 617,643 2,069,520 1,894,533
----------- ----------- ----------- -----------
Income (loss) before provision for income taxes 196,962 303,265 672,810 889,580
Income tax expense (benefit) ................... 73,913 112,354 247,662 329,646
----------- ----------- ----------- -----------
NET INCOME (LOSS) .............................. $ 123,049 $ 190,911 $ 425,148 $ 559,934
=========== =========== =========== ===========
Earnings per common share ...................... $ .09 $ .13 $ .29 $ .38
Earnings per common share - assuming dilution .. .08 .13 .28 .37
</TABLE>
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